PB91-10 2061
REGULATORY IMPACT ANALYSIS
FOR THE PROPOSED RULEMAKING ON CORRECTIVE ACTION
FOR SOLID WASTE MANAGEMENT UNITS
Prepared for
Office of Solid Waste
Econocaic Analysis Staff
U.S. Environmental Protection Agency
Prepared by
ICF Incorporated
June 25, 1990
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PREFACE
This Regulatory Impact Analysis was prepared by ICF Incorporated under the
direction of the Office of Solid Waste, U.S. Environmental Protection Agency
(EPA). EPA provided substantial sections of the Executive Summary, Chapters 1
through A, and Chapter 9. ICF wrote the remainder of the report, except for the
case studies in Chapter 5, which were prepared jointly by ICF and Sobotka &
Company, Inc. EPA also provided review comments on the entire document.
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PART 1
ANALYSIS OF PROPOSED CORRECTIVE ACTION PROGRAM
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TABLE OF CONTENTS
Part 1 -- Analysis of Proposed Corrective Action Program
Pa^e
EXECUTIVE SUMMARY ES -1
1. INTRODUCTION 1-1
2. PROBLEM DEFINITION 2-1
2.1 The Problem 2-1
2 2 National Extent of Hazardous Constituent Releases to
the Environment 2-9
2 3 Conclusions 2-10
3. REGULATORY STRATEGIES 3-1
3.1 Regulatory Strategies 3-1
3.1.1 Strategy 1: Cleanup to Background Levels As Soon As
Practicable For All Facilities 3-2
3.1.2 Strategy 2: Cleanup to Health-Based Levels, With
Flexibility in Timing 3-3
3.1.3 Strategy 3: Cleanup to Health-Based Standards Only
Where Actual or Imminent Exposure Exists 3-5
3.2 Conclusions 3-6
4. CORRECTIVE ACTION FOR EACH ENVIRONMENTAL MEDIUM 4-1
4.1 Overview 4-1
4.2 Corrective Action for Releases to Ground Water 4-1
4.2.1 Releases to Ground Water: Sources, Transport,
and Potential Threats 4-3
4.2.2 Typical Activities to Correct Releases to
Ground Water 4-4
4.2.3 Analysis of Alternative Regulatory Strategies to
Address Ground-Water Contamination 4-5
4.2.4 Corrective Action for Releases to Ground Water
Under the Proposed Rule 4-8
4.3 Corrective Action for Releases to Soil 4-9
4.3.1 Releases to Soil: Sources, Transport, and
Potential Threats 4-9
4.3.2 Typical Activities to Correct Releases to Soil 4-10
4.3.3 Analysis of Alternative Regulatory Strategies
to Address Soil Contamination 4-11
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4.3.4 Corrective Action for Releases to Soil Under
the Proposed Rule 4-15
4.4 Corrective Action for Releases to Surface Water . 4-16
4.4.1 Releases to Surface Water- Sources, Transport,
and Potential Threats .4-17
4.4.2 Corrective Action Activities to Address Releases
to Surface Water ... 4-18
4.4.3 Alternative Regulatory Strategies to Address
Surface Water Contamination 4-19
4.4.4 Corrective Action for Releases to Surface Water
Under the Proposed Rule 4-23
4.5 Corrective Action for Releases to Air 4-23
4.5.1 Releases to Air: Sources, Transport, and
Potential Threats 4-23
4.5.2 Typical Activities to Correct Releases to Air 4-25
4.5.3 Analysis of Regulatory Strategies to Address
Air Contamination 4-26
4.5.4 Corrective Action for Releases to Air Under
the Proposed Rule 4-29
5. CORRECTIVE ACTION CASE STUDIES 5-1
5.1 Introduction 5-1
5.2 Hypothetical Facility One -- Aircraft Research Technologies . . 5-2
5.2.1 Background 5-2
5.2.2 RCRA Facility Investigation Results 5-3
5.2.3 Corrective Measures Study 5-6
5.2.4 Corrective Actions Under Alternative Regulatory
Approaches 5-7
5.3 Hypothetical Facility Two -- Electromechanical Produces and
Testing, Inc 5-9
5.3.1 Background 5-9
5.3.2 RCRA Facility Investigation Results 5-10
5.3.3 Corrective Measures Study 5-14
5.3.4 Corrective Actions Under Alternative Regulatory
Approaches 5-18
5.4 Hypothetical Facility Three -- Offsite Wastes, Ltd 5-19
5.4.1 Background 5-19
5.4.2 RCRA Facility Investigation Results 5-21
5.4.3 Corrective Measures Study 5-24
5.4.4 Corrective Actions Under Alternative Regulatory
Approaches 5-27
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Part 2 -- Quantitative Analysis of Ground-Water Corrective Action
6. APPROACH TO QUANTITATIVE ANALYSIS 6-1
6.1 Facility Data Base ... 6-1
6.2 Modeling of Ground-Water Contamination and Corrective Actions . 6-3
6 2.1 Facility, Waste, and Environment Characteristics . . 6-3
6.2.2 Releases of Hazardous Wastes 6-3
6.2.3 Simulation of Fate and Transport 6-6
6.2.4 Simulation of Corrective Action 6-6
6.2.5 Remedy Selection ... ... 6-7
6 3 Parameters Used to Define Ground Water Regulatory Alternatives. 6-8
6 4 Definition of Ground Water Regulatory Alternatives 6-10
6.4.1 Baseline Scenario 6-11
6.4.2 Option A: Immediate Cleanup to Background 6-12
6.4.3 Option B: Immediate Cleanup to Health-Based Standards . 6-14
6.4.4 Option C: Flexible Cleanup to Health-Based Standards. . 6-15
6.4.5 Option D: Flexible Cleanup Based on Actual Exposure . . 6-17
7. RESULTS OF QUANTITATIVE ANALYSIS OF GROUND-WATER REGULATORY OPTIONS. 7-1
7.1 Likelihood of Initiating Corrective Action 7-1
7.2 Distribution of Remedies Selected 7-5
7.3 Time to Implement Corrective Action 7-8
7.4 Time to Reach Target Concentration Within 1,500 Meters 7-11
7.5 Conclusion 7-15
8. GROUND-WATER CORRECTIVE ACTION COSTS FOR NON-FEDERAL FACILITIES. . . 8-1
8.1 Derivation of Unit Cost Estimates 8-1
8.1.1 Costs of Investigation 8-1
8.1.2 Costs of Corrective Action 8-2
8.1.3 Estimation of Costs Per Facility 8-4
8.1.4 Discounting 8-5
8.2 Results for Costs Per-Facility 8-5
8.2.1 Per-Facility Costs by Regulatory Alternative 8-5
8.2.2 Effect of Facility Characteristics on Costs 8-6
8.3 Results for Total Non-Federal Costs 8-10
8.3.1 Background 8-10
8.3.2 National Non-Federal Costs 8-10
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9. COMPARISON OF SIMULATED COSTS TO CERCLA EXPERIENCE 9-1
9.1 Development of CERCLA Cost Estimates 9-1
9.2 Methodology for Adjusting CERCLA Cost Estimates 9-2
9.3 Results and Conclusions .... .9-5
Part 3 -- Supporting Analysis
10. ECONOMIC IMPACTS 10-1
10.1 Methodology 10-2
10.1.1 Universe of Firms Examined 10-3
10.1.2 Ability to Pay Analysis 10-3
10.1.3 Calculation of Corrective Action Costs 10-6
10.1.4 Simulation of Economic Impacts 10-7
10.2 Results 10-9
10.2.1 Baseline Scenario 10-9
10.2.2 Option A -- Immediate Cleanup to Health-Based
Standards 10-11
10.2.3 Option B -- Immediate Cleanup to Health-Based
Standards 10-11
10.2.4 Option C -- Flexible Cleanup to Health-Based
Standards 10-14
10.2.5 Option D -- Flexible Cleanup Based on Actual
Exposure 10-14
10.2.6 Comparison of Financial Impacts Among Alternatives. . .10-14
10.3 Conclusions and Limitations 10-19
11. REGULATORY FLEXIBILITY ANALYSIS 11-1
11.1 Identifying Small Entities 11-1
11.1.1 Determining the Industries and Firms Potentially
Affected 11-1
11.1.2 Defining a Small Business 11-2
11.1.3 Identify Small Businesses 11-3
11.1.4 Limitations 11-4
11.2 Criteria for Determining Significant Impacts on Small
Businesses 11-4
11.2.1 Criteria for Determining Significant Impacts 11-4
11.2.2 Criteria for Determining Substantial Number
of Small Entities 11-6
11.3 Calculation of Corrective Action Costs 11-6
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11 4 Simulation of Economic Impacts 11-7
11 5 Measures of Economic Impacts. . .11-8
11.5.1 Firm Results 11-8
11 5.2 Facility Results 11-8
11 6 Results and Conclusions 11-9
11.6 1 Firms and Facility Impacts. . . 11-9
11.6.2 Conclusions 11-16
12 FEDERAL FACILITIES 12-1
12.1 Overall Population of Federal Facilities 12-1
12.2 Characterization of RCRA Federal Facilities 12-3
12.2.1 Average Number of SWMUs Per Facility 12-3
12.2.2 Estimate of RCRA Federal Facilities that will
Require Ground-Water Corrective Action 12-5
12.3 Estimate of Corrective Action Costs at Federal Facilities . . . 12-6
12 3.1 Per-Facility Cost of Corrective Action at Federal
Facilities 12-6
12.3.2 Total Cost of Corrective Action at Federal Facilities . 12-8
Part A -- Summary
13. SUMMARY 13-1
APPENDIX A. DEVELOPMENT OF FACILITY DATA BASE
A.l Facility Survey A-l
A.1.1 Facilities Subject to RCRA Corrective Action
Regulations A-2
A.1.2 Data on Facilities Subject to RCRA Corrective
Action Regulations A-2
A.1.3 Universe of Subtitle C Facilities Represented A-3
A.1.4 Methodology Used to Select Representative Survey
Sample A-5
A.1.5 General Approach Used for Analyzing Each Facility. . . . A-12
A. 1.6 Overview of Collected Data A-12
A.2 Overview of Hydrogeologic Mapping A-28
A.3 Development of Hypothetical Facility Characterization A-29
A.3.1 Overview of Missing Data A-29
A.3.2 Methodology for Completing Facility Information A-34
A.3.3 Inference of Waste Characteristics A-34
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A.3.4 Estimation of Unit Operating Life A-38
A. 3.5 Assumptions About Unit Types . .... A-39
A. 3.6 Methodology for Determining Dates of Waste Removal . . . A-41
A. 3. 7 Estimation of SWMU Sizes and Quantities of Wastes
Managed by SWMUs A-41
APPENDIX B. CORRECTIVE ACTION TRIGGERS
B.l Constituent Selection B-l
B.2 Detection Limits B-3
B.2.1 Practical Quantification Limits B-3
B.2.2 LLM Detection Limits .. B-3
B.3 Health-Based Corrective Action Triggers B-7
B 4 Triggers for Baseline Scenario and Regulatory Options B-14
APPENDIX C. METHODOLOGY FOR ECONOMIC IMPACT ANALYSIS
C.l Firm/Facility/Financial Data Base (F3DB) C-l
C.l.l Overview C-l
C.l. 1.1 Facility Data C-l
C.l. 1.2 Ownership and Financial Data C-2
C.l. 1.3 Status of TSDFs in the Data Base C-3
C.l. 2 Data Sources C-4
C.l.2.1 Ownership Characteristics C-4
C.l.2.2 Financial Characteristics C-5
C.l. 2. 3 Data Sources Used for Imputations C-5
C.l. 3 Imputations Methodology C-6
C. 1. 3.1 Approach C-6
C.l.3.2 Imputations Formulae C-7
C.1.4 Data Elements C-10
C.1.4.1 TSDF Ownership and Financial Data on
the Firm/Facility/Financial Data Base C-10
C.l.4.2 Other Data Items on the Firm/Facility/
Financial Data Base C-13
C.1.5 F3DB Limitations C-14
C.2 Methodology for Calculating Weighted Average Cost of Capital. . C-16
C.2.1 Weighted Average Cost of Capital -- Total Analysis . . . C-16
C.2.2 Weighted Average Cost of Capital -- Regulatory
Flexibility Analysis C-22
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C.3 Ability to Pay Analysis . C-26
C.3.1 Corporate Structure -- Types of Owners or
Operators Examined C-27
C 3.2 The Concept of Ability to Pay . , C-27
C.3.3 Ability-to-Pay Rules C-28
C.3.4 Estimated Ability to Pay ... C-30
C.4 Monte Carlo Model C-43
APPENDIX D. CERCLA CORRECTIVE ACTION ACTIVITIES
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EXECUTIVE SUMMARY
INTRODUCTION
This regulatory impact analysis (RIA) was performed in conjunction with
the development of EPA's proposed rule to require corrective action for
releases from solid waste management units at hazardous waste treatment,
storage, and disposal facilities.1 The results of this RIA demonstrate that
the proposed corrective action rule is a "major" regulation. Pursuant to the
Regulatory Flexibility Act, the Agency also assessed the impact of the
proposed rule on small businesses and determined that the rule will not have a
significant impact on a substantial number of such businesses.
The proposed regulations analyzed in this regulatory impact analysis are
authorized by Sections 3004(u) and (v) of the Resource Conservation and
Recovery Act of 1976 (RCRA), as amended by the Hazardous and Solid Waste
Amendments of 1984 (HSWA). Section 3004(u) requires that permits issued to
hazardous waste management facilities after November 8, 1984 shall require
"corrective action for all releases of hazardous waste or constituents from
any solid waste management unit at a treatment, storage, or disposal facility
seeking a permit under [Subtitle C of RCRA], regardless of the time at which
waste was placed in such unit." RCRA Section 3004(v) mandates that EPA
require hazardous waste management facilities to undertake corrective action
for releases beyond the facility boundary.
Other elements of EPA's corrective action program include the
requirements under Section 3008(h) of RCRA and standards contained in Subpart
F of 40 CFR Part 264. Section 3008(h), which was added to RCRA as part of the
1984 amendments, authorizes EPA to issue orders requiring corrective action to
any facility authorized to operate under RCRA interim status whenever EPA
determines that there is or has been a release of hazardous waste into the
environment from such a facility. EPA's corrective action program also
includes the Subpart F requirements, which were in effect prior to HSWA and
address releases to ground water from certain types of land disposal units.
EPA expects that corrective actions at interim status facilities taken
under the authority of Section 3008(h) will generally be similar in nature to
actions required by the proposed rule. Moreover, the existing Subpart F
standards are being revised concurrent with the proposed rule to ensure
consistency in the approach taken to corrective action. For the analysis in
this RIA, therefore, EPA assumed that the proposed rule, under the authority
of Sections 3004(u) and (v), will cover all RCRA corrective action. By making
this assumption, the Agency was able to analyze the impact of the proposed
rule as a single, uniform corrective action program applied to all types of
1 Regulatory impact analyses, mandated by Executive Order 12291, are
required for "major" regulations. Major regulations are defined as those likely
to result in (1) annual effects on the economy of $100 million or more; (2) a
major increase in costs or prices for consumers or individual industries, or
(3) significant adverse effects on competition, employment, investment,
productivity, innovation, or international trade.
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ES-2
solid waste management units (SWMUs) at all facilities, regardless of permit
status. This RIA, therefore, goes beyond the requirements of the Executive
Order to analyze just the proposed rule and examines the entire RCRA
corrective action program rather than the proposed rule alone.
This RIA. is organized into four separate parts, each containing a number
of chapters. Part 1 provides an overview of the RIA and the alternatives
considered by EPA in developing the proposed corrective action rule. Part 2
presents a quantitative analysis of the proposed rule that focuses on ground-
water cleanup. Part 3 contains the economic impact analysis and an overview
of Federal facilities while Part 4 summarizes the RIA.
In addition to this main report, four appendices were prepared.
Appendix A provides a detailed description of the facility data base used in
estimating the effects of the proposed rule. Appendix B discusses the
contaminant concentrations used to trigger corrective action in the
quantitative simulation described in Part 2. Appendix C describes the
methodology used in estimating the economic impacts of the rule. Finally,
Appendix D lists the costs and actions of CERCLA Records of Decision used to
described typical corrective actions in Chapter 4 of the RIA.
The remainder of this executive summary reviews the methodology and
principal results of Parts 1, 2, and 3 of the RIA. This executive summary
concludes with a section highlighting the primary conclusions and limitations
of the entire RIA.
QUALITATIVE ANALYSIS
In developing the RIA for the proposed corrective action rule, the
Agency analyzed both qualitatively and quantitatively several basic
alternatives for the rule. The alternatives studied range from a highly
conservative "cleanup to background" approach, with very little flexibility in
adjusting remedies for site-specific conditions, to an alternative in which
cleanups of releases are triggered in limited circumstances only. For the
qualitative analysis presented in Part 1 of the RIA, three alternative
regulatory strategies were developed and analyzed. Part 1 includes the
definition of the problem, a description of the three strategies, and a
multimedia analysis of the strategies, including a review of case studies.
Problem Definition
In developing the RIA, EPA assembled data to estimate the potential
scope of the RCRA corrective action program. The data used in generating
these estimates were obtained primarily from the Agency's existing database on
RCRA facilities (the Hazardous Waste Data Management System, or HWDMS), and an
analysis conducted for the RIA which examined a sample of 65 RCRA Facility
Assessment (RFA) reports. These reports typically are prepared by EPA or the
States prior to issuance of RCRA permits. The reports provide preliminary
findings as to what releases have or may have occurred and what investigation
should be conducted to verify and/or characterize the releases. These 65
RFAs, referred to collectively as the RFA survey, were used to estimate the
numbers and types of facilities that may require corrective action. Data from
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ES-3
the reports also were used to support modeling for the quantitative analysis
of the RIA.
EPA estimates that there are approximately 5,700 facilities regulated
under RCRA Subtitle C that are potentially subject to the corrective action
authorities of RCRA Sections 3004(u), 3004(v), and 3008(h) and 40 CFR Part
264, Subpart F. The HWDMS classification scheme organizes these facilities
into three types: land disposal facilities (i.e., hazardous waste management
facilities with a landfill, surface impoundment, waste pile, or land treatment
unit), incineration facilities (i.e., facilities that have an incinerator but
no land disposal unit), and treatment and storage facilities (i.e., facilities
not belonging to either of the above two categories). There are about 1,500
land disposal facilities, 200 incineration facilities, and 4,000 treatment
storage facilities.
Prior to the enactment of HSWA, only certain units at land disposal
facilities were subject to corrective action. As explained above, HSWA
extended corrective action requirements to all SWMUs. Based on the RFA
survey, it is estimated that there are roughly 81,000 solid waste management
units at RCRA facilities, including some 3,000 land-based hazardous waste
management units that were subject to corrective action prior to the 1984 HSWA
amendments. Exhibit ES-1 summarizes the effect of HSWA on the scope of EPA's
corrective action program.
The number of solid waste management units at individual facilities
varies widely, ranging from one to as many as 1,300. Federal facilities,
because of their large size, typically contain many more solid waste
management units than non-Federal facilities. The RIA estimates that Federal
facilities operate an average of 55 SWMUs per facility while non-Federal
facilities operate an average of 12 solid waste management units (including
hazardous waste management units). Exhibit ES-2 presents the average number
of SWMUs subject to corrective action for the different facility types
(Federal and non-Federal combined) both before and after the enactment of
HSWA.
The types of solid waste management units found at facilities are
diverse. More than one-third (36 percent) are tanks used for storage or
treatment of wastes. Landfills comprise 16 percent, and surface impoundments
15 percent. The remainder are units such as container storage areas, piles,
land treatment units, incinerators and other miscellaneous units. The survey
also found a wide diversity within unit categories in terms of size, age,
general condition, types of wastes managed, and other factors.
The RIA also estimates that, on average, 62 percent of all facilities
have indications of possible releases, based on RFA findings, sufficient to
require follow-up remedial investigations (i.e., RCRA Facility Investigations
(RFIs)). Typically, facilities which have Subtitle C land disposal units and
incinerators are more likely to require RFIs than are treatment/storage
facilities (74 percent, 70 percent and 56 percent, respectively). Although
the analysis indicates that Foughly two-thirds of all RCRA facilities will not
require corrective action, the Agency's experience with the corrective action
program to date (as confirmed by the RFA survey results), indicates that the
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EXHIBIT ES-1
SCOPE OP KPA'S CORRECTIVE ACTIGH PROGRAM AFTER HSUA
Number of Facilities
Number of Units
Subject to Corrective Action
Subject to Corrective Action
6.700
c
a
o
A
E
3
Pre-HSWA
Po*t*H8WA
81,000
f/AWAWl
PI
(A
Pre-HSWA
Post-HSWA
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ES-5
EXHIBIT ES-2
PRIOR TO HSWA, THE TYPICAL FACILITY HAD FEW SWKUs
SUBJECT TO CORRECTIVE ACTION
Facilities
Land Disposal
Incineration
Treatment and Storage
All Facilities
Average No. of
Units Newly
Subject to
Corrective Action
13
16
14
15
Average No. of
Land Disposal Units Average
Previously No. of
Subject to Total
Corrective Action a/ Units
2 15
0 16
0 14
1 16
a/ Only RCRA-permitted land disposal units were subject to corrective
action prior to the enactment of HSWA.
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remaining one-third will require some type of corrective action, based on the
confirmation of a release in the RFI.
Potential releases of concern most often noted in RFA findings are
releases to ground water and soil. Of all facilities, 30 percent have actual
or suspected releases to ground water while 34 percent have confirmed or
suspected releases to soil. Facilities with confirmed or suspected releases
to surface water and air are less common, 17 percent and 7 percent
respectively. Finally, based on the results of the models used in the
quantitative analysis conducted for the RIA, approximately 31 percent (1,750
RCRA facilities) will have ground-water contamination requiring remediation.
Regulatory Strategies
EPA considered the following three alternative regulatory strategies in
developing the proposed corrective action rule:
¦ Strategy 1: Cleanup to Background Levels As Soon As
Practicable For All Facilities;
• Strategy 2: Cleanup to Health-Based Levels, With
Flexibility in Timing; and
¦ Strategy 3: Cleanup to Health-Based Standards Only
Where Actual or Imminent Exposure Exists
Each of these strategies is discussed in turn below.
Strategy 1: Cleanup to Background Levels As Soon As Practicable For All
Facilities
This strategy represents the most stringent and environmentally
conservative option of the three. Regulations modeled after this approach
would require complete restoration of all contamination back to the unit
boundary as quickly as could be practicably achieved. Contamination would
have to be cleaned up to background (i.e., the background concentration of a
waste in an environmental medium), which would amount to a "zero release"
standard. Under this strategy, extensive source controls would be required,
perhaps often involving treatment or destruction of all wastes that could
cause future contamination, in order to ensure that solid waste management
units would continue to meet the background cleanup standard.
Theoretically, this strategy would achieve the highest degree of
protection by reducing risks to human health and the environment. In
practice, however, current technologies cannot achieve consistently cleanups
to background levels. In addition, the economic impacts of such a regulatory
approach would be much greater than the other two options. Strategy 1,
therefore, could cause substantially more owners and operators to become
insolvent than Strategies 2 or 3, thereby placing additional demands on other
funding sources, such as State or Federal cleanup funds.
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Strategy 2: Cleanup to Health-Based Levels, With Flexibility in Timing
In broad terms, this strategy would require cleanup of releases to the
unit boundary to concentration levels safe for lifetime human exposure (i.e.,
health-based standards). The timing for achieving these levels would vary
depending on a number of site-specific factors, such as the extent and nature
of the contamination, exposure potential, availability of technologies, and
other factors. Source controls would be required in order to prevent further
releases above health-based levels.
Because health-based standards are generally higher than background
levels, this strategy would cost less per unit of risk reduction than Strategy
1. Moreover, this strategy would facilitate technically feasible remedies
based on site - specific conditions more so than would Strategy 1. Therefore,
the economic impacts of this strategy, although substantial, would be
considerably smaller than for Strategy 1.
Strategy 3: Cleanup to Health-Based Standards Only Where Actual or
Imminent Exposure Exists
Under Strategy 3, corrective actions would be required only if there was
evidence of actual or imminent exposure to contaminated media (e.g.,
contaminated drinking water wells) above health-based standards. Moreover,
once triggered, the extent of cleanup would be tied to alleviating that
exposure. Cleanup to the unit boundary, therefore, would not be required
unless exposure were actually of concern at that point. Required source
control measures would be less extensive than under Strategies 1 or 2.
Moreover, protection against future exposure to contamination would rely
heavily on institutional controls (e.g., security fencing around a
contaminated facility to prevent access and exposure).
This regulatory approach would achieve a minimum level of protection, as
compared to the other two strategies. By allowing contaminated media to
remain contaminated based on current exposure patterns, protection against
future exposure could not be guaranteed. Thus, Strategy 3 is the least
protective strategy. This strategy would, however, be substantially less
costly to owners and operators relative to Strategies 1 and 2.
Based on an evaluation of these three broad regulatory strategies, which
is described in more detail below, EPA adopted the framework of Strategy 2 for
its proposed corrective action program. EPA developed the proposed corrective
action rule within the context- of Strategy 2 as the best approach for
protecting human health and the environment for releases of hazardous
constituents from SWMUs. In general, EPA followed Strategy 2 because it
provides an optimum balance in ensuring a high degree of protection of human
health and the environment while not placing unnecessary burdens on facility
owners or operators.
It should be understood that crafting a comprehensive rulemaking within
the broad confines of any of the three alternatives listed above would, of
necessity, require addressing a large number of specific policy questions.
Thus, a variety of specific regulatory blueprints could be created under any
one alternative. This is reflected in the proposed rule, which is generally
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ES-8
patterned after Strategy 2, but also contains certain regulatory requirements
that could be considered to be a part of Strategies 1 and 3.
Multi-Media Evaluation of the Regulatory Strategies
The RIA also analyzes in Chapter 4 the three regulatory strategies
qualitatively by applying them to media-specific hazardous waste release
scenarios and to several actual case studies. In doing so, the RIA first
discusses the sources, transport, and potential threats of hazardous
constituent releases to ground water, soil, surface water, and air and then
describes typical corrective actions taken to address such releases. Second,
the RIA presents four example facilities, each with a release to one of the
four environmental media, drawn from existing RCRA and CERCLA case studies.
Finally, the three regulatory strategies are applied to the example release
scenarios and then analyzed in terms of their effectiveness in addressing the
releases.
The principal conclusion drawn from this qualitative analysis is that
Regulatory Strategy 2 is consistently the preferable strategy for each of the
media-specific scenarios analyzed in terms of flexibility and cost-
effectiveness. In addition to this analysis, the RIA also presents in Chapter
5 a series of case studies involving actual sites with hazardous waste
releases and remedies that would be required under the proposed rule. Both
the general analysis in Chapter 4 and the direct case study analysis of the
rule in Chapter 5 indicate that strategy 2, which correlates to the proposed
rule, is generally protective of human health and the environment. Moreover,
of the possible regulatory strategies, the proposed rule generally is both
protective and the most cost-effective approach.
QUANTITATIVE ANALYSIS
In addition to a qualitative analysis of three regulatory strategies,
EPA analyzed quantitatively five regulatory alternatives related to ground
water that were considered by the Agency in the development of the proposed
corrective action rule. EPA limited this quantitative analysis to ground
water, rather than including other media, primarily because modeling tools for
E" er media were not readily available. This RIA, therefore, only examines
ntitatively the costs and effectiveness of the regulatory options in terms
protecting ground water. The ground-water regulatory options are analyzed
usinp one of EPA's huTjrHnnc uncro yftjqase. fate and transport, and corrective
action models (the Liner Location Model).This model and other such models
have been used extensively bv EPA to analyze previous hazardous waste
regulations.
The basic approach taken in the analysis involved use of the Liner
Location Model to simulate each of the five regulatory alternatives as it
would be applied at a sample of 65 RCRA facilities. The following section
summarizes the methodology used to model the costs and effectiveness of the
various regulatory alternatives, details the alternatives themselves, and
presents the principal conclusions of the quantitative analysis.
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Methodology
As noted above, sonJe 5,700 RCR^facilities are potentially subject to —n
EPA's proposed corrective actionp^fquirements. Since it was not possible do ]
study the effects of theseTeqtfiTrements at each RCRA facility, a sample of 65 J
facilities was chosen and characterized. This sample includes 21 land
disposal facilities, 41 treatment/storage facilities, and three incineration
facilities. Because of the way the sample was selected, these facilities are
intended to represent only those facilities at which the RFA will call for an
RFI. As explained in Appendix A, the model estimates of the extent and costs
of the corrective action program apply to all 5,700 RCRA facilities
potentially subject to the corrective action program, not just the sample
facilities.
Each of the 65 facilities was characterized based on a review of the
information contained in the RFA and, where data were unavailable, based on
best professional judgment. This process yielded the number and types of
SWMUs at the facility, dates of operation of SWMUs, types and quantities of
wastes managed in SWMUs, regulatory status of each SWMU, and other information
related to Federal ownership and type of facility. Using EPA's DRASTIC
system, the hydrogeology and climatic setting of each facility were
characterized.
Exhibit ES-3 presents a schematic diagram illustrating the various
procedures used in the Liner Location Model (LLM). The LLM begins with the
basic characterization of each facility described above. Using these facility
characterizations, facility-wide release profiles are generated. Each release
profile contains the total mass of each contaminant constituent release in
each year of the modeling period. For this analysis, the modeling period
extends for 200 years from 1920 to 2119.
After the releases from all SWMUs have been estimated, the fate and
transport of the released contaminants in the environment is simulated. If
the contaminant concentration at a ground-water monitoring well exceeds a
specific level, the LLM simulates the implementation of a corrective action
Within the LLM, if corrective action is triggered, the model estimates the
costs o^ the "corrective action and adjusts the contaminant concentrations to
reflegt the impact otfthe action^ The specific remedies simulated by the
model include capping, recovery veils, excavation, and excavation with
recovery wells. These four remedies were selected to represent the range of
costs and effectiveness of available corrective action technologies.
Combinations of remedies (e.g., capping with recovery wells) or types of
remedies other than those listed here are not used in the model. For some
regulatory options, however, institutional controls may be selected in some
cases.
In choosing an appropriate remedy for a specific facility, the model
evaluates the four ground-water corrective measure remedies using three
criteria, including effectiveness, cost, and feasibility. The different
remedy selection rules used for each of the five regulatory alternatives are
described in detail in the RIA.
-------
EXHIBIT ES-3
OVERVIEW OF THE LIMBS LOCATION HODKL
Facility,
Simulate
Waste and
Generate
Fate
Environment
Releases
and
Characteristics
Transport
I
I
Simulate
Dose
Response
Simulate
Corrective
Action
I
T
I
Groundwater cleanup actions
Source control actions
Produce I
Output I
-------
ES-11
Regulatory Options
In conducting the quantitative analysis, a range of regulatory options
similar to those presented for the qualitative analysis were analyzed. For
comparison purposes, however, the quantitative analysis examined also a
"baseline" option, which reflects the pre-HSWA corrective action program. In
addition, the Agency developed four regulatory options, two of which were used
to approximate the approach of the proposed rule. These options (Options B
and C) provide an upper and lower bound to the costs of the proposed rule and
reflect the Agency's uncertainty about several of the data and assumptions
used in estimating costs, such as the types of remedial measures that will be
ultimately implemented. In structuring the modeling logic for this analysis,
it was necessary to make certain assumptions and use decision rules which vary
slightly from those used in the qualitative analysis. Nonetheless, the broad
regulatory alternatives examined in the qualitative and quantitative analyses
are generally the same. They are:
¦ Baseline Scenario
Option A: Immediate Cleanup to Background
Option B: Immediate Cleanup to Health-Based Standards
Option C: Flexible Cleanup to Health-Based Standards
Option D: Flexible Cleanup Based on Actual Exposure
The quantitative analysis examined each of the five regulatory options
in terms of the following criteria: cost, protection of human health and the
environment, flexibility in implementation, and technical practicability.
This analysis evaluates the effects of each alternative only as it would
address contamination of ground water.
Baseline Scenario
This option represents requirements under RCRA prior to enactment of the
HSWA corrective action requirements and is used as the basis for comparison of
costs and benefits of other options. Only land disposal units regulated under
Part 264, Subpart F, were assumed to be subject to corrective action. The
corrective action trigger and target concentrations, either the background
concentration or a Maximum Contaminant Level, are the sane.2 Only on-site
clean-up within the facility boundary is addressed. Ground-water removal and
treatment, or capping, are the only corrective action remedies considered.
Option A: Immediate Cleanup to Background
This option is the most stringent of those evaluated. All SWHUs, in
addition to regulated land disposal units, are subject to corrective action.
Any detectable release to ground water in excess of background levels would
2 For modeling purposes, the baseline scenario assumed that cleanup targets
would not be established at Alternate Concentration Limits under Subpart F.
-------
ES -12
trigger action. Moreover, both on-site and off-site contamination must be
cleaned up to background levels as soon as practical. Finally, only remedies
that include excavation of the source are allowed.
Option B: Immediate Cleanup to Health-Based Standards
This option is intended to represent the upper bound approach to the
proposed rule. Under Option B, corrective action would be triggered only if
concentrations were detected above a health-based standard, rather than above
background concentrations. This option simulates use of four remedies (i.e.,
excavation, excavation with recovery wells, capping, and recovery cells).
Moreover, a remedy is simulated for every facility that triggers corrective
action regardless of the practicality or feasibility of the remedy. In
addition, unlike the previous option, cleanup of on-site contamination could
be deferred until facility closure, or the end of the post-closure period, at
which point cleanup to health-based levels would be required.
Option C: Flexible Cleanup to Health-Based Standards
This option is intended to represent the lower bound approach to the
proposed rule. As with Option B, it also addresses all SWMUs and uses health-
based standards as both trigger and target levels. As in the previous option,
owners and operators may defer cleanup of on-site releases until facility
closure or the end of the post-closure period. In this alternative, however,
owners and operators have considerable flexibility in identifying corrective
action remedies. Here, remedies less costly than source control can be chosen
if they achieve cleanup targets within a reasonable time frame. As a decision
rule to reflect the fact that the problems of scale and other technical
difficulties will preclude certain remedies at complex sites, remedies that
failed to achieve cleanup in a reasonable period of time (assumed to be about
130 years for this analysis) or that would be extraordinarily expensive (i.e.,
over $150 million) were rejected as "impracticable." Instead, institutional
controls (e.g., security fences or restrictions on water use) would be relied
upon to prevent exposure in these cases.3
Option D: Flexible Cleanup Based on Actual Exposure
This option is the least stringent of the four post-HSWA scenarios. It
is similar to Option C, except that cleanup of off-site exposure could be
deferred if there is no actual human exposure to the release. If there is an
off-site exposure, corrective action must address the exposure. Again, under
this option, there is a flexible approach towards remedy selection, using the
same remedy selection rules as Option C.
Effectiveness Results
Exhibit ES-4 depicts the likelihood and timing of corrective action
under the regulatory alternatives. As this exhibit illustrates, the analysis
3 This approach is not intended to imply that remedies of this scope would
never be undertaken in practice, nor to define the limits of technical
practicability.
-------
ES-13
EXHIBIT ES-4
CORRECTIVE ACTION IS DEFERRED FOR OPTIONS C AND D a/
Year in Which
Corrective Action Options b/
is Triggered c/
Baseline
A
L
B
C
D
1
9.
,11
25.
71
12.4X
12.4X
12 4 X
2-14
OX
2.
9 X
3.7X
3.7 X
2.7X
15-39
3
.6*
3.
21
10. 2X
H4
O
ro
10.4X
40-133
1,
r2X
1
11
4.7X
4.7 X
5.4X
Trigger Subtotal
14
.42
32.
9 X
30. 9X
30. 9X
30.9X
Never Trigger
85
.6*
67.
IX
69. IX
69. IX
69. IX
a/ Percentage indicates the distribution of start dates among the total
population of facilities potentially affected by the corrective action program
(i.e., 5,661 facilities).
W
Option A
Option B
Option C
Option D
Immediate Cleanup to Background
Immediate Cleanup to Health-Based Standards
Flexible Cleanup to Health-Based Standards
Flexible Cleanup based on Actual Exposure
cj Year 1 represents the year in which the corrective action program is
implemented.
-------
ES-14
estimated that approximately 31 percent of all RCRA facilities will trigger
corrective action in all the post-HSWA options analyzed, while only 14 percent
trigger under the baseline pre-HSWA scenario. This reflects the requirement
that all SWMUs, not just land disposal units, are subject to corrective action
under post-HSWA options. Note that even in the post-HSWA options,
approximately two-thirds of the facilities will not trigger corrective action
for ground water.
Differences in trigger levels did not result in significant differences
in the number of facilities triggering corrective actions. However,
differences in target levels for the various regulatory options made a
significant difference in how many corrective actions were "successful" in
achieving cleanup levels, as is discussed later in this section.
Exhibit ES-4 lists when corrective action is triggered for each of the
regulatory options. The analysis demonstrates that, for Option A (Immediate
Cleanup to Background), in which corrective action must begin immediately,
approximately 26 percent of all existing RCRA facilities would initiate
corrective action in the first year of the program. In Options B, C, and D,
in which on-site corrective action can be deferred, only about 12 percent of
all facilities would initiate corrective action in the first year. The time
of trigger is important primarily because the deferral of on-site corrective
actions results in lower economic impacts.
Another primary output of the quantitative analysis is the distribution
of remedies selected across the five regulatory options. These remedy
selection results are presented in Exhibit ES-5. The remedy selection rules
for each of the options is detailed in Chapter 6 of the RIA. In general, the
selection rules favor reliable, long-term corrective action remedies (e.g. ,
excavation) for the more stringent Options A and B (Immediate Cleanup to
Health-Based Standards) and a broader range of remedies and a more flexible
implementation approach for Options C (Flexible Cleanup to Health-Based
Standards) and D (Flexible Cleanup Based on Actual Exposure). For example,
institutional controls, such as security fencing or prohibitions on water use,
are allowed for Options C and D only.
Given the model results with regard to facilities triggering corrective
action, timing of triggering, and remedy selection, the primary measure of
effectiveness generated by the model is the time to reach target
concentration. This effectiveness measure represents the length of time
required for a corrective action to reduce all contaminant concentrations
below the target levels at all wells within 1,500 meters of the unit (i.e. ,
the maximum modeled well distance). 'This measure was developed because it
provides a consistent measure across all remedies and regulatory options. A
corrective action, thus, is defined to be effective for modeling purposes if
all constituents within 1,500 meters of the unit are cleaned up to their
option-specific levels.
Exhibit ES-6 presents the distribution among the baseline scenario and
regulatory options of the time required for the facilities that trigger
corrective action to reach target levels at all wells within 1,500 meters.
The "target not reached" category represents situations where none of the
-------
ES-15
EXHIBIT ES-5
REMEDY SELECTION VARIES SIGNIFICANTLY AMONG OPTIONS a/
Options b/
Selected Reraedv
Baseline
A c/
B
C
D
Excavation
N/A d/
59. OX
3. IX
9. OX
9.8X
Excavation with wells
N/A
20. 72
CM
4.62
3 . 62
Recovery wells
28. 6X
20.22
33.4X
15. 9X
14.92
Capping
71.4X
N/A
37.8X
64.82
65.02
Institutional Controls
N/A
N/A
N/A
5.7X
6. 72
a/ Percentage indicates the distribution of selected remedies at those
facilities triggering corrective action under the baseline scenario and
regulatory options.
b/ Option A
Option B
Option C
Option D
Immediate Cleanup to Background
Immediate Cleanup to Health-Based Standards
Flexible Cleanup to Health-Based Standards
Flexible Cleanup based on Actual Exposure.
oj Option A is structured to require source control. Thus, capping and
recovery wells without source control (i.e., excavation) are not allowed.
However, for situations where excavation is infeasible, recovery wells alone
are simulated.
d/ N/A: Regulatory option does not allow this remedy.
-------
ES-16
EXHIBIT ES-6
DISTRIBUTION FOR TIMES TO REACH TARGET
WITHIN 1,500 METERS VARIES AMONG OPTIONS a/
Baseline Option A Option B Option C Option D
Total Percent
of All
Facilities
Triggering
Corrective Action 14.42 32 92 30.92 30.92 30.92
Duration to
Reach Target
(Years) Percentages of All Facilities Where Cnnraminants Exceed Triggers
0-10
17. IX
14.72
23.72
18.52
18.52
11-25
5.52
7.02
9.52
3.12
3.12
26-50
9.72
6.52
15.92
22.92
21.92
51-75
1.92
5.52
6.42
6.7*
8.02
76-100
02
5.12
1.52
3.3*
1.82
101-131
02
02
0.82
1.8*
1.82
Target Not Reached
65.82
61.22
42.22
38.0*
38.32
Institutional
Controls
02
02
02
5,6*
6.62
Total
1002
1002
1002
100*
1002
£/ Option
A:
Immediate
Cleanup to
Background
Option
B:
Immediate
Cleanup to
Health-Based Standards
Option
C:
Flexible
Cleanup to
health-Based
Standards
Option
D:
Flexible
Cleanup based on Actual
Exposure
-------
ES-17
remedies resulted in target levels being reached at all wells within 1,500
meters
Under Options E and C, about 56 percent and 52 percent of the
facilities, respectively, are simulated to reach cleanup targets at all
modeled well distances within 75 years of initiation of the action. For
Option A, the proportion of facilities with corrective action not reaching
target concentrations at all wells within 1,500 meters is greater than the
percentage for Options B, C, and D, because the target levels for Option A
(i.e., cleanup to background) are more difficult to attain than those for the
other options (i.e., cleanup to health-based levels). Moreover, a somewhat
larger number of facilities take corrective action under Option A than under
the other three options.
In summary, based on the results of the quantitative analysis of ground
water, about 31 percent of the population of RCRA facilities subject to the
corrective action requirements are estimated to require corrective action for
ground-water contamination. Moreover, most of these actions appear likely to
be initiated prior to the year 2000. Finally, under the options most similar
to the proposed rule (i.e., Options B and C), over 50 percent of the
facilities undertaking corrective action are simulated to reach cleanup
targets at all modeled well distances within 75 years.
Cost Results
The Agency also developed estimates of the costs of corrective action
under different regulatory options on a per-facility and national basis.
These estimates were derived by the Liner Location Model, which applied
standardized unit cost algorithms to the 65 sample facilities comprising the
RFA survey. These algorithms were developed based on EPA experience, best
professional judgment, and standard construction cost estimation techniques.
The results of these cost calculations are summarized below. Note that all of
the costs were discounted with a rate of 3 percent and all annualized costs
were calculated using a period of 20 years.
Typical facility corrective action costs vary significantly depending
upon the specific regulatory option. The cost analysis demonstrates that the
most stringent post-HSWA regulatory option, Option A (Immediate Cleanup to
Background), is by far the most costly option, with a mean present value cost
of over $281 million per facility, and an annualized per-facility cost of
about $19 million (at a 3 percent discount rate). On the other hand, Option B
(Immediate Cleanup to Health-Based Standards) was estimated to have a mean
present value cost of $26.9 million and annualized per-facility costs of $1.8
million. Option C (Flexible Cleanup to Health-Based Standards) was estimated
to have a mean present value cost per facility of $6.3 million dollars and
annualized per-facility costs of $0.4 million. Option D (Flexible Cleanup
Based on Actual Exposure) was estimated to have a mean present value cost of
$4.8 million and annualized per-facility costs of $0.3 million. Finally, the
baseline per-facility cost is the lowest of all the options at a mean present
value cost of $3.8 million and an annualized per-facility cost of $0.3
million.
-------
ES-18
The total national cost for EPA's corrective action program is
influenced by three parameters: the average cost of each action, the number
of facilities required to undertake corrective action, and the cost to
facility owners and operators of undertaking required investigations. Not all
facilities performing RCRA Facility Investigations (RFIs) are assured to
perform corrective actions. These investigative costs, therefore, are
included only in the national cost estimates and not the per-facility
corrective action cost estimates. Moreover, because cost data for RFIs and
Corrective Measures Studies (CMSs) are not available, the Agency assumed for
the sake of analysis that the typical RFI would cost $300,000 and the typical
CMS would cost $100,000. These estimates are based in part on EPA's
experience in the Superfund remedial action program. National costs discussed
below are presented in incremental terms (i.e., after subtracting the costs of
the baseline scenario).
Option A is the most expensive option, with an incremental total cost
above the baseline pre-HSWA scenario of $490 billion. This option was
estimated to have an annualized cost of $32.9 billion. Among the other
regulatory options, the differences in costs are primarily a result of
differences in timing of cleanup and in the flexibility afforded in terms of
choosing corrective action remedies. Option B was estimated at a total cost
of $41.8 billion, with an annualized cost of $2.8 billion. This option is
relatively costly, due in part to modeling assumptions as to the types of
remedial technologies which would be employed to meet these standards. Option
C was among the least costly, with a total cost of $7.4 billion, and an
annualized cost of $0.5 billion. The costs under this option are lower
because, in general, less expensive technologies are assumed and, for many
facilities, final cleanup of contaminated ground water would be deferred for a
number of years, thus reducing the present value costs. Option D, where both
on-site and off-site cleanup of contamination could be deferred until closure
if there was no actual exposure, was somewhat less expensive than Option C.
Option D had a total cost of $5.0 billion and an annualized cost of $0.3
billion.
It is difficult, however, to validate these cost estimates using data
from the RCRA corrective action program because the program is relatively new.
EPA used data from the CERCLA remedial action program, which began in 1981 and
is similar in focus to the RCRA corrective action program, to verify these
estimates. Using the CERCLA data and correcting for many of the differences
between the two programs, EPA estimated that the estimated total cost for the
proposed corrective action rule is $12.9 billion, for an average per-facility
cost of $4.4 million (this estimate is for total. not incremental costs).
The total cost estimate is higher than the estimate of $10.6 billion in
total costs for Option C (calculated as $3.2 billion in baseline costs plus
$7 4 billion in incremental costs). The main source of this difference is
that the CERCLA-based analysis assumed that a much larger universe of RCRA
facilities would require corrective action. Much of the difference in the
per-facility costs arises from the fact that the CERCLA-based analysis
included many minor (and relatively cheaper) cleanups that were not included
in the estimates developed in the RIA analysis.
-------
ES-19
In sum, the proposed corrective action regulation is most similar to
Options B and C. The Agency believes that the results of the quantitative
analysis support the proposed rule as being a flexible, cost-effective
approach that provides a high degree of protection of human health and the
environment.
SUPPORTING ANALYSIS
In addition to the qualitative and quantitative analyses of regulatory
alternatives performed for this RIA, EPA performed several supporting
analyses, including an analysis of national economic impacts due to the rule,
a regulatory flexibility analysis, and an analysis of the corrective action
program at Federal hazardous waste management facilities. All three of these
supporting analyses are summarized below.
Economic Impacts
With the cost information developed from the quantitative analysis, EPA
estimated the financial impacts of the proposed rule on affected firms. These
economic impacts were measured in three different ways, including a measure of
adverse impacts on facilities, a measure of adverse impacts on firms, and an
estimate of corrective action costs left unfunded by responsible parties due
to insolvency. Adverse impacts on facilities were calculated as the
percentage of facilities that would be unable to cover their corrective action
costs required under a given regulatory alternative without facing a high risk
of insolvency. The analysis assumed that a firm faces high risk of insolvency
when the cost of a corrective action reduces the firm's ratio of cash flow to
its total liabilities to less than 10 percent. This ratio, referred to as tfie
Beaver ratio, and the threshold of 10 percent, are commonly used to predict
Under Option C, an additional 345 facilities, or 7 percent of all
facilities, relative to the baseline scenario might be unable to cover their
corrective action costs. Option C would result in less economic impacts than
Options A or B, however, which could create incremental adverse effects on as
many as 18 percent and 10 percent of all facilities, respectively.
In a similar fashion, firm impacts were calculated as the percentage of
firms facing adverse impacts. For this measure, it was assumed that an
adverse impact on a firm occurs when the corrective action costs required of
one or more of the firm's facilities cannot be covered by the firm without
placing it in a high risk of insolvency, ^gain, the insolvency risk measure
used is the Beaver ratio. Under Option C, the lower bound rule option, an
additional 224, or 9 percent of all firms, relative to the baseline scenario,
might face adverse impacts due to corrective action costs. Option C could
result in less economic impacts than either Options A or B, however, which
incrementally could adversely affect as many as 20 percent and 11 percent of
all firms, respectively.
The final measure of economic impacts used for this RIA was a measure of
unfunded costs. Unfunded costs are expressed in terms of the predicted total
costs left unfunded by facility owners and operators due to insolvency These
bankruptcy.
-------
ES-20
costs could be faced ultimately by entities other than the immediate owner or
operator of the facility, such as the Superfund (provided that the facility
would be eligible for Superfund funding), State remedial action funds, or,
through price increases, the customers of the firm owning or operating the
facility. The results of this analysis are presented in "undiscounted"
numbers, since Superfund monies are generally described in undiscounted terms.
For scenarios other than the baseline, costs are presented on an incremental
basis relative to the baseline.
Under the baseline scenario, it was estimated that 9 percent of all
firms owning RCRA facilities would be adversely impacted, creating total
unfunded costs of $97 million (undiscounted) over the next 50 years. Option A
generated by far the highest level of unfunded costs, totaling $74.2 billion
over the next 50 years. Option B results in unfunded costs of over $5.1
billion over the next 50 years. Option C results in unfunded costs of $457
million over the next 50 years. Finally, Option D resulted in a total of $165
million unfunded costs, undiscounted, over the next 50 years.
Based on the RIA analysis, EPA anticipates that the ability to fund
corrective action costs will vary between industries. Industries that may
have a relatively low ability to pay for corrective actions include sanitary
services; coating, engraving, and allied services; and miscellaneous wood
products. These industries have relatively low net income levels. Industries
that show a particularly high ability to pay include petroleum refining, motor
vehicles and motor vehicle equipment, and aircraft and aircraft parts.
Regulatory Flexibility Analysis
The Regulatory Flexibility Act requires Federal agencies to fully
analyze the economic effects of regulations on small entities. For this RIA,
the Agency assumed that a small business is significantly affected if its
excess of cash flow over ten percent of its total liabilities is insufficient
to meet corrective action costs (i.e., if it failed the Beaver ratio test), or
if its net income is insufficient to meet its corrective action costs. These
two tests were chosen because they come close to established EPA criteria for
measuring economic impacts. With regard to measuring significant impacts
nationally, the Agency established in its guidance for performing regulatory
flexibility analyses that a substantial number of small entities are affected
if 20 percent or more of all small entities subject to a proposed rule are
affected adversely.
Using methodology similar to that used for estimating economic impacts,
EPA found that, under the regulatory options intended to represent the
proposed corrective action rule, small firms do encounter more severe impacts
from the corrective action requirements than large firms. These options
result in adverse incremental impacts (i.e., relative to the percentage of
firms affected under the baseline scenario) on approximately 9 to 11 percent
of small businesses owning RCRA facilities. Based on the Agency's guidelines
for implementing the Regulatory Flexibility Act, therefore, the results of the
analysis as summarized above suggest that the proposed rule does not impose a
significant impact on small entities when considered relative to the impact of
the baseline scenario.
-------
ES-21
Federal Facilities
The RIA discusses Federal facilities as a separate category because,
although they constitute only 6 percent of the total RCRA facility universe,
they contain more SWMUs per facility (on average, 55 per facility compared
with 12 per facility for non-Federal facilities). Corrective action cost at
these facilities must be funded with public money.
The Federal facility component of the RCRA universe is not characterized
as completely as other components. Consequently, a precise estimate of the
number of Federal facilities requiring corrective action is not possible.
However, EPA estimated the range of the number of Federal facilities —
potentially requiring corrective action.
Based on the RIA analysis, EPA estimates that, of the 352 Federal RCRA
facilities, between 30 percent and 100 percent are likely to require ground-
water corrective action under the proposed rule, with approximately 60 percent
representing the most likely estimate (compared to between 17 percent and 23
percent under the baseline). A rough approximation of the costs for these
corrective actions, per facility, ranges from $17 million dollars for the
baseline scenario to $1.3 billion for Option A (Immediate Cleanup to
Background). For Option C (Flexible Cleanup to Health-Based Standards), the
mean per-facility cost is estimated to be $29 million, or in annualized terms,
about $1.9 million per facility.
The analysis indicates also that total corrective action costs
incremental to the baseline for Federal facilities can range widely depending
on the regulatory option considered and assumptions about the number of
Federal facilities requiring cleanup. The lower bound regulatory option,
Option C, is estimated to have a potential total cost of about $6.1 billion
and an annualized cost of about $0.4 billion (i.e., total cost incremental to
baseline of $5.1 billion or $0.3 billion annually).
This analysis thus concludes that, although Federal facilities comprise
only 6 percent of the population affected by the corrective action program,
they will incur roughly 40 percent of the total cost of the rule.
CONCLUSIONS AND LIMITATIONS ^
In conclusion, thi^Tr«gblakory impact analysis was performed to
characterize the costs .j/tjenefit^y and other impacts of EPA's proposed
corrective action rule.f\The epneral approach taken was to establish
alternative regulatory opfetcfus with varying cleanup targets, types of
remedies, and timing. These regulatory options were then compared and
contrasted both qualitatively, using hazardous constituent release scenarios
and case studies, and quantitatively, using a computer simulation model in
order to yield representative costs and benefits. Based on this analysis, the
following conclusions were reached:
¦ The qualitative analysis suggests that the regulatory
strategy upon which the proposed rule is based offers
a high degree of protection of human health and the
-------
ES-22
environment while not placing unnecessary burdens on
facility owners and operators.
m Based on the quantitative analysis, under the
regulatory options most similar to the proposed rule,
over 50 percent of the facilities undertaking
corrective action for ground-water contamination were
simulated to reach cleanup targets within 75 years.
¦ Costs for ground-water corrective action under the
proposed rule were simulated to have a lower bound
mean present value cost per facility of $6.3 million
and an annualized per- facility cost of $0.4 million.
Moreover, under this same option, national costs were
simulated to be about $7.4 billion, or $0.5 billion on
an annualized basis, more than the costs that would
have been incurred for corrective action prior to the
enactment of HSWA.
¦ Based on the economic impacts analysis for Option C,
an additional 7 percent of all facilities and 9
percent of all firms will face adverse impacts from
the corrective action requirements of the proposed
rule, leaving a total of $457 million (undiscounted)
in corrective action costs left unfunded due to
insolvency.
¦ Based on the regulatory flexibility analysis, the
regulatory options most similar to the proposed rule
do not impose significant impacts on a substantial
number of small entities (i.e., only 9 to 11 percent
of entities are adversely affected) when considered
relative to the impacts of corrective action
requirements prior to the enactment of HSWA.
¦ Finally, while Federal facilities comprise only 6
percent of all RCRA facilities, these facilities could
incur up to 40 percent of the total cost of the rule.
In reviewing the results presented by this executive summary, a number
of key limitations to the analysis and assumptions made in the quantitative
analysis and supporting analysis should be considered. These limitations and
assumptions, which are discussed more thoroughly where appropriate throughout
the RIA, are summarized below. In general, these limitations fall into three
categories: effectiveness, costs, and supporting analyses.-
Effectiveness
¦ Effectiveness measures the degree to which a particular option
achieves the cleanup target. It should not be viewed as a measur
of potential ground-water protection benefits.
-------
ES-23
¦ Because Che RIA simulated releases to ground water
only, the effectiveness of the regulatory options in
addressing releases to other environmental media is
likely to vary somewhat from the estimates presented
in the RIA.
¦ Due to modeling constraints, the performance of
simulated remedies may diverge somewhat from the
actual performance and effectiveness of such remedies.
For instance, in the model, caps are simulated to fail
in 35 years and recovery wells are assumed to be 95
percent effective in removing ground-water
contamination. In practice, the life of caps and the
efficiency of recovery wells will vary from site to
site, depending on local factors, such as
hydrogeologic conditions.
¦ Because only four remedies were simulated, the model
may not accurately reflect the broader range of
remedies available in practice. Moreover, the model
uses simplified remedy selection rules in selecting
among the range of remedies. In contrast, under the
proposed rule, detailed studies would be used as the
basis for selecting among corrective measure remedies.
¦ In all cases, it was assumed for modeling purposes
that background contaminant concentrations are zero.
It is likely that, at some RCRA facilities, background
concentrations are not equal to zero. Because
concentrations must reach the detection limit before
corrective action can be triggered, it will cake
longer to detect a release if background
concentrations are zero than it would if ground-water
supplies were already contaminaced to a level higher
chan che detection level. As a result, the RIA may
underestimate the likelihood of triggering corrective
action for all options.
Costs
¦ Because the RIA models the entire corrective action
program (i.e., by including RCRA Section 3008(h) and a
revised Subpart F program in addition to the Subpart S
rule authorized by Section 3004(u)), the costs of the
Subpart S rule itself are overestimated.
i The quantitative analysis assumes that the targec
cleanup level is equal Co che crigger level. Because
che proposed rule accually allows che cargec cleanup
level co be sec ac a poinc higher Chan che level ac
which accion is firsc iniciaced, che analysis may have
over escimaced costs.
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ES-24
The remedy selection rules used for the model only
approximate the proposed rule and are not as flexible
as the rule, thus potentially overestimating costs
Because the quantitative analysis modeled releases to
ground water only, this analysis underestimates the
costs of corrective action
For modeling purposes, remedies were simulated only
once for a given release scenario (i.e., not for
additional future releases), thus potentially
underestimating costs
Because of modeling limitations, the RIA does not
simulate the use of Alternate Concentration Limits
(i.e., site-specific cleanup standards set under
Subpart F). Thus, the RIA may overestimate the cost
of the baseline scenario and underestimate the
incremental cost of other options.
The RIA simulates off-site land disposal of excavated
wastes. However, the additional costs of treating
land-disposal wastes to the Land Disposal Restrictions
(40 CFR Fart 268) were not included in the cost
estimates. Moreover, incineration of excavated wastes
was not simulated. As a result, the RIA may
significantly underestimate costs for the options that
select excavation remedies.
The model did not estimate the costs of institutional
controls where they were selected. As a result, the
RIA may underestimate costs for the options that
select institutional controls.
The RIA derives the costs of RFIs and CMSs from lower-
bound estimates of similar Superfund investigation
steps. If, in practice, the investigative costs for
RCRA corrective actions diverge from these lower-bound
estimates, then the accuracy of the cost estimates
would be reduced.
Using Superfund remedial action program data, total
national costs for the proposed corrective action rule
were estimated to be $12.9 billion (non-incremental to
baseline), compared to $10.6 billion to $45 billion in
total national costs (non-incremental) for the
proposed rule in this analysis.
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ES-25
Supporting Analyses
¦ Because the economic impact analysis does not simulate
the availability of alternate funding sources, such as
payouts from financial assurance mechanisms, corporate
parents, price increases, Superfund, or State cleanup
funds, the RIA may overestimate the economic impacts
of the proposed rule.
¦ In the economic impacts and regulatory flexibility
analyses, corrective action costs are not simulated to
vary with the financial size of the firm required to
take corrective action. Therefore, the RIA may
underestimate the economic impacts of the proposed
rule on small firms.
¦ Federal facility costs are estimated using a very
imprecise methodology that involves extrapolating from
smaller private facilities to very large Federal
facilities. Actual costs observed at Federal
facilities may differ significantly from those
estimated in the RIA.
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1. INTRODUCTION
The Environmental Protection Agency (EPA) prepared this Regulatory
Impact Analysis (RIA) in order to assess the costs and benefits of alternative
approaches to addressing releases from solid waste management units (SWMUs) at
facilities managing hazardous wastes.1 Under Executive Order 12291 (issued
February 17, 1981), a Regulatory Impact Analysis is required for every major
Federal regulation. Executive Order 12291 defines a major rule as one that is
likely to result in: (1) an annual effect on the economy of $100 million or
more; (2) a major increase in costs or prices for consumers, individual
industries, Federal, State, or local government agencies, or geographic
regions; or (3) significant adverse effects on competition, employment,
investment, productivity, innovation, or on the ability of United States-based
enterprises to compete with foreign-based enterprises in domestic or export
markets The results of this RIA demonstrate that the proposed corrective
action rule is a "major" rule.
Regulatory Impact Analyses ensure that Federal agencies consider the
trade-offs between costs and benefits of proposed regulations. This RIA
quantifies, to the extent possible, the costs to society of alternative
regulatory approaches to cleaning up hazardous waste facilities, the economic
impacts on such facilities caused by compliance with the proposed regulations,
and the benefits of increased protection of human health and the environment
derived from the alternative approaches. By developing and organizing
information on costs, benefits, and economic impacts of proposed regulations,
this RIA is intended to assist EPA decision makers assess alternative
approaches to regulating hazardous waste release problems.
The proposed regulations analyzed in this RIA are authorized by Sections
3004(u) and (v) of the Resource Conservation and Recovery Act of 1976 (RCRA),
as amended by the Hazardous and Solid Waste Amendments of 1984 (HSWA).
Section 3004(u) requires that permits issued to hazardous waste management
facilities after November 8, 1984 require "corrective action for all releases
of hazardous waste or constituents from any solid waste management unit at a
treatment, storage, or disposal facility seeking a permit under [Subtitle C of
RCRA], regardless of the time at which waste was placed in such unit."
Section 3004(v) mandates that EPA require hazardous waste management
facilities to undertake corrective action for releases beyond the facility
boundary.
EPA codified the provisions of Section 3004(u) by incorporating the
statutory language in 40 Code of Federal Regulations (CFR) Part 264, Subpart F
(50 FR 28702, July 15, 1985). EPA codified Section 3004(v) by adding 40 CFR
264 100(e) and 264.101(c) to the existing regulations (52 £R 45788, December
1 Throughout this RIA, the term "release" refers to the release of
hazardous wastes or hazardous constituents to the environment.
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1-2
1, 1987). The proposed rule is intended to replace these codifications of
statutory language with a detailed regulatory program for corrective action
that includes investigative requirements, cleanup standards, and
implementation procedures.
The proposed corrective action rule, based on RCRA Sections 3004(u) and
(v), is just one element of EPA's corrective action program. Other elements
include the requirements under Section 3008(h) and standards contained in
Subpart F of 40 CFR 264. RCRA Section 3008(h), added to the statute by HSWA,
allows EPA to issue orders requiring corrective action to any facility
authorized to operate under RCRA interim status (i.e., facilities that have
not received a final Part B permit) whenever EPA determines that there is or
has been a release of hazardous waste into the environment from such a
facility. Finally, EPA's corrective action program also includes the Subpart
F requirements that existed prior to HSWA, which regulate releases to ground
water from regulated land disposal units at permitted facilities.2
For this RIA, the Agency assumed that the proposed rule, under the
authority of Sections 3004(u) and (v), will cover corrective action at all
RCRA facilities regardless of their permit status or the types of waste
management units present. By making this assumption, EPA was able to analyze
the impact of the proposed rule as a single, uniform corrective action program
applied to all types of units at all facilities. As noted earlier, EPA is
required, under Executive Order 12291, to analyze proposed rules and the
alternatives considered in their development. This RIA, however, analyzes
more than just the proposed rule; it examines the entire RCRA corrective
action program. This important assumption is explained briefly below.
HSWA created a statutory requirement that a RCRA permit must address all
releases to all media from all solid waste management units located at the
facility and the proposed rule specifically addresses such releases at
permitted RCRA facilities, except for releases to ground water from regulated
land disposal units subject to Subpart F. EPA is also authorized, under RCRA
Section 3008(h), to require corrective action at RCRA interim status
facilities. Concurrent with the proposed rule, EPA is also proposing
revisions to the Subpart F corrective action standards. The purpose of these
revisions is to ensure that units regulated under Subpart F and units
regulated under the proposed rule are treated consistently with respect to
ground-water releases.
Consequently, this RIA considers the effects of the proposed rule on all
facilities in the RCRA universe based on the following two assumptions:
1. Section 3008(h) corrective action orders at all
interim status facilities will require corrective
actions that are essentially identical to those
imposed at permitted facilities under the proposed
rule; and
2 Regulated units are defined in *0 CFR 264.90(a) as waste piles, surface
impoundments, land treatment areas, anr landfills that received hazardous wastes
after July 26, 1982.
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1-3
2. Subpart F will be revised concurrently with the
proposed rule so that regulated land disposal units
will be subject to the same standards as those in the
proposed rule.
The RIA is organized into four separate parts, each containing a number
of chapters. Part 1 contains Chapters 1 through 5 and provides an overview of
the RIA and the proposed corrective action rule. The scope of the hazardous
waste cleanup problem is discussed in Chapter 2. Chapter 3 presents the
various regulatory strategies and approaches considered by EPA in designing
the proposed rule. The qualitative effects of these alternative approaches to
corrective action for each environmental media (i.e., soil, air, surface
water, and ground water) are discussed in Chapter 4. Finally, Chapter 5
describes several case studies illustrating how the proposed rule may be
implemented.
Part 2 contains Chapters 6 through 9 and presents the quantitative
analysis of the proposed rule with respect to ground-water cleanup. Chapter 6
explains how the Liner Location Model (LLM) was used to analyze five
regulatory scenarios. Chapter 7 analyzes the effectiveness achieved through
ground-water cleanup by each regulatory alternative. Then, the costs of
implementing each corrective action alternative are analyzed in Chapter 8.
Finally, the estimated costs are compared to the experience of the Superfund
program in Chapter 9.
Part 3 contains Chapters 10, 11, and 12, the supporting analyses to the
RIA. In general, these supporting analyses are based on the results of the
Liner Location Model (LLM) analysis, and so primarily address corrective
action to ground water, although impacts of correcting releases to soil,
surface water, and air are discussed also. The economic impact of the
alternatives on firms is evaluated in Chapter 10. Chapter 11 evaluates the
effect of the proposed rule on small entities (i.e., small businesses), as
required by the Regulatory Flexibility Act. Chapter 12 assesses the effect of
the regulatory alternatives on Federally-owned or -operated hazardous waste
facilities
Part U consists of Chapter 13, the summary of the entire RIA.
In addition to this main report, four appendices were prepared for this
RIA. Appendix A provides a detailed description of the facility data base.
Appendix B discusses the hazardous waste concentrations that trigger
corrective action at facilities. Appendix C describes the methodology used in
estimating the economic impact of the rule. Finally, Appendix D lists the
costs and actions of CERCLA Records of Decision used to describe typical
corrective actions in Chapter A of the RIA.
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2. PROBLEM DEFINITION
Congress significantly expanded the scope of EPA's corrective action
program in the Hazardous and Solid Waste Amendments of 1984. Prior to the
enactment of HSWA, only certain land disposal units at permitted facilities
were subject to ground-water cleanup provisions. As explained in Chapter 1,
HSWA now requires EPA to ensure that corrective action is taken for releases
to all media, from all SWMUs, at all types of RCRA facilities, as necessary to
protect human health and the environment.
The proposed corrective action rule is designed to establish a
comprehensive regulatory framework for releases to all media from all SWMUs.
It will establish national consistency for implementing corrective actions,
including evaluating releases, initiating corrective action, and meeting
cleanup standards. Finally, the rule establishes standards for States seeking
authorization to conduct the Section 3004(u) corrective action program. This
chapter briefly describes the size and scope of the regulatory problem to be
addressed by the proposed rule.
2.1 THE PROBLEM
As of April 1987, EPA's Hazardous Waste Data Management System (HWDMS)
identified 5,661 RCRA Subtitle C facilities that are potentially subject to
the corrective action provisions of HSWA.1 Of the 5,661 facilities, 5,309
(94 percent) are classified as "non-Federal facilities," which include
privately-owned facilities, State and municipal facilities, and non-profit
facilities. The distinction between Federal and non-Federal facilities is
important because Federal facilities are typically larger and have more SWMUs
per facility than privately-owned facilities; moreover, the types of hazardous
waste managed at Federal facilities tend to be less common (e.g., radioactive
waste mixed with hazardous waste).
Based on the HWDMS classification scheme, the RCRA Subtitle C facility
population is composed of three types of facilities:
1. Land disposal facilities, which are defined as
hazardous waste management facilities with a landfill,
surface impoundment, waste pile, or land treatment
unit;
1 The number of facilities subject to corrective action may change as
facilities obtain permits or stop managing hazardous wastes. This estimate is
based on the facility population at the time the RIA commenced; the number of
facilities currently subject to corrective action provisions may be greater or
smaller.
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2-2
2. Incineration facilities, which are defined as those
facilities that have an incinerator but no land
disposal unit; and
3. Treatment and storage facilities, defined as all
hazardous waste management facilities that do not
belong to either of the above two categories.
Exhibit 2-1 shows the distribution of facilities by each type; the majority
are non-Federal storage and treatment facilities.
To create a facility data base for this RIA, EPA analyzed RCRA Facility
Assessments (RFAs) for a sample of 65 Subtitle C facilities, referred to as
the RFA survey. Based on the Agency's analysis of these data and other
available information, EPA found an average of 12 SWMUs per non-Federal
facility and an average of 55 SWMUs per Federal facility.2 Across all types
of facilities, the average number of SWMUs is 16. Exhibit 2-2 shows the
frequency distribution of the number of SWMUs per non-Federal facility.
Because only 6 of the 65 RFAs used to create the facility data base are from
Federal facilities, there is no similar exhibit for Federal facilities.
Analysis of the facility data base also indicates that about 3,000 units
were subject to corrective action before the enactment of HSWA and that an
additional 78,000 have become subject to corrective action regulations as a
result of HSWA.3 Exhibit 2-3 shows that, prior to the enactment of HSWA, the
typical facility had very few SWMUs subject to corrective action under RCRA.
Similarly, Exhibit 2-4 illustrates the proportions (relative to the total SWMU
population subject to regulation by HSWA) of different types of SWMUs at land
disposal and treatment and storage facilities. The majority of units (about
95 percent) have been subject to corrective action requirements only since the
enactment of HSWA. The approximately 5 percent that were subject to these
requirements before HSWA were land disposal units at land disposal facilities.
About one-third of the total SWMU population are tanks used for
treatment or storage of hazardous waste. Landfills and surface impoundments
together constitute approximately another third of all SWMUs while container
storage units make up 14 percent of the total. The remaining 24 percent are
divided among transfer stations, waste piles, incinerators, injection wells,
recycling units, and other units. Appendix A provides a complete description
of this analysis and the resulting data base.
All hazardous waste management facilities have the potential of
releasing hazardous wastes or constituents into the environment during their
operating lifetime. In many cases, moreover, units may release to several
media simultaneously. For example, hazardous constituents from surface
impoundments may leach into ground water, ultimately reach 'an outlet to
surface water or drinking water supplies, and release volatile constituents to
2 Chapter 12 of this report contains detailed information on corrective
action for Federal facilities.
3 Note that only a portion of these facilities, however, will require
facility investigations or corrective measures for releases.
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jftfilT 2-1
THEKK ABE ABOUT 5,700 FACILITIES AFFECTED BY CORRECTIVE ACTION PROVISIONS
3,727
1,600 -
1,400
1,200
1,000
aoo
600
400
200
0
1407
Land Disposal Inolnaratlon Traatmant and Storaga
Typa of Facility
I J I Non-Fadaral [555
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2-4
EXHIBIT 2-2
THE NUMBER OF SWIDS PER HON-FEDERAL FACILITY VARIES WIDELY,
FROM 1 TO OVER 30
Percentage
of 6
Facilities
Number of SWMTJs
Source: ICF Incorporated. September 1987.
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2-5
EXHIBIT 2-3
PRIOR TO HSWA, THE TYPICAL FACILITY HAD FEW SWMUs SUBJECT TO CORRECTIVE ACTION
Facilities
Land Disposal
Incineration
Treatment and Storage
All Facilities
Average No. of
Units Newly
Subject to
Corrective Action
13
16
14
15
Average No. of
Land Disposal Units
Previously
Subject to
Corrective Action a/
0
0
Average
No. of
Total
Units
15
16
14
16
aJ Only RCRA-permitted land disposal units were subject to corrective
action prior to the enactment of HSWA.
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EXHIBIT 2-4
Almost all waste management units now subject to
corrective action were not regulated by Subpart F before HSWA.
i
o\
Wast* management units subject to
corrective action only after HSWA
Waste management units subject to
corrective action prior to HSWA
^ Subtitle C units are defined as active hazardous
waste management units generally sublect to
RCRA Subtitle C design and operating standards.
^ Non-Subtitle C units Include closed units and
other units generally exempt from the RCRA
Subtitle C design and operating standards.
6,000 Subtitle C
treatment/storage units
at land disposal facilities -5/
3,000 Subtitle C
land disposal units at
land disposal facilities-^
26,000 non-Subtitle C SWMUs
at treatment/storage facilities ^
33,000 Subtitle C treatment/storage
units at treatment/storage facilities &
13,000 non-Subtitle C SWMUs
at land disposal facilities ^
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2-7
the atmosphere. Humans may be exposed to hazardous constituents through
several exposure pathways: by drinking contaminated ground or surface water,
breathing contaminated air or dust, ingesting contaminated soils, or coming
into direct contact with wastes.
Because the regulated community is so large (composed of about 5,700
facilities and over 80,000 SWMUs), the range of corrective actions required at
these facilities will be diverse. Several Federal facilities subject to the
corrective action requirements are large sites at which unusual wastes have
been placed in hundreds of SWMUs. Some RCRA corrective action facilities,
including some Federal facilities, will be similar in scope and complexity to
large Superfund sites and will require complex remedial actions. Currently,
about 150 RCRA facilities are on the Superfund National Priorities List.
In contrast, most RCRA facilities will have minor release problems
requiring relatively simple corrective actions. Contamination at some of
these sites will need to be addressed immediately in order to reduce risks to
human health and the environment while other sites will not require immediate
action. The corrective action program, therefore, has been designed to be
flexible enough to address a wide range of site conditions, procedural
situations, and cleanup needs.
In order to determine the overall need for corrective action, available
data and ground-water models were used to estimate the number of facilities
subject to each step of the corrective action process. B$sed on this
information, EPA estimates that about 3,500 (62 percent) of the 5,661
facilities potentially subject to the corrective action requirements under
HSWA will require a RCRA Facility Investigation (RFI). In addition, EPA
estimates that about 50 percent of all facilities conducting an RFI
(approximately 30 percent of the total regulated community) will require
corrective action for ground-water contamination.* Consequently, of the
approximately 3,500 facilities that must perform RFIs, about 1,750 are
estimated to require corrective action. This estimate only considers those
facilities that have triggered corrective action due to ground-water releases,
however, based on a ground-water simulation model. The actual number of
corrective actions required is likely to be higher when releases to other
media are accounted for. Exhibit 2-5 shows how many facilities are estimated
to require ground-water corrective action. EPA further estimates that, of the
approximately 1,750 facilities requiring corrective action, about 40 percent
may require immediate corrective action (i.e., beginning in 1987).5
4 See Chapters 6 and 7 for a complete description of how these estimates
are derived.
5 The bulk of this RIA was developed in 1987. The analysis, therefore,
used 1987 as the assumed first year of the HSWA corrective action program. While
the rule will not be proposed until after 1987, the analytic results are not so
sensitive that this discrepancy will significantly affect the overall results.
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2-8
EXHIBIT 2-5
ABOUT 31 PERCENT OF ALL FACILITIES WILL REQUIRE
GROUND-WATER CORRECTIVE ACTION
Total
Facilities
(N -
5.661)
Estimated Percentage for which
RFA will Recommend RFI
62%
Facilities
Performing RFIs
(N - 3,487)
Estimated Percentage for which
RFI will Require Corrective Action*
50*
Facilities Taking
Corrective Action
(N - 1,749)
* Estimated number of facilities requiring corrective action
based on ground-water cleanup only.
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2-9
2.2 NATIONAL EXTENT OF HAZARDOUS CONSTITUENT RELEASES TO THE ENVIRONMENT
This section presents an overview of the national extent of releases to
all media from hazardous waste management facilities. This overview is based
upon data gathered from the RCRA Facility Assessment (RFA) survey and the
National Priority List (NPL) data base of candidate sites for CERCLA cleanup.
No precise estimates are currently available concerning the number of
facilities that have released hazardous constituents to soil, ground water,
surface water, or air. The information gathered for this RIA from the RFA
survey and the NPL data base, however, provides a valid basis for generally
estimating the size of the national population of facilities that are
releasing or have released hazardous constituents to these media and would be
subject to corrective action requirements.
The RFA survey contains information characterizing 65 RCRA facilities
that have undergone a RCRA Facility Assessment and that were required to
prepare follow-up RCRA Facility Investigations. Assuming that facilities not
required to perform RFIs are not releasing significant quantities of hazardous
waste constituents to the environment, this data base provides the best
available information concerning the current status of hazardous waste
management and release events requiring corrective action at RCRA facilities.
This section also presents the NPL data describing release events from CERCLA
sites as corroborating evidence of the extent of the national problem. The
NPL data base contains information on 951 facilities (as of the date of this
analysis) that have been identified as priority sites for CERCLA cleanup.
The information contained in the RFA survey indicates that roughly 30
percent of all RCRA facilities (1,710 of 5,661) may have releases to ground
water requiring corrective action. In comparison, based upon reported NPL
information, 73 percent (695 of 951 sites) of the NPL sites reported releases
to ground water. This apparent discrepancy in percentages is expected,
however, since releases would necessarily have been discovered at a facility
to place the facility on the NPL, and a greater emphasis has been placed on
ground-water releases in the Superfund program.
The RFA survey indicates also that roughly 34 percent of all RCRA
facilities (1,920 of 5,661) are releasing or have released hazardous
constituents to soil. Although the NPL data base does not explicitly track
hazardous constituent releases to soils, the information on releases to ground
water provide a general indication of the extent of releases to soil, as well.
Hence, the NPL data base indicates that approximately 73 percent of NPL sites
have soil contamination.
Based on the RFA survey, approximately 17 percent of all RCRA facilities
are releasing hazardous constituents to surface water (980 of 5-,661
facilities). In comparison, according to the NPL data base, 42 percent (397
of 951 sites) of the NPL sites reported releases to surface water.
Finally, the information contained in the RFA survey indicates that
approximately 370 facilities are releasing hazardous constituents to air, or
roughly 7 percent of all RCRA facilities. In comparison, based upon reported
NPL scores, 14 percent (137 of 951 sites) of the NPL sites reported releases
to air.
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2-10
Overall, both the RFA and NPL data indicate that a potentially
significant proportion of the sites or facilities managing hazardous waste
have released or are releasing hazardous constituents to soil, ground water,
surface water and air, and that there is a significant need, therefore, for
corrective action to address releases to these media.
2.3 CONCLUSIONS
Congress clearly mandated that EPA require owners and operators of
hazardous waste management facilities to implement corrective action to
protect human health and the environment. In developing these corrective
action requirements, EPA recognized that the universe of facilities is both
large and diverse. As a result, the corrective action rule is designed to
provide considerable flexibility to address releases to all media from a wide
variety of releasing units.
Approximately 1,750 facilities will require ground-water corrective
action to protect human health and the environment. The remedies selected and
the timing of corrective action are described in Chapter 6 of this RIA.
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3. REGULATORY STRATEGIES
This chapter discusses the general regulatory approaches, or strategies,
that EPA considered in developing the proposed corrective action rule. As
noted in Chapter 2, the Congressional mandate of RCRA Section 3004(u) limits
EPA's discretion in developing its corrective action program. Under this
section of RCRA, EPA is required to address corrective action for releases
from solid waste management units (SWMUs) at facilities seeking a RCRA permit.
Although Executive Order 12291 urges Federal agencies to consider both
regulatory and non-regulatory alternatives when developing new regulations,
non-regulatory approaches (e.g., tax incentives) were not considered in
developing the corrective action regulations. The general regulatory options
that were considered in developing the corrective action rulemaking are
described below.
3.1 REGULATORY STRATEGIES
This section describes the three broad regulatory strategies EPA
considered in developing the proposed corrective action rule. Each strategy
represents a distinctly different approach to implementing cleanups at RCRA
facilities. These strategies focus on several key issues relevant to
addressing contamination at a RCRA facility, including the levels to which the
affected media will be cleaned up, the timing of cleanup requirements, and the
flexibility to address site-specific situations. The three strategies are:
Strategy 1. Cleanup to background levels as soon as
practicable for all facilities;
Strategy 2. Cleanup to health-based levels, with flexibility
in timing; and
Strategy 3. Cleanup to health-based standards only where
actual or imminent exposure exists.
These strategies represent a range of different approaches that EPA
considered in developing its corrective action program. The first strategy
represents a very stringent approach to corrective action that entails
complete restoration of all contaminated media to their condition prior to the
release while, under the third strategy, only contamination that constitutes
an actual threat to an exposed human population or environmental receptors
would be addressed. The second strategy represents a "middle ground" in terms
of stringency. It requires corrective action whenever contamination exceeds
health-based levels, allowing flexibility in implementing cleanups according
to site-specific conditions.
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3-2
EPA's analysis of these three strategies is described briefly below. In
analyzing the three strategies, a number of comparative features were
assessed, including:
e Protection of human health and the environment;
¦ Cleanup to either background or health-based levels;
¦ Timing of initiation of corrective action;
¦ Location of the points of compliance;
¦ Cost to the regulated community;
¦ Source control to prevent future releases;
¦ Consistency with CERCLA cleanup objectives; and
¦ Technical practicability.
3.1.1 Strategy 1: Cleanup To Background Levels As Soon As Practicable for All
Facilities
The objective of Strategy 1 would be to restore all contaminated media
to background levels as soon as possible. The point of compliance for
determining the extent of cleanup for each medium would generally be measured
at the unit boundary. Under this strategy, very extensive source control
measures would typically be required in order to ensure a high degree of
reliability over the long term for ensuring against any future releases in any
concentration. Such source controls would presumably often involve
substantial excavation of units and contaminated soils for treatment (e.g.,
incineration). Such actions would be required of owner/operators as
expeditiously as possible; little flexibility in timing would be allowed.
This strategy would rely on a simple, consistent standard (i.e., cleanup to
background concentrations for all constituents) to achieve the maximum amount
of cleanup possible and provide the greatest degree of protection to human
health and the environment.
Cleanup Levels: Under this strategy, cleanup levels would be
established at the "background" concentration levels for all media. Few, if
any, site-specific adjustments to this standard would be allowed. It should
also be noted that in some situations, background concentrations may actually
exceed health-based levels, and thus, requiring cleanup to such levels may not
achieve the goal of yielding "drinkable" ground water.
Timing: Cleanups would take place as soon as possible under Strategy 1.
Owners and operators would be required to achieve cleanup targets, as well as
implement all other remedy requirements (e.g., source controls) as
expeditiously as possible. The exact timing requirements for a facility would
still be established on a case-by-case basis, based primarily on technological
capabilities; actual or potential exposure to contamination, and the ability
of owners and operators to control such exposure, would play little role in
establishing timing requirements for implementing remedies and achieving
cleanup targets.
Points of Compliance: This strategy would require that compliance with
cleanup standards be achieved at the unit boundary for all media. This also
represents the most conservative approach environmentally by minimizing the
locations where exposures to releases could occur. This approach would impose
a particularly stringent standard for releases to the air medium (see the
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3-3
discussion in the preamble to the proposed rule on points of compliance for
air releases).
Cost: By imposing very stringent cleanup requirements, Strategy 1 would
impose much higher costs on the regulated community than the other two
regulatory strategies. This would cause more severe economic impacts (i.e.,
bankruptcy of owners and operators) , which in turn would impose substantially
greater burdens on the Superfund program to cleanup of those facilities.
Source Control: Very substantial source control measures would be
required under this strategy in order to ensure against future releases that
would exceed the background cleanup standard. It can be assumed that these
source control measures would more often rely on the use of treatment
technologies such as incineration to comply with source control requirements
than would Strategies 2 and 3, and substantially greater volumes of material
would be subject to such treatment. In addition, for any wastes deposited or
left in place, highly effective containment structures would be applied to
protect against migration of contaminants in the future.
Consistency With CERCLA: Strategy 1 would be the least consistent with
the CERCLA. remedial action program among the three strategies by imposing a
background cleanup standard, and allowing only minimally site-specific
adjustment factors to influence cleanup decisions. This could create a
significant "disconnect" between the two programs.
Technical Feasibility: Cleanup to background levels would be
technically infeasible, in many cases, due to site-specific circumstances. In
addition, as the precision of analytic detection methods increases, background
levels may be measured at increasingly lower levels (e.g., parts per
trillion). The effective cleanup standards thus would become more stringent
over time. Cleanup standards under Strategy 1 would be technically much more
difficult to attain, therefore, in comparison to the health-based standards
that would be required under Strategies 2 and 3.
Protection: Theoretically, this strategy would provide the highest
possible degree of protection of human health and the environment by adopting
what would in essence be a "zero risk" standard for cleanup. Realistically,
however, achieving such a standard would often be impossible due to technical
and other limitations.
3.1.2 Strategy 2: Cleanup To Health-Based Levels, With Flexibility in Timing
The general objective of this strategy is to allow considerable
flexibility in tailoring remedial requirements to site-specific conditions,
with cleanup standards tied to health-based concentrations in all media. This
approach would be expected to yield a high degree of protection of human
health and the environment, while minimizing unnecessary economic impacts.
The strategy would allow considerable flexibility in timing, with
cleanups deferred in some cases where owners and operators can assure that
exposure to contamination, as well as further significant environmental
degradation, will not occur. Cleanup of contamination would generally be
required to the unit boundary, with some limited exceptions such as for
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releases to air, where the point of compliance could be established to reflect
more realistic exposure conditions. In setting cleanup standards themselves,
site specific factors would be considered in setting the levels, and some
adjustments would be made in situations where cleanup to health-based levels
would not be a sensible remedial requirement (e.g., for reasons of technical
impracticability). In achieving remedial goals under this strategy, extensive
source control requirements would often be required.
Cleanup Levels: Cleanup levels would be health-based standards that
could be adjusted on a site-specific basis. These levels would represent the
scientific consensus about cleanup standards that are protective of human
health and the environment based on very conservative exposure assumptions.
Timing: Flexibility in timing is a key characteristic of Strategy 2.
Cleanups could be conducted immediately, phased in over time, or deferred
depending on site-specific characteristics. For example, cleanups could be
phased in by first implementing source controls and then treating and
disposing the contaminated materials as capacity becomes available.
Flexibility in timing would generally be available only where no significant
risk would be created by deferring cleanups; in general, cleanup of off-site
contamination would not be deferred. Thus, Strategy 2 would be more flexible
than Strategy 1, which requires cleanups as soon as possible.
Points of Compliance: Compliance with cleanup standards generally would
be measured at the unit boundary under Strategy 2. Exceptions to this could
be made in some cases, such as for air releases from operating units, where
compliance with health-based levels might be required at locations that would
reflect more realistic exposure conditions at or beyond the facility.
Cost: Although the costs associated with implementing Strategy 2 would
be substantial, it would be considerably less costly than Strategy 1. This is
primarily because health-based standards are generally higher than background
levels, and therefore are less costly to attain with current technologies. In
addition, the flexibility in timing allows owners and operators to spread more
costs over time, and would accordingly be expected to cause considerably fewer
bankruptcies than Strategy 1, and correspondingly lesser demands on Superfund
resources.
iniiren Control: Extensive source controls would often be required under
Strategy 2. However, the volumes of materials that would need to be subjected
to incinerator or other extensive treatment processes could be presumed to be
relatively less than for Strategy 1, since the standard for controlling future
releases (health-based vs. background) is somewhat less stringent.
Consistency With CERCLA: Strategy 2 would be more cctasistent with EPA's
current approach under the CERCLA remedial action program than either
Strategies 1 or 3. The goals of the two programs would be consistent,
emphasizing source control and long-term remedies. Moreover, both programs
provide flexibility to meet site-specific cleanup situations. Such
consistency is desirable because both RCRA and CERCLA may potentially apply to
particular sites and because EPA intends that environmental problems should be
addressed similarly under the two programs.
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Technical Feasibility: Strategy 2 would provide flexibility to both the
Agency and facility owners and operators in selecting the most appropriate
remedy. Waivers (e.g., for technical infeasibility) would accommodate site-
specific problems while protecting human health and the environment. For
example, where complete cleanup is not technically feasible, other methods to
reduce exposure to contaminants could be required, such as institutional
controls (e.g., restricting access to the site).
Protection: Strategy 2 would ensure a high level of protection of human
health and the environment. Achieving health-based standards would minimize
human health risks from carcinogens and non-carcinogens. In addition,
Strategy 2 would be more protective of the environment than Strategy 3,
because it would reduce the risks of future exposure to releases and prevent
degradation of environmental resources (e.g., ground water of drinkable
quality) regardless of whether human exposures actually occur.
3.1.3 Strategy 3: Cleanup To Health-Based Standards Only Where Actual or
Imminent Exposure Exists
While the goal of this strategy is similar to Strategy 2, Strategy 3
would not require cleanup unless there were actual human exposure to releases
above health-based levels, or actual threats to environmental receptors. If
there were no exposed populations or threats to the environment, no cleanup
would be required. For example, ground-water contamination would generally
not be remedied unless people were drinking the water. Source controls,
however, would be required to prevent continuing releases from degrading
environmental resources. This approach would use risk factors, such as the
location of exposed populations, current and future use patterns, and
environmental fate and migration of contaminants, to estimate human exposure
to releases. Cleanups would have to meet health-based standards at the point
of human exposure to contaminants. Strategy 3 would control future exposures
largely by relying on institutional controls.
Under Strategy 3, for example, an owner of a leaking hazardous waste
treatment tank would have to conduct a risk assessment of the site to
determine the extent of human exposure to the release. If the release
exceeded health-based standards in nearby ground-water drinking wells (i.e.,
the point of compliance), the owner would have to implement corrective action
expeditiously to reduce the contamination below the health-based standards.
For instance, the tank owner could replace the leaking tank, begin a ground-
water remedy, and provide nearby residents with bottled water until
contamination in the ground water falls below the health-based levels.
Cleanup Levels: Cleanups under Strategy 3 would be to health-based
standards (i.e., similar to Strategy 2) where exposure exists above these
levels. These levels are equal to or higher than the background cleanup
standards required under Strategy 1. Adjustments (e.g., technical
impracticability) would be allowed on a case-by-case basis, as under
Strategy 2.
Timing: Cleanups would be required as soon as possible after
determining that human (or environmental) exposure to contaminants above
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health-based standards exists. Where no human exposure or significant threats
to the environment exist, cleanup would not be required.
Points of Compliance: Compliance with cleanup standards would be
measured at the points of human exposure (i.e., where people are exposed to
contamination above health-based levels). Depending on the proximity of the
exposed population, contamination could extend a considerable distance beyond
the facility boundary before compliance with health-based standards would be
required. This approach could be difficult to implement, since estimates of
human exposure to releases often must rely on technically complex fate and
transport modeling procedures and are open to substantial debate, potentially
delaying cleanup actions.
Cost; Strategy 3 would entail the least cost among the three regulatory
strategies. Nonetheless, Strategy 3 could result in more costly cleanups in
cases where contamination is spreading quickly, thus producing a more
extensive cleanup at the time when remedial measures finally begin.
Source Control: Under Strategy 3, source control would be required only
if necessary to achieve the cleanup standards at the point of exposure or to
prevent continuing releases from degrading environmental resources (e.g.,
ground water). Thus, in this respect, Strategy 3 would be less stringent than
either Strategies 1 or 2.
Consistency With CERCLA: The concept of triggering cleanup of
contamination only where actual exposure problems exist is not compatible with
current CERCLA remedial requirements. This strategy would create a
significant disparity in the degree of cleanup -- and ultimately, protection
-- between the RCRA and CERCLA programs.
Technical Feasibilicv: Strategy 3 would be expected to be the strategy
that would least often encounter problems of technical feasibility, if only
because considerably fewer remedies would be required, and less rigorous
cleanup standards would be applied. Thus, this strategy could be considered
the most "doable" of the three.
Protection: Strategy 3 would protect human health by requiring cleanup
to health-based standards where exposure above such levels exists. It would
be considerably less protective of human health and the environment, however,
than the other strategies. Since contamination would be allowed to remain,
prevention of future exposure to the contamination would often not be
guaranteed. In addition, this strategy would allow considerable resource
damage (e.g., polluted aquifers) to remain uncorrected and thereby unusable
for future generations.
3.2 CONCLUSIONS
Based on an evaluation of these three broad regulatory strategies, EPA
adopted the framework of Strategy 2 for its proposed corrective action
program. This strategy was used as the context for developing the proposed
rule, for several reasons. Of paramount concern was the need to develop a
regulatory approach which satisfied the RCRA statutory mandate of protection
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of human health and the environment. EPA believes that Strategy 2 is highly
protective, and offers a level of protection roughly equivalent to Strategy 1.
Strategy 3, by allowing substantial resource damage to remain unaddressed, and
by relying heavily on the use of institutional controls and projections of
future exposure patterns, was rejected as being not sufficiently protective.
The corrective action process is designed to allow decision makers to
design remedies to fit the particular circumstances at the facility. EPA is
persuaded that Strategy 2 offers an optimum degree of flexibility in tailoring
sensible cleanup requirements to site-specific conditions (see above
discussions on points of compliance, timing, cleanup levels, and technical
feasibility). Strategy 1, in contrast, would establish cleanup requirements
in a manner much less sensitive to facility-specific conditions.
In terms of cost, Strategy 1 would be expected to have much greater
costs and associated economic impacts than either Strategies 2 or 3. This
presumption was confirmed in the quantitative analysis performed for this RIA
(see following chapters). EPA believes that imposing costs of this magnitude
on the regulated community to obtain what would likely be at best a marginal
effect on the environmental and human health benefits produced by the
corrective action program, would be unnecessary and unwise public policy.
Further, by causing relatively fewer economic impacts, Strategy 2 is expected
to create correspondingly fewer additional burdens on the Superfund program,
since more owners and operators will be able to bear the costs of cleanup.
Finally, Strategy 2 represents a regulatory approach that is designed to
be compatible with the CERCLA program, in terms of yielding similar remedies
for similar environmental problems. This consistency between cleanup programs
is another important objective of the Agency in developing the RCRA corrective
action program.
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4. CORRECTIVE ACTION FOR EACH ENVIRONMENTAL MEDIUM
4.1 OVERVIEW
This chapter addresses corrective action for hazardous waste releases to
all environmental media: ground water, soil, surface water, and air. In
Chapter 3, three regulatory strategies were described which outline alternate
approaches available to the Agency under HSWA to develop the proposed
corrective action rule. This chapter builds upon that discussion by
analyzing how the alternative regulatory strategies would affect corrective
action for releases to each of the environmental media. Each medium is
discussed separately in Sections 4.2 through 4.5. These media-specific
discussions include a description of release mechanisms, transport pathways,
exposure scenarios, and corrective measures under the alternative regulatory
strategies. Finally, the approach adopted in the proposed rule for each of
the media is compared to the regulatory strategies.
In the media-specific sections, the general regulatory strategies are
applied to an example facility requiring corrective action to illustrate how
the broad strategies would influence the conduct of a cleanup in a specific
situation. Because the regulatory strategies describe only general approaches
to corrective action, however, the example cleanups encompass certain
assumptions concerning the course of a corrective action. The clean-up
approaches described, therefore, do not represent all possible approaches
under the respective regulatory strategies, but are intended to depict the
general differences among the strategies.
Exhibit 4-1 illustrates many of the factors governing corrective action
discussed in this chapter and some of the exposure pathways that will be
addressed by the proposed rule. As illustrated in the exhibit, the extent of
the threat to human health and the environment from hazardous waste or
constituent releases is a function of several factors. In general, these
factors include: (1) the source and release mechanisms (e.g., volatilization
of hazardous organics); (2) the environmental transport medium (e.g., air);
(3) the distance to potentially exposed populations (e.g., the presence of a
nearby residential neighborhood) ; and (4) the route and duration of human
exposure and the toxicity and concentration of the contaminant at the time of
exposure (e.g., inhalation of carcinogenic volatile organics). These topics
are discussed further in the sections addressing the environmental media.
4.2 CORRECTIVE ACTION FOR RELEASES TO GROUND WATER
This section discusses the potential sources, transport mechanisms, and
resulting risks from releases to ground water. The section also describes
typical corrective action activities that could be employed to address
releases to ground water under the alternative regulatory strategies described
in Chapter 3 and then discusses the approach encompassed in the proposed rule.
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EXHIBIT 4-1
RELEASES CAM LEAD TO EXPOSURES THROUGH ALL ENVIRONMENTAL MEDIA
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(Air)
Eapoaura
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Tranaporl Madlum
(Surfact Waitr)
Transport Machanlam
(Volumaiion)
Transport
Machanlam
(Surfact Runoff)
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Transport Madlum (Soil
Transporting
(Ltaching)
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Transport Madlum
(Ground Waitr)
LEGEND
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8urlaca Walar Expo aura Pathway
8oH Exposura Pathway
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4-3
4.2.1 Releases to Ground Vater: Sources, Transport, and Potential Threats
Hazardous constituent releases from solid waste management units (SWMUs)
may contaminate ground water through several pathways. For example, water may
infiltrate into a SWMU and produce leachate containing hazardous constituents
which may then move into ground water. In addition, direct releases to ground
water can occur when the water table comes into contact with the hazardous
materials in the SWMU. This may happen if the materials are actually buried
below the water table or, under certain circumstances, when the water table is
drawn up into the SWMU itself, thus bringing the water into direct contact
with hazardous materials. In any of these situations, soluble hazardous
constituents may enter the ground water directly.
Indirect releases occur when contaminants are released to another medium
and migrate into ground water. Indirect releases generally involve releases
to soil, from which constituents leach into ground water, or as releases to
surface waters that are connected hydrologically to ground water. The extent
of leaching or migration after a release from soil or surface water to ground
water will depend both on site characteristics (e.g., porosity of the soil,
depth to the water table, ground-water flow patterns, etc.) and on the
characteristics of the released constituents (e.g., viscosity, ability of the
constituents to degrade or persist, etc.).
The types of SWMUs that may release hazardous constituents directly or
indirectly to ground water include the following: underground injection
wells, surface impoundments, landfills, land treatment units, container
storage areas, tank systems, and waste piles.
Just as contaminants may migrate from soil or surface water into ground
water, contaminants released to ground water may migrate to other media as
well. For example, volatile constituents in ground water may release
hazardous gases into the unsaturated soil zone above the water table.
Likewise, contaminants in one aquifer may flow into other, interconnected
aquifers or into hydrologically connected surface waters. Again, the extent
of migration will depend primarily on both site and hazardous constituent
characteristics. In many cases, the extent of migration also may be affected
by human activities, such as the placement of irrigation or drinking water
wells that affect ground-water flow patterns.
Human exposure to contaminated ground water primarily occurs through the
withdrawal of water from wells for domestic use or irrigation. Hence,
ingestion and dermal contact through bathing or during irrigation activities
are the primary routes of exposure. Exposures also occur when contaminants
migrate to surface waters that are ingested or used for bathing. Moreover,
contaminants may enter surface water ecosystems or agricultural systems,
through the use of contaminated ground water for irrigation, and bioaccumulate
in organisms that are eventually consumed by humans (e.g., shellfish or grain
crops).
Depending on the constituents present in the ground or surface water and
their concentrations, such exposures may result in human health effects
ranging from acute illness or dermal irritation to chronic disease. In
addition to these environmental and human health threats, releases to ground
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4-4
water pose other environmental threats such as the contamination of wetland
ecosystems.
4.2.2 Typical Activities to Correct Releases to Ground Vater
Corrective action to address releases to ground water will involve
activities to control the source of the release and activities to remediate
existing contamination. Because ground water can flow at relatively slow
rates, typically ranging from tens of feet to as little as inches per year,
constituent concentrations at any given location may remain high for long
periods of time if left unaddressed. In contrast, because ground water also
can flow at very high rates (e.g., hundreds to thousands of feet per), a
release can travel quickly and affect large areas. Remediation may be
critical in both of these situations.
The Agency anticipates that corrective action activities taken to
address hazardous waste releases to ground water will be similar to the
activities employed for Superfund cleanups. A summary of Superfund activities
to remediate ground water contamination, described by CERCLA Records of
Decision (RODs), is presented in Appendix D. As this exhibit illustrates,
activities designed for source control may include:
¦ Excavation and treatment or off-site disposal of SWMU
materials or contaminated soil from which leachate is
entering ground water;
¦ Removal and off-site disposal of lagoon sediments and
liquids;
¦ Installation of slurry walls and other systems to
intercept migrating constituents;
¦ Leachate treatment and off-site disposal;
¦ Installation of impervious caps to prevent
infiltration of water that can cause leaching; and
¦ Surface water diversion, treatment, and monitoring.
Ground-water remediation and assessment activities may involve:
• Pumping contaminated ground water;
¦ Treating the ground water and either reinjecting it
into the aquifer or diverting it into a nearby surface
water;
¦ Replacing contaminated drinking water supplies with
alternative sources; and
¦ Ground-water monitoring.
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Note that because releases to ground water often involve, or occur in
conjunction with, releases to other media, activities taken at a site often
address more than one medium. For example, excavation of contaminated soil
may constitute both the remediation of a release to soil and the control of a
ground-water contamination source. The information presented in Appendix E,
therefore, represents the kinds of corrective action activities taken at sites
with releases to ground water rather than activities taken strictly to address
ground-water releases alone.
4.2.3 Analysis of Alternative Regulatory Strategies to Address Ground-Water
Contamination
The alternative strategies presented in Chapter 3 vary in their
requirements, especially with regard to the extent of cleanup. The following
discussion compares corrective action for ground-water contamination at an
example facility under these alternative regulatory strategies.
Example Facility
The example facility contains a RCRA waste pile unit and is located in a
remote area. Currently, portions of the facility property are being mined for
sand, gravel, and peat deposits. From 1967 to 1978 paint sludge was dumped in
a landfill that was created originally as a gravel pit. The SUMU is
approximately one-half acre in area and as deep as 30 feet in several places.
There are two hardened layers of paint sludge and a layer of five-gallon paint
buckets. Finally, layers of paint mixed with sand are present at various
depths. Altogether, the volume of waste material from which leachate is being
released to the ground water is roughly 15,000 cubic yards.
Because this site is remote, the ground water currently is not used as a
drinking water source or for other purposes. However, the ground water is a
potential drinking water source. Organic contaminants that have been detected
in on-site and downgradient monitoring wells indicate the migration of
contaminants from the landfill into the ground water. The types of
contaminants monitored include: volatile organic compounds (VOCs), organics,
inorganics, base-neutral compounds, TCE, toluene, xylene, and metals. Those
contaminants found in concentrations greater than health-based standards
include: benzene, chloroform, methylene chloride, chlordane, and heptachlor.
No significant surface water or air contamination was detected at the
facility.
Corrective Measures Under the Regulatory Strategies
The following discussion describes the corrective measures that might be
followed at the example facility and the resulting benefits under the
alternative regulatory strategies.
Strategy 1: Cleanup to Background Levels As Soon As Practicable For All
Facilities
This strategy would require the immediate cleanup of the ground water to
bring contaminant concentration levels down to background levels at the edge
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of che landfill unit. Site-specific adjustments in the cleanup standards or
the timing of remediation would not be allowed under this strategy.
Potential Corrective Measures: The corrective measures required by this
strategy would include excavation of the entire 15,000 cubic yards of
contaminated waste and soil followed by treatment on-site. Also, the strategy
would require the sinking of monitoring and recovery wells along the unit
boundary to monitor the contamination plume and the installation of a
treatment system to remove, treat, and reinject (or divert to a surface water)
the treated water until contaminant levels at the edge of the landfill were
essentially zero (i.e., background levels given no other sources of
contamination).
Benefits Analysis: This regulatory strategy would impose a corrective
action program that is highly protective of human health and the environment.
Source control would be employed immediately to prevent future releases to
ground water. Furthermore, the requirement to clean up existing ground-water
contamination to background levels represents the most stringent standard
possible.
These extensive cleanup requirements, however, may entail considerable
costs and may be very difficult to complete. The imposition of these costs
may not be justifiable when one considers that the contaminated ground water
does not currently pose a threat to human populations. Moreover, only a
subset of the contaminants detected in the ground water exceed health-based
standards. Because these standards are designed to be protective of human
health and the environment, cleaning up to background may not significantly
improve environmental protection despite imposing prohibitive costs.
Furthermore, even if the costs were incurred, cleaning ground water to
background constituent levels is technically difficult and for certain
constituents may be impracticable.
Strategy 2: Cleanup to Health-Based Levels, Vith Flexibility in Timing
This strategy is designed to be fully protective of human health and the
environment by requiring cleanup to health-based standards (e.g., maximum
contaminant levels, reference doses, or risk specific doses) rather than
background levels, depending on site-specific exposure pathways. Under this
strategy,, the Agency also could allow the use of interim remedies and
institutional controls rather than strictly requiring immediate remediation.
The remedy would have to be completed, however, prior to the completion of
facility closure.
Although the ground water underlying the example facility is not
currently used as a drinking water source, it is a potential source. The
corrective action program required under this strategy, therefore, would
include, first, the cleanup of the contaminated material and soils in order to
prevent future releases. Second, this strategy would require ground-water
treatment to bring the contaminants at concentrations above health-based
standards down to those standards at the edge of the unit boundary.
Potential corrective measures: The corrective measures would include
capping and closing the unit, thereby isolating the entire 15,000 cubic yards
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of contaminated waste and soil and the removal of any remaining material
outside the unit for treatment or off-site disposal. In this case, a cover
would control continuing releases adequately. If a cover could not control
the release, then more extensive source control might be required (e.g.,
excavation). Also, the strategy would require the sinking of monitoring and
recovery wells along the contamination plume and the installation of a
treatment system to remove and treat the water until the contaminant levels
for benzene, chloroform, methylene chloride, chlordane, and heptachlor (i.e.,
those contaminants in concentrations greater than health-based standards) were
below their respective standards.
Benefits analysis: This strategy would be fully protective of human
health and the environment by treating the ground water to health-based
standards. Isolation of the contaminated wastes and soils also would prevent
future releases to the ground water. Relative to the first strategy, this
second strategy would be less costly and more technically practicable for two
reasons. First, for virtually all contaminants, treating ground water to
reach background concentrations would be very difficult and, therefore, far
more expensive than the lower level of treatment required to reach health-
based standards. Second, requiring that health-based standards be achieved at
the edge of the unit imposes less rigorous remediation than requiring
compliance at all points in the contaminant plume. Hence, this second
strategy is fully protective of human health, but is more practicable and
therefore less costly than the first approach.
Strategy 3: Cleanup to Health-Based Standards Only Where Actual or
Imminent Exposure Exists
The requirements of this strategy are similar to Strategy 2 in that
cleanup of the ground water must be to health-based standards. Moreover,
interim remedies and institutional controls also would be allowed under this
strategy by the Agency during the active life of the unit until permanent
remedies could be completed prior to closure. Unlike the health-based
approach, however, compliance with these cleanup standards need only be met at
the point of actual exposure. If the Agency determined that site-specific
conditions make exposure to contamination unlikely, then corrective measures
beyond source control may not be required. Ground-water remediation would not
be required as long as there were no potentially exposed populations in the
area. However, the hazardous materials would be consolidated and capped in
order to prevent further contamination from occurring.
Potential corrective measures: Because the ground water underlying the
example facility is not currently used as a drinking water source or for other
purposes during which exposure to contaminants could occur, the corrective
action program for this facility would not include remediation of the ground
water. However, some measure of source control would be required to prevent
the continuing release from further degrading the ground-water resource. This
approach represents a conditional remedy, contingent upon the exposure
pathways that may develop in the future (e.g., placement of a drinking water
well in the aquifer that would trigger ground-water cleanup).
Benefits analysis: As with the health-based strategy, this strategy is
designed to be fully protective of human health and the environment. However,
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implementation of corrective action is contingent upon the presence of a
potentially exposed population. The aquifer underlying the example facility
is not a current drinking water source, but is a potential source. Hence, of
the three strategies, this strategy is the least expensive in the short term
because neither extensive source control nor ground-water remediation is
undertaken. However, the presence of a potentially exposed population in the
future may trigger more extensive and expensive ground-water treatment than
would be necessary if taken in the short term. Therefore, implementation of
this strategy may yield short-term savings at the expense of potentially
significant long-term resource damage and ground-water cleanup costs.
Comparison and Analysis of Strategies for Ground-ffater Corrective Action
In sum, Strategy 1 offers the greatest protection of human health and
the environment in terms of reducing contaminant concentrations throughout the
aquifer. Requiring such stringent remediation may impose unnecessary burdens,
however, especially since remediation to background levels may be
impracticable, and because it is unlikely that drinking water wells will be
placed within the facility boundary. Strategy 3, on the other hand, may
overlook potential future exposure pathways and, thereby, result in delayed
remediation that could be considerably more extensive than efforts required at
present. Strategy 3 also does not account for the.loss of the ground-water
resource, regardless of whether actual exposures occur. Because Strategy 2
would require source control and the remediation of the contaminated ground
water to health-based standards beyond the point where exposure would likely
occur (i.e., the unit boundary), this strategy would be fully protective of
human health and the environment. Furthermore, it would not impose overly
stringent and potentially impracticable remediation requirements where
exposure to the ground water is not likely to occur.
4.2.4 Corrective Action for Releases to Ground Water Under the Proposed Rule
This section describes the approach to corrective action for ground-
water contamination contained in the proposed rule.
The proposed rule establishes 40 CFR Fart 264, Subpart S requirements
for the cleanup of releases to ground water. The current requirements for
addressing releases to ground water are found in 40 CFR Part 264, Subpart F,
which require corrective action for releases from regulated land disposal
units only.1 In general, the proposed rule modifies the existing Subpart F
approach for correcting releases to ground water by addressing releases from
all SUMUs and by shifting the emphasis of corrective action from ground-water
pumping and treatment to more comprehensive cleanups, including source
control.
Under the proposed rule, ground-water cleanup will be required to reach
MCLs, where available, or to health-based standards (e.g., Reference Doses or
RfDs). The point of compliance for cleanup under the proposed rule includes
the entire contaminant plume. This may include areas that extend beyond the
1 The current Subpart F requirements also will be amended by a companion
Notice of Proposed Rulemaking to the Subpart S proposal.
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facility boundary in those cases where the plume has migrated off site and the
owner or operator is able to gain access to the off-site property.
The rule proposes that the final remedy control the source of releases
so as to reduce or eliminate ground-water releases that may cause a threat to
human health and the environment. The timing of the source control may be
deferred, however, depending on the characteristics of the particular site.
The purpose of this source control requirement is to ensure that future
releases to ground water are prevented.
The proposed rule generally adopts an approach similar to Regulatory
Strategy 2. This approach calls for remediation of ground water to health-
based levels at the unit boundary regardless of current exposure patterns and
source control to prevent further degradation of the ground-water resource.
A.3 CORRECTIVE ACTION FOR RELEASES TO SOIL
Cleanups of hazardous constituent releases to soil are needed both to
prevent current exposure to the contamination and to allow for future use of
the contaminated property. Human exposure to soil contamination may occur
either through direct dermal contact with the contaminants or ingestion of the
hazardous constituents in the soil. Furthermore, indirect exposures may occur
following transport of the contaminants from the soil to other environmental
media. The characteristics of the releases and exposure threats addressed by
corrective action, the remedies available under the proposed rule, and
alternative regulatory strategies to address soil contamination are discussed
below.
A.3.1 Releases to Soil: Sources, Transport, and Potential Threats
The typical types of solid waste management units (SWMUs) that may
release hazardous constituents to soil include the following: surface
impoundments, landfills, waste piles, land treatment units, container storage
areas, tank systems, incinerators, and underground injection wells. The
proposed corrective action rule also addresses routine or systematic releases
of hazardous constituents to soil from units not meeting the definition of
SWMU.
Such past and current releases may result from mishandling of wastes or
the disposal of wastes into unlined or open areas, thereby allowing hazardous
constituents to infiltrate directly into the soil. Moreover, water-soluble
hazardous constituents may be leached from waste piles, unlined landfills, or
contaminated surface soils, leading to further soil contamination and
potential contamination of other environmental media (i.e., air, ground water,
and surface water).
Exposure to the hazardous constituents in contaminated soils may occur
under two general scenarios: (1) direct contact with the soil, or (2)
indirect contact with hazardous constituents transported from the soil to
other environmental media. Direct or proximate exposures are more likely to
involve on-site workers or visitors and may involve dermal contact or
ingestion. Soil ingestion is often associated with specific behavior patterns
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of children. However, for active, controlled sites with little off-site soil
contamination, children may not have ready access to contaminated soils.
Therefore, soil ingestion may not be a serious problem.
Typical off-site, direct exposure routes also include ingestion,
inhalation, and dermal contact. Contaminated soils may be tracked or
windblown off-site and accumulate where direct human exposure may occur. Such
exposures could involve inhalation of contaminated dust particulates blown
into the air or dermal contact with accumulated contaminants. Exposure could
also occur through ingestion, if soil contaminants migrate off site.
The transport of contaminants from soil to other environmental media
depends upon certain site-specific conditions such as soil characteristics,
topography, adsorptivity of the hazardous constituents to soil particles, and
hydrologic conditions (e.g., rainfall, water table level, etc.). Surface soil
contaminants also may be spread through wind-induced dispersion, or through
human activities such as vehicle-induced saltation of soil particles and
movement of contaminated equipment.
Indirect exposure to contaminated soils may occur through a number of
routes. For example, contaminated soils may be carried into surface waters as
sediments and expose bottom dwelling plant and animal life. Contaminated
sediments can remain toxic for long periods of time, occasionally
recirculating in the water as a result of turbulence caused by storms,
dredging, or recreational activities. Moreover, surface water or wetlands may
be drained for development, thus exposing the contaminated sediments and
increasing the likelihood of human exposure. Contaminated soils also may be
transported to and accumulate in agricultural areas via wind dispersion or
surface run-off. Such contaminated soils may then become concentrated in
crops and livestock through bioaccumulation. Finally, soil contaminants also
may leach into ground water and contaminate drinking water supplies
In sum, releases to soil pose a potential exposure threat through a
variety of pathways. For example, a release of hazardous constituents to soil
may leach into ground water, be transported by runoff into surface water, or
volatilize into the air. Therefore, although it is important to note the
risks from direct human or environmental exposure to a soil release, the
movement of that release to other media also may pose an exposure threat both
at the time of the release and in the future.
4.3.2 Typical Activities to Correct Releases to Soil
The design of an appropriate corrective action to address a release to
soil will depend primarily on the potential routes of hazardous constituent
exposure to human populations, the current and future uses of the site itself,
and the current and potential uses of areas surrounding the site.
Because releases to soil may present a threat to human health and the
environment through the potential to migrate to other media, site-specific
characteristics (e.g., location, topography, and hydrologic conditions) and
the current and future uses of a site are critical considerations in
determining the appropriate corrective measure for a release to soil. For
example, sites with highly toxic constituents, highly vulnerable ground water
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or surface water nearby, or large populations with ready access may warrant
immediate, permanent remedies, such as waste excavation and treatment or
incineration. On the other hand, remote sites with low contaminant
concentrations and migration potential or limited human contact may be
addressed adequately with institutional controls (e.g., prevention of public
access or land use restrictions) and site containment, such as waste
consolidation and capping.
The Agency anticipates that the types of corrective action activities
employed to correct soil contamination at particular sites will be similar to
the activities encountered for Superfund cleanups. Appendix D provides
details of the corrective action activities taken at a sample of CERCLA sites
and the costs of those activities. This summary, compiled from Records of
Decision, indicates that corrective action activities typically employed to
alleviate or prevent the effects of soil contamination include:
¦ Excavation and removal of soils for incineration, treatment,
and/or disposal;
¦ Treatment of soils in place to remove or immobilize
contamination; and
¦ Capping contaminated surface soils to prevent direct
contact and limit hazardous constituents from leaching
to ground or surface waters.
Note that these activities will effectively remediate other media, as
well, because releases to soil often can migrate. The summary presented here,
therefore, represents the kinds of corrective action activities taken at sites
with releases to soil, rather than the types of activities taken to remediate
releases to soil alone.
Because corrective action activities vary considerably from site to
site, as described above, the cost of remediation for a site is also highly
variable. Appendix D illustrates this variation. In general, costs appear to
be a function largely of the volume of soil requiring corrective action,
although transport of contaminated soils over long distances prior to disposal
also may result in high costs.
4.3.3 Analysis of Alternative Regulatory Strategies to Address Soil
Contaminat ion
The strategies described in Chapter 3 vary in their requirements,
especially with regard to the extent of soil cleanup and the timing of
cleanup. This section compares the timing and level of cleanup associated
with corrective action implemented to address soil contamination at an example
facility under the regulatory strategies. The example is based upon a
description of a "real world" site, which has been modified for the purpose of
this analysis.
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Example Facility
The example facility encompasses 120 acres and contains a closed 60-acre
landfill unit. The owner/operator also operates a second landfill on the
facility, which is a RCRA regulated unit. The closed landfill operated from
1958 to 1980 and is currently capped with a layer of clay. Wastes disposed in
the unit include municipal and industrial sludges, spent solvents, and
pesticide containers. A RCRA Facility Investigation indicated that this unit
released hazardous organic constituents, including benzene, dichloroethane,
and dichloromethane, into an area surrounding the northeast side of the unit.
This release resulted in the contamination of three acres of surface soils
(encompassing 7,260 cubic yards) outside the unit itself. Approximately 15
percent of the contaminated soils contain concentrations of organic
contaminants in excess of health-based standards. The site is currently
active, and therefore exposure of off-site individuals to the area of
contamination is controlled. No significant surface water, ground-water, or
air contamination was detected at the facility.
Corrective Action Measures Under the Regulatory Strategies
This section describes the corrective measures that would be followed at
the example facility and the resulting benefits under the regulatory
strategies.
Strategy 1: Cleanup to Background Levels As Soon As Practicable For All
Facilities
This alternative would effectively require cleanup of all contaminated
soil to the unit boundary to background constituent concentrations.
Potential corrective measures: The corrective measures required under
this alternative would involve excavation to remove all contaminated soil,
followed by treatment of the contaminated soil on-site. The activities are as
follows:
1) Excavate all contaminated soil;
2) Treat the soil on-site in a mobile treatment unit;
3) Backfill the site with the treated soil, cover with a layer of
topsoil and revegetate; and
4) Maintain the site for 30 years.
The costs involved in excavating, treating, and disposing of 7,260 cubic
yards of soil would be high compared to the corrective measures under
regulatory Strategies 2 and 3 discussed below.
Benefits analysis: The corrective action under this alternative is
intended to be a complete cleanup of the site to prevent all future exposures
to the contaminated soil. However, such an extensive level of cleanup may be
neither technically practicable nor warranted in all cases. Because the soil
contamination at this site does not affect any other media, the main exposure
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threat is through direct contact with the soil. If the site remains
controlled or if there are no populations within the vicinity of the facility,
then such direct exposures may be unlikely. Furthermore, because the majority
of the soil at the site contains concentrations of contaminants which are
below health-based standards, exposure to much of the soil at the site would
not produce significant adverse health effects. As a result, the high cost of
requiring complete soil excavation and treatment may not be justifiable.
Strategy 2: Cleanup to Health-Based Levels, With Flexibility In Timing
When determining an appropriate corrective measure for the site under
this strategy, the Agency may consider the likely exposure patterns and tailor
the cleanup level to an appropriate health-based standard. As a result, only
the contaminated soil which exceeds the health-based standard at the site
would be excavated. In addition, conditional remedies may be used, such as
institutional controls, to prevent exposures during the operating life of the
facility, followed by completion of the remedy at closure.
Potential corrective measure: The corrective measure under this
strategy would address only the soil that contained concentrations of
contaminants in excess of health-based standards. The remedy would be
conducted on a multi-year basis with a conditional remedy instituted to
prevent exposures while the remedy was underway. The activities under this
strategy are as follows:
1) Install security fence around contaminated site and maintain
for the active life of the facility (assumed to be ten
years);
2) Excavate all soil with contaminant concentrations in
excess of health-based standards;
3) Treat the soil on-site in a mobile treatment unit;
4) Backfill the site with non-hazardous treatment residue
and cover with topsoil;
5) Cap the remaining contaminated soils with a two foot
layer of topsoil;
6) Revegetate the entire site; and
7) Maintain the site (mow, erosion control, rodent
control) for 30 years.
Approximately 975 cubic yards of soil would be extracted from the site
under this alternative. The cost for soil excavation, treatment, and site
cover and maintenance would be less than the costs under Strategy 1, but would
still be high compared to Strategy 3.
Benefits analysis: The clean-up approach under this alternative would
address all contaminated soils that could potentially produce adverse health
effects through direct contact. However, this alternative would not require
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cleanup of soils that do not pose a significant health risk. Such soils would,
instead be covered to restrict contact, even though exposures would not impose
a significant risk. In addition, this alternative would allow remedies to be
phased in as long as institutional controls at a site would prevent harmful
exposures. At sites such as the example facility, which are active and could
effectively prevent exposures through the use of inexpensive security
measures, the corrective action could be implemented over a several year
period so long as it were completed prior to closure of the facility.
Strategy 3: Cleanup to Health-Based Standards Only tfhere Actual or
Imminent Exposure Exists
Under this strategy, the need for and type of corrective measure
conducted at a facility would be determined based upon a risk analysis of the
site. The Agency would determine the risk associated with the most likely
exposure scenarios at a facility and design the corrective measure
accordingly. If the Agency finds that the characteristics of the site make
exposure to the contamination unlikely, then corrective measures may not be
required. For example, if a contamination site were located within a
controlled industrial complex, exposure to the contaminants could be limited
and site remediation would not be required. If control of the site were not
feasible and therefore exposure were likely, cleanup to health standards could
be required.
Potential corrective measures: In the case of the example facility, the
corrective measure could involve either no action or simply consolidating and
covering the contaminated soils to prevent direct exposure.
The activities involved in soil consolidation and cover would include
the following:
1) Consolidate the soils that contain concentrations of
contaminants in excess of health-based levels;
2) Cover the area containing the contaminated soils with
a two foot layer of topsoil;
3) Revegetate the entire area; and
4) Maintain the site for thirty years.
The present value for these activities would be low compared to
Strategies 1 and 2. The low cost of this strategy reflects the absence of
soil excavation and disposal activities.
Alternatively, if the Agency determined that the population patterns
surrounding a site and controls at the site would effectively prevent exposure
to the contaminants, no corrective action could be required under this
strategy. Hence, the cost of corrective action under this strategy could be
essentially zero for some sites.
Benefits analysis: Although this strategy represents the least cost,
option for owners and operators, it also provides for the lowest level of
assurance of protection for human health and the environment. There is no
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guarantee that current assumptions concerning likely exposure scenarios will
not change over time. As a result, any contamination left in place could
eventually result in health damage, especially if soil concentrations in
excess of health-based standards were left in place. In addition, this
strategy may not address adequately movement of contaminants from soil to
other media and resulting indirect exposures. Finally, leaving the waste in
place would inherently involve resource damage and a loss of beneficial future
uses of the area containing the contaminated soil.
Comparison and Analysis of Strategies for Soil Corrective Action
Although Strategy 1 theoretically may be more protective than Strategies
2 and 3, cleaning up all contaminants to background levels may not be feasible
at many sites. Moreover, such a level of cleanup may not be necessary to
adequately protect human health and the environment. In contrast, the purely
risk-based approach described under Strategy 3 may not be sufficiently
protective if land uses surrounding a site change with time and direct
exposures become more likely. The third strategy also may not account for
other environmental degradation or transport of contaminants from soil to
other media. Hence, Strategy 2 is more protective by virtue of its requiring
corrective action to address contamination in concentrations above certain
threshold levels and is practicable in terms of achieving cleanup to health-
based levels.
4.3.4 Corrective Action for Releases to Soil Under the Proposed Rule
The general extent and severity of the soil contamination problem
addressed under RCRA §3004(u) and the activities that may be involved in
correcting this problem have been outlined above. This section describes the
approach to corrective action for soil contamination contained in the proposed
rule.
The proposed corrective action rule is designed to provide the Agency
with the flexibility to tailor the timing of corrective measures at facilities
with soil contamination based on the threat to human health and the
environment posed at these facilities through either direct exposure or cross-
media impacts. Specifically, the rule proposes to allow consideration of
current and anticipated future land use patterns when setting media cleanup
standards for soil during remedy selection. In addition, the proposed rule
would allow the use of conditional remedies that protect human health and the
environment during the term of the permit, with implementation of the final
remedy phased-in prior to closure.
Soils may pose a threat through the direct ingestion route, either
through consumption of soils or through inhalation of windblown soil
particulates. Under the proposed rule, the owner/operator would be required
to assess these exposure routes and compare likely exposure levels to health-
based standards. If deeper soils are contaminated, the proposed rule may
require that the RFI include an analysis of the risks posed by migration of
hazardous constituents through the soil to other media, such as underlying
ground water or hydraulically connected surface water. If the Agency
determines, based on these investigations, that contaminated deep soil is not
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adversely affecting other media under current or projected future use
scenarios, the Agency could require the owner/operator to place in the
facility deed, or other appropriate instrument, a notice of residual
contamination; active source control and remediation of the contaminated
medium, however, would not be routinely required in this situation.
A Corrective Measures Study (CMS) typically will be required if action
levels are exceeded or if it is determined that either surficial or deep soils
are adversely impacting other media. The proposed rule allows the Agency
flexibility to choose a final remedy which cleans up contaminated soil to
levels consistent with current and plausible future patterns of land use at or
near the facility. For example, where access to an area would be unrestricted
upon closure, cleanup of contaminated soil generally would be required to
levels appropriate for residential development (i.e., direct contact). In
such a situation, exposure assumptions which assume a residential use pattern
with long-term contact to soils contaminated with carcinogens, as well as soil
ingestion by children of both carcinogens and non-carcinogens, might be most
appropriate to use when setting media cleanup standards. The proposed rule
also requires that the final cleanup standard for soils must be achieved at
any point where direct exposure to the soils may occur,.
In certain situations, the Regional Administrator may select a
conditional remedy that would not necessarily be the final remedy for the
facility, but would protect human health and the environment from exposure to
contaminated soil. For example, where an owner/operator can control direct
access to the contaminated soil, an appropriate conditional remedy for the
site might be the cleanup of contamination to a level consistent with current
exposure, together with permit conditions ensuring that use patterns did not
change. In this case, the owner/operator may be required to use institutional
controls (e.g., fences or other physical barriers) to prevent significant
direct exposures to contaminated surficial soil, or to implement engineering
controls to control the source of the release to surficial and/or deep soils
prior to implementation of the final remedy at closure.
As described above, the proposed corrective action rule generally adopts
the approach outlined under Regulatory Strategy 2. This approach is
protective of human health and the environment by requiring cleanups of soil
contaminated at concentrations in excess of health-based standards.
Furthermore, the approach allows for the use of conditional remedies which may
delay cleanups and reduce costs, so long as adequate and protective
institutional or other controls are used on a temporary basis.
4.4 CORRECTIVE ACTION FOR RELEASES TO SURFACE WATER
This section discusses the potential sources, transport mechanisms, and
resulting risks from releases to surface water; describes representative
corrective action activities that may be employed to address surface water
releases; and outlines the proposed rule and alternative regulatory strategies
for the rule that this RIA has identified.
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A.4.1 Releases to Surface Water: Sources, Transport, and Potential Threats
The severity of the threat to human health and the environment resulting
from surface water contamination is a function of the source of the release,
the extent of contaminant transport in surface water, the distance to a
potentially exposed population, and the route and duration of human and
environmental exposure. Each of these factors is discussed separately below.
Hazardous waste releases to surface water arise from four primary
sources: direct releases to the water; continuous or intermittent overland
contaminant discharges flowing into waterways; seepage of hydrologically
connected contaminated ground water into surface water; and deposition of
contaminants from the air. Direct releases may occur as a result of vehicular
accidents involving carriers of hazardous waste, illegal dumping, or the
release or overflow of wastewater from an impoundment or lagoon. Overland and
ground-water flow also may transport leached hazardous constituents to surface
waters over time. The rate and quantity of contamination increases with
increased rainfall or flooding. Finally, air transport can lead to the
deposition of contaminants in surface waters. Volatile organics and
contaminated particulate matter may tend to disperse in the atmosphere,
however, and reduce the expected concentrations of constituents deposited
downwind.
Sources of hazardous constituent releases may arise from a variety of
SVMUs including the following: surface impoundments, landfills, waste piles,
land treatment units, container storage areas, tank systems, incinerators, and
underground injection wells.
Mechanisms influencing the transport, extent, and Impact of
contamination depend upon factors such as the volume, temperature, and flow
pattern of the water and the characteristics of the released constituents.
Some contaminants are dispersed far downstream along with the surface water
discharge. Other contaminants tend to fall out of the water into the
sediments of the stream or lake. Such contaminants may continue to be
released from the sediments back into the water over the long term, however,
through chemical processes and turbulence or through the disturbance of the
sediments by bottom-feeding fish and other organisms. The presence and
composition of plant and animal life in the water also affects the fate of
hazardous constituents through bioaccumulation and biological degradation.
Exposure to hazardous constituent releases to surface water occur
through several pathways. Bioaccumulation (or biological magnification) is
the process in which toxic materials are absorbed by vegetation and small
animals and then passed along the food chain in ever increasing
concentrations. Animals living in contaminated water concentrate soluble
contaminants in their fatty tissues. As a result, many hazardous constituents
can become concentrated in fish and shellfish at levels higher than those
found in the surrounding water. Ultimately, the animals at the end of the
food chain, such as fish and humans, become exposed to high concentrations of
contaminants. Such exposures may pose a serious health risk due to the high
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concentration of constituents frequently found in animals living in
contaminated surface water.2
Human exposure following releases to surface water also occurs either
through withdrawal of contaminated surface water or in-stream contact with the
water. Typical withdrawal exposure points and routes include: drinking water
ingestion and contact with water used for cooking or bathing, consumption of
agricultural crops irrigated with contaminated water or livestock fed
contaminated water, and exposure to contaminated water withdrawn for
industrial use. In addition, individuals are exposed to contaminated water
during recreational use both through dermal contact and ingestion.
4.4.2 Corrective Action Activities to Address Releases to Surface Water
The preceding section characterized the problem of surface water
contamination by providing an overview of release and exposure pathways and
the resulting health risks. This section discusses the activities involved in
corrective action for releases to surface water.
The choice of an appropriate corrective action design to address a
release to surface water at a given site will depend primarily on the
potential routes of hazardous constituent exposure to human populations.
Because releases of hazardous contaminants to surface water often occur
initially as releases to other media (e.g., releases to soil resulting in
contaminated runoff or contaminated sediments and releases to hydrologically
connected ground water), corrective action activities taken to remediate
surface water contamination or to prevent additional surface water
contamination also may involve remediating other media. Moreover, the
potential for human exposure may indicate the appropriate extent of
remediation. For example, surface water which contains contaminated sediments
and which is used heavily as a drinking water supply or for recreational
activities may require extensive water treatment and sediment excavation to
protect the water supply and to control the sediment source. Likewise,
surface water in a remote area contaminated by natural conditions (e.g., high
turbidity), and therefore not a suitable drinking water source, may be
remediated sufficiently by containing the release source (e.g., soil surface
runoff controls) and applying institutional controls (e.g., prohibition of
recreational activities). In general, a wide range of corrective action
activities may be required to adequately address a release to surface water,
depending on the characteristics of the release source and the potential for
exposure of human populations or environmental receptors to contaminants.
The Agency anticipates that the types of corrective action activities
engendered by the proposed rule will be similar to those activities
encountered at Superfund cleanups. Examples of these activities are outlined
in Appendix D. This summary was compiled using Records of Decision for the
sites. As the summary indicates, the corrective actions typically employed to
alleviate or prevent surface-water contamination include:
2 U.S. EPA, "Superfund Public Health Evaluation Manual," EPA/540/1-86/060.
October 1986.
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Excavation, treatment, or consolidation of bottom sediments;
¦ Wetland restoration and revegetation;
¦ Construction of surface water diversions (i.e., levees,
dikes, dams, or drainage ditches);
¦ Removal of contaminated surface soil to avoid leaching by
surface runoff;
¦ Extraction, treatment or drainage of ground water which may
drain to surface water;
¦ Capping soils or landfills to avoid contamination by surface
runoff; and
¦ Water sampling and monitoring.
Note that many of these activities, while addressing releases to surface
water, also address releases to other media. This summary of activities,
therefore, represents the kinds of corrective action activities taken at sites
with contaminated surface water, rather than activities strictly designed to
clean up surface waters alone.
Because the typical corrective action activities taken to remediate
hazardous waste releases to surface water vary greatly, costs for typical
corrective action activities differ as well, as the summary of activities and
costs in Appendix D illustrates. In general, the corrective action costs for
a site with contaminated surface water appear to be driven most significantly
by the extent of soil or sediment excavation required; the extent of surface
water diversion required; the need for ground-water drainage or extraction;
the need for a cover or cap; and the size of the contaminated area.
Based on the corrective action activities described in Appendix E, the
more costly actions tend to involve extensive sediment excavation, surface-
water diversion, and ground-water treatment. Because of the variety of
factors that influence the cost of a corrective action, however, it is
difficult to predict what a "typical" corrective action addressing surface-
water contamination might cost.
4.4.3 Alternative Regulatory Strategies to Address Surface Vater
Contamination
The following discussion compares the level of cleanup required and
points of compliance associated with corrective action at an example faci lity
involving a release to surface water that would be implemented under the
alternative regulatory strategies presented in Chapter 3. Although the timing
of the remedy was raised as an important issue in the preceding sections
describing strategies for ground water and soil corrective actions, for
surface water there is no feasible way to differentiate among regulatory
strategies based upon the timing of the remedy due to the nature of the
medium. In contrast with ground water, contaminated surface water moves and
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dissipates very quickly. Therefore, surface-water contamination! remediation
relies more on source control than treatment of the medium itself.
Example Facility
A hypothetical facility that has experienced hazardous constituent
releases to surface water is described below. The example is based upon a
description of a "real world" site, which has been modified for the purpose of
this analysis.
This example involves a 23 acre chemical manufacturing facility situated
along the marshlands of a tidal river. Assorted waste containers, open steel
drums, and manufacturing debris have been stored on site in an open
impoundment approximately 50 yards from the river during the facility's ten
years of operation. Two reported incidents involving the rupture of two 500-
gallon storage tanks containing paint thinning agents and solvents occurred as
a result of flood events during these years. These events, combined with
leaching of soluble hazardous constituents from the surface impoundment,
resulted in PCB, organic solvent, and heavy metal (including lead, cadmium,
and chromium) contamination of the river water and sediments. The receiving
stream does not discharge to ground water in the area of the contamination.
Significant ground-water contamination, therefore, has not been detected at
the site. At the time of the facility investigation, contaminant
concentrations in the water did not exceed drinking water standards or other
applicable health-based standards, but high concentrations of organics and
heavy metals were found in the sediments and wetland soils immediately
downstream from the facility. A drinking water intake is located one mile
downstream from the facility.
Corrective Action Measures Under the Regulatory Strategies
This section describes the corrective measures that could be followed at
the example facility and the resulting benefits under the regulatory
strategies.
Strategy 1: Cleanup to Background Levels As Soon As Practicable For All
Facilities
This strategy would require source control to prevent further
contamination and would effectively require treatment of the water and
dredging of sediment and wetland soils to remove contamination, where
practicable. Due to the nature of the surface-water medium, contamination
generally does not remain in place within the water column for extended
periods of time. Consequently, source control is the primary corrective
measure to address surface water contamination. Nonetheless, although the
example described above involves releases to a river which would dissipate
quickly, still water bodies such as ponds and lagoons could tend to retain
contaminants in the water column for longer periods of time. If contaminants
remain in the water body, treatment techniques are available to remove the
contaminants, including liming and the use of polymers as contaminant
precipitants.
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Potential corrective measure: The corrective measure would focus on
removing contaminants from the water system, including constituents in the
water column, sediments, and wetland soils. Presumably, only very low levels
of contaminants would remain in the water itself, because the river flow would
continually cleanse the water column. Therefore, water treatment would yield
little environmental benefit. However, contaminants would remain in the
sediments and these contaminated sediments could continue to leach hazardous
constituents into the water over time. These contaminants also could
bioaccumulate in fish and shellfish and result in adverse health effects
through consumption. Hence, the major corrective measure undertaken at this
facility would involve source control to prevent any future releases to the
water, followed by limited sediment and wetland soil dredging and disposal
off-site. Such dredging would be conducted, however, only if the
environmental damage caused by the dredging were not greater than the harm
caused by leaving the contamination in place.
Benefits analysis: If this corrective measure were completed
successfully, it would effectively remove the sources of future contamination
from the site. However, removal of all contamination from such a site would
prove very difficult, costly, and damaging to the environment. Contaminants
can disperse over a large area in a water system. Therefore, a potentially
large volume of sediments and soils would have to be dredged from the site,
thereby causing environmental damage from the dredging itself. Furthermore,
many contaminants become relatively immobile in sediments. Hence, they do not
return to the water column in high concentrations. Once dredged up, however,
the process can resuspend contaminants and lead to additional exposures in the
water column. Finally, removing all contaminants from a water system may not
be warranted on the basis of human health protection. If contaminants are
present in low concentrations in the water (as in the case of the example
facility), the contaminant concentrations may not exceed drinking water or
ambient water quality standards. Hence, under this strategy only such
treatment would be required that would provide human health benefit, while not
adversely damaging the environment.
Strategy 2: Cleanup to Health-Based Levels, With Flexibility In Timing
This strategy mandates source control to prevent further contamination
and cleanup of water systems to prevent exposures above health-based levels
anywhere within the water body, and specifically at the point of entry of the
contaminant. Because contaminant concentrations in the water were measured at
levels below health-based standards, additional activities beyond source
control, such as water treatment and sediment dredging, would not be required.
In this case, sediment resuspension or bioaccumulation in bottom-feeding fish
is not expected to lead to damage to human health and the environment.
Potential corrective measure: No corrective measure beyond source
control would be required at this facility. Hence, no water treatment or
sediment excavation would be required.
Benefits analysis: Because sediment removal and water treatment is not
required under this strategy, the costs and environmental damage resulting
from such activities would be precluded. However, if long term contamination
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and bioaccumulation of contaminants in fish emerged as a problem, it could be
addressed through institutional controls which would limit exposure to the
contaminated fish.
Strategy 3: Cleanup to Health-Based Standards Only Where Actual or
Imminent Exposure Exists
This strategy requires corrective action only to limit contaminant
concentrations at actual points of exposure, such as drinking water intakes.
Because the contaminant concentrations in the water column are very low and
virtually non-detectable at the drinking water intake, no action would be
required at this site. Limited action might be required, however, if
environmental damage were severe. In that instance, source isolation or
removal might be required to prevent further environmental damage.
Potential corrective measure: No action.
Benefits analysis: By only requiring corrective action to correct
measurable exposures above health-based levels, this approach is less likely
to require action than Strategies 1 or 2 and is, therefore, less costly.
However, this strategy is also least protective. It does not address
incidental human exposures in the water body or bioaccumulation. Potential
future contamination of the drinking water source caused by resuspension of
the bottom sediments (e.g., during a storm event) also might not be addressed.
Environmental degradation is not addressed in this instance, because such
degradation is not severe. If environmental degradation were a problem,
however, source control could be required under this strategy. Furthermore,
in certain situations, this strategy could allow for discharges of hazardous
constituents into a surface water to continue so long as the discharge
dissipated before reaching a point of contact, such as a drinking water
intake, or was present at a low concentration.
Comparison and Analysis of Strategies for Surface Water Corrective Action
Due to the nature of the medium, source control should generally prove
to be an adequate corrective measure to address surface water contamination.
In most cases, water treatment and extensive sediment dredging would not be
required because contaminants tend to become isolated in sediments, which
generally limits exposures above health-based standards. Strategy 1 does not
account for this characteristic of the medium by requiring water treatment and
sediment removal when such activities might not be warranted on the basis of
human health and environmental protection. However, in some circumstances,
limited sediment removal may be needed to prevent possible future
contamination of the water body and to reduce bioaccumulation problems and
environmental damage. Focusing only on measuring health-based concentration
levels at readily identifiable points of exposure, such as drinking water
intakes as described under Strategy 3, may overlook other points of exposure
and one time events that could lead to damaging exposure episodes. Strategy 2
avoids this problem by assessing contaminant concentrations at all points in
the water column. Furthermore, while Strategy 2 would rely on source control
as the primary corrective measure for surface water, limited sediment removal
could be required under the strategy to prevent bioaccumulation problems or
resuspension of contaminated sediment.
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4.4.4 Corrective Action for Releases to Surface Water Under the Proposed Rule
The proposed corrective action rule addresses human health risks posed
by direct exposure to contaminated surface water from a variety of sources,
including ingestion of water and consumption of aquatic organisms. The
proposed approach also reflects the fact thdt concentration levels protective
of humans based on such intakes often may be insufficient for protection of
aquatic life or sensitive ecosystems. It does so by relying on State Water
Quality Standards (WQS), which explicitly factor in the State-designated uses
of the surface water and the sensitivity of the environmental system, and on
Federal Water Quality Criteria, which consider human and environmental
exposure to contaminated surface water, in determining action levels which are
protective of human health and/or aquatic life.
If action levels in surface water samples have been exceeded, or if
other investigations indicate that contaminated sediments pose a threat to
human health or the environment, a CMS may be required. The proposed rule
provides the Agency with the flexibility to consider potential uses of the
surface water and all potential routes of human exposure to contamination, as
well as exposure of sensitive environmental species or systems, when setting
media cleanup standards at remedy selection. The Regional Administrator will
specify the locations where surface water or sediment samples must be taken to
monitor surface water quality, and demonstrate that compliance with surface
water cleanup standards has been achieved.
This approach adopted by the proposed rule is similar to the approach
described under Regulatory Strategy 2 above. As with Regulatory Strategy 2,
the proposed rule focuses on source control as the best means of preventing
contamination of surface waters, but acknowledges the need for "in-stream"
corrective measures such as sediment dredging in isolated circumstances.
4.5 CORRECTIVE ACTION FOR RELEASES TO AIR
This section specifically assesses corrective action to address
hazardous constituent releases to air. The section describes air release
sources, transport mechanisms, and exposure pathways, as well as resultant
human health risks. Representative corrective measures to address air
releases are also described, followed by a discussion of the manner in which
releases to air-are addressed by the proposed corrective action rule.
4.5.1 Releases to Air: Sources, Transport, and Potential Threats
As demonstrated in studies prepared by EPA,3 air releases of volatile
organic compounds (VOCs) are known to occur from hazardous and nonhazardous
waste units. Evidence from states such as California indicates that SWMUs can
be a significant source of VOCs, such as chloroform. The level of exposure to
such air releases experienced by a population will depend upon the amount of
3 U.S. Environmental Protection Agency, "Analysis of Air Emissions and
Controls at Municipal Landfills," prepared for the Office of Air and Radiation
by Radian Corporation, July 1987.
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hazardous constituents released, the fate and transport of those constituents,
and the proximity of the potentially exposed populations. Health risks
resulting from exposure will depend on the duration of exposure (i.e., acute
or chronic) and the toxicity and concentration of the contaminants.
The two most typical types of release of hazardous waste or hazardous
constituents to air are the volatilization of organic compounds and the
generation and transport of airborne dust particles from contaminated surface
soils or waste piles.4
Releases to air may occur from a variety of SWMUs including the
following: surface impoundments, open tanks, landfills, land treatment units,
waste piles, container storage areas, incinerators, and non-RCRA wastewater
treatment ponds.
Typical VOCs, which arise from SWMUs such as surface impoundments,
include benzene, toluene, chloroform, and other organic solvents. Many of
these VOCs are known or suspected carcinogens, or may cause other detrimental
health effects. Organic solvents are found at many units and facilities.
These volatile compounds either may be emitted directly to the air from
uncontrolled waste management sites or migrate from the subsurface.
Dust or particulate emissions also may serve to transport a variety of
adsorbed hazardous constituents. For example, hazardous organic and metal
constituents may adsorb onto soil or dust particles and become airborne
through wind erosion or by the movement of heavy machinery over a waste
management unit.
The mechanisms influencing the transport of constituents in the air to a
point of exposure include wind movement (i.e., air flow patterns), the natural
dispersion of constituents in the atmosphere, wash-out of constituents from
the air through rainfall or deposition, and the decay of certain constituents
over time. Constituents that are adsorbed onto soil or dust particles,
transported through air, and subsequently deposited also may lead to
additional soil or surface water contamination downwind from a unit. Finally,
the height of the release to the surrounding area can have a significant
effect on the distance over which contaminants are transported and dispersed;
higher air releases tend to be dispersed further.
As a general rule, populations in proximity to a release site tend to
receive higher acute and chronic exposures than more distant populations.
However, populations located far downwind of a release site also may receive
potentially threatening exposures over the long term, depending on airflow
patterns.
Potential air exposure points may range from nearby residential to
commercial or industrial areas. For example, in one case, a local school was
temporarily closed as a result of chemical air releases from a facility. In a
second case, several VOCs were detected in an adjacent residential community
* U.S. Environmental Protection Agency, Superfund Public Health Evaluation
Manual, EPA/540/1-86/060, October 1986.
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and were, at times, present in quantities above the National Air Emission
Standards. The first case also demonstrates that local areas are especially
vulnerable to exposure if located in valleys characterized by temperature
inversions, where a release would be held stationary and close to the ground
for long periods of time. Due to dispersion, however, air releases generally
have a shorter residence period at the point of exposure relative to soil or
water releases. Reductions in hazardous constituent release levels,
therefore, will generally lead to prompt reductions in air pollutant
concentrations.
The primary route of exposure to humans following an air release is
inhalation.5 Exposures may be characterized as either acute or chronic.
Acute exposures involve the presence of high volumes of contaminants over
short durations of time and, depending on the toxicity and concentration of
the contaminant, can lead to health effects ranging from eye and throat
irritation to death. Chronic exposures involve exposure to relatively low
volumes of contaminants over long periods of time, which, depending upon the
toxicity and concentration of the released constituents, can lead to
degenerative diseases (such as cancer, kidney and liver disfunction, and blood
disorders).
4.5.2 Typical Activities to Correct Releases to Air
The appropriate corrective action for a release to air will depend
primarily on the potential routes of hazardous contaminant exposure to human
populations and the types of contaminants being released. Moreover, because
contaminant concentrations diminish relatively quickly as a release disperses,
the frequency with which corrective actions are taken will be a function of
the point chosen to trigger corrective measures studies and corrective
actions.
The typical route of exposure from a release to air is direct exposure
such as inhalation and dermal irritation. Therefore, the threat of an air
release, relative to releases to other media, is primarily a function of the
proximity of human activities surrounding a site. For example, toxic releases
to air at sites surrounded by large, permanent populations may require
rigorous source controls (such as reducing the VOCs in wastewaters entering a
surface impoundment).
The Agency anticipates that the types of activities taken for RCRA
corrective actions may in some cases be similar to the activities taken at
Superfund sites to remediate air releases. In addition, however, many RCRA
corrective actions will involve controls on operating units which will limit
the generation of hazardous particulates and volatile organic compounds.
Such activities at active units may simply involve process changes which lower
the concentrations of VOCs in waste management units or limit their
volatilization in the atmosphere. Further examples of Superfund remedial
activities for air releases are outlined in Appendix D. This summary was
compiled from Records of Decision prepared for the CERCLA sites. Although
many of the activities completed at Superfund sites to remediate air releases
5 U.S. EPA, Superfund Public Health Evaluation Manual, October 1986.
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would not be appropriate for active RCRA units, some of the ROD actions are
illustrative of probable corrective action activities:
¦ Limiting the placement of wastes into or covering surface
impoundments;
¦ Waste pile stabilization; and
¦ Installation of gas ventilation and collection systems.
Note that a number of activities designed to control the source of an
air release are in fact remedial activities for other media (i.e., soil,
ground water, and surface water). Because the corrective action activities
described in Appendix D address the remediation of media other than air, this
summary represents the types of activities taken at sites with releases to air
rather than the typical activities required to clean up air alone.
4.5.3 Analysis of Regulatory Strategies to Address Air Contamination
The regulatory strategies described here correspond with the general
strategy descriptions in Chapter 3. When applying the regulatory strategies
to the air medium, the major distinction among the strategies involve
differences concerning constituent concentrations in air which trigger action
and the point of compliance for measuring Che constituent levels. The air
medium differs significantly from the other media, and this difference
influences the choice of an appropriate regulatory strategy. Releases to air
dissipate quickly, relative to the other media. Therefore, source control
alone is the only reasonable action available to addresses air releases.
Cleanup of the medium itself is not a viable option. Hence, the main question
when addressing air releases is whether source control is needed at a
particular site and when such controls should be instituted. Determining
where the point of compliance should be set and what trigger levels should be
measured at that point are the critical determinants of the need for and
frequency of corrective action. In the following discussion, the manner in
which the different regulatory strategies would govern corrective action for
air releases are described by applying the strategies to an example facility.
Example Facility
The example facility contains an active surface impoundment unit.
Manufacturing wastewaters containing solvents and other organic wastes are
treated in the impoundment. A RCRA Facility Investigation at the facility
measured concentrations of dichlorobenzene, trichloroethylene, and benzene in
the air beyond the facility boundary in concentrations that, exceeded health-
based air level standards. As a result, a corrective measures study (CHS) was
instituted at the facility. Based upon monitoring and modeling data, the CMS
found that the air concentrations did not exceed health-based standards in the
vicinity of the nearest residence, which is located 1200 yards from the
facility boundary. No other residences or population gathering places are
located within this 1200 yard radius of the facility.
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Corrective Measures Under the Regulatory Strategies
This section describes the corrective measures that would be followed at
the example facility and discusses the resulting benefits under the regulatory
strategies. The only activity generally available to address air
contamination involves source control.
Strategy 1: Background Levels at the Unit Boundary
Under Strategy 1, corrective action would be triggered if constituent
concentrations were measured at the unit boundary in excess of background
levels. This approach is analogous to regulatory Strategy 1 for ground water.
Corrective action would be triggered for the unit at the example
facility because the background levels for the VOCs are exceeded at the unit
boundary.
Potential corrective measure: The volatile emissions are from an active
unit. Therefore, reducing either the volume of the wastes or the volatility
of the constituents should serve as the most effective remedy. Controlling
the source through either removal or capping would not be a viable option for
this unit. Instead, covering the surface of the wastes in the impoundment to
reduce contact with the air or waste treatment to reduce the volatility of the
constituents are the only viable options. Other controls might include
reducing the volume of the most volatile or hazardous constituents or closing
the impoundment and switching to other treatment processes, such as in tanks.
However, reducing the emission of VOCs to background levels probably could be
accomplished only if the unit were closed.
Benefits analysis: The stringency of this strategy would force most
units which manage VOCs to close or severely curtail their management
practices. By triggering corrective measures at background levels at the unit
boundary, this strategy is highly protective because it ensures that no off-
site exposures would occur. However, at many facilities air remediations
would be triggered even when there exists only a limited chance of human or
environmental exposure. Furthermore, because air releases disperse rapidly,
even releases that move beyond the unit are unlikely to cause chronic and
excessive human or environmental exposures, unless the constituent is released
in high concentrations and populations are in close proximity to the unit.
Therefore, this strategy is extremely protective, but also very burdensome.
Strategy 2: Health-Based at Facility Boundary
This strategy would set corrective faction process triggers and cleanup
target concentrations for hazardous constituents in air at health-based
levels, with the point of compliance set at the facility boundary. This
approach is analogous to regulatory Strategy 2 for ground water.
Under this strategy, typical corrective actions for air could entail
covering the releasing unit, treating wastes prior to their storage or
disposal in these units, or excavating and treating the source of the air
release.
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Corrective action would be triggered at the example facility because air
emissions exceed the applicable health-based standard at the facility
boundary.
Potential corrective measures: The emissions emanate from an active
unit. As with Strategy 1, therefore, reducing either the volume of the wastes
or the volatility of the constituents should serve as the most effective
remedy. Covering the surface of the wastes in the impoundment to reduce
contact with the air or waste treatment to reduce the volatility of the
constituents may serve as adequate controls. Other controls might include
reducing the volume of the most volatile or hazardous constituents or closing
the impoundment and switching to other treatment processes, such as in tanks.
Although the corrective measures used under Strategies 1 and 2 are similar,
the strategies would differ in terms of the frequency with which the measures
are applied and the extent of source control needed at the site.
Benefits analysis: This strategy triggers a corrective measure if
health-based concentrations are exceeded at the facility boundary. Note that
by triggering corrective measures at the facility boundary, many facility air
remediations would be triggered even when actual human or environmental
exposures above health-based levels are not occurring. In addition, this
alternative implies chronic exposure at the facility boundary to air releases,
an unlikely scenario given that air releases typically disperse rapidly. As a
result, this strategy is protective, but may trigger corrective measures when
a unit is not causing harmful exposures.
Strategy 3: Health-Based at the Maximum Exposed Individual (MEI)
This strategy would require corrective measures to address air releases
only if there were actual exposures to individuals in excess of health-based
standards. Hence, this alternative is analogous to the risk-based approach
described under Strategy 3 for ground water.
The actions taken to address air releases under this alternative would
not differ from those described under Strategies 1 and 2. However, the need
for corrective action activities would be triggered less frequently. Under
Strategy 3, corrective actions for air releases could entail covering the
releasing unit or treating wastes prior to their storage or disposal. Source
controls, such as excavation and consolidation of contaminated materials, are
generally not involved in addressing air contamination problems because the
source levels dissipate over time.
Because this alternative requires corrective measures only if actual
exposures of individuals to contaminant air concentrations In excess of
health-based standards are demonstrated, corrective measures would not be
required for the example facility.
Potential corrective measures: No action.
Benefits analysis: This strategy differs from Strategies 1 and 2 with
regard to the frequency with which corrective measures would be required and
the extent of source control mandated once the need for corrective measures is
triggered. Hence, Strategy 3 would impose lesser burdens on the regulated
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community. It is less stringent than Strategies 1 and 2, but this strategy is
still protective of human health and the environment by prohibiting exposures
at the MEI at levels that exceed health-based standards. This strategy does
not explicitly account for environmental or property damage. Nonetheless,
placing the point of compliance at the MEI should ensure that releases which
affect environmental receptors will be addressed through corrective action.
Comparison and Analysis of Regulatory Strategies for Air Releases
Each of Strategies 1, 2, and 3 outline an approach that is protective of
human health. The strategies differ in stringency, however, and in the burden
placed on the regulated community, which is measured in terms of the frequency
with which corrective measures are triggered. For example, Strategy 1 is most
stringent and burdensome and would theoretically trigger the most corrective
measures. Strategy 2 is also protective, but would trigger corrective
measures less frequently. Finally, Strategy 3 also prohibits exposure to
constituents at levels above health-standards and is therefore protective, but
would be less likely to trigger corrective measures when they are not needed
to protect human health and the environment. Hence, Strategy 3 is least
burdensome.
In addition, however, because Strategy 3 would trigger corrective action
only when human health is clearly threatened, the strategy does not control
exposures at levels below the health-based standards or transient exposures.
On the other hand, setting the compliance point for the corrective action
trigger and target level at the facility boundary is more protective, but such
an approach also would impose costs for corrective action when no populations
are actually at risk. Therefore, using the MEI as the point of compliance for
triggering corrective action imposes lesser burdens and should still be
protective due to the nature of the medium.
4.5.4 Corrective Action for Releases to Air Under the Proposed Rule
Releases to air from solid waste management units present a unique
remediation situation. First, unlike releases to other media, air releases
from SWMUs impact human and environmental receptors within a short time period
after the release, but also disperse rapidly. In addition, corrective
measures controlling the source of the air releases stop adverse exposures
within a similarly short time frame. Corrective action for air contamination
typically will not involve "cleanup" of the contaminated medium, but rather
source control to minimize future releases. The Agency anticipates that
source control measures for air may include: covering a surface impoundment
so that volatile organics will not be emitted, or treating wastes before they
are placed in a unit which is releasing hazardous constituents to air.
Under the provisions of the proposed rule, the owner/operator will first
compare air monitoring or modeling data collected during the RFI at the
facility boundary (or another location closer to the unit if necessary to
protect human health and the environment) to action levels for specified
hazardous constituents, assuming exposure through inhalation of air
contaminated with the hazardous constituents. The action levels for air are
based on standard air exposure assumptions typically used by the Agency in
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risk assessments (i.e., 20 meters3 per day for a 70 kilogram adult for a 70
year lifetime).
If action levels are exceeded at the facility boundary, the
owner/operator would then measure, model, or otherwise estimate air
concentrations at the most exposed individual (MEI), or other point of
exposure determined by the Agency to be protective of human health and the
environment. Again, the owner/operator would compare facility-generated
concentration data against action levels in order to allow the Agency to
determine the need for corrective measures to address air releases.
If air releases are of concern, the proposed rule provides the Agency
with the flexibility to set the point of compliance for hazardous constituent
releases to air at the location of the MEI or at a compliance point other than
the MEI. For example, where environmental receptors are threatened by air
releases between the facility boundary and the MEI, the Agency may specify
that the owner/operator demonstrate compliance with facility-specific air
cleanup standards at the location of the most exposed environmental receptor.
A population shift into the area located between a point of compliance
that was based on the MEI point of exposure and the facility boundary would
result in human exposures above health-based levels. In this situation, a
permit modification could require additional source controls to reduce
exposure levels. Similarly, if at any time during the life of the permit air
concentrations exceed the action level at the MEI, the owner/operator would be
required to notify EPA and any individuals who may be subject to exposure to
the contaminated air.
By generally adopting the approach outlined in Strategy 3, the proposed
rule encompasses a protective and reasonable approach for triggering air
release remediation. In addition, the proposed rule contains provisions that
allow the point of compliance to be moved to account for varying exposure
assumptions and uncertainty in exposure modeling. In so doing, the standard
may be made more protective and may account for environmental damage or
transient exposures. As a result, the rule is sufficiently flexible to
account for circumstances that threaten human health and the environment.
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5. ILLUSTRATIVE EXAMPLES OF THE
CORRECTIVE ACTION REGULATORY STRATEGY
5.1 INTRODUCTION
This section presents three hypothetical case studies which illustrate
the application of the proposed corrective action regulatory strategy to
specific contamination problems. These case studies have been developed to
demonstrate how the proposed regulation works, show how the alternative
strategies considered by the Agency in developing the regulation would have
worked, and identify some of the differences in results that would be achieved
under the proposed regulation and alternative strategies.
The hypothetical case studies have been designed to illustrate a range
of complexities of site problems and solutions and to demonstrate some of the
variation that may occur in selecting remedies because of the flexibility
built into the proposed regulations. The case studies are not designed to
provide guidance on selecting corrective measures for actual facilities. The
corrective measures selected in these case studies should not be construed to
be models for corrective measures at actual facilities that may appear similar
to these hypothetical sites. Appropriate corrective measures for actual
facilities can only be determined by a site-specific analysis of numerous
location, waste, solid waste management unit (SWMU), and release parameters
which affect remedy selection.
Each case study provides background information on the facility, solid
waste management units, wastes, and releases. Then, the studies illustrate
the steps of the investigation and remedy selection process outlined in the
proposed rule, providing summary, hypothetical results of a RCRA Facility
Investigation (RFI) and Corrective Measures Study (CMS) at each facility. A
selected remedy for each case is identified and a brief discussion of why the
remedy was selected, based on criteria in the proposed rule and site-specific
parameters, are provided. These discussions illustrate the types of tradeoffs
that may occur when selecting corrective measures. Estimated costs for the
remedial actions are provided for purposes of comparison. These cost
estimates are based on rough calculations and take into account some site-
specific cost factors particular to each case study facility. These cost
estimates should not be construed as generally applicable to or representative
of corrective action costs at actual facilities: costs of actions at actual
facilities vary greatly according to site-specific factors, such as local
availability of necessary materials. Each study concludes with'a qualitative
discussion of the benefits of the corrective action.
Each case study discusses corrective measures that might have been
selected for the facilities under two other regulatory strategies considered
in developing the proposed regulation -- the Maximum Protection Scenario
(i.e., cleanup to background levels as soon as practicable for all facilities)
and the Exposure-Based Scenario (i.e., cleanup to health-based standards only
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where actual or imminent exposure exists). For each case, corrective measures
are identified that would probably satisfy requirements under the alternative
approach; also provided are estimates of the costs of the corrective measures
(for comparison with costs of the corrective measures selected under the
proposed rule). We also present some of the differences in benefits that
might accrue as a result of the different actions.
5.2 HYPOTHETICAL FACILITY ONE -- AIRCRAFT RESEARCH TECHNOLOGIES
5.2.1 Background
Aircraft Research Technologies (ART) is a 30-acre industrial plant that
manufactures airplane parts. The plant generated hazardous wastes from the
operation of a wastewater treatment facility between 1950 and 1977. These
wastes, consisting of chromium bearing waste sludge, were placed in a landfill
during the operation of the wastewater treatment facility. In 1977, ART
closed the landfill and the wastewater treatment facility because water
conservation and process changes significantly reduced volume and concentrated
the wastes. Currently, the operator stores hazardous waste in two tanks and
then ships the waste, periodically, to an off-site disposal facility. The two
hazardous waste storage tanks are operating under RCRA interim status; ART has
applied for a RCRA permit for these tanks.
Location
ART is located in a rural area about 2.5 miles south of a small city.
The entire facility is surrounded by scattered farm residences, the closest
being located within one-half mile of the facility boundary.
The surface soil at this site is a silty clay loam and is generally
characterized as reddish, moderately well-drained, deep, and medium-textured.
The surface soils extend to a depth of 30 feet and are underlain by low
permeability silty clay soils. These silty clay soils extend to a depth of
160 to 200 feet in the plant area and are underlain by an aquitard. The water
table at the site is at a depth of 40 feet. Flow in the surficial aquifer is
slow (lOm/yr) and to the southwest. The aquifer is the primary supply of
water for rural domestic and agricultural uses in the area. The small city to
the north of the plant uses a different source for its water supply. The
closest downgradient domestic water supply wells are located about one-half
mile from the plant's western boundary.
The region has an average annual precipitation of 37 inches. A small
stream is located outside the facility's southeast corner; however, the
majority of the 30-acre site, including the waste management area, slopes to
the west and is in a different drainage area. Wastewater discharged from the
treatment plant entered this stream until 1977.
Solid Waste Management Units
The waste management area at the facility covers approximately 10 acres.
The area contains an inactive landfill, a concrete foundation from a
disassembled wastewater treatment unit, and two waste storage tanks.
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The landfill was used from 1950 to 1977 for the
disposal of semi-solid and solid waste. The landfill
covers approximately one and a half acres with waste
material deposited at depths up to five feet below the
surface. The landfill has not been properly closed
(i.e. , capped).
The wastewater treatment units have been disassembled
and the equipment has been removed. The tank
foundations remain.
The two waste storage tanks have been used since 1977
to hold hazardous waste which is periodically
transported to an off-site disposal facility. The
operator has applied for a RCRA permit for these
tanks.
There are no regulated land-based units at ART, and therefore, there were no
ground-water monitoring wells at the facility until the RCHA Facility
Investigation was performed.
The waste generated at the site consisted primarily of waste sludge from
the plant's wastewater treatment facility. The sludge (hazardous waste number
D007) contains chromium. None of the other types of waste in the landfill is
known to contain hazardous constituents.
5.2.2 RCRA Facility Investigation Results
A RCRA Facility Assessment (RFA) was performed by the EPA Regional
Office as part of the review process for ART'S RCRA permit application. The
RFA identified the landfill as a potential source of release of hazardous
wastes and/or constituents. No releases were identified from the waste
storage tanks.
As a result of the RFA, the operator was required to perform a RCRA
Facility Investigation (RFI) in the permit schedule of compliance. The
operator developed and submitted a plan for the RFI outlining the overall
approach to the RFI, and the processes to be used in characterizing the
nature, direction, rate, movement, and concentration of releases from the
landfill SWMU. The plan also included procedures for assessing risks to human
health and the environment. The RFI focused on evaluating potential chromium
releases because it was the only Appendix VIII constituent suspected at the
site. Upon approval of the plan, the operator proceeded with the RFI; the
results are detailed below.
Release Characterization
The RFI confirmed the release of hazardous constituents from the
landfill to both ground water and to soil. Sampling results from the RFI are
as follows:
¦ Soil -• chromium was detected in soil directly below
the landfill. About 80 percent of the total chromium
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in the waste was found to be in the more toxic
hexavalent state.
¦ Ground water -- ground-water sampling results showed a
plume of chromium contamination radiating in a
southwesterly direction from the landfill.
The maximum concentrations detected in the RFI were
¦ Subsurface soils -- total chromium - 1,000 mg/kg
hexavalent chromium - 800 mg/kg
¦ Ground water -- total chromium - 750 ug/1
hexavalent chromium - 632 ug/1
These contaminant levels exceed action levels for ground water. The
action level for ground water, based on the maximum contaminant level of 0.05
ppm, was substantially exceeded immediately downgradient from the landfill,
within the facility boundary. The slow flow of the aquifer (lOm/yr), and the
slow rate at which chromium migrates, limited the area covered by the
contaminated plume to within 300 feet of the landfill.
Contaminant levels in soil were also high. However, because the soil
contamination was below the landfill, there was no potential threat of direct
exposure to contaminated soil, and the action level for direct exposure was
not considered applicable. The owner/operator was required, however, to
analyze the potential risk through other media (e.g., ground water) posed by
chromium migration from deep soil.
No releases of hazardous constituents to air or surface water were
identified during the RFI.
Health and Environmental Assessment
Given the location of the facility and the localized extent of the
contamination in the soil and ground water, it is unlikely that any exposure
had occurred before the discovery of the contamination. The extent of
contamination is illustrated in Exhibit 5-1.
ART's contractor evaluated the extent of contaminant releases and
potential routes of contaminant exposure to assess possible future exposures
to constituents from the landfill. The results of this assessment are as
follows:
Soil -- Exposure to the levels of chromium in soil at
the landfill through ingestion or direct contact is
highly unlikely, particularly since the contamination
was only detected in subsurface soil and the facility
is not readily accessible to the public or wildlife.
Ground water -- The ground water immediately below and
downgradient from the landfill is not a source of
drinking water for the facility or the nearby
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5-5
Exhibit 5-1
Extent of Contamination at ART
Ground-Water Flow
Landfill
Wastewater
Treatment Facility
7<~0 .
Waste Storage
Tanks
/
Manufacturing
Plant
Key
• —» — Area of Ground-Water Plume Exceeding Action Level
\\\Yi Extent of Subsurface Soil Contamination
—Facility Boundary
O Monitoring Well
Scale: 275 ft/In
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5-6
residences. Although the aquifer is used as a rural
domestic and agricultural vater supply, the nearest
intake is a half-mile from the boundary of the
facility. At the current rate of flow (lOm/yr), it
would take over 100 years for the contaminated plume
to reach the intake. Also, chromium moves much more
slowly than the ground water due to adsorption to
soil. Because of the slow rate of flow in the aquifer
and the slow movement of chromium, exposure to
hexavalent chromium through drinking water is not
likely to occur, given present conditions at and near
the facility.
With no current exposure, the contamination at this site does not pose a
direct threat to human health or the environment. The soil contamination does
not extend beyond the landfill and the ground-water plume is still a
significant distance from the facility boundary. Also, the contamination does
not have the potential to migrate rapidly off site, either in the soil or in
ground water. The only potential for future exposure would be if the aquifer
at the landfill site were tapped for a drinking water source at some point.
The probability of such an event is low since ART is likely to occupy the site
for an extended period of time. Given these conditions, interim measures were
not required.
5.2.3 Corrective Measures Study
The ground-water action level for hexavalent chromium was exceeded at
the site, triggering the Corrective Measures Study (CMS) requirements. EPA
required ART to evaluate two options in the CMS. ART submitted a CMS plan to
EPA which detailed the overall approach and objectives of the study,
techniques to be used, and a completion schedule for the CMS.
Upon approval of the plan, ART's contractor evaluated performance,
reliability, ease and timing of implementation, media and cross-media impacts,
and the appropriateness of the remedial technology. The results of the CMS
are described below.
Selected Remedy
Because of the limited current extent of the contamination at ART, the
relatively low risk of current or potential future exposures, and the
expectation (supported by ground-water modeling studies of the contaminant
plume's migration) that very limited movement of the plume will occur over the
next several years, a conditional remedy was selected for the ART facility.
The remedy selected for ART has four components:
¦ Source control --a RCRA cap on the landfill to
prevent future migration of the contaminants in the
landfill.
¦ Institutional controls on ground-water use -- ART must
prevent use of contaminated ground water originating
from the site through control over ground-water
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5-7
withdrawals. Because the plume is completely within
the boundaries of the ART plant, and there is a
substantial buffer between the plume and the plant
boundary, ART can control ground-water use in the
contaminated area and prevent nearby withdrawals that
might cause the plume to migrate.
¦ Ground-water monitoring -- ART must continue to
monitor ground water to determine future growth or
movement of the plume. If monitoring results indicate
that significant further degradation of the aquifer is
likely to occur, EPA would reopen the permit to
require additional remedial measures to prevent or
mitigate such damage.
¦ Financial responsibility -- ART must provide financial
assurance for complete implementation of the final
remedy.
The selected remedy is protective of human health and the environment;
there are no current exposures and contamination is entirely within the
facility boundary. The remedy prevents further significant degradation by
controlling the source of the release and controls are in place to prevent
exposures during the operating life of the facility. Monitoring will allow
EPA to evaluate in the future whether further significant degradation is
occurring. Financial assurance demonstrates that the company will be able to
afford the costs of remediating the facility contamination.
Costs and Benefits
The only major cost involved in the selected remedy is the cost of
installing and maintaining the RCRA cap. This cost is on the order of
$500,000 for a landfill of this size (one and one-half acres). Operation,
maintenance, and capital replacement costs could exceed $100,000 over the time
period of the remedy. The costs of ground-water monitoring are minimal,
amounting to approximately $70,000 in capital costs plus a small addition for
operation and maintenance.
In terms of benefits, the remedy selected ensures that there will be no
exposure to contaminated ground water or to the landfill itself. Although the
ground water contaminant plume is relatively small, the remedy will result in
the eventual restoration of the contaminated ground water to a usable state.
5.2.4 Corrective Actions Under Alternative Regulatory Approaches
The corrective measure selected and discussed above was chosen based
upon the proposed corrective action regulatory option ("Flexible Cleanup to
Health-Based Standards," or Strategy 2 -- see Chapter 3). The corrective
measures selected would be different under alternative regulatory scenarios
designed to achieve a greater or lesser degree of protection to human health
and the environment. In the following sections, we discuss corrective
measures that would be selected under the two alternative regulatory
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5-8
approaches considered by the Agency, as outlined in Chapter 3 of this
document. These alternatives are:
¦ Strategy 1 -- Cleanup to background levels as soon
as practicable for all facilities;
¦ Strategy 3 -- Cleanup to health-based standards
only where actual or imminent
exposure exists.
Strategy 1: Cleanup to Background Levels As Soon As Practicable For All
Facilities
Under Strategy 1, the remedy for the ART facility would likely entail
more extensive source controls and cleanup of the affected media to background
concentrations as soon as practicable. In this case study, the specific
result of this regulatory strategy would be to require the owner/operator to
implement the following source control measures: excavation of wastes and
contaminated soil; treatment to reduce the toxicity and/or mobility of the
hazardous constituents in the wastes and soil; and redisposal of the treatment
residues. Additionally, the owner/operator would be required to implement an
aggressive pump-and-treat system as expeditiously as practicable to restore
the affected ground water to its "background" purity. The pump-and-treat
method would, in this case, restore the aquifer in less time (estimated at 10
years based on site-specific modeling) than required for the natural
attenuation and dilution relied upon in the selected remedy.
The source and ground-water control measures that would be required
under the Maximum Protection Scenario would entail an estimated $7,000,000 in
capital costs. With operation and maintenance costs included, the total net
present value of the remedy over its operating period would be over
$10,000,000.
The main benefit of this more stringent approach is the restoration of
the ground water to usable quality in a shorter time period. Since no current
or anticipated future uses of the ground water are affected by the current
contamination, this benefit would appear to be small based on current
knowledge.
Strategy 3: Cleanup to Health-Based Standards Only Vhere Actual or Imminent
Exposure Exists
In contrast to the above example, Strategy 3 would require minimal
action at ART because no exposures are occurring or likely to occur in the
foreseeable future. The action required under the Exposure-Based Scenario
would be limited to ground-water monitoring of the movement of the plume to
ensure that any migration threatening ground-water wells would be detected in
time to allow actions to be taken to prevent exposures. No source control
would be put in place and the ground water would not be restored.
The cost for monitoring alone would be less than $70,000, making this
the least costly alternative. This alternative would provide only assurance
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5-9
against future exposures. This option provides no benefits beyond those
benefits outlined in the selected remedy and does not provide the benefit of a
restored aquifer until the contaminant source is depleted and the plume
dissipates through natural processes.
5.3 HYPOTHETICAL FACILITY TWO -- ELECTROMECHANICAL PRODUCTS AND TESTING, INC.
5.3.1 Background
Electromechanical Products and Testing, Inc. (EMPTI) is a 45-acre
electrical equipment manufacturing plant constructed in the mid-1950s. The
plant manufactures several types of electrical equipment, including
capacitors, transformers, and small motors. Operations performed at the plant
include machining and metals fabrication, electroplating, solvent degreasing,
product assembly, and painting.
Wastes generated from plant operations include solvent and metal
contaminated wastewaters, concentrated solvent wastes, cooling and machining
oils, and paint wastes. Process wastewaters are treated in a surface
impoundment and then discharged to a small publicly owned treatment works
(POTW). Non-hazardous cooling and machining oils are evaporated on site.
Concentrated solvent wastes and sludges are packed in drums and shipped off
site for recycling or disposal.
Location
EMPTI is located in a predominantly rural area and is bordered on the
south and east by farmland, with several farm residences located within one-
half mile of the facility boundary. The EMPTI plant is bounded on the north
and west by a community of 5,000 people. A residential subdivision is located
within 600 feet of the northwestern border of the plant. An elementary school
serving the subdivision is 500 feet from the plant boundary. The local
economy is based on agriculture and light industry, and EMPTI is a major local
employer.
The area is a flat, arid alluvial plain composed of inter-bedded sands,
silts, gravels, and clays. Several water bearing units combine to form a
large surficial aquifer system within these inter-bedded deposits. This
aquifer system-extends in depth from 40 to 400 feet below the surface and is
the primary supply of water for domestic, agricultural, and industrial uses in
the community. Horizontal permeabilities in this aquifer range from 10~* to
10'3 cm/sec; vertical permeabilities range from 10~6 to 10~s cm/sec. Around
the EMPTI plant, horizontal ground-water flow is moderately rapid
(approximately lOOm/yr) and primarily from the southeast to northwest. A
downgradient municipal water supply well for the community is located
approximately 450 feet west of the facility boundary. A few private domestic
wells serve the surrounding farm residences.
The surficial aquifer is underlain by a clay aquitard extending
approximately from 400 to 600 feet below the surface. Water bearing units
underlying this aquitard contain a confined saline aquifer which is not usable
for domestic, agricultural, or industrial purposes.
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5-10
The region is arid, with an average annual precipitation of 16 inches
and an average annual evapotranspiration of AO inches. The nearest surface
water is a river located one-half mile east of the plant. There is no surface
drainage from the facility to any surface water body.
Solid Waste Management Units
The plant has several RCRA permitted waste management units used for
storing and treating hazardous waste generated during manufacturing. These
units are:
¦ Tank and drum storage units for holding waste solvents
and sludges prior to off-site disposal.
¦ A double-lined surface impoundment used to treat
process wastewaters.
The plant also has several other operating or closed solid waste
management units. These units cover approximately 15 acres and are as
follows:
¦ Three closed lagoons used from the 1950s until 1980
for storing, treating, and disposing of process
wastewaters and sludges. These units cover about five
acres. They have not been properly closed (i.e.,
capped); however, there is no standing water remaining
in them.
¦ One operating lagoon used since the 1950s for the
disposal (by evaporation) of non-hazardous machine
coolants, cutting oils (which generally contain about
95 percent water and 5 percent oil) and cooling
waters. This lagoon covers five acres.
¦ Five landfill trenches used from 1958 to 1978 for
disposing of solid wastes, including paint sludges,
electroplating sludges, sludges from vapor degreasers,
paint solvents, other waste solvents, rags, and other
plant wastes. The trenches cover five acres and have
been covered with about a foot of soil.
Wastes managed at EMPTI have contained trichlorethylene, methylene
chloride, varsol, toluene, xylenes, methyl ethyl ketone, methanol, and other
solvents. Waste polychlorinated biphenyls (PCBs) from transformer and
capacitor production were disposed of in rags, transformer and capacitor
casings, and other wastes. Additionally, wastewater-treatment and
electroplating sludges disposed in the impoundments and landfill contained a
variety of metals, including nickel, cadmium, and copper.
5.3.2 RCRA Facility Investigation Results
The EPA Regional Office conducted a RCRA Facility Assessment (RFA) of
the EMPTI plant during the review of EMPTI's RCRA Part B permit application.
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5-11
The RFA results indicated that the following SWMUs were potential sources of
hazardous waste and/or constituent releases:
¦ The three closed lagoons that had been used for
treating, storing, and disposing of process
wastewaters.
¦ The "regulated unit" surface impoundment used for
treating process wastewaters.
¦ The operating lagoon used for disposal of coolants,
cooling water, and cutting oils.
¦ The five landfill trenches used for solid waste
disposal.
As a result of the RFA, EMPTI was required to conduct a RCRA Facility
Investigation (RFI) under the permit schedule of compliance. EMPTI developed
and submitted a plan for the RFI which provided for sampling and other
investigations necessary to characterize the nature, direction, rate,
movement, and concentration of possible contaminant releases from these SWMUs.
Upon approval of the plan by EPA, EMPTI carried out the RFI. The RFI results
are summarized below.
Release Characterization
The RFI results demonstrated that SWMUs at EMPTI were releasing
hazardous constituents to the air, soil, and ground water. The following
releases were identified.
¦ Air - - trichloroethylene was found in air samples
taken at the plant and on adjacent property to the
northeast.
¦ Soil -- PCBs, cadmium, and nickel were found in
surficial soils surrounding the three closed lagoons.
PCBs, trichloroethylene, methylene chloride,
dichloroethylene, cadmium, and nickel were found in
deeper soils under these lagoons. Trichloroethylene,
methylene chloride, and dichloroethylene were found in
soils under the landfill trenches.
¦ Groundwater -- trichloroethylene, methylene chloride,
dichloroethylene, and vinyl chloride were found in
ground water downgradient of the landfill trenches and
closed lagoons.
A magnetometer survey conducted during the RFI revealed 25 magnetic
anomalies in the landfill trenches. These were assumed to be drums that could
become sources of solvent releases if allowed to remain in the landfill.
It was determined that the lagoon used for management of cooling oils
was not a source of releases of hazardous constituents.
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5-12
Concentrations of the contaminants found and their action levels
specified in the facility's permit are shown, by medium, in Exhibit 5-2 The
following contaminants were found to have been released at concentrations
exceeding action levels:
¦ Air -- trichlorethylene, released from the treatment
surface impoundment.
¦ Soils -- PCBs in soil surrounding the closed lagoons
exceeded action levels for exposure through direct
ingestion of the contaminated soil. Additionally,
soil under the closed impoundments and landfill
contained sufficient contaminants to be of concern as
a source of ground-water contamination.
• Ground water -- trichloroethylene, methylene chloride,
dichloroethylene, and vinyl chloride.
Trichloroethylene and methylene chloride were
determined to be released by leaching from the closed
lagoons, the landfill trenches and contaminated soil
under the lagoons. Dichloroethylene and vinyl
chloride were determined to be present as a result of
the degradation of trichloroethylene.
Health and Environmental Assessment
EMPTl's site investigation contractor assessed the extent of contaminant
releases and evaluated potential routes of exposure to released contaminants
through monitoring at potential exposure points and through migration
modeling. The principal routes of exposure evaluated were air and ground
water.
The contractor monitored air quality at nearby residences and at the
elementary school, and determined the prevailing wind direction and velocity.
The contractor periodically sampled the municipal water supply well
downgradient of the plant and installed and sampled additional ground-water
monitoring wells to delineate the extent of ground-water contamination.
The results of the monitoring and data evaluation indicated the
following:
Air -- Levels of trichloroethylene in exceedance of
action levels were measured at the facility boundary
approximately 50 percent of the time. The prevailing
wind direction was easterly.
Ground water -- the municipal supply well was
contaminated with trichloroethylene, dichloroethylene,
and vinyl chloride at concentrations below the action
level. Extrapolation of future contaminant migration
indicated that concentrations in the well would exceed
action levels in one to two years.
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5-13
EXHIBIT 5-2
COMPARISON OF MAXIMUM CONTAMINANT CONCENTRATIONS AT EMPTI TO ACTION LEVELS
CONSTITUENTS
Trichloro- Methylene Dichloro- Vinyl
MEDIUM ethylene Chloride
Ground
Vater:
Maximum Level
Observed
(mg/1) 0.5
Action Level
(mg/1) 0.005
Soli:1
Maximum Level
Observed
(mg/kg) 10.6
Action Level
(mg/kg) 64¦0
0.9
12.3
93.0
Chloride PCB's Nickel Cadmium
0.4
0.0047 0.007
1.1
12.0
0.3 N.D.
0.002
N.D. N.D.
N.D. 22.4
0.091 1,600.0
120.5 15.1
U R.2
Air:3
Maximum Level
Observed
(ug/m3) 0.45 N.D. N.D.
Action Level
(ug/m3) 0.27
N.D. N.D.
N.D. N.D.
1 Action levels are not applicable because concentrations were observed in
subsurface soils for vhlch there was no plausible route of exposure through
direct contact. No surface contamination vas observed for contaminants other
than those for which action levels are provided.
2 This soil action level was under review at the time of preparation of this
document.
3 Measured at the eastern boundary of the facility property.
N.D. •• Not Detectable
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5-14
The results of the investigation are shown on Exhibit 5-3.
Based on these results, the EPA Regional Office determined that interim
measures were necessary at EMPTI to address the potential problem of
contamination of the drinking water supply well. EMPTI was required to close
and replace the well. EMPTI drilled a new well, connected it to the municipal
system, and sealed the old well. EMPTI also supplied an alternative water
source until the new system was operable.
Additionally, the Regional Office determined that wind-blown soil from
the closed lagoons posed a plausible route of exposure to contaminated surface
soil and required EMPTI to sample surface soil near the school and in the
subdivision. The results of this sampling were negative; no surface soil
contamination was found.
5.3.3 Corrective Measures Study
In the CMS, several remedial alternatives were evaluated for addressing
the ground water contamination, including an assessment of a number of
different approaches to controlling the source of the contamination. In
addition, measures that could be effective in controlling the air emissions
from the operating surface impoundment were examined.
Selected Remedy
In selecting the remedy for the facility, EPA designated an area
circumscribing the three "closed" lagoons as a corrective action management
unit (CAMU). Since the wastes in the three old lagoons were essentially
identical, and since the soil surrounding the units was also contaminated, the
decision was that it would be sensible to treat this area as a single remedial
unit for the purpose of implementing source control measures. The selected
remedy required EMPTI to excavate the sludges from each of the impoundments,
treat those wastes through a stabilization process, and consolidate them into
a single nearby clay-lined area that was formerly the middle lagoon. A clay-
soil cap over the disposal area was also required.
More specifically, the remedy selected by EPA for implementation at the
EMPTI site consisted of the following corrective measures:
¦ Source control:
A 10-acre clay-synthetic cap was required to be
installed over the .landfill trenches and closed
lagoons. The contractor's study estimated that,
following the removal of any remaining liquid
drummed solvents, the cap should minimize future
releases of contaminants from the landfill and
lagoons by effectively eliminating percolation
through the wastes and contaminated subsurface
soil. Also the cap should also eliminate the
possibility of direct contact with the wastes
and surrounding contaminated soils.
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5-15
Exhibit
Extent of Contamination at EMPTI
Subdivision
~
Elementary
School
rum & Tank
Storage Area
o
/
I
\
/
Municipal y
Supply Well y
\
Ground-Water
Flow
IP
ft*:'
:W.
EMPWf!
Plant ||
ill
renches\
\J\J\J\J
Closed Lagoons
Coolant and
Cooling Water
Lagoon
Surface Impoundment
Key
!\\\i
Area of Ground-Water Plum* Exceeding Action Level
Extent of Surface Soil Contamination Exceeding Action Level
Facility Boundary
Scale: 400 ft/In
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5-16
Excavation and off-site disposal of 25 buried
drums discovered in the landfill trenches during
the RFI.
¦ Ground-water remediation:
Installation of a ground-water withdrawal system
consisting of eight well points to remove
contaminated ground water.
Pumping and treatment of contaminated ground
water with activated carbon. Treated ground
water would be discharged under the facility's
existing NPDES permit, along with the treated
process wastewaters already discharged under the
permit.
¦ Ground-water monitoring:
Installation of twelve additional monitoring
wells throughout the plume area.
Sampling and analysis, on a quarterly basis,
throughout the corrective action period to
determine progress in meeting cleanup objectives
and evaluate the effectiveness of the action.
¦ Air:
Although air releases above action levels were
detected at the facility boundary, levels of
concern were not detected at residences or at
the nearby school. Therefore, actual corrective
action for air releases was not required.
Continued periodic monitoring of air emissions
was required, however, and under the terms of a
permit condition, EMPTI is required to notify
EPA if changes in land use surrounding the
facility trigger the need to reconsider remedies
for the air releases.
EMPTI's contractor estimated, through use of a site-specific model, that
the ground-water cleanup would probably require operation of the pump-and-
treat system for 20 to 30 years, with a significant possibility that the
required operating period could be longer. EMPTI has provided appropriate
financial assurances for this duration. We have assumed that the cleanup
would be achieved in 30 years for purposes of estimating corrective action
costs.
The selected remedy minimizes potential human and environmental
exposures to contaminants by controlling the sources of releases and removing
contamination that has been released to ground water. The remedy also
protects against direct contact exposure to contaminants remaining at the
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5-17
facility. The alternative does not pose significant risks to the local
population during construction, in part because it does not involve excavation
of contaminated wastes and soil. Excavation of contaminated wastes and soil,
considered as an alternative in the CMS, would liberate buried volatile
organics and could result in significant short-term exposures and risks The
excavated drums will be managed off-site in compliance with applicable RCRA
standards.
Based on the contractor's hydrogeologic investigations, it was concluded
that no technically proven methods are more likely to achieve the ground-water
standard at this site than pumping and treating. However, innovative
technologies under development (such as in-situ bioremediation) could
eventually prove more effective.
The remedy does require long-term maintenance of the RCRA cap covering
the wastes left in the impoundments and the landfill. However, maintenance
should not be extensive because of the arid nature of the region, and EMPTI
has committed resources necessary to maintain the site by establishing a
suitable financial assurance instrument.
Costs and Benefits
The estimated cost for performing the selected remedy is approximately
$5 million in capital costs and $100,000 per year in operation and maintenance
costs. The major capital expense for the corrective action is the cap over
the trenches and the closed lagoons; this accounts for about 90 percent of the
cost. The major cost component for operation and maintenance costs is
operation of the ground-water treatment system. Ue have assumed a 30 year
operation and maintenance period for the ground-water pumping and treatment
system, and that the cap will not need replacement; however, the withdrawal
system may need to operate longer than 30 years to achieve the media cleanup
standards.
Benefits from the selected action occur in two categories: resource use
and other benefits:
¦ The principal resource use benefit accrued as a result
of the action is availability of current and future
water supply. The action prevents the spread of
contamination in ground water in the area, preserving
ground water beyond the limits of the plume for
current and future use as a water supply.
¦ Other benefits of the action are the preservation of
existence and bequest values of the ground water.
Because of the arid nature of the region, ground water
would be expected to be valued highly both as a
current source of water and as a source of water for
future generations. Local residents would be expected
to place a high value on maintaining ground water in
an uncontaminated state, even if it is not currently
used as a water source. Thus, returning the
contaminated ground water to an uncontaminated state,
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5-18
and preventing contamination of a larger volume of
ground water, would restore and preserve existence and
bequest values that would be lost if contaminants were
allowed to remain.
5.3.4 Corrective Actions Under Alternative Regulatory Approaches
The corrective measure selected and discussed above was chosen based
upon the proposed regulatory option for corrective actions. The corrective
measures selected for EMPTI would be different under alternative regulatory
approaches which are designed to achieve a greater or lesser degree of
protection of human health and the environment than the proposed option. In
the following sections we discuss the corrective measures that might be
required at EMPTI under the two major regulatory approaches EPA considered in
developing the proposed rule.
Strategy 1: Cleanup to Background Levels As Soon As Practicable For All
Facilities
Under this Strategy, EMPTI would be required to use extensive treatment
to control contaminant sources, i.e., the landfill and closed lagoons. Source
control would probably require the removal, treatment, and redisposal of most,
if not all, wastes and soil contaminated above background levels. A ground
water pump-and-treat system would be installed. In addition, technology such
as air-stripping with carbon absorption (or the equivalent) would be required
to control air emissions.
We have estimated the incremental costs of removing wastes and
contaminated soil and transporting them off-site for treatment and redisposal,
and the cost associated with air treatment. We have assumed that
approximately a third of the wastes would require treatment, and that the
remainder could be placed in landfills without treatment. We estimate that
the incremental cost of performing the maximum protection alternative at EMPTI
would be approximately $100 million. Treatment alone accounts for about one
third of the incremental cost. Excavation and transportation are the next
most expensive components, with each contributing about 20 percent of the
cost.
The incremental benefits provided by this type of remedy, although
difficult to quantify, would be in EPA's opinion very small. The contaminated
ground water that would be restored to drinkable levels under the selected
remedy would be marginally purer, but not necessarily more valuable as a
resource. The likely remedy under Strategy 1, however, would be expected to
be more reliable over the long term In preventing further releases of concern.
This is somewhat offset under the selected remedy by the requirements
specified in the permit for extended monitoring to detect future releases, and
maintenance requirements for the caps.
Strategy 3: Cleanup to Health-Based Standards Only Where Actual or Imminent
Exposure Exists
A remedy at EMPTI under Strategy 3 would likely consist of providing an
alternative water supply to the existing supply well and some limited capping
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5-19
to minimize further releases to ground water. Access to plant grounds would
be controlled in order to prevent any future exposures through direct contact
with contaminated soil. The estimated cost of these measures is approximately
$200,000.
This alternative does not provide any of the resource use benefits
provided by the selected measure because ground-water contamination would not
be cleaned up. It also does not provide benefits in the form of preserved
existence or bequest value of ground water.
5.4 HYPOTHETICAL FACILITY THREE -- OFFSITE WASTES, Ltd.
5.4.1 Background
Offsite Wastes, Ltd., (OWL) comprises a 150-acre site owned and operated
by an environmental waste management firm. The owner/operator currently
operates a 40-acre RCRA Subtitle C regulated landfill at this site. Only one
other solid waste management unit (SWMU) exits at this site: a 60-acre
landfill that rises about 100 feet above the surrounding topography and
contains approximately 6 million cubic yards of waste. This unit was in
operation from the late 1950s until 1980. Solid and liquid hazardous wastes
and other hazardous substances have been disposed in this SWMU.
Location
The OWL facility is located in a mixed-use area near the southern edge
of the suburban community of Bridgetown (population 30,000). The surrounding
land-use is residential to the east and north; light industrial to the south
along the Route X corridor; and agricultural to the west and northwest. A
recreational area lies about 3,500 feet north of the facility along Berry
Lake. Because of contamination, the recreational area, which was once popular
for fishing, swimming, and water sports, has been reduced over the years to a
picnic area. Berry Lake no longer supports any fish, and the park authorities
have closed the lake to swimming.
Berry Run is a stream that originates in the southwest and flows
northward along the western edge of the landfill, draining into Berry Lake.
From Berry Lake, Berry Run flows into the Woodbine River approximately 3,000
feet further downstream. One quarter mile from the confluence of Berry Run
and the Woodbine River is the Bridgetown drinking water intake.
The closest homes to the site are part of the Berry Lake Subdivision and
are about 2,000 feet from the northeast toe of the inactive landfill. Fifty
people reside in this subdivision. A second subdivision lies to the south-
east. Several isolated residences lie in the agricultural area to the
northwest, across Berry Run.
The site is located in the Atlantic Coastal Plain Region and overlays
six geologic formations. Sand and gravel, sand, and sandy clay comprise the
majority of sediments in these formations. Within these formations are two
aquifers separated by a clay/sandy-clay aquitard approximately 70 to 100 feet
thick. In the area of the facility, this aquitard is located at a depth of
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5-20
approximately 100 to 120 feet below natural surface elevations and is composed
of sandy clays with permeabilities of 1 x 10~6 cm/sec. There is a small
amount of flow from the upper to the lower aquifer through this aquitard.
Some local wells (in the Berry Lake Subdivision, which is not serviced with
municipal water from Bridgetown) are developed from the upper aquifer. The
lower aquifer is an important source of municipal water for Wytheville
(population 15,000) which lies about one mile south of the OWL facility.
The surficial aquifer is unconfined to semi-confined. Ground water in
this aquifer generally flows north to northwest. The inactive landfill is
situated directly over this aquifer, and in some areas, contacts the saturated
zone. The mean seasonal high water table under the landfill is 10 to 12 feet
below natural surface elevation. Estimated ground-water flow velocity is
between 15 and 60 meters per year; permeability coefficients for deposits
composing this aquifer vary from 5 x 10~5 to 5 x 10"3 cm/sec.
The lower aquifer is confined and ground water flows to the south,
towards the Wytheville municipal well field. The ground-water flow rate in
this aquifer is slow, estimated to be 8 meters per year; the permeability
coefficient of deposits in this aquifer is approximately 3 x 10"5 cm/sec.
The climate of the area is moist, with average annual precipitation of
45 inches and average annual evapotranspiration of 30 inches per year. The
average temperature is 55°F.
Solid Waste Management Units
The regulated operating unit was opened in 1980. Total estimated
capacity of the unit is 4 million cubic yards; currently, 1 million cubic
yards have been disposed in the unit, covering 10 of the unit's 40 acres. The
unit was subdivided in 1985; the filled cells were capped, and a composite
liner and leachate collection system was constructed for the remaining 30
acres. The composite liner is composed of a three-foot thick clay bottom
liner and 40-mil thick synthetic top liner, separated by a drainage layer.
Since that time, an additional 250,000 cubic yards of waste have been disposed
in the lined section.
The 60-acre inactive landfill operated from 1958 until April 1980.
During the summer of 1980, a cap composed of six inches of clay covered by a
topsoil layer was installed. This unit extends from a depth of 10 to 20 feet
below grade to a height of 100 feet above grade and contains an estimated 6
million cubic yards of waste.
Wastes disposed of in this inactive unit include sludges from municipal
and industrial waste treatment facilities, municipal solid waste, and a
variety of industrial wastes including spent solvents (F001, F002), pesticide
formulations, wood preserving sediment and sludge (K001), off-specification
products, and debris. Additionally, residues from a veterinary pharmaceutical
firm were disposed in the unit for a five-year period between 1975 and 1980.
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5-21
5.A.2 RCRA Facility Investigation Results
The EPA Regional Office conducted a RCRA Facility Assessment (RFA) of
the OWL site as part of the Part B permit process when OWL applied for an
operating permit. Based upon evidence of surface water contamination obtained
during the RFA, the requirement to conduct a RCRA Facility Investigation (RFI)
was included in a permit schedule of compliance, issued as part of OWL's RCRA
permit. The RFA also noted the potential for contamination in other media;
hence, the RFI also addressed releases to ground water, soil and sediments,
and air. OWL's RFI results are summarized below.
Release Characterization
No releases from the operating regulated unit were identified in
performing the RFI. The following releases from the closed landfill were
identified in soil, surface water and sediments, ground water, and air:
¦ Ambient air samples taken at the perimeter of the unit
showed very low concentrations of methylene chloride
and 1,2-dichloroethane. Beyond the perimeter of the
landfill, contaminant levels fell below detection
limits.
¦ Analysis of soil obtained from borings in the
unsaturated zone beneath the unit showed contamination
with phenol, methylene chloride, 1,2-dichloroethane,
and pentachlorophenol.
¦ During the RFI, OWL noted several leachate seeps on
the west and northwest slopes of the landfill.
Leachate from these seeps contaminated about 10 acres
of surface soil between the landfill and Berry Run.
Pentachlorophenol and phenol were found in the soil
down to one foot below the surface.
¦ After conducting ground-water sampling, benzene, 1,2-
dichloroethane, methylene chloride, and phenol were
found in the surficial aquifer. Sampling in the
deeper aquifer downgradient of the facility indicated
that there is no contamination in this aquifer from
the units.
¦ Water quality analyses of samples taken from Berry Run
and Berry Lake found significant levels of hazardous
constituents including benzene, phenol, and
pentachlorophenol.
¦ Sediments sampled in Berry Run and Berry Lake showed
pentachlorophenol contamination.
The concentration of the contaminants found and their action levels
specified in the facility's permit are shown, by medium, in Exhibit 5-4. The
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5-22
EXHIBIT 5-4
COMPARISON OF MAXIMUM CONTAMINANT CONCENTRATIONS AT OWL TO ACTION LEVELS
HfiPXW Benzene
Ground Water:
Maximum Level
Observed (mg/1) 1.8
Action Level
(mg/1) 0.005
Surface tfater:
Maximum Level
Observed (mg/1) 0.03
Action Level
(mg/1) 0.005
Soil:
Maximum Level
Observed (mg/kg) N.D.
Action Level
(mg/kg)
Air:1
Maximum Level
Observed (ug/m3) N.D.
Action Level
(ug/m3)
CONSTITUENTS
1,2-dichloro- Methylene
ethane Chloride Phenol
0.35
0.005
N.D.
30.0
7.7
0.002
0.038
3.1
4.5
0.0047 1.4
N.D. 1.4
1.4
15.3
0.6
93.0 3,200
0.0006 N.D.
0.25
Pentachloro-
phenol
N.D.
0.069
1.1
3000
2,400
N.D.
1 Measured at unit boundary of inactive landfill. Operating regulated unit
had no detectable releases to air.
N.D. -- Not detectable.
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5-23
following contaminants were found to be released at concentrations at or
exceeding their action levels:
¦ Air - - none.
a Soil -- 1,2-dichloroethane, pentachlorophenol from
leachace from the inactive landfill percolating
through or over soils.
¦ Ground water -- benzene, 1,2-dichloroethane, methylene
chloride, phenol due to leachate from the inactive
unit migrating into the ground water and ground water
contacting about 10 acres of waste deposited below the
high water table. Monitoring results for the
upgradient regulated unit confirmed that the
contamination originates from the closed landfill.
¦ Surface water -- benzene, phenol from leachate flowing
over ground and reaching surface water and discharge
of contaminated ground water into surface water.
¦ Sediments -- pentachlorophenol in surface water
preferentially adsorbed onto the sediment particles.
Health and Environmental Assessment
In the RFI, OWL's scientists assessed the extent of the releases and
evaluated the potential for exposure to the releases in each of the affected
media. Their investigation identified the following areas with the potential
for exposure to contaminants released from the inactive unit:
¦ Soil -- There is no direct exposure potential to the
unsaturated zone soil under the inactive landfill;
however, contaminants in this soil may migrate into
ground water. Surface soil contaminated by leachate
and runoff has the potential for direct contact even
though the facility has restricted access.¦
¦ Ground water - - The plume extends about 1,500 feet to
the north and laterally to the northeast. It is
cutoff by Berry Run to the northwest and discharges
into the Run. Although the plume extends towards the
Berry Run Subdivision, the plume does not reach any
residential wells. At the current rate of expansion,
it will take about 10 years to reach the nearest
wells, through lateral expansion of the plume.
¦ Surface water -- Berry Run and Berry Lake do not
support aquatic life; therefore, exposure through fish
consumption is not presently possible. Swimming has
been prohibited by the authorities, limiting dermal
exposure; however, accidental exposure to contaminated
surface water is possible. Berry Run and Berry Lake
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5-24
have never been sources of drinking water. None of
the contaminants from the OWL site has been detected
in the surface water intake for Bridgetown. (A
surface water area of approximately 3 acres contacts
contaminated sediments.)
Presently, the only potential exposure is by accidental contact with
contaminated surface water and sediments in Berry Run and Berry Lake. Because
of this potential, additional restricted access to Berry Run and Berry Lake
was initiated as an interim measure.
The extent of the releases is shown in Exhibit 5-5.
5.4.3 Corrective Measures Study
The EPA Regional Office requested OWL to conduct a Corrective Measures
Study (CMS) after results from the RFI indicated that action levels were
exceeded in the following media: soil, ground water, and surface water.
Based on the results of the CMS, the following remedy was selected.
Selected Remedy
¦ Twenty well points were installed to lower the water
table below the inactive landfill and to capture
ground-water contaminants.
¦ Contaminated ground water was treated by the addition
of chemical oxidants. Treated ground water was
discharged to Berry Run.
¦ Ground-water monitoring was in place over the area of
the plume.
¦ A diversion ditch was constructed to prevent run-on to
the south side of the inactive landfill.
¦ Contaminated surface soil was excavated and
consolidated into the inactive landfill.
¦ A cap meeting RCRA §264.310 minimum technology
standards was installed over the inactive landfill.
¦ Berry Run was temporarily diverted and sediments from
the stream bed were excavated.
¦ Contaminated sediments were dredged from Berry Lake
and a temporary dewatering impoundment was installed.
Supernatant water was collected and a system designed
for ground-water treatment was put in place. Dried
sediments were disposed of in the regulated unit.
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5-25
Exhibit 5-5
Extent of Contamination at OWL
Berry Lake
And Recreation
Area
Upper Aquifer
Flow
o
O
o
o
o o
Berry Lake
Subdivision
Lower Aquifer
Inactive
Landfilll
Stream
Regulated
Berry Run
V\\\\\
— Area of Ground-Water Plum* Exceeding Action Laval
Extant of Soil Contamination Exceeding Action Laval
Extant of Surfaca Watar Contamination Excaadlng Action Laval
Facility Boundary
O Residential Watt I I Scala: 1400 ft/In
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5-26
The proposed remedy is intended to control the source of the releases,
capture and treat the contaminated ground water, and restore surface water
quality. Capping as a source control was selected over other options (e.g.,
excavation and treatment of waste in the inactive landfill), because the size
of this unit and limited treatment and disposal capacity made such actions
infeasible. The selected measures, over the time that it takes to implement
the action, will eliminate exposure to surface water and soils and reduce, to
an acceptable degree, the potential for future exposure to contaminated ground
water. Ground-water modeling efforts predict that contaminant concentrations
over the whole plume area will fall below the media cleanup standard within 20
years. The cap and the pump-and-treat controls are well established
corrective actions indicating a high degree of reliability. The removal of
sediment from both Berry Run and Berry Lake is a reliable measure because it
prevents further contamination of the surface waters. Water treatment alone
is not always sufficient to bring surface water quality to an acceptable
level. The wells and treatment unit should operate for 20 years prior to
replacement. The cap is estimated to need replacement after AO years.
Costs and Benefits
The corrective measures for OWL's solid waste management unit are
estimated to cost close to $60 million in initial capital costs, the majority
of which is the cost of the large cap required for a site of this size.
Annual operation and maintenance costs are estimated to be $4 million, plus
any additional capital replacement costs.
Once implemented, the chosen corrective measures would produce a number
of benefits by preventing further degradation of soil, ground water, and
surface water, and by actually restoring surface water quality. In an
uncorrected state, environmental problems at the site would continue to worsen
considerably. Because the damage is potentially severe, the corrective action
provides substantial benefits:
¦ Health -- The remedy eliminates the potential for any
future exposure to the contamination at or near the
site and Co contaminated drinking water. It can be
assumed that contamination of the residential wells in
the Berry Lake subdivision would be detected, and that
upon detection an alternative supply would be put in
place. However, the remedy eliminates any potential
health damages that could occur from drinking water
prior to detection.
¦ Use value *• Because the corrective measures restore
the quality of drinking water in the area, a major
benefit of the remedy is preserving the use value of
the water resources. Once the surface and ground
water are returned to a usable state, these resources
are once again available for future drinking water
use. By making these water sources available for
future use, the corrective measures save the cost of
developing alternative supplies.
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5-27
¦ Recreation value -- The corrective measures will
restore the recreational area at Berry lake once the
water quality is improved to levels that will allow
fishing, swimming, and boating. Once the surface
water is no longer contaminated, it is expected that
wildlife will return to the area. The value of these
resources for recreational use is restored. Because
the recreational area was once very large and provided
a recreational area for thousands of nearby residents,
this benefit is likely to be substantial.
¦ Non-use value --As with all types of natural
resources, people place a value on preserving a
resource in its natural state and preserving the
option to use the resource in the future. The chosen
remedy will return the area (stream, lake, and
aquifers) to its natural state over time and provide
such a benefit.
5.4.4 Corrective Actions Under Alternative Regulatory Approaches
The corrective measures selected and discussed above were chosen based
upon the proposed regulatory option for corrective action. The selected
measures would be different under regulatory scenarios that were anticipated
to achieve either a greater or lesser degree of protection for human health or
the environment. In the following section we discuss briefly corrective
measures that would be selected under alternative regulatory approaches
considered in the development of the corrective action standards. These
alternatives are the Maximum Protection Scenario and the Exposure-Based
Scenario.
Strategy 1: Cleanup to Background Levels As Soon As Practicable For All
Facilities
Under Strategy 1, OWL would probably be required to perform much more
extensive remediation. This would require all of the remediation steps in the
chosen remedy, with the addition of requiring removal of the highly
contaminated waste areas from the inactive landfill. This entails
identification of "hot spots," excavation, treatment (assumed to be
incineration), and disposal of the residuals.
The corrective measures for OUL's solid waste management unit under the
maximum protection alternative are estimated to cost $250 million in initial
capital costs. Approximately two thirds of the total cost (approximately $200
million) would be attributable to excavation of hot spots and on-site
incineration. Annual operation and maintenance costs are estimated to be $4
million, as in the chosen remedy.
This type of remedy would decrease the length of time necessary to
attain the ground-water cleanup standard, but modeling efforts predict that
time reduction would be insignificant (18 years instead of 20).
Identification, excavation, and treatment of the hot spots would delay capping
the landfill for at least a year. Preventing infiltration by capping was
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5-28
found to be more effective in reducing migration of contaminants to the ground
water than reducing contaminant content of the landfill. The time to
recapture released contaminants in the ground water, which would not be
affected by the excavation requirement, is the major factor in the time period
necessary to reach the media protection standard.
Strategy 3: Cleanup to Health-Based Standards Only Where Actual or Imminent
Exposure Exists
Under this regulatory strategy, OWL's remediation efforts would likely
be limited to the following corrective measures:
¦ Installation of a single layer clay cap over the
landfill.
¦ Maintaining restricted access to the stream and lake
indefinitely.
¦ Monitoring the movement of the ground-water plume and
of the surface water contamination.
¦ Replacing the water supply to the Berry Lake
Subdivision only when the wells show signs of
contaminat ion.
The present value capital costs of these remedies is less than $20
million. Annual operation and maintenance costs are expected to be less than
$500,000 dollars.
The exposure-based alternative provides no incremental benefit over the
chosen remedy, and in fact, provides no benefit other than maintaining the
access restrictions, thereby reducing the likelihood of accidental contact
with the contamination. None of the resources is restored to a usable state.
Because the resources have not been restored there is no resource use benefit,
and no preservation of option value, existence value, or bequest value.
-------
PART 2
QUANTITATIVE ANALYSIS
OF GROUND-WATER CORRECTIVE ACTION
-------
6. APPROACH TO QUANTITATIVE ANALYSIS
EPA quantitatively analyzed five regulatory alternatives related to
ground water that were considered by the Agency in the development of the
proposed corrective action rule. This chapter describes the overall approach
to the analysis while Chapters 7 and 8 present the results of the analysis.
EPA limited its quantitative analyses to ground water, rather than
including other media, primarily because modeling tools for other media were
not readily available. This RIA, therefore, only examines quantitatively the
costs and effectiveness of the regulatory options in terms of protecting
ground water. The ground-water regulatory options are analyzed using one of
EPA's hazardous waste release, fate and transport, and corrective action
models (the Liner Location Model). This model and other such models have been
used extensively by EPA to analyze previous hazardous waste regulations. The
focus of previous hazardous waste regulations, however, has been the
protection of ground water.
The basic approach taken in the analysis involved use of the Liner
Location Model to simulate each of the five regulatory alternatives as it
would be applied at a sample of 65 RCRA facilities. This chapter first
describes the facility data base used in the RIA in Section 6.1. Section 6 2
then describes the model used to simulate ground-water contamination and
corrective action costs. The parameters used to distinguish among the
simulated regulatory alternatives are discussed in Section 6.3. The remaining
Section, 6.4, defines the five regulatory alternatives modeled in the RIA.
6.1 FACILITY DATA BASE
As explained in Chapter 2, there are over 5,600 RCRA facilities
potentially subject to EPA's proposed corrective action requirements. Since
it was not possible to study the effects of these requirements at each RCRA
facility, a sample of facilities was chosen and characterized. The
development of the facility data base is described in detail in Appendix A;
this section briefly explains how the data base was developed.
Because of the detailed nature of the RIA, EPA had to obtain a
significant amount of information on each facility included in the sample.
Required information included data on the types of waste management units at
the facility, the dates of operation of each unit, the types of wastes
handled, and the quantities of waste handled. A number of data sources for
this information were considered, including Part A and Part B permit
applications, RCRA inspection reports, responses to Regional requests for
information on solid waste management units (SVMUs), and RCRA exposure
assessments. None of these data sources was readily accessible and available
in a consistent format for use in this RIA. Consequently, RCRA Facility
Assessments (RFAs) were chosen as the primary source of information for the
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6-2
RIA. RFAs generally represent a compilation of several data sources on
individual facilities. Further, because RFAs are prepared as part of EPA's
existing corrective action process, they tend to include a great deal of
information relevant to the analysis of corrective action regulations.
Two factors limited the group of facilities in the sample. First, the
sample was limited by the fact that, as of April 1987,1 RFAs had been
completed at 624 facilities. Second, of these RFAs, 437 called for the next
step in the corrective action process, the RCRA Facility Investigation (RFI).
The other 187 facilities were determined not to require corrective action.
EPA assumed that facilities for which the RFA did not recommend an RFI pose
negligible environmental and human health damages. A sample was thus drawn
from the 437 facilities where the RFA indicated the need for the RFI. Because
EPA has placed a priority on completing RFAs at land disposal facilities, a
significant fraction of the available RFAs are for land disposal facilities; a
simple random sample of the available RFAs would thus not have produced a
representative sample. Consequently, EPA stratified the sample based on
facility type. As a result, the proportions of land disposal (26.3 percent),
treatment/storage (70.2 percent), and incineration facilities (3.5 percent) in
the sample are approximately the same as in the population of RCRA facilities
assumed to require an RFI.
The final sample includes 65 facilities, of which 21 are land disposal,
41 are treatment/storage, and three are incineration. Because of the way the
sample was selected, these facilities are intended to represent only those
facilities at which the RFA will call for an RFI. As explained in Appendix A,
these facilities are believed to represent about 62 percent of all facilities.
At the other 38 percent of all facilities, environmental damages and
corrective action costs are all assumed to be negligible.
Analytic results related to the entire population of RCRA facilities
presented in Chapters 7 and 8 thus include an adjustment for the fact that, in
addition to the effects observed at facilities represented in the sample,
there will be no impacts on those facilities (i.e., those where an RFI is not
required) not represented in the sample. In calculating the number of
facilities undertaking corrective action, for example, a two-step process was
used. First, it was determined that roughly 50 percent of the facilities in
the sample, i.e., those with RFIs, would trigger corrective action. Second,
because the sample represents only the 62 percent of all facilities likely to
receive an RFI, the proportion of all facilities triggering corrective action
was calculated as 50 percent of 62 percent, or 31 percent. This adjustment
assumes that facilities that do not require an RFI will also not trigger
corrective action. As a result, the calculations accurately represent all
facilities potentially subject to the corrective action program, not just
those where an RFI is required.
Each of the 65 facilities was characterized based on a review of the
information contained in the RFA and, where data were unavailable, based on
best professional judgement. This process yielded the following parameters:
1 The sample of facilities was drawn in April 1987.
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6-3
¦ Number and types of SUMUs at the facility;
¦ Dates of operation of SWMUs;
¦ Types and quantities o'f wastes managed in SWMUs;
¦ Regulatory status of each SWMU; and
¦ Other information related to Federal
ownership and type of facility.
Using EPA's DRASTIC system, the hydrogeology and climatic setting of each
facility were also characterized by locating the geographic coordinates of the
facility within a particular DRASTIC setting. Each DRASTIC setting was
defined in terms of depth to ground water, net infiltration, saturated and
unsaturated zone permeabilities, and ground-water velocity. The facilities in
this data base were then analyzed as described in the following section.
6.2 MODELING OF GROUND-WATER CONTAMINATION AND CORRECTIVE ACTIONS
The quantitative analysis of ground-water regulatory options in this RIA
uses a computer simulation model developed by EPA. This model, the Liner
Location Model (LLM), simulates ground-water contamination at hazardous waste
management facilities. The LLM was developed several years ago by EPA's
Office of Solid Waste to analyze the costs and risks of various hazardous
waste design and operating regulations. The LLM was modified for use in this
RIA and has been used to estimate effectiveness and corrective action costs
for contaminated ground water. As shown in Exhibit 6-1, the LLM consists of
several parts, each of which is briefly described below.2
6.2.1 Facility, Waste, and Environment Characteristics
The LLM begins with a basic characterization of each facility to be
analyzed. This information, which describes the operation of all SWMUs at the
facility, the types and quantities of wastes managed, and the facility
hydrogeologic and climatic setting, is used as an input to the model. For
this RIA, the facility data base described in Section 6.2 provided all
information necessary for facility characterization.
6.2.2 Releases of Hazardous Wastes
Based on the facility characterization, a facility-wide release profile
is generated. This release profile contains the total mass of each
contaminant constituent released in each year of the modeling period. For
this analysis, the modeling period extends for 200 years from 1920 to 2119.
The facility-wide release profile is calculated by summing, on an annual
basis, the release of each constituent from each individual SWMU at the
2 See also U.S. EPA, "The Liner Location Risk and Cost Analysis Model:
Phase II Report," prepared by ICF Incorporated, March 1986,
-------
EXHIBIT 6-1
OVERVIEW OF THE LINER LOCATION MODEL
Facility.
Simulate
Waste and
Generate
Fate
Environment
Releases
and
Characteristics
Transport
I
I
Simulate
Dose
Response
I
Simulate
Corrective
Action
T
I
I
Groundwater cleanup actions
Source control actions
0
1
*
Produce
Output
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6-5
facility. The approach used to estimate releases from a specific SWMU depends
on the SWMU type and, as described below, is based on methodologies developed
by EPA in support of previous rulemaking efforts.
For releases from landfills and surface impoundments, releases are
calculated by a stochastic Monte Carlo simulation model that estimates the
timing and magnitude of the contaminant release. These release profiles are
time dependent and the annual quantity of waste released may change over time.
Because of its stochastic nature, the simulation model produces a range of
release profiles which are clustered into relatively homogenous groups. A
release profile is then developed to represent each cluster. A weight, or
probability, for each of the representative release profiles is then derived
based on the likelihood of all profiles contained in the cluster. For this
RIA, EPA selected from among these representative profiles the release profile
with the greatest quantity of waste released that had a relative weight of at
least ten percent. Releases from landfills and surface impoundments are
simulated to continue until a mass balance calculation indicates that no
contaminant mass remains in the unit.
Releases from tanks are simulated in a similar fashion based on the
results of EPA's Hazardous Waste Tank Failure Model (HWTFM).3 The HWTFM is
also a stochastic model and generates several release profiles for each of
several different tank technologies. For each technology, these release
profiles are clustered and representative profiles are developed for each
cluster. A single profile is then selected from among the representative
profiles. The selected profile is the one with the greatest quantity released
and a relative weight of at least ten percent. These profiles were estimated
for an assumed 20 year operating life. Consequently, the profiles must be
adjusted based on the different reported operating lifetimes for the tanks
located at facilities in the sample data base. For tanks in operation less
than 20 years, the release profile is truncated at the year of closure and
releases are set to zero. For tanks operating for more than 20 years, the
annual quantity of waste released every year after year 20 is assumed to be
the average annual profile quantity estimated for years between 15 and 20
years.
Releases from land treatment units, waste piles, and injection wells are
estimated based upon the RCRA Risk-Cost Analysis Model (also known as the
W-E-T model).4 For each of these unit types, the W-E-T model estimates a
constant annual release during the unit's operating life. After unit closure,
EPA assumed that releases drop to 10 percent of the constant release and
continue releasing at that rate until all mass in the unit is depleted.
For other units, including container storage areas, waste recycling
units, and incineration units, simple algorithms were developed that estimate
the quantity of waste released as a function of the unit's throughput. EPA
3 See U.S. EPA, "Hazardous Waste Tank Risk Analysis, Draft Report,"
prepared by ICF Incorporated and Pope-Reid Associates Incorporated, June, 1986.
* See U.S. EPA, "The RCRA Risk-Cost Analysis Model, Phase III Report,"
Appendix D, prepared by ICF Incorporated, March, 1987.
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6-6
also developed a method for estimating the quantity of waste released to the
unsaturated zone from a systematic spill of waste on the ground.
6.2.3 Simulation of Fate and Transport
After the releases from all SWMUs have been aggregated into a single
facility-wide release profile, the fate and transport of the released
contaminants in the environment is simulated. Movement of contaminants
downward through the unsaturated zone is simulated using a modified version of
the McWhorter-Nelson Wetting Front Model that accounts for the degradation of
constituents and the delay associated with movement in the unsaturated zone.
Once contaminants reach the aquifer, their movement is simulated using a two-
dimensional random-walk particle tracking model (adapted from Prickett, et al,
1981).5 The concentration of each contaminant at each of several down-
gradient wells is then calculated.
6.2.A Simulation of Corrective Action
If the contaminant concentration at a ground-water monitoring well
exceeds a specific level, the LLM simulates the implementation of a corrective
action. Within the LLM, if corrective action is triggered, the model
estimates the costs of the corrective action and adjusts the contaminant
concentrations to reflect the impact of the action. The specific remedies
simulated by the model are:
1. Capping - Wastes in the unit are capped to prevent
infiltration of precipitation. Capping is assumed to
be up to 100 percent effective in reducing the
concentration of contaminants measured in the ground-
water contaminant plume for 35 years. After 35 years,
the model assumes that the cap will immediately fail.
2. Recovery wells - Ground-water recovery wells pump and
treat contaminated ground water. Recovery wells are
generally assumed to be 95 percent effective in
reducing the concentration of contaminants in the
plume (i.e., the concentration of a hazardous
constituent is reduced 95 percent once the wells
become fully effective). Contaminant concentrations
at exposure wells located within the plume are,
however, reduced by an amount less than 95 percent.
3. Excavation - All wastes 'and the liner system are
excavated from the disposal unit. Excavation is
assumed to be 100 percent effective in eliminating the
release of wastes to the unsaturated zone. Non-land
based units and associated wastes (e.g., tanks) are
assumed to be excavated as well, using assumptions on
5 Prickett, T.A., T.C. Haymick, and L.G. Lonquist. 1981. "A 'Random Walk'
Solute Transport Model for Selected Groundwater Quality Evaluations." Bulletin
#65, Illinois State Water Survey.
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6-7
average tank volumes. The model assumes that all
wastes excavated from units are disposed off-site.
4 Excavation with recovery veils - The remedy is assumed
to be 100 percent effective at eliminating the release
of wastes to the unsaturated zone, but the
effectiveness of the wells in reducing contaminant
concentrations is generally assumed to be 95 percent,
as noted above.
These four remedies were selected to represent the range of costs and
effectiveness of available corrective action technologies. No other
combinations of remedies (e.g., capping with recovery wells), or types of
remedies, than those listed here are used in the model.
6.2.5 Remedy Selection
The model evaluates the four ground-water corrective measure remedies
and chooses a single remedy for each facility using three criteria. They are:
1. Effectiveness - Measures the number of years after
corrective action is triggered that are required for
the remedy to achieve the corrective action target
level at all wells located within 1,500 meters of the
unit boundary. In some regulatory options, it is
sometimes the case that one or more of the modeled
remedies require more than 132 years (i.e., beyond the
end of the model's time horizon) to achieve the target
level. The effectiveness of such remedies is set at
132 years and the fact that the target was not met is
noted by the model.6
2. Cost - Measures the net present value cost of
implementing the corrective measure remedy (discounted
at three percent to 1987). Chapter 8 of the RIA
discusses how the costs for ground-water corrective
action are calculated.
3. Feasibility - Measures the technical feasibility of
implementing a particular corrective action
technology. Remedies that are inappropriate for
particular releases from units are not selected (e.g.,
source control remedies are not selected if all wastes
have been released from Che unit).
Different remedy selection rules are used for each of the five
regulatory alternatives described in Section 6.4. These rules are based on
the three criteria listed above.
6 The assumptions used in measuring the effectiveness of the modeled
remedies are discussed in Chapter 7.
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After the model has simulated the release of contaminants, the fate and
transport of those contaminants in ground water, and the costs and effects of
corrective action, it produces a wide range of output that can be studied in
order to assess the costs and benefits of various regulatory options.
6.3 PARAMETERS USED TO DEFINE GROUND-WATER REGULATORY ALTERNATIVES
The simulated regulatory alternatives differ with respect to several key
model parameters:
¦ Units regulated;
¦ Regulated media;
• Corrective action trigger;
¦ Corrective action target;
¦ Point of compliance; and
¦ Extent of contamination.
Each of these parameters is described in turn below.
The units regulated differ among options. Under the baseline scenario,
for example, only active land disposal units that received hazardous waste
after July 26, 1982, known as "regulated units," are assumed to be subject to
the pre-HSWA RCRA Subpart F regulations (i.e., standards in effect prior to
1984 and prior to imposition of §264.101 requirements). Under Options A
through D, however, HSUA is assumed to extend corrective action to all solid
waste management units (SWMUs).
Of note is that only about 4 percent of all 83,000 solid waste
management units were subject to Subpart F requirements before HSUA. These
units are simulated to be subject to corrective action both in the baseline
and in Options A through D. The remaining 96 percent of all units that were
not previously required to address contaminant releases are assumed to be
subject to corrective action requirements only in Options A, B, C, and D.
The regulated media can potentially include air, ground water, surface
water, and soil. Prior to the enactment of HSUA, only releases to ground
water were regulated under RCRA; after enactment, releases to all media are
regulated. The quantitative analysis conducted in the R1A is generally
limited to corrective action for ground-water contamination. Thus, the
regulatory options analyzed in Chapters 7 and 8 are defined in terms of
ground-wacer corrective action only and therefore underestimate the number of
facilities with other types of releases regulated by the corrective action
requirements.
The corrective action trigger used in the model is the ground-water
contaminant concentration that the model uses to initiate cleanup. The
trigger concentration may vary with the stringency of the simulated regulatory
option. Depending on the option being simulated by the model, corrective
action can be triggered by a release that exceeds one or more of the
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following: a ground-water protection standard,7 a release in excess of a
background concentration,8 or a release in excess of a health-based standard.
In our analysis, the choice of a trigger concentration is closely linked to
the decision about where to monitor for compliance, as described below. The
specific triggers used in the model are listed in Appendix B. The model also
assumes for all options that the effects of corrective measure remedies start
one year after contaminant concentrations in excess of the applicable trigger
level are detected, based on an assumption that ground-water remedies take one
year to plan, construct, and implement.
The corrective action target is the contaminant concentration that the
corrective action must be designed to achieve in the model. When the target
concentration is reached, the simulated corrective action is considered
successful. Due to modeling limitations, all options are analyzed assuming
that the target level is equal to the trigger level.9 As with the corrective
action trigger, a determination must also be made about where to monitor for
compliance with the corrective action target.
The point of compliance is the physical point at which the corrective
action trigger and target levels are measured in the model. Depending on the
simulated option, several points of compliance are used in the model,
including:
7 The ground-water protection standard is a regulatory concept that is
discussed later in this chapter, under the baseline scenario definition.
8 Note that the model assumes for all scenarios modeled that background
levels are zero. As a result, the RIA may underestimate the likelihood of
triggering corrective action for all options and may overestimate the cost of the
baseline scenario and Option A, which both require cleanup to background.
9 This assumption may not directly reflect the implementation of the
proposed rule. Under the proposed rule, the corrective action target would be
set by the Director (i.e., the Director of the State environmental agency or the
EPA Regional Administrator) on a case-by-case basis at levels that are
protective. In setting the target, the Director may consider:
¦ Multiple contaminants in the medium;
¦ Exposure threats to sensitive environmental
receptors;
¦ Other site - specific exposures or potential
exposures to contaminated media; or
¦ The reliability, effectiveness, practicability,
or other relevant factors of the remedy.
The analysis included in the RIA is not, however, sufficiently detailed to
discern those situations in which target adjustments would be applied.
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¦ The edge of the waste management area (an
imaginary line circumscribing the waste
management unit or units - assumed to be 10
meters from the unit boundary);
¦ The facility boundary (the property line of the
hazardous waste management facility - assumed to
be 200 meters from the unit boundary); and
¦ The point of human exposure (the point of
potential human contact with the contaminated
medium - generally assumed to be 600 meters from
the unit boundary).
The point of compliance in the model is tied to the trigger for some options.
For example, because corrective action is triggered by human exposure in
excess of a health-based standard under Option 0, the point of compliance is
at the point of human exposure. Due to dispersion and attenuation of
contaminants in ground water, as the point of compliance is moved closer to
the unit boundary, the likelihood of a corrective action being triggered in
the model for a given contaminant concentration is increased.
The extent of contamination determines whether off-site corrective
action is required in the model. Prior to HSWA, off-site corrective action
was not required under Subpart F. Based on RCRA Section 3004(v), however,
Options A through D are assumed to include off-site cleanup, although the
timing of the off-site action varies among options.
6.4 DEFINITION OF GROUND-WATER REGULATORY ALTERNATIVES
This section describes each of the five regulatory alternatives used in
the quantitative analysis of ground-water contamination for this RIA. Its
major purpose is to focus on the modeling assumptions used in defining the
five alternatives. All of the differences between the five simulated options
and the proposed corrective action rule are not, therefore, described. Where
pertinent, however, comparisons between the proposed rule and the RIA are
drawn and implications for modeling results are discussed.
The RIA considers the following regulatory alternatives for addressing
ground-water releases:
¦ Baseline Scenario;
Option A: Immediate Cleanup to Background;
Option B: Immediate Cleanup to Standards;
Option C: Flexible Cleanup to Health-Based Standards;
Option D: Flexible Cleanup based on Actual Exposure.
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The baseline scenario described in chis chapter represents the
requirements under RCRA that were in effect prior to codification of the HSWA
corrective action requirements. The remaining four regulatory options (i.e.,
Options A through D) represent different approaches to implementing the
corrective action requirements of Sections 3004(u), 3004(v), and 3008(h) of
RCRA as well as concurrent changes to the existing Subpart F corrective action
program for regulated land disposal units. The proposed rule is actually
designed to address corrective action only under the authority of RCRA
Sections 3004(u) and (v) (i.e., by addressing waste management units not
already regulated at permitted facilities and releases to non-ground-water
media from regulated units). The procedures established in the rule for
Section 3004(u) (e.g., establishing media protection standards and selecting
corrective measure remedies) are, however, likely to be similar to those
procedures used in implementing corrective action orders under RCRA Section
3008(h). Furthermore, EPA is planning to revise the existing Subpart F
corrective action program for land disposal units at permitted facilities to
be consistent with the proposed rule. Therefore, the analyses done for the
RIA address the entire RCRA corrective action program (i.e., Sections 3004(u),
3004(v), 3008(h) and the existing program for regulated units).
In short, each of the regulatory options (other than the baseline
scenario) analyzed in the RIA assumes a single corrective action program that
is uniformly applied to all types of units at all RCRA Subtitle C facilities.
Each regulatory alternative is described in turn below.
6.4.1 Baseline Scenario
The baseline scenario is intended to represent the RCRA corrective
action regulations in effect prior to the codification of the 1984 HSWA
corrective action provisions and is the scenario against which the costs and
benefits of the other options are compared. In developing the proposed
corrective action rule, EPA did not consider an approach that followed the
baseline scenario because it would not have been consistent with the
Congressional mandate in HSWA.
Under the baseline scenario, EPA assumed that only land disposal units
(i.e., the subset of SWMUs that includes surface impoundments, waste piles,
land treatment units, and landfills) that received hazardous waste after July
26, 1982, are regulated under the Subpart F regulations and only contamination
of ground water is regulated. Although only land disposal units managing
waste after January 26, 1983 were subject to Subpart F before HSWA, current
EPA data on such facilities are based on land disposal units that received
wastes after July 26, 1982. Thus, this cutoff date is used for the RIA.
The simulated corrective action target is either background (i.e., the
background concentration of a waste in ground water) or an MCL (i.e. , a
Maximum Contaminant Level, defined as health-based concentration limits
established for hazardous constituents under the Safe Drinking Water Act) and
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is assumed to be the same as the trigger.10 For this scenario, EPA assumed
that only on-site cleanup (within the facility boundary) is required.
Moreover, based on earlier work done by the Office of Solid Waste, it was
assumed that the facility boundary is 200 meters down-gradient of the unit
boundary. Finally, the analysis assumes that ground-water removal and
treatment must be a part of any corrective action in the baseline scenario,
except when it is technically impracticable.
In addition, under the simulated baseline scenario, ground-water
contamination may exist further than 10 meters from the unit boundary since
ground-water monitoring is assumed to begin in 1987 even though facilities may
have been in operation for several years before this date. Releases prior to
1987 thus may have spread to further well distances. Therefore, the model
searches for contamination above the trigger level by examining ground water
contaminant concentrations at points between the 200 meter well, assumed to be
at the facility boundary, and the unit boundary. The monitoring well then is
located at the first on-site well at which contamination above the trigger
level is detected. Of note is that if the monitoring well is located at any
distance other than 10 meters, then contamination has been detected and
corrective action will begin in 1987.
Remedy selection rules were developed for each option in the model using
the selection criteria discussed above (i.e., effectiveness, cost, and
feasibility). The remedy selection rules are applied to each facility modeled
in each option. The selection rules are designed so that only one remedy is
selected at each facility. In the RIA model, the remedy selection rules for
the baseline scenario are:
Rule 1. If recovery wells reach the target within
the modeling timeframe, select recovery
wells.
Rule 2. If recovery wells are technically
impractical (i.e., target concentrations
are not reached within the modeling time
period) and if capping is feasible (i.e.,
contaminants remain in the unit), select
capping. If not, select recovery wells.
6.4.2 Option A: Immediate Cleanup To Background
This option is the strictest option among those considered in this RIA.
It would provide for maximum protection of human health and the environment.
10 Under the Subpart F regulations, the owner or operator may also
request that an ACL (i.e., Alternate Concentration Limits, defined as a site-
specific health-based standard that will not adversely affect human health and
the environment) be used as the ground-water protection standard. ACL's are
determined on a site-specific basis. Since the Liner Location Model is not
currently structured to allow simulation of the use of ACL's, this RIA does
not consider the use of ACL's under anv of the regulatory alternatives. As a
result, the RIA may overestimate the cost of the baseline scenario.
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In comparison to the baseline, it would cover all SWMUs rather than just
regulated land disposal units. Any detectable release to ground water in
excess of background levels would trigger immediate corrective action and
source control remedies (i.e., excavation or excavation with recovery wells)
would be required. The rationale for the option is that requiring strict
cleanup to background levels using source control remedies would provide the
greatest degree of protection to human health and the environment. Source
control corrective action remedies would be required on the grounds that on-
site containment of wastes may cause future releases and require additional
cleanups.
Because of previous waste management activities at a facility,
contamination may already exist in the first year of the corrective action
program. The model is thus structured to mimic the investigative process of
the RFI to locate all contamination at a facility. Under Option A, the model
begins searching for contamination in 1987 at the well located 1,500 meters
from the unit boundary and continues inward toward the unit until
contamination above the trigger level is measured at a particular well
distance. The monitoring well is then located at this well distance and
corrective action is begun in 1987. If there is no simulated contamination
beyond the 10 meter well in 1987, then the 10 meter well is used as the
monitoring well. The difference between the baseline scenario and Option A is
that, under the baseline scenario, the search for contamination simulated to
occur in 1987 does not consider off-site contamination while, due to RCRA
Section 3004(v), Option A includes an analysis of contamination up to 1,500
meters down-gradient (i.e., the limit of the model's estimation of contaminant
concentrations).
The remedy selection rules for Option A are:
Rule 1. Consider only remedies that provide source
control (i.e., excavation or excavation
with wells). If all wastes have been
released from the unit or if excavation is
otherwise infeasible, source control is
not necessary (i.e., select recovery
wells).
Rule 2. If both excavation and excavation with
veils reach target within the modeling
timeframe, select the remedy with the
shortest duration.
Rule 3. If both remedies have the same duration
and achieve the target, select the remedy
with the least cost.
Rule 4. If neither remedy reaches the target
within the modeling timeframe, select the
remedy with the least cost.
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6.4.3 Option B: Immediate Cleanup To Health-Based Standards
In contrast to Option A, corrective action under Option B would be
triggered in the model based on a health-based standard (i.e., MCLs, RfDs, or
RSDs at specified risk levels) rather than a release in excess of background
levels.11 Option B provides an upper bound estimate of the costs of the
Agency's proposed corrective action rule. Specific triggers (e.g., RfDs, RSDs,
and MCLs) used in the model are listed in Appendix 5. Generally, the triggers
are derived in the following fashion:
¦ For carcinogens, Risk Specific Doses (RSDs) calculated
to produce 10"* risk levels were used in the analysis.
An RSD is a chemical-specific concentration level that
results in a specified risk level for an individual
ingesting contaminated water over a 70-year lifetime.
An RSD is calculated using chemical-specific potency
scores developed by the Agency's Carcinogen Assessment
Group (CAG) and an assumed water consumption rate of 2
liters per 70 kilogram adult per day. For
constituents lacking a CAG potency score, best
professional judgement was used to set the trigger.
¦ Agency-approved Reference Doses (RfDs) were used for
systemic toxicants. These effects are most commonly
characterized as malfunctions of various organ
systems. An RfD is calculated by adjusting a "no
observed adverse effect level" using an uncertainty
factor. Uncertainty factors are selected on a
chemical-specific basis, and typically, the smaller
the uncertainty concerning the health data, the
smaller the adjustment. For constituents lacking an
approved RfD, best professional judgement was used to
set the trigger level.
Unlike Option A, Option B would allow owners and operators to defer
cleanup of releases that remain on-site (as would Options C and D) . The model
assumes that, for land disposal facilities, on-site corrective action would be
delayed until the end of the post-closure period while, for treatment and
storage facilities, cleanup would be postponed until closure. Corrective
action for releases that have migrated off-site is assumed to take place
immediately upon detection.
The rationale for Option B is that no one is likely to be exposed to on-
site releases while the facility is operating or in its post-closure period.
Thus, corrective action for such releases may be postponed. After the post-
closure period or if the releases migrate off-site, people may be exposed to
hazardous waste constituents and corrective action is assumed to begin
11 While the proposed rule provides that the health-based cleanup standards
may be set on a site - specif ic basis, the model used a more simple approach to
allow consistency. These health-based triggers and targets are intended to
represent the cleanup standards set under the proposed rule.
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immediately. The model also assumes that corrective action would be triggered
by any release in excess of a health-based standard. The health-based
standard would not be limited to MCLs, as discussed above.
The model assumes that the ground-water point of compliance would be the
facility boundary (i e., 200 meters from the unit boundary) during the
operating life of the facility. Subsequent to facility closure, at treatment
and storage facilities, the point of compliance would be moved to the edge of
the waste management area (i.e., 10 meters from the unit boundary). For land
disposal facilities, the simulated point of compliance would change from the
facility boundary to the edge of the waste management area at the end of the
post-closure care period.
Again, the model simulates the investigative process by checking in 1987
for contamination beyond the point of compliance. Monitoring for
contamination in 1987 begins at the 1,500 meter well and moves inward until
contamination above the trigger level is detected. However, the model does
not search in 1987 for on-site contamination (i.e., contamination within 200
meters of the unit boundary). If no contamination is detected off-site, the
monitoring well is set at 200 meters until closure or post-closure, whichever
applies, at which time the model looks for on-site contamination and moves the
monitoring well to the 10 meter well.
All four remedies are considered in Option B (i.e., excavation,
excavation with wells, capping, and recovery wells). The remedy selection
rules used to simulate Option B are:
Rule 1. Select the remedy with the shortest
duration to achieve target from among
those that reach target within the
modeling timeframe.
Rule 2. If several remedies have the same duration
and achieve the target, select the remedy
with the least cost.
Rule 3. If all remedies fail to reach the target
within the modeling timeframe, select the
remedy with the least cost.
6.4.4 Option C: Flexible Cleanup To Health-Based Standards
Option C is generally intended to provide a lower bound estimate of
costs and effectiveness of the Agency's proposed corrective action rule.
Options B and C are similar in that both would allow owners and operators Co
defer cleanups of releases that remain on-site until facility closure or the
end of the post-closure period and would allow selection of all modeled
remedies. The key distinction between these two options is that, under Option
C, a great deal more flexibility is allowed in the remedy selection process
Facilities are allowed to forego expensive corrective actions that do not
produce tangible cleanup benefits on the condition that institutional controls
are in place to prevent exposure to contaminated ground water.
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Institutional controls are methods used to prevent human exposure to
hazardous waste releases, such as legal or physical barriers. For instance,
institutional controls could include providing bottled water to replace
contaminated ground water, erecting a fence around a facility to prevent
people from entering, or placing restrictions on future land use in the
facility deed. The model selects institutional controls in cases where
either: (1) no remedies reach the cleanup target within the model time
horizon and capping is infeasible, or (2) where no remedies cost less than
$150 million.
The costs of selecting institutional controls, however, are assumed to
be zero in the model. The costs of some institutional controls, such as legal
restrictions, are negligible in comparison to the costs of other corrective
action remedies. Moreover, institutional controls are selected infrequently
in the model. By assuming zero costs for institutional controls, the RIA may
tend to underestimate the costs of Option C (and Option D, which also allows
for institutional controls) in comparison to other options.
Under Option C, remedies are also limited to those with costs below $150
million. The Agency expects that, in practice, cleanup costs could actually
be greater in rare instances at some facilities, such as those undergoing
corrective action for releases to multiple media or facilities in close
proximity to exposed populations. A limitation on ground-water corrective
action costs is, however, necessary for modeling purposes. Without such a
limit, the model would select remedies chat would actually be infeasible in
practice due to site conditions or technical constraints (e.g., excavations
could be selected by the model for the entire area of very large sites
whereas, in practice, excavations may only be performed for limited portions
of such sites).
Finally, the model selects the least costly remedy for Option C from
among those that reach the cleanup target within the modeling period. In
contrast, remedies are selected under Option B among those that reach the
target within the shortest duration without regard for cost. In other words,
Option C uses a more flexible approach to selecting remedies than Option B.
This assumption was chosen to approximate the site-specific approach taken in
the proposed rule, which would allow local flexibility in choosing among
protective remedies.
The remedy selection rules used to simulate Option C are:
Rule 1. If no remedies reach the target within the
modeling timeframe and capping is feasible
and costs less than $150 million, select
capping. Otherwise, implement
institutional controls.
Rule 2. If one or more remedies reach the target
within the modeling timeframe but no
remedy costs less than $150 million,
implement institutional controls.
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Rule 3. Select the remedy with the least cost from
among those which reach target and which
costs less than $150 million (i.e.,
excavation plus wells, excavation,
recovery wells, or capping.)
Because these remedy selection rules are somewhat more complex for
Option C than the preceding options, these rules are depicted graphically in
Exhibit 6-2.
As with Option B, the model checks for existing contamination in 1987.
In subsequent years, during the facility operating life (and post-closure, if
applicable), monitoring is at the facility boundary. After this period,
monitoring is performed at the unit boundary.
Under the proposed rule, however, the remedy selection process may
differ because the Regional Administrator has the discretion to select
remedies that meet the remedy selection standards of proposed §264.525(a)
(i.e., remedies must meet cleanup standards, control the source of releases,
and comply with standards for management of wastes). In addition, the
Regional Administrator may consider several remedy selection criteria,
including:
¦ Long-term reliability and effectiveness;
¦ Reduction of toxicity, mobility, or volume;
¦ Short-term effectiveness;
¦ Implementability; and
¦ Cost.
Thus, the proposed rule remedy selection standards and criteria provide for
more thorough consideration of site-specific characteristics than do the
remedy selection rules used in the model. The model remedy selection rules,
however, are intended to roughly approximate the remedy selection process
under the proposed rule.
Finally, under the proposed rule, the speed of initiation of corrective
action as well as the speed of its completion would be set by the Director and
could be based on several factors, including the extent of waste management
capacity, the availability of technology, and other relevant factors. This
option would allow EPA or States and the owner or operator flexibility in
determining the timing of corrective action. Thus, the remedy simulated under
Option C for a facility may not be the same as that actually selected in
practice, though these remedy selection rules are intended to roughly
approximate the types of decisions made under the proposed rule.
6.4.5 Option D: Flexible Cleanup Based on Actual Exposure
This option is the most flexible of the regulatory options. It is
similar to Options B and C in that on-site cleanup is assumed to be deferred
until closure or the end of the post-closure period (depending on whether the
facility is a land disposal facility). It is different in that off-site
cleanup is also assumed to be deferred if there is no actual human exposure to
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EXHIBIT 6-2
Remedy Selection Flow Chart For Options C and 0
C Start )
Do Any
Remedies
Reach Target
Within the
Modeling
Timeframe •>
Is
Capping
Feasible?
institutional Controls
Does
Capping Cost
Less Than
$150 Million?
Institutional Control:
Select
Capping
Does Facility
Have Any Remedies
With A Cost Under
$150 Million?
institutional Controls
Select Remedy With
Least Cost From
Among Those Which
Reach Target
Excavation
Plus Wells
Excavation
Recovery Wells
Capping
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the release. Thus, although the remedy selection rules are the sane for
Options C and D, the point of compliance modeled is different.
The rationale for Option D is that human exposure to hazardous wastes
arises from exposure to releases, therefore, exposure (rather than releases)
should be regulated. Under this approach, releases likely to cause exposures
are assumed to be immediately cleaned up while cleanup of other releases would
be deferred. While human exposure to contamination during the period of
deferral is, by definition, unlikely, environmental contamination may persist
until corrective action is undertaken.
The RCRA statutory mandate to protect human health and the environment
precluded EPA from analyzing a more flexible risk-based option. As discussed
in Chapter 3, the Agency constrained its analysis to options that fulfilled
this Congressional mandate. As a result, human exposure is limited under
Option D by requiring on-site cleanup to health-based standards at closure (or
the end of the post-closure period).
The model also assumes that, during a facility's operating life (and
throughout the post-closure period, if applicable), corrective action would be
triggered by actual human exposure to hazardous waste releases with
concentrations in excess of health-based standards (as defined for Options B
and C). After a facility had closed (or after the end of the post-closure
period, if applicable), the same health-based standard would be used but it
would be applied in the model at the edge of the waste management area rather
than at the point of exposure.
Until the point of compliance reverted to the edge of the waste
management area (at closure or at the end of the post-closure period,
depending on the type of facility), the point of compliance would be the
actual or threatened human exposure point. For each facility, this point is
determined based on available data.12 The point of compliance was modeled at
the 10 meter exposure well for 3 percent of the facilities, at the 600 meter
well for 83 percent of the facilities, and at the 1,500 meter well for 14
percent of the facilities.
The investigative phase of the corrective action program is simulated in
a manner similar to that used in Options A, B, and C. The model looks for
contamination in 1987 beginning at the 1,500 meter well and moves upgradient
to the exposure point. If contamination above the trigger level is detected
at wells near or down-gradient of the exposure point, then corrective action
is triggered. If no contamination is detected at the exposure point, the
monitoring well is set at the assumed exposure point until closure or post-
12 The data base for the RIA was obtained from a sample of RCRA Facility
Assessments (RFAs). In some cases, the RFAs noted the nearest human exposure
points. This RFA data, where available, was used in calculating the human
exposure point under Option D. If such data were not available, the model
assumed that the human exposure point was 600 meter from the unit boundary.
The 600 meter point is not based on average human exposure points but is only
a modeling assumption. See Appendix A for detailed information on the
facility data base.
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closure, whichever applies, at which time the monitoring well is moved to the
10 meter well.
The remedy selection rules in the model for the exposure-based approach
are the same as those for Option C (see Exhibit 6-2):
Rule 1. If no remedies each the target within the
modeling timeframe and capping is feasible
and costs less than $150 million, select
capping. Otherwise, implement
institutional controls.
Rule 2. If any remedies reach the target within
the modeling timeframe but no remedies
cost less than $150 million, implement
institutional controls.
Rule 3. If any remedies reach the target within
the modeling timeframe and any remedy
costs less than $150 million, select the
remedy with the least cost from among
those which reach target (e.g., excavation
plus wells, excavation, recovery wells, or
capping.)
The key assumptions used in the RIA for the five regulatory assumptions
are listed in Exhibit 6-3.
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EXHIBIT 6-3
GROUND-WATER CORRECTIVE ACTION REGULATORY ALTERNATIVES
AS SIMULATED IN THE »TA
Unit* Point of Initiation Typaa
Ragulatad Iriggar nd Target Laval* CoopLianea of Action of R«adias
1. Baa alia* Scan aria
Actlv* Land
disposal.
units
Groucdoatar protection
standard
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7. RESULTS OF QUANTITATIVE ANALYSIS OF GROUND-WATER REGULATORY OPTIONS
This chapter presents the results of the quantitative analysis of the
ground-water regulatory options presented in Chapter 6. The basic approach
used starts with a sample of RCRA facilities that will be subject to the
proposed corrective action requirements. The extent of ground-water
contamination at these facilities and the effectiveness of corrective actions
is simulated using a modified version of EPA's Liner Location Model (LLM).
The LLM produces several results related to the types of corrective actions
taken at facilities and the effectiveness of these corrective actions.
This chapter summarizes these results in terms of the likelihood that
corrective action will be initiated, the type of remedy selected, the time
required to implement corrective actions, and an effectiveness measure that
reflects the success of corrective action in cleaning up particular sites.1
The analysis of the ground-water regulatory options suggests that
approximately 31 percent of the population of RCRA facilities require ground-
water corrective action under the 4 regulatory options. Under Options B
(Immediate Cleanup to Health-Based Standards) and C (Flexible Cleanup to
Health-Based Standards), more than 80 percent of the actions were fully
implemented within 75 years. Of those facilities undertaking corrective
measures, the selected remedy was successful in attaining the cleanup goals
within 1,500 meters of the source within 75 years for over 50 percent of the
facilities under Option C.2
7.1 LIKELIHOOD OF INITIATING CORRECTIVE ACTION
The likelihood of corrective action is expressed as the percentage of
facilities that trigger corrective action in a particular year over the 200-
year modeling period.3 Facilities trigger corrective action when contaminant
concentrations in ground water exceed specific trigger levels assumed for a
particular regulatory option. For example, under Option A (Immediate Cleanup
to Background), corrective action is triggered as soon as contaminant
concentrations are detectable at the monitoring well.
1 The costs of corrective action were also estimated. These estimates are
discussed in Chapter 8, Ground-Water Corrective Action Costs for Non-Federal
Facilities, and Chapter 12, Federal Facilities.
2 The 1,500 meter distance was used because it is the maximum distance
simulated by the LLM.
3 In the context of the LLM, each facility is simulated to initiate
corrective action no more than once in one modeling period.
-------
7-2
The timing of corrective action (i.e., the initiation of corrective
actions) differs among the regulatory options. Under Options B (Immediate
Cleanup to Health-Based Standards), C (Flexible Cleanup to Health-Based
Standards), and D (Flexible Cleanup based on Actual Exposure), EPA assumed
that corrective action for releases that have not migrated off-site may be
deferred until facility closure. As a result, although the number of
facilities triggering corrective action may be similar among particular
options, the timing of corrective action may differ.
Under Option A, 33 percent of the population of RCRA facilities subject
to the corrective action requirements (i.e., about 5,660 facilities) trigger
corrective action for ground water. Approximately 31 percent of the
population of RCRA facilities trigger corrective action under Options B
through D, compared to only 14 percent triggering under the pre-HSWA Subpart F
requirements of the baseline scenario. The percentage of facilities that
trigger and initiate corrective action under the baseline scenario and each of
the regulatory options is listed in Exhibit 7-1. Under Option A, most actions
are simulated to begin in the first year of the corrective action program,
while under Options B through D, about half of the actions are deferred until
after the year 2000.
Exhibit 7-2 graphically compares the number of facilities that trigger
corrective action in the baseline scenario and each regulatory option. More
than twice as many facilities trigger corrective action under the 4 regulatory
options (i.e., A through 0) compared to the baseline scenario. The reasons
for the difference in the likelihood of triggering corrective action among the
regulatory options are:
¦ Options A through D trigger action more often than
does the baseline because they are assumed to regulate
releases from all SWMUs, not just those from regulated
land disposal units as under the baseline scenario.
As explained in Chapter 2 of the RIA, the number of
units subject to corrective action has increased by a
factor of more than 20 from about 3,000 units before
HSVA to over 80,000 after HSVA.
¦ Option A triggers at slightly more facilities because
it requires cleanup to background, while Options B, C,
and D are somewhat less stringent and only require
cleanup to health-based levels.
¦ Options B and C are identical with respect to the
likelihood and timing of corrective action because
they both involve the same assumptions about trigger
levels and points of compliance; these options differ
only in terms of the remedies selected.
-------
7-3
EXHIBIT 7-1
CORRECTIVE ACTION IS DEFERRED FOR OPTIONS C AND D a/
Year in Which
Corrective Action Options b/
is Triggered
Baseline
A
B
C
D
1987
9.7*
25.
.71
12 .hi
12.
.4*
12
.42
1988-2000
01
2.
.9*
3.71
3.
.72
2.
.72
2001-2025
3.6*
3.
.2*
10.2 *
10.
.22
10,
.42
2026-2120
1.2*
1,
,1*
4.7*
4
72
5,
,42
Trigger Subtotal
14.4*
32.
.91
30.9*
30.
92
30.
.9*
Never Trigger
85.62
67.
.11
69.12
69.
,12
69.
.1*
a/ Percentage indicates the distribution of start dates among the total
population of facilities potentially affected by the corrective action program
(i.e., 5,661 facilities).
b/ Option A
Option B
Option C
Option D
Immediate Cleanup to Background
Immediate Cleanup to Health-Based Standards
Flexible Cleanup to Health-Based Standards
Flexible Cleanup based on Actual Exposure
-------
EXHIBIT 7-2
SIGNIFICANTLY MORE FACILITIES TRIGGER CORRECTIVE ACTION AFTER HSWA
2000
1,662
1900
1,749
1,749
1,749
1800
1700
1600
1500
1400
1300
1200
1100
1000
900
815
800
700
600
600
400
300
200
100
Baseline
Scenario
Option A:
Immediate
Cleanup to
Background
Option B:
Immediate
Cleanup to
Health-Based
Standards
Option C:
Flexible
Cleanup to
Health-Based
Standards
Option 0:
Flexible
Cleanup Based
On Actual
Exposure
al number of Federal and non-Federal RCRA TSDFs subject t' rrectlve actions Is estimated to be 5,661.
-------
7-5
¦ Option D triggers corrective action at an identical
number of facilities as Options fi and C because it
triggers corrective action at the same health-based
concentration levels. The only difference among these
options is that, under Option D, the initiation of
corrective action is delayed for releases that do not
threaten off-site exposure points until after facility
closure (or the end of the post-closure period, if
applicable).
The timing of corrective action under each of the regulatory options is
presented graphically in Exhibit 7-3. Under Option A, where corrective action
for all releases must begin immediately, 25.7 percent of the facilities
trigger corrective action in 1987. In contrast, under Options B, C, and D,
where corrective action may be deferred until facility closure (or the end of
the post-closure period, as applicable), approximately 12 percent of
facilities trigger corrective action in 1987. As a result, the costs
associated with corrective action are incurred later in the modeling period
under Options B, C, and D than compared to Option A. As explained in Chapter
8, the opportunity to defer action accounts, in part, for the lower present
value costs of Options B, C, and D' compared to Option A.
7.2 DISTRIBUTION OF REMEDIES SELECTED
Four remedies are modeled: excavation, excavation with wells, recovery
wells, and capping. Under Options C and D, institutional controls are
sometimes simulated when technical constraints severely limit the
effectiveness of these 4 remedies. Each of these remedies and the method by
which the model selected among them for a facility are discussed in more
detail in Chapter 6. The remedies selected under the baseline scenario and
each regulatory option are presented in Exhibit 7-4.
Under the baseline scenario, only 2 remedial alternatives (capping or
recovery wells only) are candidates for the selected remedy. Recovery wells
are selected at about 29 percent of the facilities. Recovery wells is the
selected remedy in cases where the wells succeed in reducing concentrations at
all wells within 1,500 meters to below trigger levels within the modeling time
horizon.4 Capping is selected at about 71 percent of the facilities under
the baseline. Capping is the selected remedy when recovery wells fail to be
effective within the modeling time horizon. However, in situations where
capping is not feasible (because all of the contaminants have been released
from the unit by the time the release is detected), recovery wells is the
selected remedy regardless of its effectiveness.
For purposes of the LLM simulation under Options A and B, the remedy
selected for a particular site is based on the effectiveness of the corrective
* See Section 7.4 for a more detailed explanation of the measure of
effectiveness.
-------
EXHIBIT 7-3
CORRECTIVE ACTION IS DELAYED UNDER OPTIONS C AND D
34 0*
u
m
<
«~-
o
*•
c
o
m
E
3
O
8.0*
32.0%
Option A
30.0X
28.0%
Option* B and C
26.0*
24.0*
Option D
22.0*
20.0%
18.0*
18.0%
14.0%
12.0% -
10.0% -
Baseline Scenario
I I I I I I I I I I I I I
1987 1990 2000 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100 2110 2120
Year of Trigger
Option A Immediate Cleanup to Background
Option B: Immediate Cleanup to Health-Based Standards
0 • C: Flexible Cleanup to Health-Based Standards
C 0: Flexible Cleanup based on Actual Exposure
-------
7-7
EXHIBIT 7-4
REMEDY SELECTION VARIES SIGNIFICANTLY AMONG OPTIONS a/
Options b/
Selected Remedy Baseline A c/ B C D
Excavation
N/A d/
59. OX
3. IX
9.
.OX
9.
,8X
Excavation with wells
N/A
O
CM
25.11
4.
. 6X
3
. 6X
Recovery wells
28. 6X
20. 2X
33.4X
15.
. 9X
14.
. 9X
Capping
71.4X
N/A
37. 8X
64.
,8X
65.
.OX
Institutional Controls
N/A
N/A
N/A
5.
,71
6.
.71
a/ Percentage indicates the distribution of selected remedies at those
facilities triggering corrective action under the baseline scenario and
regulatory options.
b/ Option A
Option B
Option C
Option D
Immediate Cleanup to Background
Immediate Cleanup to Health-Based Standards
Flexible Cleanup to Health-Based Standards
Flexible Cleanup based on Actual Exposure.
c/ Option A is structured to require source control. Thus, capping and
recovery wells without source control (i.e., excavation) are not allowed.
However, for situations where excavation is infeasible, recovery wells alone
are simulated.
d/ N/A: Regulatory option does not allow this remedy.
-------
7-8
action and the cost of the corrective action. The RIA assumes that Option A
requires remedies with long-term reliability. Thus, under Option A,
excavation or excavation with recovery wells is selected at about 80 percent
of the facilities. However, in situations where excavation is not feasible
(because all of the contaminants have been released from the unit by the time
the release is detected), recovery wells alone is the selected remedy (i.e.,
at about 20 percent of the facilities under Option A). Under Option B, only
about 29 percent of facilities are simulated to use excavation or excavation
with recovery wells. In contrast to Option A, Option B does not require only
remedies with long-term reliability. Therefore, recovery wells are selected
at about 33 percent of facilities and capping is selected at about 38 percent
of facilities.
Option C (Flexible Cleanup to Health-Based Standards) and Option D
(Flexible Cleanup Based on Actual Exposure) are assumed to allow any of the 4
remedies used in the model or institutional controls. The proportions of
remedies selected are similar under both Options C and D. Under Options C and
D, remedies with long-term reliability (i.e., excavation and excavation with
recovery wells) are selected at about 10 percent of facilities. Recovery
wells are selected at about 15 percent of facilities and capping is selected
at about 65 percent of facilities. Institutional controls are selected only
about 6 percent of facilities under Options C and D.
7.3 TIME TO IMPLEMENT CORRECTIVE ACTION
This section presents the analysis of the time necessary to implement
corrective action at specific facilities. The duration of a corrective action
depends on the type of remedy, the extent of contamination, and the cleanup
level. For excavation and capping, the duration is always assumed to be 1
year.
For recovery wells, the duration is dependent on the target
concentration at the monitoring wells and the regulatory option. For Option A
(Immediate Cleanup to Background), pumping must continue until the target has
been achieved for 5 consecutive years. For example, if pumping begins in
1990, and the target concentration is reached in year 2000 and stays below
target, pumping must continue through year 2004. Alternatively, if the
concentration increases above the target again in 2002, pumping must continue
even longer. For the baseline scenario and Options B, C, and D, pumping must
continue while the concentration remains below target for 3 consecutive years.
Option A (Immediate Cleanup to Background) is the most stringent modeled
option (i.e., this option would provide the maximum protection of human health
and the environment) compared to the other options. Consequently, a more
stringent additional pumping period (i.e., 5 years) was assumed for this
option. The targets must be met at all wells within the point of compliance
before a recovery well corrective action is simulated to be terminated.
-------
7-9
The modeled point of compliance is the facility monitoring well (i.e. , a
well located at a certain distance from the waste management area).5 The
determination of the monitoring well location is based on the regulatory
option. The methodology used to determine the point of compliance for each
regulatory option is explained in Chapter 6.
Exhibit 7-5 presents the durations for corrective actions required under
each of the regulatory options. The proportion of facilities associated with
corrective actions of 1 year represent the facilities undertaking excavation
or capping. All other time categories represent facilities operating recovery
wells or a combination of recovery wells and excavation. The "ongoing at end
of modeling time horizon" category represents those facilities undertaking
recovery well operations where the corrective action was still ongoing at the
end of the 200 year model time horizon (i.e., the target could not be reached
by the year 2120).
In general, under the baseline and Options A and B, recovery wells that
are still in operation at the end of the model period represent facilities
where the capping and excavation actions were infeasible due to the release of
all the contaminants from the facility prior to detection. (In those cases
where capping or excavation was feasible but all remedies were incapable of
reaching target levels, capping, with a duration of 1 year, was usually
selected because of its cost.) Under Options C and D, the remedy selection
rules are generally structured to allow the use of institutional controls in
situations where none of the available remedies is able to achieve corrective
action targets within the modeling period. Thus, the "institutional controls"
category in Exhibit 7-5 represents those facilities for which an engineering
remedy was foregone.
As shown in Exhibit 7-5, a significant proportion of the actions have
relatively short durations. Under Options B and C, for example, 64 percent
and 82 percent of the facilities, respectively, undertake actions of less than
25 years. For all options, less than 11 percent of the facilities are
simulated to be in corrective action for more than 100 years. Under Option B,
in fact, only about 6 percent of the actions are assumed to last more than 75
years.6
5 In the proposed rule, the ground-water points of compliance represent the
entire area of contamination, therefore, meeting the cleanup standards at the
points of compliance corresponds to cleaning up the entire plume. For modeling
purposes, one modeled point of compliance is used to represent the most
downgradient point of contamination. Contaminants upgradient of this point are
assumed to require cleanup. Any contaminants that migrate beyond this point
after an action is initiated are not simulated to be cleaned up.
6 Under the proposed rule, EPA has made provisions for situations where
corrective action is technically impracticable. Based on the standards in
proposed 40 CFR 264.525(d)(2)(iii) and 264.531, adjustments in the required
remedy can be made in cases where technical factors make a complete remedy
infeasible. To the extent that such adjustments are made, the quantitative
results provided above may overestimate the length of time associated with
recovery well actions.
-------
7-10
EXHIBIT 7-5
DISTRIBUTIONS FOR DURATIONS OF CORRECTIVE ACTIONS VARIES AMONG OPTIONS a/
Baseline Option A Option B Option C Option D
Total Percent
of All
Facilities
Triggering
Corrective Action 14.4X 32.9X 30. 9X 30.9X 30.9X
Time to Imple-
ment Remedy b/
(Years) Percentages of All Facilities Wher*> rnnraminants Exceed Triggers
1
71.4X
59.OX
40. 9X
73. 8X
74. 8X
2-10
11. OX
7.5X
18. 8X
7.2X
7 . 2X
11-25
2.2X
6. OX
3.9X
1.0X
1.0X
26-50
4.4X
6.5X
17.OX
7.7X
6.7X
51-75
OX
6.3X
6.4X
2.8X
1.8X
76-100
OX
4.6X
2.3X
0.8X
0. 8X
101-131
OX
1.0X
o.ox
1.0X
1.0X
Ongoing at end of
modeling time
horizon
11.OX
9.2X
10.8X
O.OX
O.OX
Institutional
Controls
OX
P*
OX
5,7*
6 . 7X
Total
100X
100X
100X
100X
100X
a/ Option A: Immediate Cleanup to Background
Option B: Immediate Cleanup to Health-Based Standards
Option C: Flexible Cleanup to Health-Based Standards
Option D: Flexible Cleanup based on Actual Exposure
tj/ Excavation: Assumed to take 1 year to Implement.
Capping: Assumed to take 1 year to implement.
Excavation with recovery wells: Time to implement depends on
contaminant concentrations.
Recovery wells: Time to implement depends on contaminant
concentrations.
-------
7-11
The duration of a corrective action is not, however, a consistent
measure of effectiveness among all options because capping and excavation are
always modeled to have a duration of 1 year. Because these 2 remedies are
source control actions, contamination may persist for many years beyond the
completion of the action. In addition, for recovery wells, the duration is
the time required for the target to be reached at the modeled point of
compliance inside the area of contamination where the recovery wells are
located. Because recovery well operations are modeled to be at most 95
percent effective in removing contaminants, the remaining contamination may
still result in the trigger concentrations being exceeded downgradient of the
modeled point of compliance. Over time, in the model the plume area
effectively increases, but the modeled point of compliance does not change.7
Duration is therefore not a good measure of effectiveness because, for some
facilities, corrective action will terminate following cleanup within the
point of compliance, even though contamination may still exist beyond the
point of compliance.8 Consequently, an additional measure of effectiveness
to analyze the effectiveness of corrective actions was developed. This
measure is discussed in the next section.
7.4 TIME TO REACH TARGET CONCENTRATION WITHIN 1,500 METERS
This effectiveness measure represents the length of time required for a
corrective action to reduce all contaminant concentrations below the target
levels at all wells within 1,500 meters of the unit (i.e., the maximum modeled
well distance). This measure was developed because it provides a consistent
measure across all remedies and regulatory options, and it provides an
indication of the effectiveness of corrective actions within a standard area.
A corrective action is thus defined to be effective if all constituents within
1,500 meters of the unit are cleaned up to their option-specific levels.
Exhibit 7-6 presents the distributions among the baseline scenario and
regulatory options for the time required for the facilities with corrective
actions to reach target levels at all wells within 1,500 meters. The "target
not reached" category represents situations where none of the remedies
resulted in target levels being reached at all wells within 1,500 meters. As
discussed in Chapter 6, the "institutional controls" category represents
situations where remedies do not reach target and are infeasible or where the
costs of remedies exceed $150 million.
7 The plume area is defined as the area of contamination where the trigger
concentration is exceeded.
8 This situation should be regarded as a model limitation. In the model
simulation, corrective actions are initiated only once (i.e., if contamination
is detected following termination of a corrective action, correction action is
not restarted) and recovery well operations are not expanded to clean up
contamination beyond the modeled point of compliance. This limitation results
in an underestimation of the effectiveness of corrective actions in controlling
ground-water contamination. In reality, the recovery wells would probably be
moved further downgradient such that more contaminants would be controlled and
recovered.
-------
7-12
EXHIBIT 7-6
DISTRIBUTION FOR DURATIONS TO REACH TARGET
WITHIN 1,500 METERS VARIES AMONG OPTIONS a/
Baseline Option A Option B Option C Option D
Total Percent
of All
Facilities
Triggering
Corrective Action 14.42 32.92 30.92 30.92 30.92
Duration to
Reach Target
(Years') Percentages of All Facilities Wher«» rnpt-nim'riar^s Exceed Triggers
0-10
17.12
14.72
23.72
18.52
18.52
11-25
5.52
7.02
9.52
3.12
3.12
26-50
9.72
6.52
15.92
22.92
21.92
51-75
1.92
5.52
6.41
6.72
8.02
76-100
02
5.12
1.52
3.32
1.82
101-131
02
02
0.82
1.82
1.82
Target Not Reached
65.82
61.22
42.22
38.02
38.32
Institutional
Controls
02
02
02
5.62
6.62
Total
1002
1002
1002
1002
1002
a/ Option
A:
Immediate
Cleanup to
Background
Option
B:
Immediate Cleanup to
Health-Based Standards
Option
C:
Flexible
Cleanup to Health-Based
Standards
Option
D:
Flexible
Cleanup based on Actual
Exposure
-------
7-13
Under Option B, about 56 percent of the facilities are simulated to
reach cleanup targets at all modeled well distances within 75 years of
initiation of the action. Under Options C and D, about 51 percent attain
cleanup targets in the same period. For Option A (Immediate Cleanup to
Background), the proportion of facilities with corrective action not reaching
target concentrations at all wells within 1,500 meters is greater than the
percentage for Options B, C, and D, because the target levels for Option A
(i.e., detection limits) are lower than those for the other options.9 These
facilities that did not reach target levels represent situations where the
cleanup of contaminants to target concentrations may be difficult to achieve.
Moreover, under Options C and D, those facilities with institutional controls
also represent situations where corrective action was unable to attain cleanup
targets.
There are numerous factors affecting the ability of the modeled
facilities to reach ground-water target concentrations. These factors include
physical phenomena likely to affect results in the field and model
limitations. These factors are discussed here. The procedures in the
proposed rule for facilities where cleanup levels cannot be met due to site
characteristics are also presented.
Factors that affect the potential for cleanup of contaminants in the
subsurface environment include the chemical and physical properties of the
contaminants, the characteristics of the subsurface environment, and, most
importantly, the interaction between the two factors.10 Together, these
factors determine how far released contaminants will spread, how quickly
contaminants will move in the subsurface environment, how long contaminants
are likely to remain in the ground water, and the potential for cleanup
operations to remove the contaminants from the subsurface environment. For
example, heavy metal contaminants may adsorb to soils while moving through the
unsaturated zone or onto aquifer material once in the ground water. The
presence of clay minerals would increase the likelihood of this adsorption
process occurring. The ultimate fate of the contaminants would depend on the
irreversibility of the adsorption process. If the contaminants did not desorb
from the surrounding clay material, cleanup would be extremely difficult.
' The success of Options B, C, and D (which share the same health-based
triggers) in achieving cleanup is not strictly comparable to the success rate for
Option A (which requires cleanup to background) because Options B, C, and D have
lower cleanup goals (i.e., less stringent target concentrations) than Option A.
Moreover, a somewhat larger number of facilities take corrective action under
Option A than under the other three options.
10 Physical and chemical properties of the contaminants include solubility,
density, viscosity, and degradability. Subsurface environment properties include
the presence of karst formations or highly fractured bedrock underlying a
facility. Specific ground-water properties include velocity and hydraulic
conductivity.
-------
7-14
Within the context of the model analysis, there are several additional
reasons why not all facilities are simulated to attain target levels within
1,500 meters. The model results reflect:
¦ The choice of the removal efficiency of 95 percent for
recovery well operations. Under actual field
conditions, this efficiency level may be significantly
lower or may approach 100 percent. If this efficiency
level is understated in the model, then more
facilities would be able to achieve complete cleanups
than simulated by the model while, if the efficiency
is overstated, less facilities would reach target.
¦ Situations where constituent concentrations are so
high that the modeled 95 percent efficiency of
recovery well operations is insufficient in reducing
the constituent concentrations below target
concentrations. Such situations are particularly
likely to occur at facilities with extensive and
widespread contamination resulting from large scale
hazardous waste activities, a long history of
operation, or both.
¦ Situations where the plume area continued to increase
after initiation of corrective action such that
contamination exist at wells down-gradient of the
modeled point of compliance. For such situations in
the model, an action could be terminated even though
the presence of contamination downgradient of the
point of compliance suggests that the action has not
been fully effective.
m Situations where the 200-year modeled time horizon
limits the continuation of recovery well operations.
While these situations did not occur frequently in the
model analysis, for corrective actions simulated to
occur late in the modeling period, the time remaining
in the simulation may be insufficient to complete the
action.
Finally, it is important to recognize that the proposed rule addresses
situations where cleanup does not appear to be technically practicable.
Specifically, there are 2 provisions in the proposed rule that provide for
alternate approaches in these situations:
-------
7-15
Proposed 40 CFR 264,525(d)(2)(iii) allows EPA to
determine that remediation of a release is not
required when it is technically impracticable. In
such cases, the facility owner/operator could be
required to undertake source control, reduce exposure
to the contaminated medium, or remediate to
concentration levels which are technically
practicable.
Proposed 40 CFR 264.531 allows EPA, in situations
where the facility's best efforts to implement the
selected remedy prove unsuccessful, to require the
owner/operator to examine alternative technologies or
to determine that complete cleanup is not technically
feasible. For example, if a ground-water recovery
system does not appear to be performing as expected,
it may be possible to utilize alternate remedies that
are more effective. However, in cases where EPA
determines that complete cleanup is not technically
feasible, then the facility will not be required to
meet the cleanup standards but may be required instead
to implement institutional controls that prevent
exposure to contaminated ground water.
7.5 CONCLUSION
In short, based on the results of the quantitative analysis of ground
water, about 31 percent of the population of RCRA facilities subject to the
corrective action requirements are estimated to require corrective action for
ground-water contamination. Moreover, most of these actions appear likely to
be initiated prior to the year 2000. Under the options designed to represent
the proposed rule (i.e.. Options B and C), over 50 percent of the facilities
undertaking corrective action are simulated to reach cleanup targets at all
modeled well distances within 75 years. About 6 percent are assumed to use
institutional controls because of the limited effectiveness of available
remedies.
-------
8. GROUND-WATER CORRECTIVE ACTION COSTS FOR NON-FEDERAL FACILITIES
This chapter analyzes the ground-water corrective action costs that
would be incurred by non-Federal facility owners and operators under the
corrective action program. Costs at Federal facilities are estimated in
Chapter 12. In summary, this analysis of the costs of the corrective action
program suggest that costs are likely to increase significantly over the
baseline scenario. Under the lower bound option of the proposed rule, total
costs are estimated to increase nationwide by $7.4 billion. On an annualized
basis, this increase is approximately $500 million.
The chapter first describes the methodology for estimating costs at
individual facilities. Results are then presented as typical per-facility
costs for each regulatory alternative and as total national costs.
8.1 DERIVATION OF UNIT COST ESTIMATES
The total estimated cost to the regulated community of EPA's corrective
action program is estimated in this RIA based on the costs of each step in the
cleanup process. Accordingly, this section describes the estimation of these
costs.
8.1.1 Costs of Investigation
As explained in Chapter 2, the EPA corrective action program is divided
into several steps. The first 3 steps are the RCRA Facility Assessment (RFA),
the RCRA Facility Investigation (RFI), and the Corrective Measures Study
(CMS). These steps are of an investigative or analytic nature and are
distinct from the actual implementation of the corrective action.
EPA is responsible for conducting RFAs and plans to do so over the
coming years at all RCRA facilities. Because EPA undertakes the RFA, the
facility owner or operator is unlikely to face significant costs in this phase
of the corrective action process. Accordingly, the cost of the RFA is not
included in the estimates of total corrective action costs.
Should the RFA suggest the need for further analysis at a facility, EPA
may direct a facility owner or operator to undertake an RFI. Because the
specific steps of the RCRA corrective action program are a relatively recent
addition to the program, there is little information on the costs to the
regulated community of each step. Given, however, that the RFI is similar in
scope and content to the Remedial Investigation (RI) phase of the Superfund
cleanup program, available data on the cost of the Rl were reviewed. In doing
so, it was determined that RI costs may range widely. Based on conversations
with contractors associated with the CERCLA program, RI costs were estimated
to range from $300,000 to $1,300,000 per site. In general, an assessment of
environmental threats at the typical RCRA facility is likely to cost less than
a similar assessment at the typical uncontrolled Superfund site because
sampling and monitoring activities may have been performed at RCRA facilities
(e.g., RCRA land disposal facilities must comply with ground-water monitoring
and hydrogeologic characterization requirements to obtain a RCRA permit).
-------
8-2
Moreover, information on the wastes disposed or handled on-site may be more
readily available for a RCRA facility than a Superfund site due to the record-
keeping requirements under RCRA. Accordingly, RFI costs are assumed to be
lower than Superfund RI costs. For the purposes of this RIA, therefore, the
cost of a RFI is assumed to be the same as the lower bound estimate for a
Superfund RI, or $300,000.
If, based on the results of the RFI, EPA determines that contaminant
concentrations in the environment exceed the health-based standards specified
in the proposed rule, an owner or operator may be compelled to undertake a
Corrective Measures Study. Again, EPA's experience in the Superfund program
was used to develop an estimate of the cost of the CMS. A CMS is roughly
analogous to the Feasibility Study (FS) done at each Superfund site.
Available information suggests that the cost of a FS may range from $100,000
to $200,000. Because the specific requirements for a CMS are somewhat less
prescriptive than for a FS and, given the earlier assumption that RCRA
facilities are likely to be less complex sites than Superfund sites, the
estimated CMS cost is taken from the low end of the range of FS costs; that
is, the typical CMS is assumed to have a cost of $100,000 to the RCRA
facility.
6.1.2 Costs of Corrective Action
After the CMS has been completed, EPA may select a particular corrective
action alternative from among those studied in the CMS. The facility owner or
operator is then responsible for implementing the particular remedy. As
described in Chapter 6, this RIA has analyzed the costs and effectiveness of 4
corrective action remedies that address ground-water contamination:
¦ Capping;
¦ Recovery wells;
¦ Excavation; and
¦ Excavation with recovery wells.
Other remedies have been used in the Superfund remedial program and are likely
to be used in the RCRA corrective action program; nonetheless, these 4
remedies were selected to be representative of the range of available
remedies. As discussed in Chapter 6, for Options C and D, the RIA assumes
that institutional controls will be selected in lieu of 1 of the 4 remedies in
cases where remedies do not reach target and are infeasible or where all
remedies exceed $150 million to implement.
In the analysis done for the RIA, the Liner-Location Model (LLM) was
used to estimate the cost of each of these actions for facilities in the data
base simulated to trigger corrective action using standardized algorithms.1
These algorithms were developed based on EPA experience, best professional
judgment, and standard construction cost estimation techniques. Within a
model run, the LLM computes the cost of each remedy available for a particular
facility; based on a series of remedy selection rules, the model chooses a
1 Liner Location Risk and Cost Analysis Model: Phase II Report, Appendix,
March 14, 1986, prepared by ICF Incorporated, hereinafter cited as Phase II
Report.
-------
8-3
single remedy for each facility. The remainder of this section describes the
cost calculations for each remedy, while Section 8.2 presents cost estimates
for those remedies that were actually selected.
Capping involves Che placement of a relatively impermeable layer (i.e ,
2 feet of clay and a synthetic layer) over the top of the particular SWMUs
subject to corrective action. The costs of capping reflect the costs of site
preparation, materials, installation, and indirect costs such as engineering
design, inspection and testing, overhead and profit, contingencies, and a
health and safety allowance. As modeled, the cost of the cap is a function
only of the total surface area of the unit, with total costs equal Co $71.40
per square mecer.2
Recovery wells are used to withdraw contaminated ground water for the
purposes of treatment. As modeled for this RIA, the cost of recovery wells
reflects both the installation and operation of the wells and the construction
and operation of an appropriately sized effluent treatment system. The costs
of this remedy reflect a complex set of several calculations.3 In general,
though, the recovery well remedy simulated by the LLM involves several steps.
First, a series of detection wells are drilled to delineate the plume and to
provide a method for assessing the performance of the remedy while it is
underway. Next, the actual recovery wells are installed along with the
required infrastructure such as pumps, piping, and electrical lines. Based on
the estimated volume of water to be recovered, a treatment plant of sufficient
capacity is constructed. After adding the same types of indirect costs
associated with capping, the model calculates the first year cost of the
remedy. Finally, the model estimates the annual cost of operating the
recovery well and treatment plant systems. This annual cost is then incurred
in each year that the remedy is underway. In general, the remedy is continued
until contaminant concentrations reach the target levels associated with the
particular regulatory alternative being analyzed.
Excavation involves the removal and off-site disposal of all
contaminated wastes within the SWMUs subject to corrective action. Costs
reflect various preparatory activities, the actual excavation of the wastes,
transportation to an off-site landfill, and landfill disposal costs. A series
of indirect capital costs such as engineering design and inspection and
overhead are then added to the direct capital costs. The cost of excavation
at a particular site is a function of both the surface area and the volume of
material excavated.4 The total cost of the excavation is estimated as $95.04
2 Capping costs consist of two components. The first is the direct costs,
estimated at $34 per square meter. Direct costs are based on data provided by
Sobotka and Company, Inc. in a memorandum dated August 9, 1985. The second
component is indirect costs, estimated at 110 percent of the direct cost.
Indirect costs, which include engineering, testing, overhead, health and safety,
and contingencies, are drawn from the Phase II report.
3 See Phase II Report.
4 The costs of off-site disposal were developed based on prices prevailing
at the time the model was developed; such costs do not include the increased
prices associated with limitations on disposal capacity brought about by EPA's
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8-4
times the surface area (in square meters) plus $574.56 times the volume of
waste (in cubic meters).5
Excavation with Recovery Wells involves a combination of 2 specific
remedies. Its costs are estimated based on the algorithms for each of the 2
remedies. The cost of the excavation portion of the remedy is the same as
when excavation by itself is simulated. The cost of the recovery well action,
however, differs depending on whether excavation has been included. The
reason for the difference is that the excavation is often successful in
significantly reducing the total contaminant mass released to ground water
and, thus, the duration over which the recovery wells must be operated.
8.1.3 Estimation of Costs Per Facility
After the Liner-Location Model has simulated each of the remedies that
are available at a particular facility in a manner that is consistent with the
particular regulatory alternative being analyzed (e.g., certain remedies are
not allowed for some alternatives), the LLM estimates the following 3 key
parameters for each of the simulated remedies:
¦ Effectiveness;
¦ Cost; and
¦ Feasibility.
As described in Chapter 6, these parameters are then used in conjunction with
a series of remedy selection rules to assign a particular remedy to a specific
facility. The selected remedies and their cost may vary among the regulatory
alternatives for several reasons;
¦ The set of allowable remedies and the rules for
selecting remedies are not the same for each
alternative (e.g., institutional controls may be
selected under Options C and D) ;
¦ Some facilities trigger corrective action under some
alternatives but not under others;
¦ The triggers and targets for corrective actions may
vary between alternatives and the same facility may be
simulated to use a different remedy under each of 2
alternatives. Even if the same remedy were simulated,
its costs might vary due to differences in the start
and end years.
Land Disposal Restrictions Program (LDRP) or the costs of treating land disposed
waste using Best Demonstrated Available Technology, as required by the LDRP. As
a result, the model may underestimate costs for the options that select
excavation remedies.
5 See Phase II Report.
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8-5
8.1.4 Discounting
Because the costs of the corrective action may be incurred over time, we
discounted these costs to a consistent basis to allow for comparison. Three
different discount rates were considered for use in this analysis: 3 percent,
5 percent, and 9.49 percent. A rate of 3 percent reflects standard
assumptions used in other Office of Solid Waste Regulatory Impact Analyses; 5
percent is the rate used in the recent CERCLA National Contingency Plan (NCP)
R1A; and 9.49 percent represents the weighted average cost of capital
calculated in the economic impacts chapter of this RIA. Although there is no
single correct discount rate, the 2 lower rates are meant to reflect a social
discount rate which might be appropriate for a societal investment in a public
good such as environmental protection. These rates are arguably represented
by the after-tax real rate of return on risk-free savings. The weighted
average cost of capital measures the return on private investment by firms in
the regulated community.
Although 3 discount rates were considered, a single rate of 3 percent
has been chosen for the remainder of the analysis. Unless otherwise noted,
all discounted results are calculated using a 3 percent rate. The primary
reason for using a single rate is to simplify the analysis and because of the
general insensitivity of the relative performance of the regulatory
alternatives to the discount rate. This insensitivity results largely from
the fact that a significant proportion of corrective action costs are incurred
in the first several years of the program and are relatively unaffected by the
discount rate. The 9.49 percent rate is discarded on the grounds that it is
more appropriate for assessing private, rather than social, investments.6
The rate of 5 percent is not used because it generates results quite close to
those of 3 percent. Because the 3 percent rate is generally consistent with
many other analyses of various regulatory elements of the RCRA program that
have already been done, it is used as the sole discount rate.
8.2 RESULTS FOR COSTS PER FACILITY
This section presents results on the estimated per-facility cost of
corrective action at non-Federal facilities for each regulatory alternative.
It is divided into 2 subsections. The first explains how costs vary among
regulatory alternatives while the second evaluates the effect of facility
characteristics (such as age or number of SVMUs) on costs.
8.2.1 Per-Facllity Costs by Regulatory Alternative
This subsection discusses the mean and annualized per-facility cost by
each regulatory alternative and notes that Option A is by far the most costly
option.
6 The rate of 9.49 percent is, however, used throughout the economic
impacts analysis presented in Chapter 10 to represent the weighted average cost
of capital. As explained in Chapter 10, this rate measures the cost of funds to
firms and is appropriately used when simulating a firm's internal financial
decision making.
-------
8-6
Mean Per-Facilitv Cost
As demonstrated by Exhibit 8-1, the simulated corrective action cost
incurred by the typical non-Federal facility varies significantly among the
regulatory alternatives under consideration. The highest cost per facility
occurs under Option A, which has a mean per-facility cost of over $281 million
when discounted at 3 percent. Such costs are not surprising given the
stringency of this alternative. Under this alternative, corrective action is
triggered sooner, lasts longer, and involves more expensive remedies than with
the other regulatory scenarios.
Option C was estimated to have a mean cost of $6.3 million. Options C
and D have low per-facility costs because of the associated remedy selection
rules. Under Options C and D remedy selection hinges primarily on costs when
faced with a choice of more than 1 effective remedy. Also, institutional
controls (the costs of which are not calculated in the model) are enacted when
the selected remedy exceeds a cost of $150 million. In comparison, the mean
per-facility cost of the baseline scenario ($3.8 million) is somewhat lower
than the costs associated with all regulatory options. The lower baseline
costs are due in part to the fact that the baseline scenario assumes cleanup
on-site only, while Options A through D assume both on- and off-site cleanup.
Moreover, as noted in Chapter 7, the baseline scenario selects inexpensive
remedies (e.g., capping) in comparison to some options, which may select
expensive remedies. For instance, excavation and excavation with recovery
wells is selected at about 80 percent of the facilities under Option A.
Annualized Per-Facilitv Costs
We examined the annualized cost of the typical per-facility corrective
action cost because the costs of corrective action will be incurred over time
and because firms in the regulated community may be expected to spread costs
over time through internal and external financing methods. The process of
annualizing these costs involves amortizing costs using a certain interest
rate and a specific time period (a 20 year period is used in this analysis) .
We have computed annualized costs using a 3 percent interest rate, the
baseline discount rate used throughout this RIA. The annualized per-facility
cost of corrective action at a typical non-Federal facility is presented in
Exhibit 8-2. For the lower bound proposed rule option (i.e., Option C),
annualized costs are approximately $422 thousand at a 3 percent discount rate.
8.2.2 Effect of Facility Characteristics on Costs
In addition to analyzing the mean per-facility cost for the entire
population of facilities, we also considered the effect of 3 facility
characteristics on costs:
¦ Facility age,
¦ Number of SVMUs at facility, and
~ Ground-water flow field setting.
-------
ISJLti r B-l
290
280 -
270 -
260 -
Mean Cost Per Facility Is Greatest For Option A
(Non-Federal Facilities)
(Discount rate of 3 percent)
$261.9 million
$26.9 million
$6 3 million
$4 8 million
$3.8 million
30 -
20 -
10 -
Baseline
Scenario
Option A:
Immediate
Cleanup to
Background
Option B
Immediate
Cleanup to
Health-Based
Standards
Option C
Flexible
Cleanup to
Health-Based
Standards
Option 0
Flexible
Cleanup Based
On Actual
Exposure
Costs Include Implementation of corrective action only, do not Include RCRA Facility Investigation or Corrective Measui es Study
-------
EXHIBIT 8-2
Annualized Mean Cost Per Facility Is Greatest For Option A
(Non-Federal Facilities)
(Discount rate of 3 percent annualized over 20 years)
$19.0 million
$1.8 million
$0 42 million
$0 32 million
$0.25 million
Baseline
Scenario
Option A:
Immediate
Cleanup to
Background
Option B.
Immediate
Cleanup to
Health-Based
Standards
Option C
Flexible
Cleanup to
Health-Based
Standards
Option D
Flexible
Cleanup Based
On Actual
Exposure
-------
8-9
There were no clear patterns associating these 3 facility characteristics with
corrective action costs. Older facilities showed a tendency to have higher
corrective action costs. The mean cost under Option C (Flexible Cleanup to
Health-Based Standards), for example, for facilities that were between 11 and
20 years old was $698,000, while facilities with an age between 21 and 30
years had a mean cost of $1.5 million. The relationship between facility age
and mean per-facility cost was somewhat erratic, however, suggesting that
factors other than age have a more direct influence on costs. Such factors
include the extent of contamination, the nature of the particular SWMUs to be
addressed, and the remedy selected for the facility.
Similarly, the per-facility costs are only somewhat influenced by the
number of SWMUs at the facility. Again, the relationship was generally in the
expected direction; facilities with 6 to ten SWMUs faced a mean cost of $1.8
million under Option B (Immediate Cleanup to Health-Based Standards) while
facilities with between eleven and twenty units had an estimated mean cost of
$7.9 million. These costs did not, however, vary uniformly with respect to
the number of SWMUs either within a single regulatory alternative or across
all h regulatory options.
There are several reasons why the number of SWMUs may not directly
affect the cost results. Most importantly, not all SWMUs pose an equal threat
to the environment. A single large surface impoundment of several acres may
be much more likely to trigger a major corrective action than 1 small above-
ground tank. Similarly, even if an action is triggered, response costs for
small units are likely to be lower than for big units. And, for a remedy that
does not include source control (e.g., recovery wells), costs are driven
primarily by the extent of the contaminant plume. While it is certainly
likely that as the number of SWMUs at a facility increases, potential plume
sizes will also increase, the relationship is not direct. Finally, the cost
estimating methodology of the model does not account for economies of scale in
corrective actions.
Ue also examined the degree to which the particular ground-water flow
field setting influenced the mean corrective action cost. These flow fields
are defined in detail in Appendix A. As with the other factors discussed
above, there was no clear pattern of costs among ground-water settings.
In short, it seems that several factors have the potential to affect
corrective action costs, including the nature and extent of the contamination,
the hydrogeologic characteristics of the site, the time period over which
contaminants have been released, the nature of the waste management practices
leading to the release, and the particular corrective action remedy selected.
While these factors are simultaneously incorporated in the facility-by-
facility cost simulation that produced the mean per-facility cost shown in
Section 8.2.1 above, it is not possible, given the data available from the
model outputs, to isolate the effect of these various facility-specific
factors.
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8-10
8.3 RESULTS FOR TOTAL NON-FEDERAL COSTS
The total national non-Federal cost for EPA's corrective acti'on program
represents an interaction of 3 important parameters: the average cost of each
action, the investigative costs of the RFI and CMS, and the number of
facilities required to undertake corrective action. Section 8.1 explained our
calculation of average corrective action costs for each regulatory
alternative. After briefly summarizing the number of facilities subject to
corrective action, this section describes our estimation of the total costs of
the corrective action program for non-Federal facilities. Results for the
costs of corrective action at Federal facilities are presented in Chapter 12.
8.3.1 Background
As explained in Chapter 7, the number of facilities that trigger
corrective action varies among the regulatory alternatives analyzed. Exhibit
8-3 again summarizes how many facilities undergo corrective action in each of
several time periods. In general, the baseline scenario has significantly
fewer facilities with corrective action because, prior to the enactment of
HSWA, only regulated land disposal units were subject to corrective action.
Option A (Immediate Cleanup to Background) has the highest number of
facilities with corrective action, an unsurprising result given its stringent
nature. Options B, C, and D all have the same number of facilities
undertaking corrective action because each involves eventual cleanup to the
same level (i.e., a health-based target measured at the 10 meter well).
8.3.2 National Non-Federal Costs
Exhibit 8-4 presents the total national non-Federal costs of each
regulatory option relative to the baseline scenario (i.e., the baseline
scenario cost of $3.2 billion is subtracted from each option to obtain the
total incremental cost of the option). For those facilities that trigger
corrective action, the costs of the investigative phases of the corrective
action process (i.e., the RFI and CHS) have been added to the total costs
associated with the actual implementation of the corrective action. CHS costs
are simulated to occur in the same 10 year period in which corrective action
is triggered. RFI costs are assumed to be incurred in the first 20 years;
half in the first decade and half in the second decade. Exhibit 8-5 depicts
the investigative costs for each option. Those RFI and CHS costs, described
in Section 8.1.1, are combined with the mean per facility costs and multiplied
by the number of facilities that trigger corrective action to obtain the total
national costs shown in Exhibit 8-4.
Option A (Immediate Cleanup to Background) is, by far, the most
expensive of the alternatives analyzed and has an incremental cost of over
$490 billion. This result occurs because about 80 percent of the facilities
are simulated to selected excavation or excavation with recovery wells, which
are often the most expensive remedies considered by the model, and because the
stringent trigger levels cause more than 100 additional facilities to trigger
when compared to Options B, C, and D. The least cost alternative (although by
only a slight difference) is Option D (Flexible Cleanup Based on Actual
Exposure) with a cost of $5.0 billion.
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8-11
EXHIBIT 8-3
TIMING OP CORRECTIVE ACTION VARIES ACROSS REGULATORY ALTERNATIVES
Number of Non-Federal Facilities Requiring Corrective Action
Under Each Alternative
Option D:
Option B: Option C: Flexible
Immediate Flexible Cleanup
Option A: Cleanup to Cleanup to Based on
Corrective Baseline Cleanup to Health-Based Health-Based Actual
Action Timing Scenario Background Standards Standards Exposure
1987
Engineering remedy
Institutional Con-
trols
1988-2000
Engineering remedy
Institutional Con-
trols
2001-2025
Engineering remedy
Institutional Con-
trols
2026-2120
Engineering remedy
Institutional Con-
trols
515
NA a/
0
NA
1,364
NA
154
NA
658
NA
196
NA
621
37
180
16
606
53
118
27
191
NA
170
NA
542
NA
499
43
522
32
64
NA
58
NA
250
NA
250
0
288
0
770
1,747
1,646
1,646
1,646
a/ NA: Institutional controls may not be selected for this option.
-------
EXHIBIT 8-4
Total National Costs Relative to Baseline Vary Among Options
(Non-Federal Facilities)
(Discount rate of 3 percent)
$490.1 billion
$41 8 billion
$7 4 billion
$5 0 billion
Option A
Immediate
Cleanup to
Background
Option B
Immediate
Cleanup to
Health-Based
Standards
Option C
Flexible
Cleanup to
Health-Based
Standards
T
Option D
Flexible
Cleanup Based
On Actual
Exposure
Include RFI, CMS, and Implementation
of
corrective action
-------
8-13
EXHIBIT 8-5
RFI AND CMS COSTS FOR EACH REGULATORY OPTION
(in millions)
Option RFI and CMS Costs
Baseline Scenario $286.6
Option A: Immediate Cleanup to $876.9
Background
Option B: Immediate Cleanup to $845.9
Health-Based Standards
Option C: Flexible Cleanup to $845.9
Health-Based Standards
Option D: Flexible Cleanup $843.1
Based on Actual Exposure
-------
8-14
Option C has an incremental cost of $7.4 billion 7 Options B
(Immediate Cleanup to Health-Based Standards) and D have incremental costs of
$48.1 billion and $5 billion, respectively. The difference between the costs
of these 3 scenarios and Option A is due to the postponement of many
corrective actions taken immediately under Option A, and the level to which
cleanup must be performed. The difference between the costs of Options C and
D compared to Option B is attributable to the flexibility used in remedy
selection described in Section 8.2.1. For example, remedies involving
excavation (i.e., more costly remedies) are selected at about 29 percent of
facilities under Option B compared to about 14 percent under Option C.
Similarly, less expensive remedies, such as capping, are selected at about 38
percent of facilities under Option B but at about 65 percent of facilities
under Option C.
Exhibit 8-6 presents the annualized national costs associated with the
corrective action relative to the baseline. These results show that
implementation of the RCRA corrective action program may generate annual costs
of approximately $500 million (Option C, Flexible Cleanup to Health-Based
Standards) to $2.8 billion (Option B, Immediate Cleanup to Health-Based
Standards). As with total national costs, this cost is a result of the
specific modeling assumptions used in the analysis to reflect each regulatory
alternative. To the extent that a significant number of facilities are
allowed to use interim remedies, to postpone corrective action, or to use
institutional controls in lieu of prohibitively expensive cleanup
technologies, the costs of implementing the corrective action program may be
closer to those of Option C than to the other options modeled.
7 The total non-incremental cost of Option C is $10.6 billion (i.e , $3.2
billion in baseline plus $7.4 billion incremental to baseline costs).
-------
34
Annualized National Costs Relative To Baseline Vary Among Options
(Non-Federal Facilities)
(Discount rate of 3 percent annualized over 20 years)
33 -
32 -
31 -
4 -
3 -
2 -
1 -
$32.9 billion
$2.8 billion
Option A:
Immediate
Cleanup to
Background
Option B:
Immediate
Cleanup to
Health-Based
Standards
$0 5 billion
SO 3 billion
Option C
Flexible
Cleanup to
Health-Based
Standards
Option D
Flexible
Cleanup Based
On Actual
Exposure
Costs Include RFI, CMS. and Implementation of corrective action
-------
9. COMPARISON OF SIMULATED COSTS TO CERCLA EXPERIENCE
Based on results from the Liner - Location Model (LLM), Chapter 8
estimated that the incremental costs incurred at non-Federal facilities under
the proposed RCRA corrective action rule could range from $7 4 billion to
$41 8 billion, for a total national cost of between $10 6 billion to $45
billion (i e., the baseline is $3 2 billion). The RCRA corrective action
program is relatively new, it is difficult, therefore, to evaluate these
results using existing RCRA data. The CERCLA remedial action program, begun
in 1981, is similar in focus to the RCRA corrective action program and
provides data that can be used to assess the Chapter 8 estimates. CERCLA
sites and RCRA facilities differ considerably, however, and several
adjustments are necessary before making such a comparison. This chapter
presents the relevant CERCLA remedial action cost estimates and develops a
methodology to compare these estimates to those derived in Chapter 8 using the
LLM.
In response to the Superfund Amendments and Reauthorization Act of 1986
(SARA), EPA developed proposed revisions to the National Contingency Plan
(NCP). The NCP provides guidelines, operating procedures, and
responsibilities for response actions under CERCLA. In developing the
revisions to the NCP, EPA prepared a Regulatory Impact Analysis (RIA) which
estimated the costs associated with post-SARA remedial and removal actions.1
Although the methodology used in the NCP RIA differs from that used in this
RIA and involves a different EPA program, the cost estimates in the NCP RIA
provide the basis for a useful check on the Chapter 8 estimates.
9.1 DEVELOPMENT OF CERCLA COST ESTIMATES
The NCP RIA estimated the costs associated with a typical cleanup that
complied with the provisions of SARA. These costs were based on a sample of
Superfund Records of Decision (RODs). The RODs represent actual remedial
actions selected for sites (both fund-lead and enforcement-lead), and provide
cost projections based on detailed engineering plans.
The cost estimates in the NCP RIA were derived from data contained in
RODs that were signed between FY 1982 and FY 1986. The NCP RIA restricted its
analysis to 30 RODs because of the alternatives considered and the format of
the data presented in some of the RODs. The NCP RIA stated that there was no
information to determine the extent to which this sample is representative of
all ROD sites.
The NCP RIA estimated that, based on these RODs, treatment-based CERCLA
remedies incur, on average, $17.2 million in capital costs and $340,000 in
annual operations and maintenance (Otil) costs per site; containment-based
1 U.S. EPA, "Regulatory Impact Analysis in Support of the Proposed
Revisions to the National Oil and Hazardous Substances Pollution Contingency
Plan," Office of Solid Waste and Emergency Response, prepared by ICF
Incorporated, 1988.
-------
9-2
CERCLA remedies incur, on average, $4 5 million in capital costs and $610,000
in O&M costs per site. The NCP RIA assumed that 80 percent of the post-SARA
remedies are treatment-based and 20 percent are containment-based. This
yields a weighted, per-site average cost of $14 7 million in capital costs and
$394,000 in 0&M costs.
The cost estimates in the NCP RIA and in Chapter 8 cannot be compared
directly. As explained in Section 9.2, however, the NCP RIA estimates can be
used to check the Chapter 8 estimates. There are three major factors that
affect this process. First, the NCP RIA considers costs for contamination of
all media, whereas the quantitative analysis in Chapter 8 considers only
ground-water contamination Second, the NCP RIA cost estimates are only for
operable units; there may be more than one operable unit at a single site.2
The Chapter 8 cost estimates are for the entire RCRA facility. Third, the
typical Superfund site is likely to require more complex cleanup activities
than the typical RCRA facility. The methodology presented in this chapter
attempts to correct for the third factor (i.e., the complexity of the
cleanup), but the appropriate data to correct for the other two factors were
not available.
9.2 METHODOLOGY FOR ADJUSTING CERCLA COST ESTIMATES
With certain adjustments, the NCP RIA cost estimates can be used to
project the costs associated with RCRA corrective action activities.3 This
section presents a methodology to apply the CERCLA cost estimates to RCRA
facilities and calculate total and per-facility costs for non-Federal
facilities.
Categorization of RCRA Sites
There are currently 5,309 non-Federal RCRA facilities. As discussed in
Chapter 2, based on preliminary RCRA Facility Assessment (RFA) findings,
approximately 62 percent, or 3,292 facilities, are projected to require a RCRA
Facility Investigation (RFI). In Chapter 8, about half of these facilities
are assumed to require corrective action for ground-water contamination. For
the purposes of this analysis, another 40 percent are assumed to require
corrective action for contamination of other media, such as surface water,
air, and soil. The modeling effort described in Chapter 8 only considered
2 In the remedial process, a typical Superfund site may be broken down into
components, or operable units. For example, one operable unit may address the
source of contamination at a site, while another operable unit addresses a
contaminated ground-water plume. RODs, therefore, may provide costs either for
an entire site or for a single operable unit at a site.
3 Certain aspects of the LLM model were compared with algorithms and data
used in the Superfund Cost of Remedial Action (CORA) model. The CORA model
incorporates CERCLA experience to date, best engineering judgment, and a
computer-assisted decision-making algorithm used to guide Superfund remedy
selection. Based on this comparison, a few limited revisions to the LLM were
made to reflect knowledge gained in the CERCLA program.
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ground-water contamination; EPA believes that many facilities may have
contamination of other media that is not necessarily associated with ground-
water contamination. Thus, for the purposes of this analysis, approximately
90 percent, or 2,962, of these 3,292 facilities are assumed to require
corrective action of some sort.
In order to apply the CERCLA cost: estimates to these RCRA facilities,
key assumptions must be made regarding the magnitude and complexity of the
contamination, and hence the cleanup, at the facilities. Corrective action at
RCRA facilities is likely to range from relatively inexpensive activities that
address minor contamination to very large scale cleanups Based on EPA's
experience with the RCRA program and a qualitative analysis of the RFAs
included in the sample survey, approximately 20 percent of the facilities
requiring corrective action are assumed to involve remedial actions of a
magnitude equivalent to that of a Superfund site, 30 percent are assumed to
involve substantial (i.e., of a magnitude equivalent to half that of a
Superfund site) remedial actions, and the remaining 50 percent are assumed to
involve minor cleanup activities. These calculations are summarized in
Exhibit 9-1.
Not all cleanups are likely to take place in the first year of the
corrective action program. For the purposes of this analysis, the timing is
assumed to be the same as that estimated by the LLM. The projected timing of
RCRA corrective action is presented and analyzed in Chapter 7. The same
timing assumptions are used in this analysis.
Cost Estimates for Categorized RCRA Facilities
For the purposes of this analysis, the costs associated with a
Superfund-like cleanup of RCRA facilities are assumed to equal those estimated
in the NCP RIA (i.e., $14.7 million in capital costs and $394,000 in 0&M
costs). This analysis assumes that a substantial cleanup will incur capital
and O&M costs equal to half of those incurred in a Superfund-like cleanup.
The Superfund removal costs incurred from FY 1985 through FY 1987 can be
used to estimate the minor cleanup costs. Conversations with EPA Superfund
personnel indicated that the removal actions, other than "classical
emergencies," undertaken during this period incurred average costs of
approximately $325,000. This analysis uses that estimate as a proxy for the
costs incurred by a minor cleanup. There are no O&M costs associated with a
minor cleanup.
* The timing assumptions contained in Exhibit 7-1 (for Options B and C)
have been simplified by further assuming that corrective actions will be
initiated at the midpoint of the Indicated time periods and that the distribution
over time will be the same for each category of RCRA facility.
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Exhibit 9-1
Categorization of RCRA Facilities Requiring Corrective Action3
Category of Facility
Proportion6 No.
of Facilities
Superfund-like Cleanup
20 *
592
Substantial Cleanup
30 X
889
Minor Cleanup
50 X
1,481
Total
100.0 X
2,962
5 The totals in this and all other exhibits in this chapter have been
corrected for rounding errors.
6 These proportions are of the number of RCRA facilities requiring
corrective action; they do not include the 2,347 facilities that will not require
corrective action.
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The present value (using a 3.0 real interest rate) of the capital costs
with ten years of O&M is $18.1 million for the Superfund-like cleanup and $9.1
million for the substantial cleanup. The present value cost of the minor
cleanup is simply $325,000 because all the costs are incurred in the first
year. Applying these present value estimates to the time distributions in
Exhibit 7-1, and calculating the weighted average yields the present value
cost of each of the three types of remedial actions. These calculations are
summarized in Exhibit 9-2.
9.3 RESULTS AND CONCLUSIONS
Based on these estimated costs for the three types of remedial actions,
and the number of RCRA facilities expected to fall into each of the three
categories, the estimated total costs for the proposed corrective action rule
are $12.9 billion, for an average per-facility cost of $4.4 million. These
results are summarized in Exhibit 9-3.
The NCP-derived total cost estimate of $12.9 billion falls between the
Chapter 8 estimates of $10.5 billion (Option C) to $45 billion (Option B).
The per-facility costs differ as well: the NCP-derived per-facility estimate
is $4.4 million compared to the range of $6.3 million to $26.9 million
estimated in Chapter 8. Most of the difference between the per-facility
estimates arises from the fact that this analysis includes many minor (and
relatively cheaper) cleanups that were not included in the estimates developed
in Chapter 8
There are a number of limitations that should be considered in comparing
these two estimates. First, the estimates presented in Exhibit 9-3 are very
sensitive to the assumptions regarding the categorization of sites presented
in Exhibit 9-1. As Exhibit 9-4 demonstrates, plausible ranges for the cost
estimates in Exhibit 9-3 are $7.6 to $18.1 billion for total costs, and $2.6
to $6.1 million for per-facility costs. Second, as discussed in Section 9.2,
this analysis does not correct for the fact that NCP RIA considers costs for
contamination of all media, whereas Chapter 8 considers only ground-water
contamination, nor does this analysis correct for the fact that the NCP RIA
cost estimates are only for operable units.
On balance, however, this analysis demonstrates that the methodology
used in Chapter 8 appears to have produced a reasonable approximation of the
actual costs associated with EPA's proposed corrective action program.
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Exhibit 9-2
Calculation of Cleanup Costs (in millions)
Category of
Facility
Capital
Cost
O&M
Cost
Present Value
of 10 Years
of O&M Plus
Capital Cost
Weighted
Average
Cost Per
Facility7
Superfund-like $14.7
Cleanup
Substantial
Cleanup
Minor Cleanup
7.4
0.3
$0,394
0.197
None
$18.1
9.1
0.3
$12.1
6.1
0.2
7 The weighted average cost per facility reflects the effects of
discounting the costs at 3.0 percent to Incorporate the timing of the initiation
of corrective action as presented in Chapter 7.
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Exhibit 9-3
Present Value Cost Estimates of RCRA Corrective Actions
Based on NCP Estimate (in millions)
Weighted
Average
Cost Per Number of
Category of Facility Facility Facilities Total Cost
Superfund-like Cleanup
Substantial Cleanup
Minor Cleanup
Total (2,962 facilities)
$12.1
$6.1
$0.2
$4.4
592
889
1,481
2,962
$ 7,163 1
5,402.1
322 2
$12,887 4
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Exhibit 9-4
Sensitivity Analysis of Site Categorization (in millions)
Lower-bound Upper-bound
Percentage of Total Percentage of Total
Category of Facility Facilities Cost Facilities Cose
Superfund-like Cleanup 10X $3,581.5 30X $10,744.6
Substantial Cleanup 20X 3,601.4 40X 7,202.7
Minor Cleanup 70X 451.1 30X 193.3
Total (2,962 Facilities) 1001 $7,634.0 100X $18,140.7
Per-facility Average Cost $2.6 $6.1
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PART 3
SUPPORTING ANALYSIS
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10. ECONOMIC IMPACTS
Previous chapters of this analysis have established the range of
potential corrective action costs for which treatment, storage, and disposal
facility (TSDF) owners or operators may be responsible under various
corrective action regulatory scenarios. This chapter measures the economic
impacts of these regulatory costs on the firms affected by the rule.
Specifically, this part of the analysis estimates the degree to which affected
firms may encounter significant financial difficulties when attempting to pay
for the corrective action costs at their facilities under the regulatory
options assessed in the quantitative analysis for the RIA (see Chapter 6 for a
description of the regulatory options).
EPA's corrective action program will require owners or operators of
TSDFs to absorb the costs of corrective action. By placing the burden on
owners or operators, this approach ensures that the costs of cleanups are not
passed to future generations when the extent of contamination and level of
costs may be much more substantial. On the other hand, as demonstrated in
Chapter 8, the costs of corrective action can be quite large and may add
significantly to the costs of doing business for affected firms. Results may
include reduced profitability for firms owning hazardous waste facilities,
changes in the structure of affected industries by limiting firm entry or
hastening firm exit, changes in firm decisions related to prices and outputs,
and changes in consumer demand for products produced by firms generating
hazardous waste.
Because the corrective action regulations have the potential to affect
thousands of firms, each producing a variety of goods and services that are
bought and sold in a myriad of markets, a complete analysis of potential
economic impacts is not within the scope of this RIA. Instead, as an
approximation of economic impacts, this chapter concentrates on the financial
impacts of the regulation on affected firms. Economic impacts are, however,
discussed in qualitative terms in Section 10.1.2.
In summary, the analysis of the financial impacts of the corrective
action rule indicates that the baseline and four regulatory options vary
significantly in terms of the potential impacts on firms, facilities, and
alternate sources of funding for corrective action. Option A (Immediate
Cleanup to Background) leads to the highest level of economic impacts; as
compared to the baseline, an additional 20 percent of firms may experience
adverse impacts from corrective action requirements under this option.
Option B (Immediate Cleanup to Health-Based Standards), may lead to adverse
impacts for an additional 11 percent of firms. Under Options C and D
(Flexible Cleanup to Health-Based Standards and Flexible Cleanup Based on
Actual Exposure, respectively), an additional 9 percent of firms may
experience some adverse impacts due to corrective action costs. For this
analysis, a firm is assumed to experience adverse impacts if the firm faces a.
significantly higher risk of bankruptcy (as measured by a bankruptcy predictor
known as the Beaver ratio test) due to corrective action costs.
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In terms of facility impacts, Option A again leads to the highest level
of economic impacts.1 Under this option, an additional 18 percent of
facilities over the baseline level of 5 percent may be unable to cover their
corrective action costs. Options B and C lead to an additional 10 percent and
7 percent, respectively, of facilities that may be unable to cover their
costs. Under Option D, an additional 7 percent of facilities may be unable to
fund their corrective actions.
If a firm cannot cover its corrective action costs, alternate sources of
funding may have to be tapped to perform the corrective action. EPA estimates
that the potential burden on alternate sources of funding for corrective
action ranges from an additional $74 billion over the next 50 years
(undiscounted) for Option A to an additional $160 million for Option 0.
Option C, which represents the lower bound estimate of the proposed rule,
could result in an additional burden of $460 million over the next 50 years
(undiscounted).
The approach for estimating these impacts is summarized in Section 10.1;
Section 10.2 provides more detailed results of the analysis. The conclusions
are presented in Section 10.3 along with key limitations to the results.
10.1 METHODOLOGY
This section describes the approach for estimating financial impacts of
the corrective action rule. Sections 10.1.1 through 10.1.4 correspond to the
four major steps of the analysis as follows:
(1) Section 10.1.1 identifies the firms affected by the
rule and discusses the financial data used for this
analysis.
(2) Section 10.1.2 describes the estimation of the ability
of affected firms to pay for a range of potential
costs using different measures of ability to pay; one
ability-to-pay test is selected for use in the
detailed analysis of financial impacts.
(3) Section 10.1.3 discusses the calculation of after-tax
present value and annualized costs for corrective
actions from the corrective action cost data presented
in previous sections.
1 Facility impacts differ from the firm impacts described in the previous
paragraph because the number of facilities owned by a single firm varies widely,
from 1 to over a hundred.
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(4) Section 10.1.4 describes a stochastic computer model
that EPA used to estimate financial impacts based on
firms' ability to pay for corrective action costs.2
10.1.1 Universe of Firms Examined
As described in Chapter 1, the corrective action rulemaking is assumed
to affect owners or operators of all RCRA facilities regardless of permit
status. The analysis does not reflect facilities that came into operation
after April 1987 and thus does not consider impacts on new facilities. To
characterize the universe of facilities for the economic impact analysis, EPA
used information from ICF's firm/facility/financial data base (F3DB). The
F3DB is described in detail in Appendix C. This section briefly describes the
F30B and discusses the limitations of the data base for this economic impact
analysis.
The F3DB links active TSDFs identified by EPA's Hazardous Waste Data
Management System (HWDMS) with their owners and operators, and maintains
financial data on a substantial fraction of firms owning RCRA facilities.
This analysis of economic impacts uses information on owners or operators of
the 3,945 active TSDFs for which financial information was available as of
October 1986.
Using the F3DB for this analysis entails limitations that should be
considered when interpreting the results presented in later sections of this
chapter. As detailed in Appendix C, the major limitation is that the data
base has complete financial information on owners or operators of only 3,945
facilities, whereas the total number of facilities owned and operated by for-
profit firms is currently estimated to be 5,208. In addition, financial
information for a portion of the firms examined was not available from the
data sources that were consulted; rather, financial information for some
privately-held firms were imputed from industry average data according to
Standard Industrial Classification (SIC) code and firm size. Finally,
although the F3DB contains only one year of financial data, firms' performance
may vary from year to year. Predicting the future impacts of corrective
action costs based on one year of data may affect the accuracy of the results.
10.1.2 Ability-to-Pay Analysis
A firm's ability to pay for regulatory costs is best defined as the
availability of financial resources to cover those costs. This section
discusses EPA's quantitative analysis of firms' ability to pay for potential
regulatory costs, as well as a qualitative analysis of economic factors that
2 The approach used in this Regulatory Impact Analysis does not use the
model developed by OSU to analyze the impacts of the proposed financial assurance
for corrective action rulemaking (the FACA Model) for two reasons. First, this
effort focuses on ground-water modeling and remedy selection; the FACA Model
makes several simplifying assumptions in these areas. Second, the FACA Model is
a dynamic model that assesses corporate financial decision-making on an extremelv
detailed level. Thus, the model is highly resource intensive to use; the model
used for this analysis is based on a more simplified approach.
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may affect firms' ability to pay. The quantitative analysis established an
appropriate ability-to-pay test for use in the assessment of financial impacts
presented in Section 10.1.4.
Quantitative Analysis of Ability to Pay
As described in detail in Appendix C, EPA performed a quantitative
analysis of firms' ability to pay for potential regulatory costs using five
ability-to-pay rules. Based on this analysis, EPA selected the Beaver ratio
test for use in the detailed financial impact analysis presented in Section
10.1.4. The Beaver ratio test assumes that firms can pay for corrective
action out of their cash flow up to that amount where their Beaver ratio
(ratio of cash flow to total liabilities) equals the critical value of 10
percent, the point at which firms would no longer have sufficient cash flow to
assure that bankruptcy will not occur in the future. The selection was based
on the following two points:
¦ Throughout most of the likely range of corrective
action costs, firms' ability to pay using the Beaver
ratio test did not vary significantly from other
potential tests.
¦ The Beaver ratio test has been validated by previous
studies as a predictor of bankruptcy.
Note, however, that while firms that do not pass the Beaver ratio test face an
increased risk of bankruptcy, such firms may not actually declare bankruptcy.
Firms may fund corrective actions despite falling below the Beaver ratio
threshold, although it is unlikely that firms could fund costs in excess of
the cash flow ratio measure for more than a few years. Thus, the analysis
defines adverse impacts from the rule in terms of increased potential for
bankruptcy as measured by the Beaver ratio test, but does not predict actual
bankruptcies.
The analysis examines ability to pay of immediate owners of TSDFs only
and does not consider the resources of any corporate parent. Although EPA
intends to vigorously pursue corporate parents through litigation when
immediate owners fail to provide funds for corrective action, the success rate
of such activity is difficult to predict. The approach used in this analysis
will, however, somewhat underestimate the number of facilities for which
ability to pay is demonstrated.
Qualitative Analysis of Ability to Pay
The ultimate incidence of regulatory costs is an important variable in
determining the economic impact of those costs on the regulated community.
The "incidence" of regulatory costs refers to the point at which the costs are
ultimately paid. Specifically, the costs associated with a regulation may be
borne directly by firm owners in the form of lower returns on capital, or the)
may be "passed through" to consumers in the form of higher prices or to
workers in the form of lower earnings. The greater the degree to which a firm
can pass through regulatory costs to other parties, the greater will be its
ability to pay for those costs.
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The key determinants of whether a firm will be able to pass through
regulatory costs to other parties include the scope of the regulation, the
types of costs imposed by the regulation, the elasticities of supply and
demand for the output of the industry, and the ease of entry into and exit
from the industry.3 This analysis focuses on the scope of the regulation and
the types of costs imposed. The elasticities of supply and demand and the
ease of entry and exit depend on the structure of a particular industry;
analysis of the hundreds of industries affected by the corrective action
rulemaking is beyond the scope of this chapter. However, some important
conclusions may be reached by examining the broad effects of the scope of the
regulation and the types of costs imposed.
The scope of a regulation, or the degree to which a regulation affects
firms in an industry, plays a large role in whether costs may be passed
through to other parties. Theoretically, if a regulation affects all firms in
an industry, the firms are likely to pass the costs through to purchasers of
the products because all firms face increased costs and no firm will be able
to undercut increased prices without suffering decreased profit margins. On
the other hand, if a regulation affects only a portion of firms in an
industry, the costs are unlikely to be passed through because other firms will
be able to undercut any attempt to do so. Moreover, new entrants to the
industry, if unaffected by the regulation, will prevent the possibility of
passing through costs.
The costs of performing corrective action are contingent costs; firms
face the costs only in the contingency that a release requiring cleanup
occurs. Therefore, the corrective action rulemaking does not entail costs for
all firms covered by the rulemaking. Moreover, it is unlikely that all firms
in an industry will have an on-site hazardous waste facility (i.e., be subject
to the proposed rule). As discussed above, it may thus be difficult for firms
required to take corrective action to pass through the costs of the cleanup.
There is, however, a difference between existing costs of corrective
action and potential costs of corrective action. Some firms will discover
prior releases at the outset of the regulation; those releases were caused by
past waste management practices. In general, only a portion of firms in a
particular industry will discover prior releases; such firms are unlikely to
be able to pass through the costs of the required corrective action.
Corrective action liabilities in these cases are likely to result in a
reduction of profits for the affected firms.
In contrast, all firms with SWMUs have the potential to face corrective
action costs in the future resulting from their future hazardous waste
management practices. Consequently, all firms in an industry in which SWMUs
are currently part of the production process, Including new entrants, will
likely behave in one of two ways. First, they may continue to use SUMUs in
the production process and view corrective action as a long-term cost of doing
business. These firms might purchase insurance or set aside funds according
to their estimates of potential costs. Second, they may develop and implement
3 See "Principles of Regulatory Cost Incidence," ICF Incorporated, prepared
for U.S. EPA, Office of Solid Waste and Emergency Response, January, 1986
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an alternative to managing waste in SWMUs. These firms might choose to ship
wastes off-site or alter production processes to minimize or cease waste
generation. In either case, the firms will likely experience increased costs
and a corresponding industry-wide price increase will follow. If all firms in
an industry behave in the above manner, then the costs of potential corrective
action are likely to be passed through to consumers.
The degree to which large and small firms exist in an industry may
further determine the opportunities for passing through costs. If an industry
is dominated by large firms due to the capital intensity of the industry or
other barriers to entry, those firms are all likely to expect solvency in the
future and engage in long-term planning for potential costs. Therefore, firms
in these types of industries may pass through expected costs of corrective
actions because all firms behave similarly. The commercial waste management
industry provides an example of this situation.
If an industry is dominated by small firms whose resources would be
entirely exhausted in meeting potential corrective action requirements, some
of those firms may decide not to plan for the costs. Instead, they may take
the chance that their facility will not experience a release and, if a release
occurs, they may have no alternative to declaring bankruptcy. In these cases,
the pass-through of regulatory costs may be negligible; sources of funds other
than the immediate owners, including public dollars, may be the only resources
available to perform the cleanups.
In summary, the degree to which the costs of corrective action may be
passed through depends on the specific industries of affected firms. In
general, however, it can be assumed that when cleanups occur, their costs will
be passed on only if all firms in an industry incur cleanup requirements.
Moreover, it is likely that expected future cost outlays will be passed on if
all firms in an industry plan for these costs in similar fashion.
Because the corrective action rule will impose significant costs only on
firms that actually require cleanup and because the need for corrective action
is most directly related to prior waste management practices which vary among
firms, the rule is likely to affect firms in the RCRA universe unevenly.
Therefore, the stochastic model used to estimate economic impacts does not
include a factor for the pass-through of regulatory costs. This approach may
overstate the economic impacts of the corrective costs on firms; it is
possible firms in some Industries may be able to increase prices to reflect
the expected value of the future costs of corrective action.
10.1.3 Calculation of Corrective Action Costa
Because firms can smooth the incidence of corrective action costs by
borrowing equivalent amounts and repaying them on a yearly basis, the cost
information from previous chapters must be allocated evenly over an
appropriate number of years, or annualized, before the financial impacts of
the costs can be assessed. This analysis uses two steps to annualize cose
information: (1) estimating a cost of capital; and (2) discounting che cost
flows and annualizing them.
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The discount rate (or cost of capital) used in this analysis is the
weighted average cost of capital (VACC). The WACC is a common measure used to
estimate the cost of capital for firms or industries. A complete description
of the methodology used to calculate the WACC is presented in Appendix C. As
explained in this Appendix, EPA has estimated the WACC for firms subject to
the proposed rule to be 9.49 percent.
Once the proper discount rate has been established, the costs of
corrective action developed in previous chapters may be discounted to present
value costs and annualized to simulate the financing that a firm may use to
pay for the costs. The annualization period used is the period for the
corrective action cost flows for each facility, up to a maximum of fifty
years. For actions lasting less than ten years, EPA assumed an annualization
period of ten years. EPA assumed that cost outlays after the fifty-year time
period are beyond a firm's financial planning horizon. Moreover, only those
corrective actions that begin in the first 10 years are examined; firms are
unlikely to begin planning for later actions at the outset of the regulations.
The assumption that all owners and operators can spread their costs over
a given number of years may be somewhat inaccurate. The analysis does not
account for the possibility that financial differences between firms exist and
can affect the cost flow faced by a firm.
10.1.4 Simulation of Economic Impacts
EPA performed the simulation of economic impacts using a stochastic, or
Monte Carlo, computer model (described in detail in Appendix C). The model
simulates the variability involved in the number and types of facilities that
a firm may own, the range of potential corrective action costs that a
particular facility may face, and a firm's ability to cover costs at its
facilities. The model accounts for uncertainty by randomly selecting
parameter values, such as number of facilities or level of costs, from a range
of possible values with each value having a certain probability. By running
the simulation numerous times, economic impacts can be estimated within an
acceptable margin of error. The model performs this analysis for the baseline
scenario and each of the four regulatory alternatives detailed in Chapter 6
and assesses economic impacts in three major areas: firm impacts, facility
impacts, and impacts on sources of funding other than immediate facility
owners.
The firm impacts and the facility impacts are measured on both an
absolute basis and an incremental basis relative to the pre>HSUA baseline
scenario. Financial data in the F3DB generally reflect firms' status at some
point between 1983 and 1986. EPA believes that very few Subpart F corrective
actions were underway during the years for which the data were collected.
Thus, the analysis assumes that the financial strength of the regulated
community as measured by the F3DB do not reflect the effects of complying with
the baseline scenario.
m Firm Impacts -- The model estimates the impacts of the corrective
action requirements on firms using two measures: percentage of firms with no
adverse impacts and percentage of firms with adverse impacts. The results
generally are estimated within one percentage point with a 95 percent degree
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10-8
of confidence. This level of precision was achieved by running the simulation
for 5,000 iterations (i.e., for 5,000 simulated firms). The percentage
estimates were then multiplied by the total firm population to obtain firm
estimates (see Appendix C for more detail)<
Firms encountering "adverse impacts" from the corrective action
requirements are those that in the course of the simulation are unable to
provide funds for corrective action for all facilities owned without falling
below the critical threshold defined by the Beaver ratio test. The firms that
can pay for all corrective action costs (Including financial assurance) at all
facilities without significant risk of bankruptcy are considered to have "no
impacts." Firms with no corrective action costs are considered to have no
impacts, regardless of their current financial state.
(2) Facility Impacts -- The model also has three measures of impacts on
a facility basis: percentage of facilities for which neither a RCRA Facility
Investigation (RFI) nor corrective action is required, percentage of
facilities for which an RFI and/or corrective action are required and the
immediate owner covers all costs, and percentage of facilities for which an
RFI and/or corrective action are required and the immediate owner fails to
cover costs. Again, the results are generally accurate within one percentage
point at a confidence level of 95 percent. As with firm impacts, the
percentage estimates were then multiplied by the total facility population to
obtain facility estimates (see Appendix C for more detail).
The percentage of "facilities for which neither an RFI nor corrective
action is required" is calculated because some facilities will not require
RFIs and will not undergo corrective action. As described in Chapter 2, about
39 percent of facilities under Options A through D are expected to be in this
situation. Although no facilities are required to perform RFIs under the
baseline, a release characterization similar to an RFI is required for all
land disposal facilities with potential releases. The 74 percent of
facilities that are not engaged in land disposal activities will not require
release characterizations or corrective action in the baseline scenario.
The remaining facilities are assumed to either require an RFI (or
release characterization under the baseline) yet not require corrective
actions or to have an RFI and require corrective action. If a firm can fund
all costs at all of its facilities, the facilities are counted as "covered."
In addition, if a firm can only cover a portion of its facilities, then that
percentage of facilities is counted as "covered." The facilities that cannot
be covered, either when a firm cannot cover any facilities or when it can only
cover a portion of facilities, are counted as "not covered."
The results for facilities not covered should be interpreted with
caution. They do not reflect the actual number of facilities at which firms
are unable to pay for corrective action; rather, the calculations reflect the
facilities at which corrective action cannot be funded without the immediate
owner failing the Beaver ratio criterion. Firms may choose to pay the costs
of corrective action even if such payments endanger the firm as a going
concern (as reflected by an inability to meet the Beaver test) and hope chat
future income will offset the reduction in cash flow entailed in paying for
the regulatory costs. Because the Beaver ratio is a proven bankruptcy
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predictor, however, it is unlikely that a firm could sustain payments in
excess of the calculated amounts for more than a few years.
(3) Impacts on Alternate Sources of Funds -- The model calculates the
average cost per facility of facilities not covered in each year analyzed
(over a fifty year period). To translate this result into the total costs
that are unfunded by immediate owners, the average cost per uncovered facility
is multiplied by the number of facilities left uncovered by firms. The
results of this calculation provide an estimate of the costs for which sources
of funds other than the immediate owner may have to be tapped to perform the
corrective action.
One source of such funding may be the CERCLA Hazardous Substance
Response Trust Fund (Superfund). Thus, in a general sense, the results of
this analysis provide an estimate of the level of costs that may be turned
over to Superfund. However, to be eligible for Superfund monies, the
corrective action in question must not only go unfunded by the facility owner,
but it also must meet a number of other criteria including a score of at least
a 28.5 on the Hazard Ranking System. Because it is unlikely that all
facilities with unfunded corrective action will achieve this score and meet
other criteria, the estimate of facilities at which Superfund monies may be
expended will be overestimated. Other sources of funds may include State
Remedial action funds, corporate parents of facility owners and operators, or,
through price increases, the customers of the firm owning or operating the
facility.
The average yearly costs calculated in the model will generally be much
higher in the early years of the regulation than in later years; the average
corrective action requires the most substantial costs (capital costs) at the
outset of the remedial activities. Therefore, although the burden on
alternate funding sources may be in the billions of dollars in the early years
of the regulation, it should be noted that the costs over time are lower.
Moreover, the model estimate of total unfunded costs is the summation of
undiscounted costs over all 50 years; discounting the costs to present value
would reduce the estimate.
10.2 RESULTS
The following section presents the results of the stochastic simulation
of economic impacts for the baseline and each regulatory option, followed by a
comparison of the results among the options.
10.2.1 Baseline Scenario
Exhibit 10-1 presents the firm and facility impacts of the baseline
scenario. The analysis suggests that 213 firms, or 9 percent of all RCRA
firms, are estimated to encounter some adverse impact in meeting the
corrective action costs. Conversely, 2,184 firms (91 percent) suffer no
adverse impacts.
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10-10
EXHIBIT 10-I
BASELINE HAS THE LEAST ECONOMIC IMPACT
Firm Results
Adverse Impacts 213 ( 92)
No Impacts 2,184 (912)
Facility Results
Corrective Action and Release
Characterization Not Required 3,902 (752)
Corrective Action and/or Release
Characterization Required 1,309 (252)
Costs Covered 1,040 (202)
Costs Not Covered 269 ( 52)
Total Costs Unfunded by All Firms
(in thousands of dollars)
Range
of
Years
I - 5
6 - 10
II - 15
16 - 20
21 - 25
26 - 30
31 - 35
36 - 40
41 - 45
46 - 50
Total
Total
Costs in
Ranee
$64,000
5,000
7,000
5,000
5,000
4,000
2,000
2,000
2,000
2,000
$97,000
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10-11
On a facility basis, 3,902 facilities, or 75 percent, are estimated noc
to require release characterizations or corrective action. This number is
different from the four regulatory options because only land disposal
facilities are subject to the corrective action requirements under the
baseline. In addition, 1,040 facilities, or 20 percent, have release
characterization and/or corrective action costs chat are covered by immediate
owners. Only 269 facilities (5 percent) have release characterization and/or
corrective action costs that are not covered by immediate owners.
The total cost not covered by immediate owners is about $60 million in
the first year of the regulation. After the first year, however, the costs
drop significantly to under $1 million per year, resulting in a total cost of
$97 million, undiscounted, over the next 50 years.
10.2.2 Option A -- Immediate Cleanup to Background
Exhibit 10-2 presents the estimated economic impacts for Option A, the
Immediate Cleanup to Background scenario. Under this alternative, which
requires the most expensive remedies and is therefore costlier than any other
option, the economic impacts of the corrective action regulations are the
greatest. An estimated 696 firms (29 percent) will face adverse impacts under
this alternative, as compared to 9 percent under the baseline; this results in
an incremental firm effect of 20 percentage points. The facility impacts are
also highest; 1,177 facilities (23 percent) are not covered by immediate
owners. This compares to 5 percent of facilities under the baseline,
resulting in an incremental impact of 18 percentage points.
Not unexpectedly, the total cost at unfunded facilities is highest under
this option as well. Because of the high capital expenditures required by
Option A in the first year, the total first year cost not covered by
facilities is estimated at about $74.0 billion. Again, however, the costs
drop sharply after the first year to an average of about $11 million per year,
resulting in total costs of $74.3 billion, undiscounted, over the fifty year
period analyzed. This compares to a total unfunded cost of $97 million under
the baseline, resulting in an incremental impact of $74.2 billion,
undiscounted, over 50 years.
10.2.3 Option B -- Immediate Cleanup to Health-Based Standards
Option B (Immediate Cleanup to Health-Based Standards) induces economic
impacts that are second in magnitude only to Option A. As shown in Exhibit
10-3, 469 firms (20 percent) encounter adverse impacts. When compared to 9
percent of firms under the baseline, this results in an incremental effect of
11 percentage points. Moreover, 775 facilities (15 percent) are not covered
by the firms facing adverse impacts, as compared to 5 percent under the
baseline. This results in an incremental facility effect of 10 percentage
points.
The total costs not covered by facilities are estimated to be $4.7
billion in the first year, followed by average yearly costs of about $11
million. The total cost unfunded by immediate owners for the 50-year period
analyzed is approximately $5.2 billion, undiscounted. Relative to the
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10-12
EXHIBIT 10-2
OPTION A LEADS TO HIGHEST LEVEL OF ECONOMIC IMPACTS
Firm Results
Adverse Impacts
No Impacts
Absolute
696 (29*)
1,701 (712)
Facility Results
Corrective Action and RFI Not Required 2,099 (402)
Corrective Action and/or RFI Required 3,109 (60X)
Costs Covered
Costs Not Covered
1,932 (37X)
1,177 (232)
Relative
to the
Baseline
483 (202)
908 (18X)
Total Costs Unfunded by All Firms
(in thousands of dollars)
Range
Total Costs
in Ranee
of
Relative to
Years
Absolute
The Baseline
1 - 5
$73,812,000
$73,748,000
6 - 10
91,000
86,000
11 - 15
96,000
89,000
16 - 20
52,000
47,000
21 - 25
39,000
34,000
26 - 30
36,000
33,000
31 - 35
36,000
34,000
36 - 40
36,000
35,000
41 - 45
26,000
35,000
46 - 50
36,000
34,000
Total
$74,271,000
$74,174,000
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10-13
EXHIBIT 10-3
OPTION B LEADS TO SECOND HIGHEST LEVEL OF IMPACTS
Firm Results
Adverse Impacts
No Impacts
Absolute
469 (20Z)
1,928 (80X)
Facility Results
Corrective Action and RFI Not Required 2,099 (40X)
Corrective Action and/or RFI Required 3,109 (60X)
Costs Covered
Costs Not Covered
2,334 (45X)
775 (15X)
Relative
to the
Baseline
256 (11*)
506 (10X)
Total Costs Unfunded by All Firms
(In thousands of dollars)
Range Total Costs in Ranee
of Relative to
Years Absolute The Baseline
I - 5 $5,082,000 $5,018,000
6 - 10 30,000 25,000
II - 15 35,000 28,000
16 - 20 16,000 11,000
21 - 25 16,000 11,000
26 - 30 14,000 11,000
31 - 35 13,000 11,000
36 - 40 12,000 10,000
41 - 45 11,000 9,000
46 - 50 9,000 7,000
Total $5,238,000 $5,140,000
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10-14
baseline value of $97 million, then, Option B is associated with $5.1 billion
(undiscounted) in unfunded corrective action costs over the next 50 years.
10.2.4 Option C -- Flexible Cleanup to Health-Based Standards
The economic impacts of Option C (Flexible Cleanup to Health-Based
Standards), presented in Exhibit 10-4, are less than those of Options A or B.
Under Option C, 437 firms, or 18 percent, encounter adverse impacts, as
compared to 9 percent under the baseline. Thus, this option creates an
incremental effect of 9 percentage points on the firm level. These impacts
translate to 614 facilities with costs that may not be funded by immediate
owners, or 12 percent of all facilities. With 5 percent of all facilities not
covered under the baseline, this option causes an incremental effect of 7
percentage points on the facility level.
The total costs not covered are also less than those of Options A or B.
After a first year total of about $200 million, the average annual costs drop
to about $7 million, resulting in total costs over the entire 50-year period
of about $550 million, undiscounted. Relative to the baseline, a total of
$457 million over the baseline level of $97 million may not be covered over
the next 50 years.
10.2.5 Option D -- Flexible Cleanup Based on Actual Exposure
Exhibit 10-5 shows the estimates of economic impacts for Option D
(Flexible Cleanup Based on Actual Exposure). Under this alternative, 431
firms (18 percent) are estimated to face adverse impacts, or an incremental
effect of 9 percentage points from the baseline estimate of 9 percent. This
firm impact translates to 608 facilities (12 percent) that are not covered by
immediate owners, or an incremental effect of 7 percentage points from the
baseline estimate of 5 percent.
Total costs not covered for Option D are less than those in Options B
and C. In the first year of the regulation, the total cost is $200 million,
followed by average annual costs of about $1 million, resulting in total
estimated unfunded costs of $262 million, undiscounted, over the next 50
years. Compared to the baseline level of $97 million, then, an incremental
effect of $165 million (undiscounted) in unfunded costs over the next 50 years
is associated with this option.
10.2.6 Comparison of Financial Impacts Among Alternatives
Exhibit 10-6 shows a comparison of the key measures of firm and facility
impacts for the baseline and each regulatory option discussed above. Below
each measure, the relative ranking of alternatives in terms of magnitude of
impacts is shown. For both firm and facility level impacts, Option A creates
the greatest level of impacts, followed by Option B. Both Options C and D
have greater impact than the baseline, but less impact than Options A and B.
On both the facility level and the firm level, Option C has virtually
identical impact to Option D; thus, no clear conclusions on ranking can be
drawn for Options C and 0 based on these twc measures alone. However, Exhibit
10-7, which compares and ranks the baseline and each regulatory option
according to the costs estimated to be unfunded by immediate owners, indicates
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10-15
EXHIBIT 10-4
OPTION C HAS LESS IMPACT THAN OPTION B
Firm Results
Adverse Impacts
No Impacts
Absolute
437 (18*)
1,960 (82X)
Facility Results
Corrective Action and RFI Not Required 2,099 (402)
Corrective Action and/or RFI Required 3,109 (60X)
Costs Covered
Costs Not Covered
2,495 (48X)
614 (12X)
Relative
to the
Baseline
224 ( 9X)
345 ( 7Z)
Total Costs Unfunded by All Firms
(in thousands of dollars)
Range
of
Years
I
6
II
16
21
26
31
36
41
46
Total
5
10
15
20
25
30
35
40
45
50
Absolute
Relative to
The Baseline
$477,000
$413,000
12,000
7,000
18,000
12,000
7,000
2,000
7,000
2,000
7,000
3,000
7,000
5,000
6,000
4,000
6,000
5,000
6.000
5,000
$555,000
$457,000
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10-16
EXHIBIT 10-5
OPTION D HAS LESS IMPACT THAN B OR C
Firm Results
Adverse Impacts
No Impacts
Facility Results
Corrective Action and RFI Not Required
Corrective Action and/or R7I Required
Costs Covered
Costs Not Covered
Absolute
431 (18X)
1,966 (82X)
2,099 (40X)
3,109 (60X)
2,502 (48X)
608 (12X)
Relative
to the
Baseline
218 ( 9X)
339 ( 71)
Total Costs Unfunded by All Firms
(in thousands of dollars)
Range
Total Costs
in Ranee
of
Relative to
Years
Absolute
The Baseline
1 - 5
$211,000
$147,000
6 - 10
8,000
3,000
11 - 15
15,000
8,000
16 - 20
4,000
*
21 - 25
4,000
*
26 - 30
4,000
*
31 - 35
4,000
2,000
36 - 40
4,000
2,000
41 - 45
4,000
2,000
46 - 50
4,000
2,000
Total
$262,000
$165,000
* Relative cost of less than $1,000,000.
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10-17
EXHIBIT 10-6
OPTIONS ARE SIMILARLY RANKED FOR FIRM AND FACILITY IMPACTS
Baseline
Immediate
Cleanup to
Background
(Option A)
Immediate
Cleanup to
Health-Based
Standards
(Option B)
Flexible
Cleanup to
Health-Based
Standards
(Option O
Flexible
Cleanup
Based on
Actual
Exposure
(Option D)
Firm Impacts
Adversely Impacted 9X
Ranking* 1
29X
5
202
4
18X
3
18%
2
Facility Impacts
Facilities Not
Covered
Ranking*
5X
1
23X
5
15X
4
12X
3
12X
2
* Ranking from 1 through 5: 1 represents lowest level of impacts and 5 represents
highest level of impacts.
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10-18
EXHIBIT 10-7
COSTS NOT COVERED BY FIRMS VARY GREATLY BY ALTERNATIVE
Flexible
Immediate
Flexible
Cleanup
Immediate
Cleanup to
Cleanup to
Based on
Cleanup to
Health-Based
Health-Based
Actual
Background
Standards
Standards
Exposure
Total Costs in Year
Baseline
(Ootion A)
COntion B)
(Option C)
(Option D'
1
- 5
$64,000
$73,812,000
$5,082,000
$477,000
$211,000
6
- 10
5,000
91,000
30,000
12,000
8,000
11
- 15
7,000
96,000
35,000
18,000
15,000
16
- 20
5,000
52,000
16,000
7,000
4,000
21
- 25
5,000
39,000
16,000
7,000
4,000
26
- 30
4,000
36,000
14,000
7,000
4,000
31
- 35
2,000
36,000
13,000
7,000
4,000
36
- 40
2,000
36,000
12,000
6,000
4,000
41
- 45
2,000
36,000
11,000
6,000
4,000
46
- 50
2,000
36,000
9,000
6,000
4,0^"
50 Year
Average
$2,000
$1,485,000
$105,000
$11,000
$5, Oo
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10-19
that Option C clearly has greater impact than Option D based on unfunded
costs. Therefore, the alternatives can be ranked from greatest to least
impact as follows: Options A, B, C, D, and the baseline.
For the impacts shown in Exhibit 10-6 and 10-7, the rankings of
regulatory alternatives in order of magnitude of economic impacts are not
surprising considering that they reflect the order of alternatives in terms of
total costs for non-Federal facilities, as described in Chapter 7. Option C
(Flexible Cleanup to Health-Based Standards), as discussed in Chapter 6,
represents the lower bound estimate of the proposed rule. The baseline
represents the set of regulatory standards that would have been in effect had
the post-HSWA regulatory changes not been made. The key points of comparison,
therefore, are between the baseline and Option C. The baseline shows lower
impacts than Option C because it reflects only the Subpart F regulations and
thus requires fewer facilities than any other alternative to undergo
corrective actions. As discussed in Chapter 7, 770 non-Federal facilities
will require corrective action under the baseline, whereas the other
alternatives require from 1,646 to 1,747 facilities to undergo corrective
actions.
10.3 CONCLUSIONS AND LIMITATIONS
The results of the stochastic model for estimating economic impacts show
that the baseline and four regulatory options vary significantly in terms of
the potential impacts on firms, facilities, and alternate sources of funding
for corrective action. Option A, the Immediate Cleanup to Background
scenario, is by far the most costly of the alternatives with the baseline
scenario and all other options are orders of magnitude below Option A. Option
C (Flexible Cleanup to Health-Based Standards) entails costs unfunded by
immediate owners of over $550 million over the next 50 years, or $460 million
more than the baseline regulations produce.
In evaluating the potential impacts of the baseline and four regulatory
options on the immediate owners of facilities, several important
considerations must be mentioned. First, as discussed in Section 10.1.4,
firms may choose to fund RFIs and/or corrective actions despite falling below
the Beaver ratio threshold used to assess adverse impacts. The level of costs
that other sources of funds may have to cover may therefore be overestimated.
Second, some firms may be able to pass the costs of corrective action on
to consumers in the form of higher prices. As discussed in Section 10.1.2,
the pass-through of costs was not modeled because of the variety of industries
being analyzed and the fact the initial infracts of the corrective action
requirements will be on facilities suffering the effects of past waste
management practices. However, it is possible that firms in heavily affected
industries will be able to pass through costs and reduce the potential burden
on alternate sources of funds.
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10-20
Finally, Che timing of coses is important in assessing the impacts of
the corrective action program. A significant number of corrective actions are
projected co begin in the very near future. To the extent that technical,
programmatic, and budgetary constraints delay the implementation of corrective
action at a significant number of facilities, the associated financial impacts
on firms may be lower.
-------
11. REGULATORY FLEXIBILITY ANALYSIS
The Regulatory Flexibility Act requires Federal agencies to analyze
fully the economic effects of their regulations on small entities. To meet
the requirements of the Act for the corrective action rulemaking, this chapter
provides an analysis of the effects of the rulemaking on small entities It
does so by analyzing the regulatory options intended to represent the proposed
rule (i.e., Options B and C)
The Act specifically requires the regulatory flexibility analysis to
determine whether a regulation has "a significant economic impact on a
substantial number of small entities" and to estimate the magnitude of the
effects on those entities. This analysis involves the following four steps,
define small entities, develop criteria for measuring significant economic
impacts; calculate the after-tax present value and annualized costs of
corrective action, and simulate the economic effects of corrective action
costs on small firms. Using the above steps, the number and percentage of
small firms and facilities for which corrective action costs may exceed the
firms' ability to pay are estimated. Finally, economic impacts on small
entities are compared to the economic impacts on large entities. The general
approach for testing economic impacts parallels the approach used to estimate
overall economic impacts in Chapter 10. As with the economic impacts chapter,
this analysis focuses on financial impacts on the entities affected by the
rule rather than economic impacts in general.
The analysis concludes that the proposed rule does not have a
significant impact on a substantial number of small entities. Based on EPA
guidelines for implementing the Regulatory Flexibility Act, a regulation is
defined to affect a substantial number of small entities if more than 20
percent of small entities affected by the regulation suffer significant
impacts as a result of the regulation. Only 9 to 11 percent of small firms
are estimated to face significant additional impacts from the proposed rule
that would not have occurred under the baseline scenario.
11.1. IDENTIFYING SMALL ENTITIES
A three-step process was used to identify the small entities affected by
the proposed regulations: (1) determine the industries and firms potentially
affected; (2) define a small business for the regulated industries; and (3)
identify actual small businesses in these industries based on this definition.
Each of these steps is described in more detail below, followed by a
discussion of the limitations inherent in the approach.
11.1.1 Determining the Industries and Firms Potentially Affected
The corrective action rulemaking will affect owners or operators of all
RCRA facilities that have treated, stored, or disposed of hazardous waste at
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11-2
any point since November 19, 1980. To approximate this universe for the
Regulatory Flexibility Analysis, information from ICF's firm/facility/
financial data base (F3DB) was used. The methodology and content of the F3DB
is explained in detail in Appendix C. In short, the F3DB links active TSDFs
identified by EPA's Hazardous Waste Data Management System (HWDMS) with their
owners or operators, and maintains financial data on almost all firms owning
RCRA facilities. The F3DB has complete financial information on 1,838 firms
owning 3,945 facilities; these facilities were the subject of the economic
impacts analysis in Chapter 10 and were the starting point for testing the
economic impacts of the corrective action rule on small entities. This
analysis separates the 1,838 owners or operators of the 3,945 facilities into
small and large entities, as discussed below.
11.1.2 Defining a Small Business
The definitions of small entities are based on Regulatory Flexibility
Act guidelines prepared by EPA in 1982.1 These guidelines state that small
entities include:
¦ Small businesses -- any business which is
independently owned and operated, and is not dominant
in its field as defined by the Small Business
Administration (SBA) regulations <13 CFR Part 121) .
¦ Small organizations -- any not-for-profit enterprise
that is independently owned and operated and is not
dominant in its field.
¦ Small governmental jurisdictions - - any government of
a district with a population of less than 50,000.
The F3DB is dominated by private sector firms, thus the SBA definitions
of small businesses are the primary criteria used to define small entities.
The economic impacts of the proposed regulations on small non-profit or
government entities owning or operating TSDFs were not analyzed. Relevant
data on these entities are not available from the F3DB; for example, the F3DB
has no information on population of governmental jurisdictions. Moreover, the
standard measures of ability to pay for firms are generally inapplicable to
government and non-profit entities; for example, a government does not earn
net income, making a cash flow figure based on net income impossible to
calculate.
The lack of financial information on government and non-profit entities
will not significantly affect the accuracy of the ability-to-pay estimates of
this section. These entities account for only 8 percent of the facilities in
the data base. Moreover, because the Federal government is responsible for 75
percent of these facilities, the potential impact on small non-business
entities will be minimal.
1 "Guidelines for Implementing the Regulatory Flexibility Act," Memorandum
from Allen L. Jennings, U.S. Environmental Protection Agency, February 17, 1982,
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11-3
SBA regulations define small businesses in terms of either maximum
number of employees or maximum revenues by four-digit Standard Industrial
Classification (SIC) codes in 13 CFR Part 121. The definitions used for this
analysis are current through December 31, 1986; this cutoff date corresponds
to the latest employment and sales data available on the F3DB. The F3DB
contains sales and employment data on the majority of firms analyzed, which
may be compared to the SBA rules to determine the set of small businesses.
For this analysis the definitions of small businesses were applied only
to privately-owned firms. The analysis of all publicly-owned firms in the
data base indicates that they are far too large to meet the criteria for the
definition of a small business. Although some subsidiaries of publicly-owned
firms meet the size requirements of a small business, they were also excluded
because they are owned by a larger entity that does not qualify as a small
business. Therefore, the small business definitions were applied only to the
I,108 privately owned firms in the F3DB.
Every privately-owned firm in the F3DB is linked to information on
employment levels; about 150 of those firms were missing sales data. For
those firms that were missing sales data and that were in industries for which
the SBA definition of small firms is based on sales, sales figures were
estimated using Ward's Corporation Reports. 1986 (Ward's). Ward's contains
total employment and sales figures for surveyed corporations by three-digit
SIC code. To estimate the sales for a particular firm in this analysis, total
sales for the closest three-digit SIC code in Ward's were divided by the total
number of employees to obtain an average sales per employee figure for that
SIC code.2 The estimated average sales per employee figures for the relevant
three-digit SIC codes were then multiplied by the actual number of employees
in each firm to arrive at an estimated sales level by firm. As a result of
this process, each of the 1,108 privately-owned firms has the data necessary
for classifying firms by size.
II.1.3 Identify Small Businesses
Of the 1,108 privately-owned firms analyzed, 869 met the SBA definition
of small business. The remaining 239 firms were added to the group of
publicly-owned firms and subsidiaries of publicly-owned firms to form a group
of "large" firms totalling 969. The economic impacts of the corrective action
rulemaking on these two groups of firms are analyzed and compared in Section
11.6.
This analysis focuses only on owners of TSDFs. A corporate
parent that owns subsidiaries is not tested unless it directly owns
facilities; otherwise, parent firms of immediate owners are not examined. The
rationale for this approach parallels the rationale in the economic impact
analysis of Chapter 10.
2 The F3DB has four-digit SIC codes for each firm. The information from
Ward's is presented by three-digit SIC codes, which are broader in scope than
four-digit codes. However, the three-digit codes were matched as closely as
possible to the relevant four-digit SIC codes; this approximation should not
result in significant error.
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11-4
11.1.4 Limitations
The most significant limitations to the approach for defining small
businesses are, in large part, limitations inherent in the use of the F3DB.
These limitations, described in detail in Appendix C, center around the fact
that owners or operators of only 3,945 facilities are examined, whereas about
5,308 facilities owned by for-profit firms are currently believed to be in
existence. This limitation is due to: (1) recent additions to the list of
active facilities by EPA that have not been reflected in the F3DB and (2) a
lack of available financial information on some firms.
As discussed previously, the limitations inherent in the approach to
defining small businesses, namely, the lack of information on government and
non-profit entities and the approximations necessary to estimate sales in some
instances, are not expected to significantly alter the results of this
analysis.
11.2 CRITERIA FOR DETERMINING SIGNIFICANT IMPACTS ON SMALL BUSINESSES
The EPA guidelines for implementing the Regulatory Flexibility Act
require a determination of whether a regulation has "a significant economic
impact on a substantial number of small entities." The criteria used for
measuring both significant impacts and substantial numbers of entities are
explained in this section.
11.2.1 Criteria for Determining Significant Impacts
For this analysis, two rules for testing significant impacts are used.
These rules were used to establish ability to pay probability distributions
for the stochastic computer simulation described in Section 11.4.
In this analysis, a small business is assumed to face a significant
impact if its:
¦ Excess of cash flow over ten percent of its total
liabilities (i.e., the Beaver ratio test) is
insufficient to meet its corrective action costs; or
¦ Net income is insufficient to meet its corrective
action costs.
These criteria are explained in detail in Appendix C. The discussion below
compares and contrasts the criteria used in this analysis with the rules
suggested by EPA for regulatory flexibility analyses.
EPA guidance states that significant impacts on small entities occur
whenever one or more of the following criteria are met:
¦ Annual compliance costs (annualized capital,
operating, reporting, etc.) increase total costs of
production for small entities for the relevant process
or product by more than five percent;
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11-5
¦ Compliance coses as a percent of sales for small
entities are at least 10 percent higher than
compliance costs as a percent of sales for large
entities;
¦ Capital costs of compliance represent a significant
portion of capital available to small entities,
considering internal cash flow plus external financing
capabilities; or
¦ The requirements of the regulation are likely to
result in closures of small entities.
Other relevant criteria may be used if appropriate.
The first criterion suggested by EPA compares annual compliance costs to
the costs of production and sets a five percent threshold for significance.
The corrective action regulations, however, are directed primarily towards
cleanup of existing hazardous waste releases rather than current production
processes or products. Comparing corrective action costs to current
production costs is potentially misleading because hazardous waste releases
may be related to a firm's past waste management practices and not to its
current levels of production. Therefore, this criterion does not appear to be
appropriate for this regulatory flexibility analysis.
The second criterion suggested by EPA compares compliance costs as a
percent of sales for small and large entities and sets a 10 percent difference
as significant. The sales test is intended to measure the degree to which
small firms in a particular industry are disadvantaged in the marketplace
relative to large firms. However, for this analysis, corrective action costs
as a percentage of sales may not accurately measure the difference in abi lity
to pay between small and large firms. If the returns on sales (income) are
sufficient to provide funds for corrective action, then a firm will be able to
pay regardless of the percentage of sales that the costs represent.
Therefore, the net income ability-to-pay rule is used as a surrogate for the
suggested approach.
The third criterion compares the capital costs of compliance with the
sum of internally and externally available capital for each firm. The
internally available cash is easily measured by net income and adjustments for
non-cash items; the externally available cash depends on a firm's relationship
with financial institutions and is difficult to predict. However, the net
income ability to pay rule used in this analysis parallels this suggested
criterion. As discussed in Chapter 10, net income measures internally
generated funds. Yet, it also includes the estimated amount of investment
required to sustain the current operations of the firm. Because the
investment required to sustain the firm is related to the requirements for
external financing, the two approaches are comparable.
Moreover, the methodology for estimating annualized costs of corrective
action, discussed in Chapter 10, assumes that the firm will smooth the
incidence of regulatory costs by borrowing from financial institutions. The
discount rate used to annualize the costs is different for small and large
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11-6
firms (see Appendix C) to account for the potential differences in borrowing
costs. Therefore, the costs used in this analysis already incorporate an
expectation of external financing under terms typical for small firms.
The final EPA criterion for assessing small firm impacts measures the
potential for closure of the facility due to the costs of compliance. Both
decision rules used in this analysis measure the potential for closure of a
facility. The first rule, a modified Beaver ratio, is known as a predictor of
firm bankruptcy (see Chapter 10 for more details). If a firm is predicted to
have an inordinately high risk of bankruptcy due to corrective action costs,
then we assume that the firm would close the facility.3 The net income rule
forecasts an inability to pay for corrective action if total costs exceed
available cash flow. If the firm is unable to pay for the obligation, its
only option may be to declare bankruptcy, effectively closing the facility.
In summary, the two ability-to-pay rules used for this analysis cover
three of the four criteria suggested by EPA to assess small business impacts;
as explained above, the other criterion, related to production costs, is
inappropriate for this particular analysis. The ability-to-pay rules serve a
dual purpose in that they meet requirements for determining the existence of
significant impacts and at the same time enable estimation of the magnitude of
impacts on small firms using the stochastic computer simulation model
described in Appendix C.
11.2.2 Criteria for Determining Substantial Number of Small Entities
EPA guidance for regulatory flexibility analyses establishes a 20
percent rule for defining a substantial number of small entities; that is, a
regulation is designated as having significant impacts on small entities if
more than 20 percent of small entities affected by the regulation meet the
criteria for encountering significant impacts. This rule is used in this
analysis to evaluate whether the corrective action regulation creates
"significant impacts."
11.3 CALCULATION OF CORRECTIVE ACTION COSTS
Previous sections of this chapter have established the set of small
firms to be analyzed and the set of criteria for testing significant impacts.
This section explains how the corrective action costs faced by small firms
were estimated.
The corrective action cost information provided by the Liner Location
Model must be adjusted to accurately represent the flow of costs facing an
owner or operator required to perform corrective action. Specifically,
because firms can smooth the incidence of costs by borrowing equivalent
amounts and repaying them on a yearly basis, the costs must be allocated
evenly over an appropriate number of years, or annualized. The cost data.
3 In this context, closure of a facility means ceasing the operations of
the facility, not necessarily performing closure activities as required bv RCRA.
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11-7
therefore, were converted into annualized amounts for use in the analysis of
economic impacts on small businesses.
The methodology for calculating the costs of corrective action is
similar to the methodology used in the economic impact analysis. First, for
small and large firms, respectively, a weighted average cost of capital (see
Appendix C) was established. Second, using the estimated cost of capital, the
corrective action cost flows developed in Chapter 8 were discounted to present
value figures. Finally, the present value costs were annualized to simulate
the financing approaches that firms are likely to use.
11.4 SIMULATION OF ECONOMIC IMPACTS
As in Chapter 10, a stochastic, or Monte Carlo, computer model was used
to estimate the economic impacts of the corrective action rulemaking on small
entities. The model simulates the variability involved in the number and
types of facilities that a firm may own, the range of potential corrective
action costs that a particular facility may face, and a firm's ability to
cover costs at its facilities. The model accounts for these uncertainties by
randomly selecting parameter values, such as number of facilities or level of
costs, from a range of possible values with each value having a certain
probability. By running the simulation numerous times, the possible error of
the results are reduced to an acceptable level.
In the model runs for this analysis, 5,000 iterations are conducted for
both small and large firm impacts (i.e., for each run, 5,000 firms and the
facilities they own are simulated). The 5,000 iterations reduce the possible
error of the results to within one percentage point with a 95 percent degree
of confidence. As explained in Chapter 10, the model produces results for the
simulated population of firms and facilities. Therefore the results are given
m terms of percentages rather than actual numbers. These percentages can
then be multiplied by the actual number of small or large firms (or the number
of facilities owned by those firms) to obtain approximations of economic
impacts on the two groups of firms.
The model used for this analysis is the same as that used for the
analysis in Chapter 10. The only differences are the probability
distributions associated with parameters such as ability to pay, use of
financial test, and number of facilities owned, which are altered based on
whether the small or large firm groups are being examined. For example, the
ability-to-pay probability distribution for small firms may differ markedly
from the distribution for large firms; this difference is likely to make the
estimated economic impacts different as well. Therefore, this analysis breaks
the population of firms examined into two populations (large and small firms)
and uses separate ability-to-pay and facility ownership probability
distributions to examine economic impacts for each group.
Because the focus of this chapter is on testing the effects of the
proposed rule on small businesses, this analysis, in contrast to Chapter 10,
examines the economic impacts of only tvo regulatory options: Options B and
C, which are intended to reflect the bounds of flexibility afforded by the
proposed rule. In order to examine the incremental effects of the option
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11-8
beyond the current Subpart F regulations, the baseline scenario is also
included in this analysis. (See Chapter 10 for further discussion of the
baseline scenario's role in assessing incremental effects.)
The other contrast with Chapter 10 is that because two different
ability-to-pay rules are required to comply with Regulatory Flexibility Act
requirements, simulations of economic impacts were conducted for each of the
two rules, the Beaver ratio criterion and the net income criterion, to create
estimates of economic impacts for Option C and the baseline scenario.
11.5 MEASURES OF ECONOMIC IMPACTS
The measures of economic impacts for this analysis concentrate on two
areas: firm-level impacts and facility-level impacts. The measures relating
to these two areas are the same measures used in Chapter 10 and are described
there in detail. The measures are briefly described below.
11.5.1 Firm Results
Finns encountering "adverse impacts" are those that in the course of the
simulation are unable to provide funds for corrective action for all
facilities owned based on the ability-to-pay rules. Firms encountering "no
impacts" are those that can pay for all corrective action costs at all
facilities while passing the ability-to-pay rules; this category includes
firms with no corrective action costs, regardless of their financial status.
The number of small and large firms encountering adverse impacts is
determined by multiplying the percentages of small and large firms adversely
affected (estimated by the model) by 1,102 and 1,295, respectively, which are
approximations of the number of small and large firms owning RCRA facilities
11.5.2 Facility Results
Facilities for which neither corrective action nor an RFI is required
are those where no release sufficient to trigger an investigation or a
corrective action exists. Facilities incurring costs of RFIs or corrective
actions may either be "covered" or "not covered" based on whether or not each
firm can afford all or a portion of costs at facilities that it is simulated
to own.
The percentage of facilities in each category is multiplied by the
number of facilities owned by small or large firms to obtain the number of
facilities in each category. The number of facilities owned by small and
large firms, respectively, is 1,323 and 3,885; these numbers are extrapolated
from available ownership information (again, see detailed explanation in
Chapter 10).
As discussed in Chapter 10, the results for facilities not covered
should be interpreted with caution, because firms may choose to pay for
facilities to the point where they no longer pass the Beaver ratio or net
income criteria. Therefore, the estimate of the number of facilities at which
costs may not be covered may be overestimated.
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11-9
11.6 RESULTS AND CONCLUSIONS
For this analysis, the stochastic simulation model yields estimates of
economic impacts of the corrective action requirements on the previously
defined groups of small and large firms owning RCRA facilities. Section
11.6.1 presents the results of the analysis for Options B and C and the
baseline scenario and compares the impacts on small firms with the impacts on
large firms; these results are interpreted for purposes of the Regulatory
Flexibility Act in the concluding Section 11.6.2.
11.6.1 Firm and Facility Impacts
This section presents the results of the stochastic simulation of
economic impacts for the baseline scenario and the two regulatory options,
using both ability-to-pay rules. In each case, the results are interpreted to
evaluate the level of economic impact of the corrective action program on
small businesses.
Exhibits 11-1 and 11-2 show the firm and facility impacts under the
baseline scenario for the Beaver test and net income test respectively. These
exhibits show that small firms encounter more severe impacts from the existing
corrective action requirements than large firms. On a firm basis, 7 percent
of small firms under the net income rule and 10 percent of small firms under
the Beaver rule face adverse impacts, whereas only 4 percent of large firms
under the net income rule and 8 percent of large firms under the Beaver rule
encounter adverse affects. Similarly, 6 to 9 percent of facilities (depending
on the ability-to-pay rule) owned by small firms face costs that are not
covered by those firms, whereas only 2 to 4 percent of facilities owned by
large firms are in a similar situation.
The results of the baseline analyses indicate that the net income rule
is less stringent than the Beaver ratio test in evaluating the extent of
economic impacts. In fact, this relationship is true among all options
tested, thus providing a sensitivity range for the results of the analysis.
Exhibits 11-3 and 11-4 present the economic impact results for Option B,
Immediate Cleanup to Health-Based Standards. The total results and the
incremental results (relative Co the baseline) are presented. Option B
results in an additional 10 to 12 percent of small firms being adversely
affected relative to the baseline, compared to 6 to 10 percent of large firms,
depending on the ability-to-pay test used. On a facility basis, an additional
9 to 13 percent of facilities have corrective action costs that are not
covered by small firm owners, while only 6 to 9 percent of facilities have
corrective action costs that are not covered by large firm owners. On an
absolute basis (i.e., not incremental to the baseline), 17 to 22 percent of
small firms face adverse impacts under Option B, depending on the ability-to-
pay measure used.
Exhibits 11-5 and 11-6 present the results for Option C, Flexible
Cleanup to Health-Based Standards. The results are presented both as total
results and as incremental results relative to che baseline. Depending on che
ability-to-pay test considered, this option results in an addicional 8 to 10
percenc of small firms being adversely affected relative to the baseline,
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11-10
EXHIBIT 11-1
BASELINE -- BEAVER TEST
Firm Results: Laree
Adverse Impacts 109 ( 82)
No Impact 1,186 (922)
Facility Results:
Corrective Action and RFI Not Required 2,914 (752)
Corrective Action and/or RFI Required
and Costs Covered 831 (212)
Corrective Action and/or RFI Required
and Costs Not Covered 144 ( 42)
Small
105 (102)
997 (902)
988 (752)
209 (162)
126 ( 92)
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11-11
EXHIBIT 11-2
BASELINE -- NET INCOME TEST
Firm Results:
Large
Small
Adverse Impacts
No Impact
56 ( 42) 77 ( 72)
1,239 (962) 1,025 (932)
Facility Results:
Corrective Action and RFI Not Required
Corrective Action and/or RFI Required
and Costs Covered
Corrective Action and/or RFI Required
and Costs Not Covered
2,914 (752) 959 (732)
913 (232) 283 (212)
58 ( 22)
79 ( 62)
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11-12
EXHIBIT 11-3
OPTION B -- BEAVER TEST
INCREMENTAL RESULTS
Firm Results:
Large
Small
Increase in Adverse Impacts Relative to
the Baseline
10X
12X
Facility Results:
Increase in Corrective Action and/or RFI
Required and Costs Not Covered Relative to
the Baseline
91
13X
ABSOLUTE RESULTS
Firm Results:
Adverse Impacts
No Impact
Laree Small
227 (18*) 242 (22X)
1,068 (822) 860 (78X)
Facility Results:
Corrective Action and RFI Not Required
Corrective Action and/or RFI Required
and Costs Covered
Corrective Action and/or RFI Required
and Costs Not Covered
1,570 (40X) 529 (40X)
1,830 (47X) 504 (38X)
486 (13X) 290 (22X)
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11-13
EXHIBIT 11-4
OPTION B -- NET INCOME
INCREMENTAL RESULTS
Firm Results:
Layge
Small
Increase in Adverse Impacts Relative to
the Baseline
62
102
Facility Results:
Increase in Corrective Action and/or RFI
Required and Costs Not Covered Relative to
the Baseline
62
92
ABSOLUTE RESULTS
Firm Results:
Adverse Impacts
No Impact
Large Small
130 (101) 187 (172)
1,166 (901) 915 (832)
Facility Results:
Corrective Action and RFI Not Required
Corrective Action and/or RFI Required
and Coses Covered
Corrective Action and/or RFI Required
and Costs Not Covered
1,554 (402) 516 (392)
2,020 (522) 609 (462)
311 ( 82) 198 (152)
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11-14
EXHIBIT 11-5
OPTION C -- BEAVER TEST
INCREMENTAL RESULTS
Firm Results:
Large
Small
Increase in Adverse Impacts Relative to
the Baseline
Facility Results-
Increase in Corrective Action and/or RFI
Required and Costs Not Covered Relative to
the Baseline
8X
52
10*
112
Firm Results:
ABSOLUTE RESULTS
_La£&e.
Small
Adverse Impacts
No Impact
212 (16X)
1,083 (84X)
225 (20X)
877 (80X)
Facility Results:
Corrective Action and RFI Not Required
Corrective Action and/or RFI Required
and Costs Covered
Corrective Action and/or RFI Required
and Costs Not Covered
1,570 (40X)
1,970 (51X)
346 ( 9X)
529 (40X)
525 (40X)
269 (20X)
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11-15
EXHIBIT 11-6
OPTION C -- NET INCOME TEST
INCREMENTAL RESULTS
Firm Results: Large Small
Increase in Adverse Impacts Relative to
the Baseline 42 82
Facility Results:
Increase in Corrective Action and/or RFI
Required and Costs Not Covered Relative to
the Baseline 32 82
ABSOLUTE RESULTS
Firm Results:
Adverse Impacts
No Impact
Small
109 ( 82) 170 (152)
1,186 (922) 932 (852)
Facility Results:
Corrective Action and RFI Not Required
Corrective Action and/or RFI Required
and Costs Covered
Corrective Action and/or RFI Required
and Costs Not Covered
1,570 (402) 519 (392)
2,133 (552) 622 (472)
179 ( 52) 183 (142)
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11-16
compared to U to 8 percent of large firms. This proportion is significantly
below the threshold of 20 percent used to define a substantial number of small
entities under EPA's Regulatory Flexibility Act guidelines. Moreover, an
additional 8 to 11 percent of facilities have corrective action costs that are
not covered by small firm owners, whereas only 3 to 5 percent of facilities
have corrective action costs that are not covered by large firm owners. Of
note is that in absolute terms, 15 to 20 percent of small firms face adverse
impacts under Option C.
11.6.2 Conelus ions
Following the EPA guidelines for regulatory flexibility analyses, the
proposed corrective action rule options analyzed did not meet the criteria for
imposing significant impacts on small entities. Using ability-to-pay measures
as tests of significant impacts, an incremental increase of over 20 percent of
small firms (.i.e., a "substantial number") were not adversely affected.
Regardless of the ability-to-pay rule used, no more than 12 percent of small
firms suffer adverse impacts under the proposed rule options, relative to the
baseline scenario. Given that the baseline scenario represents the financial
effects of the existing corrective action regulations (as described in Chapter
10), this analysis demonstrates that the proposed corrective action program is
unlikely to significantly affect a substantial number of small businesses
using EPA-mandated definitions of significant impact.
If, however, the impacts on small businesses are assessed on an absolute
basis, then Options B and C are sufficiently costly to meet the 20 percent
rule for creating significant impacts. The absolute impacts to small firms
under the options range from 15 to 22 percent. Absolute economic impacts to
small firms are significant only when using the Beaver test. In all other
cases, the proposed rule options do not result in a significant impact on a
substantial number of small entities (i.e., on more than 20 percent of all
small firms) when evaluated without the effects of the baseline scenario
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12. FEDERAL FACILITIES
In earlier chapters of this report, the population of RCRA Subtitle C
facilities was discussed, and the number of facilities likely to require
corrective action was estimated. In that discussion, the population of
Subtitle C facilities was divided into two groups: privately-owned or
operated facilities (including municipal and non-profit facilities) and
Federally-owned or operated facilities. Federal facilities are of special
concern and are examined in this chapter in more detail for several reasons:
(1) While constituting only six percent of the total
population of RCRA facilities affected by corrective
action requirements, Federal facilities typically
contain more SWKUs per facility than non-Federal
facilities and may incur higher corrective action
costs;
(2) Ownership by the Federal government implies that
corrective action will be funded from public money and
is subject to overall Federal funding priorities.
In this chapter, the population of Federal facilities is analyzed in
terms of the following: the size of the population of Federal facilities; the
composition of Federal facilities; and the number of SWMUs per Federal
facility. Also, this chapter estimates the number of Federal facilities that
will undergo RFIs, the number of Federal facilities that will need to take
corrective action, and the cost of corrective action for the Federal facility
population.
12.1 OVERALL POPULATION OF FEDERAL FACILITIES
A complete characterization of Federal facilities is not currently
available; however, this analysis is based on verified data in EPA's Hazardous
Waste Data Management System (HWDMS). Exhibit 12-1 summarizes the
distribution of Federal facilities listed in HWDMS across the agencies that
own or operate the facilities. This exhibit also shows the distribution of
different types of facilities (i.e., land disposal, treatment and storage, and
incineration) among these agencies.
As of August 1987, HWDMS indicates that there are 352 Federally-owned or
operated facilities. Of this total, 277 facilities (79 percent) belong to the
Department of Defense (DOD). The remaining facilities are split among various
civilian agencies: 34 facilities (10 percent) for the Department of Energy
(DOE); 6 facilities for the National Aeronautics and Space Administration, and
7 facilities for EPA (about 2 percent each); and fewer facilities distributed
among other civilian agencies. Within the DOD, there is a roughly even
apportionment of facilities among the US Army (34 percent of the DOD total),
the US Air Force (31 percent of the DOD total), and the US Navy (29 percent of
the DOD total). Six percent of the total DOD facilities could not be
categorized into one of these three branches.
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12-2
EXHIBIT 12-1
DISTRIBUTION OF FEDERAL FACILITIES AOCOSS AGENCIES
All
DEPARTMENT OF DEFENSE (DOD):
US Army
US Air Force
US Navy
Unspecified DOD
93
(26%)
87
(25%)
81
(23%)
16
(5%)
DOD TOTAL
CIVILIAN AGENCIES:
Dept. of Energy
Environmental Pro-
tection Agency
National Aeronautics
and Space Administra-
tion
Dept. of Transportation
Dept. of Agriculture
Unspecified Civilian
CIVILIAN TOTAL
277
(79%)
34
(10%)
7
(2%)
6
(2%)
4
(1%)
2
(1%)
22
( 6%)
75
(21%)
Treatment
Storage and
Disposal
Facilities
59
(24%)
70
(28%)
67
(27%)
11
(4%)
207
(82%)
17
(7%)
4
(2%)
2
(1%)
1
(0%)
1
(0%)
19
(8%>
44
(18%)
Land
Disposal
Facilities
25
(21%)
16
(20%)
11
(14%)
3
(4%)
55
(69%)
15
(19%)
0
(0%)
4
(5%)
3
(4%)
1
(2%)
2
(3%^
25
(31%)
Incineration
Facilities
9
(43%)
1
(5%)
3
(14%)
2
(10^
15
(71%)
2
(10%)
3
(12%)
0
(0%)
0
(0%)
0
(0%)
1
(5%)
6
(29%)
TOTAL FEDERAL FACILITIES:
352
(100%)
251
(100%)
80
(100%)
21
(100%)
Source: HUDMS, August 1987.
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12-3
Exhibit 12-2 presents the number of land disposal, treatment and
storage, and incineration facilities for both the DOD population and the
civilian agency population. The relative distribution of facility types is
consistent between the total DOD and civilian agency populations; that is, for
both populations, there are more treatment and storage facilities than land
disposal facilities, and even fewer incineration facilities. However, the DOD
population has a greater proportion of treatment and storage facilities than
the civilian agency population. Seventy-five percent of DOD facilities are
treatment and storage facilities compared with 59 percent of the civilian
agency population. Also, 20 percent of DOD facilities are land disposal
facilities compared with 33 percent of civilian facilities, and 5 percent of
DOD facilities are incineration facilities compared with 8 percent of civilian
agency facilities.
L2.2 CHARACTERIZATION OF RCRA FEDERAL FACILITIES
While it is important to know how many Federal facilities will be
subject to the corrective action program, it is equally important to
understand the potential environmental problems these facilities pose.
Section 12.2.1 below suggests chat Federal facilities are larger (i.e.,
comprise more SWMUs per facility) than privately-owned or operated facilities,
and in Section 12.2.2, estimates suggest that a higher proportion of Federal
facilities may require corrective action as compared with private-sector
facilities.
12.2.1 Average Number of SWMUs per Facility
At present, there are relatively little data available on the actual
number of SWMUs at each Federal facility. Without such information, estimates
of the average number of SWMUs per facility must be based on the limited
information available.
In creating the facility data base for this RIA, 65 RCRA facility RFAs
were examined in detail. Six of these 65 RFAs were for DOD facilities. While
the sample was selected to be as representative as possible for RCRA
facilities, the fact that RFAs are not yet available for all RCRA facilities
limits the sample in certain ways. (See Appendix A for a full explanation of
the development of the facility data base.) One should not assume that the
six Federal facility RFAs represent all Federal facilities; however, they do
constitute nine percent of the total RFA sample. As stated above, the Federal
facility population is approximately six percent of the total RCRA facility
population. Thus, Federal facilities are represented in the hypothetical data
base in approximate proportion to their distribution among all RCRA
facilities.
An examination of the six Federal facility RFAs produced an average of
29 SWMUs per Federal facility. However, no DOE facilities were represented in
the Federal facility sample. EPA's experience with DOE facilities suggests
that they are much larger than facilities owned by other Federal agencies;
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12-4
EXHIBIT 12-2
DISTRIBUTION OF FEDERAL FACILITIES BY FACILITY TYPE
TYPE OF FACILITY:
Treatment and Storage
Land Disposal
Incineration
All Federal
Facilities
251
(71%)
80
(23%)
21
(6%)
All DOD
Federal
Facilities
207
(75%)
55
(20%)
15
(5%)
All Civilian
Federal
Facilities
44
(59%)
25
(33%)
6
(8%)
TOTAL FEDERAL FACILITIES:
352
(100%)
277
(100%)
75
(100%)
Source: HWDMS, August 1987.
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12-5
however, there are no data to accurately calculate the difference in size
between large DOE and non-DOE Federal facilities. There is some anecdotal
information about the number of SWMUs located in DOE facilities: the DOE
Hanford Site, located in Richland, Washington, has 1,200 identified SWMUs; the
Idaho National Energy Laboratory has 352 SWMUs; the Savannah River Plant in
Aiken, South Carolina, and the Oak Ridge National Laboratory have
approximately 350 SWMUs each; and the Lawrence Livermore National Laboratories
have over 180 SWMUs. Thus, the calculated average of 29 SWMUs per facility
grossly underestimates the condition of DOE facilities.
To estimate the number of SWMUs per Federal facility, it is assumed that
non-DOE facilities average 29 SWMUs (based on the RFA data base), and DOE
facilities average 290 SWMUs; that is, DOE facilities are, typically, ten
times the size of other Federal facilities. This estimate is clearly
speculative, but it represents a reasonable assumption given the available
data. Exhibit 12-1 shows that DOE facilities constitute 10 percent of the
total Federal facility population; thus, for an overall average of SWMUs per
Federal facility, we estimate the number to be 55 (i.e., 90 percent have 29
SWMUs and 10 percent have 290 SWMUs).
12.2.2 Estimate of RCRA Federal Facilities that will Require Ground-tfater
Corrective Action
The Federal facility population is not as completely described as the
non-Federal population. Because limited information is available, an exact
estimate of the number of Federal facilities requiring corrective action
cannot be provided; to do so would presume a greater accuracy than the sample
data allow. However, a range for the number of Federal facilities requiring
corrective action, based on various assumptions, can be estimated. These
assumptions are presented as Che following five cases:
Case I -- (Worst-Case Estimate1): Assumes all Federal facilities (i.e.,
352) would require an RF1 and would then be found to require some degree of
corrective action for contaminated ground water.
Case II -- (Upper Estimate): Using information from 625 completed RFAs
(used to create the facility data base as described in Appendix A) it was
found that 22 were for Federal facilities. Nineteen of these Federal facility
RFAs (86 percent) indicate the need for an RFI. Therefore, it is assumed that
86 percent (303) of all Federal facilities will require RFIs, and all of these
facilities would require corrective action for ground water.
Case III -- (Mixed Estimate): As in Case II, 86 percent will require an
RFI and approximately 50 percent (depending on the option selected)1 of all
facilities requiring an RFI may need to take corrective action, regardless of
whether the facility is Federal or not. Therefore, it is assumed that 139 to
161 Federal Facilities would require corrective action.
1 The variation is slight: 53 percent for Option A; 50 percent for Option
B; 47 percent for Option C; and 46 percent for Option D.
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12-6
Case IV -- (Lower Estimate): This case assumes that the likelihood of
an RFI and of a corrective action as estimated in Chapter 2 for the overall
RCRA population are applicable to Federal facilities as well. This suggests
that 62 percent of the 352 Federal facilities, or 218 facilities, would
require an RFI, and approximately SO percent (again, depending on the option
selected) of these facilities, or 100 to 116 facilities, would further require
corrective action for ground-water contamination.
Case V -- (Midpoint Estimate): It may be more reasonable to assume the
actual number of Federal facilities requiring corrective action lies somewhere
between the worst-case and lower estimates, stated above in Cases I and IV.
Although it seems unlikely that every Federal facility will require corrective
action, it is also unlikely that Federal facilities will require the same
proportion of RFIs and corrective actions as non-Federal facilities.
Therefore the analysis assumes that the probability of triggering an RFI lies
midway between the estimates given above (i.e., between 0.62 and 1.0), that
is, 0.81,2 and that the probability of a Federal facility moving from an RFI
to corrective action is midway between 0.50 and 1.00, or 0.75. Thus, for Case
V, 80 percent of the 352 Federal facilities (285) require an RFI, and
approximately 75 percent of these facilities (208 to 217) would further
require corrective action.
Exhibit 12-3 summarizes the five cases analyzed in this chapter. Taken
together, these cases imply that somewhere between 100 and 352 Federal
facilities will require corrective action. Given the lack of complete
information, it is estimated that 211 (i.e. , Option C for Case V above)
represents the most likely number. It is important to remember that the above
discussion is based on ground-water corrective action only. As with non-
Federal facilities, when releases to other media are considered, the numbers
of both RFIs and corrective action are likely to be higher.
12.3 ESTIMATE OF CORRECTIVE ACTION COSTS AT FEDERAL FACILITIES
Corrective action costs can be considered in two ways: (1) the cost of
cleanup at individual Federal facilities; and (2) the total cost to the
Federal government for cleaning up all Federal facilities. The following
sections estimate these two costs for Federal facilities.
12.3.1 Per-Faclllty Cost of Corrective Action at Federal Facilities
The per-facility cost results developed in Chapter 8 of this RIA were
not directly applied to Federal facility cleanups. While the cleanup
technologies are the same, and the regulatory alternatives are the same, the
per-facility costs of Federal and non-Federal facilities may differ because of
differences in the number of SUKUs per facility.
2 Note that this is not very different from the result obtained from the
22 Federal facility RFAs.
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12-7
EXHIBIT 12-3
ESTIMATED KUMBKR OF FEDERAL FACILITIES REQUIRING
GROtJND-WATKR CORRECTIVE ACTION
Case I (Worst-Case
100%
100%
Number of
Facilities
(N = 352)
Number Re-
quiring RFI
(N = 352)
Number Requiring*
Corrective Action
(N = 352)
Case II (Upper »«rt- <«**»*-«») •
86%
100%
Number of
Facilities
(N = 352)
Number Re-
quiring RFI
(N = 303)
Number Requiring*
Corrective Action
(N » 303)
Case III fMlx"H ^irt-tmate^;
86%
50%
Number of
Facilities
(N = 352)
Number Re-
quiring RFI
(N = 303)
Number Requiring*
Corrective Action
(N e 142)**
Case IV (Lower Betimatel:
62%
50%
Number of
Facilities
(N ¦ 352)
Number Re-
quiring RFI
(N = 218)
Number Requiring*
Corrective Action
• *
102)
Case V fKid-Point nmUmmfmx,
81%
75%
Number of
Facilities
(N » 352)
Number Re-
quiring RFI
(ft - 285)
Number Requiring*
Corrective Action
• #
211)
* Estimated number of facilities requiring corrective action based on ground-
water cleanup only.
** These numbers represent Option C; numbers for other options for Cases III,
IV, and V vary slightly (see text).
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12-8
The cost estimates developed in Chapter 8 were pro-rated to account for
the fact that Federal facilities average about 4.6 times the number of SWMUs
(i e., 55 divided by 12) as non-Federal facilities, with the understanding
that this is a rough approximation.
The estimated per-facility cost at Federal facilities varies with the
regulatory option chosen. For example, the per-facility cost (i.e., net
present value cost) of the baseline, or pre-HSWA scenario, is $17 million.
Similarly, for Options A through D, the Federal per-facility costs are
approximately: $1.3 billion; $123 million; $29 million; and $22 million.3
It may be useful, especially when considering agency or facility budgets, to
convert these costs into annualized costs.* Options A through D correspond
to the following approximated annualized costs per Federal facility: $87
million; $8 million; $2 million; and $1.5 million. The annualized baseline or
Pre-HSWA cost is approximately $1 million.
12.3.2 Total Cost of Corrective Action at Federal Facilities
The total cost of taking corrective action at Federal facilities depends
on two factors: the number of facilities requiring corrective action and the
cost for each cleanup. While the analysis above has estimated a single per-
facility cost (for each of the four regulatory options), the analysis
estimates a range of facilities requiring corrective action, in Section 12.2.2
above. Consequently, the total cost will also be a range. The range has been
narrowed by emphasizing two of the five cases presented above; in particular,
cost estimates are derived for Cases III and V. Exhibit 12-4 shows the total
Federal facility cleanup costs, for each of the four regulatory options,
associated with these two cases (i.e., "Mixed Estimate" and "Midpoint
Estimate") .5
3 These cost estimates have been discounted at three percent to 1987 and
are based on the same financial assumptions (e.g., timing of cost, use of
institutional controls) as are non-Federal facilities. See Chapter 8 for more
detail. More important, these costs do not include RFIs or CMSs. The above
estimates are rough, and these investigative costs are overshadowed by
calculation error and rounding.
4 Annualized costs throughout this chapter are calculated at 3 percent for
20 years.
5 These figures only represent ground-water cleanup costs; they do not
include costs for cleaning up other contaminated media or associated
investigative or administrative costs.
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12-9
EXHIBIT 12-4
COST OF CORRECTIVE ACTION AT FEDERAL FACILITIES*
COST FOR REGULATORY OPTION:**
ABC
Immediate Flexible
Immediate Cleanup Cleanup
Cleanup to Health- to Health-
Baseline*** to Back- Based Based
Scenario ground Standards Standards
Flexible
Cleanup
Based on
Actual
Exposure
(billions) (billions) (billions) (billions) (billions)
Case III (Mixed Estimate)
Total Cost
Incremental Total Cost
1.2
209.3
208.1
18.7
17.5
4.1
2.9
3.0
1.8
Annualized Cost
Incremental Annualized Cost
0.08
14.1
14.0
1.2
1.1
0.3
0.2
0.2
0.1
Case V (Midpoint Estimate)
Total Cost 1.0 282.1 26.3 6.1 4 6
Incremental Total Cost -- 281.1 25.3 5.1 3 6
Annualized Cost 0.07 19.0 1.8 0.4 03
Incremental Annualized Cost -- 18.9 1.7 0.3 0.2
* These figures only represent ground-water cleanup costs; they do not
include costs for cleaning up other contaminated media or associated
administrative costs.
** In billions of dollars; discounted at 3 percent to 1987 and annualized
for 20 years.
*** Based on 80 Federal land disposal facilities.
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12-10
Excluding the baseline estimate, total ground-water cleanup costs range
from approximately 3 to 209 billion dollars for the "Mixed Estimate" Case III,
and approximately 5 to 282 billion dollars for the "Midpoint Estimate" Case V.
These ranges are broad and reflect the divergent environmental strategies
incorporated into Options A through D. Using the "Midpoint Estimate" Case V,
for example, the upper limit of 282 billion dollars assumes an immediate
cleanup to background at all affected facilities. Option C, however, which
represents flexible cleanup to health-based levels, would cost approximately 6
billion dollars. These figures are based on total discounted costs.
Using the lower bound estimate of the proposed rule (i.e., Option C), total
Federal facility costs can be narrowed to 4 to 6 billion dollars for Case III
and Case V, respectively. This represents an annualized cost incremental to
the baseline of approximately 200 to 300 million dollars per year. Compared
with the cost estimates presented in Chapter 8, Federal facility cleanups will
constitute approximately 39.5 percent of the total cost of thi.s rule.
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PART 4
SUMMARY
-------
13. CONCLUSIONS AND LIMITATIONS
This regulatory impact analysis was performed to characterize the costs,
benefits, and other impacts of EPA's proposed corrective action rule. The
general approach taken was to establish alternative regulatory options with
varying cleanup targets, types of remedies, and timing. These regulatory
options were then compared and contrasted both qualitatively, using hazardous
constituent release scenarios and case studies, and quantitatively, using data
compiled through a sample of 65 RCRA RFAs in order to yield representative
costs and benefits. Based on this analysis, the following conclusions were
reached:
¦ The qualitative analysis suggests that the regulatory
strategy upon which the proposed rule is based offers
a high degree of protection of human health and the
environment while not placing unnecessary burdens on
facility owners and operators.
¦ Based on the quantitative analysis, under the
regulatory options most similar to the proposed rule,
over 50 percent of the facilities undertaking
corrective action for ground-water contamination were
simulated to reach cleanup targets within 75 years.
¦ Costs for ground-water corrective action under the
proposed rule were simulated to have a lower bound
mean present value cost per facility of $6.3 million
and an annualized per- facility cost of $0.4 million.
Moreover, under this same option, national costs were
simulated to be about $7.4 billion, or $0.5 billion on
an annualized basis, more than the costs that would
have been incurred for corrective action prior to the
enactment of HWSA.
¦ Based on the economic impacts analysis for Option C,
an additional 7 percent of all facilities and 9
percent of all firms will face adverse impacts from
the corrective action requirements of the proposed
rule, leaving a total of $97 million (undiscounted) in
corrective action costs left unfunded due to
insolvency.
¦ Based on the regulatory flexibility analysis, the
regulatory options most similar to the proposed rule
does not impose significant impacts on a substantial
number of small entities (i e., only 9 to 11 percent
of entities are adversely affected) when considered
relative to the impacts of corrective action
requirements prior to the enactment of HSWA.
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13-2
In reviewing the results presented by this analysis, a number of key
limitations to the analysis and assumptions made in the quantitative analysis
and supporting analysis should be considered. These limitations and
assumptions, which are discussed more thoroughly where appropriate throughout
the RIA, are summarized below. In general, these limitations fall into three
categories: effectiveness, coses, and supporting analyses.
Effectiveness
¦ Effectiveness measures the degree to which a
particular option achieves the cleanup target. It
should not be viewed as a measure of potential ground-
water protection benefits.
¦ Because the RIA simulated releases to ground water
only, the effectiveness of the regulatory options in
addressing releases to other environmental media is
likely to vary somewhat from the estimates presented
in the RIA.
• Due to modeling constraints, the performance of
simulated remedies may diverge somewhat from the
actual performance and effectiveness of such remedies.
For instance, in the model, caps are simulated to fail
in 35 years and recovery wells are assumed to be 95
percent effective in removing ground-water
contamination. In practice, the life of caps and the
efficiency of recovery wells will vary from site to
site, depending on local factors, such as
hydrogeologic conditions.
¦ Because only four remedies were simulated, the model
may not accurately reflect the broader range of
remedies available in practice. Moreover, the model
uses simplified remedy selection rules in selecting
among the range of remedies. In contrast, under the
proposed rule, detailed studies would be used as the
basis for selecting among corrective measure remedies.
• In all cases, it was assumed for modeling purposes
that background contaminant concentrations are zero.
It is likely that, at some RCRA facilities, background
concentrations are not equal to zero. Because
concentrations must reach the detection limit before
corrective action can be triggered, it will take
longer to detect a release if background
concentrations are zero than it would if ground-water
supplies were already contaminated to a level higher
than the detection level. As a result, the RIA may
underestimate the likelihood of triggering corrective
action for all options.
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13-3
Coses
¦ Because the RIA models the entire corrective action
program (i.e., by including RCRA Section 3008(h) and a
revised Subpart F program in addition to the Subpart S
rule authorized by Section 3004(u)), the costs of the
Subpart S rule itself are overestimated.
¦ The quantitative analysis assumes that the target
cleanup level is equal to the trigger level. Because
the proposed rule actually allows the target cleanup
level to be set at a point higher than the level at
which action is first initiated, the analysis may have
over estimated costs.
¦ The remedy selection rules used for the model only
approximate the proposed rule and are not as flexible
as the rule, thus potentially overestimating costs.
¦ Because the quantitative analysis modeled releases to
ground water only, this analysis underestimates the
costs of corrective action.
¦ For modeling purposes, remedies were simulated only
once for a given release scenario (i.e., not for
additional future releases), thus potentially
underestimating costs.
¦ Because of modeling limitations, the RIA does not
simulate the use of Alternate Concentration Limits
(i.e., site-specific cleanup standards set under
Subpart F). Thus, the RIA may overestimate the cost
of the baseline scenario and underestimate the
incremental cost of other options.
¦ The RIA simulates off-site land disposal of excavated
wastes. However, the additional costs of treating
land-disposal wastes to the Land Disposal Restrictions
(40 CFR Part 268) were not included in the cost
estimates. Moreover, incineration of excavated wastes
was not simulated. As a result, the RIA may
significantly underestimate costs for the options that
select excavation remedies.
¦ The model did not estimate the costs of institutional
•controls where they were selected. As a result, the
RIA may underestimate costs for the options that
select institutional controls.
¦ The RIA derives the costs of RFIs and CMSs from lower-
bound estimates of similar Superfund investigation
steps. If, in practice, the investigative costs for
RCRA corrective actions diverge from these lower-bound
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13-4
estimates, then the accuracy of the cost estimates
would be reduced.
¦ Using Superfund remedial action program data, total
national costs for the proposed corrective action rule
were estimated to be $12.9 billion (non-incremental to
baseline), compared to $10.6 billion to $45 billion in
total national costs (non-incremental) for the
proposed rule in this analysis.
Supporting Analyses
¦ Because the economic impact analysis does not simulate
the availability of alternate funding sources, such as
payouts from financial assurance mechanisms, corporate
parents, price increases, Superfund, or State cleanup
funds, the RIA may overestimate the economic impacts
of the proposed rule.
¦ In the economic impacts and regulatory flexibility
analyses, corrective action costs are not simulated to
vary with the financial size of the firm required to
take corrective action. Therefore, the RIA may
underestimate the economic impacts of the proposed
rule on small firms.
¦ Federal facility costs are estimated using a very
imprecise methodology that involves extrapolating from
smaller private facilities to very large Federal
facilities. Actual costs observed at Federal
facilities may differ significantly from those
estimated in the RIA.
-------
APPENDICES
Appendix A:
Appendix B:
Appendix C:
Appendix D:
Development of Facility Daca Base
Corrective Action Triggers
Methodology for Economic Impact Analysis
CERCLA Corrective Action Activities
-------
APPENDIX A
DEVELOPMENT OF FACILITY DATA BASE
This appendix describes the development of che facility data base used in
the RIA to estimate the costs and risks associated with various regulatory
approaches to corrective action. The data base reflects, in part, information
collected on each of 65 actual RCRA facilities. We supplemented the data
collected on the 65 facilities using best professional judgement to make
assumptions where there were data gaps. As a result, we developed a partially
hypothetical facility data base for this analysis. While not statistically
representative of the actual universe of facilities, we selected the sample of
facilities to be as representative as possible of the facilities subject to
the SWMU corrective action proposal.
This appendix is divided into three primary sections. The first section
describes the survey of actual facilities, Che second provides an overview of
the hydrogeologic mapping of the facilities, and the third explains how we
supplemented the data to complete the database.
A. 1 FACILITY SUKVKE
We developed the facility data base used for the RIA from a survey of
actual RCRA facilities. This section explains how we developed the sampling
approach and executed the survey. It is divided into the following sections:
• Section A.1.1 discusses the general characteristics of
facilities subject to the proposed corrective action
regulations;
• Section A.1.2 briefly discusses the availability of data
on facilities and SVKUs and discusses the data sources
used in this analysis;
• Section A.1.3 describes the universe of facilities
represented by the survey saotple;
m Section A.1.4 discusses the methodology used to make the
survey sample as representative of the overall population
of facilities and SVMUs as possible;
• Section A.1.5 discusses the general approach used for
analyzing each individual facility; and
Section A.1.6 presents the primary characteristics of the
survey sample.
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A-2
A. 1.1 Facilities Subject to RCSA Corrective Action Regulations
As explained in Chapters 2 and 4, the RCRA corrective action program as
amended by HSWA applies Co all RCRA Subtitle C land disposal, incineration,
and treatment/storage facilities that are either currently operating, in the
process of closing, or already closed. The corrective action program extends
to all units at these facilities that have been used for management of solid
wastes from vhich hazardous wastes or constituents may be released. Areas
where wastes have routinely and systematically been released, wastewater
treatment units, and waste recycling units are also regulated by the RCRA
corrective action program.
EPA has estimated the national population of Subtitle C facilities
subject to the RCRA corrective action regulations to be 5,661 facilities. *•
According to the Hazardous Waste Data Management System (HWDMS), approximately
26 percent of the Subtitle C facilities (1,487 facilities) are classified as
land disposal facilities, 3.5 percent (196 facilities) as incineration
facilities, and 70 percent (3,978 facilities) as treatment/storage
facilities.^ The majority of these facilities are currently interim status
facilities with either permit status or closure status pending approval by the
appropriate authorities. Approximately 21 percent of the facilities have
submitted a closure plan that has either been approved or is currently under
review.
A. 1.2 Data on Facilities Subject to RCSA Corrective Action Regulations
For the RIA, the primary data sources on SWKUs were RCRA Facility
Assessments (RFAs). RFAs are prepared as the first of three phases in the
RCRA corrective action program. The purpose of an RFA is to: (1) identify
and gather information on releases at a Subtitle C facility, (2) evaluate
SUMUs and other areas of concern for the potential for releases to the
environment, (3) make preliminary determinations regarding releases of concern
and the need for further actions and Interim measures at the facility, and (4)
screen from further investigation all those SUMUs which do not pose a
significant threat to human health or the environment.^
1 U.S. EPA, "Summary Report on RCRA Permit Activities for March 1987."
Prepared by State Programs Branch and Information Management Staff, Office of
Solid Waste, April 13, 1987, based on OSW tracking data.
2 Land disposal facilities are defined as any hazardous waste management
facility with a landfill, surface impoundment, waste pile, or land treatment
unit. Any facility that has an incinerator but no land disposal units is
considered an incineration facility. All other hazardous waste management
facilities are defined as treatment/storage facilities.
3 U.S. EPA, "RCRA Facility Assessment Guidance." Frepared by the OffL
of Solid Waste, October 1986.
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A- 3
RFAs generally consist of brief descriptions of che industrial processes
at the facility, the location of the facility and its surrounding environment,
the design of each SWMU, the types of wastes handled by each SWMU, and the
release history or potential for releases at each SUMU and the facility in
general All units potentially subject to Sections 3004(u), 3004(v), and
3008(h) are evaluated in the RFA. The units evaluated include spill areas,
recycling units, wastewater treatment units, and units that were closed prior
to the enactment of RCRA or HSWA. Depending upon the size of each facility
and the number of SWMUs at the facility, RFAs may range from a few pages to
several hundred pages per facility.
RFAs represent a compilation of several data sources on individual
facilities. In preparing RFAs, several sources are consulted including RCRA
Part A and Part B permit applications, responses to Regional requests for
information on SWMUs, RCRA inspection reports, RCRA exposure information
reports, and other sources (e.g., correspondence, waste manifests, notices to
local authorities, reports of releases, and so forth) as appropriate. In
addition, other sources such as CERCLA Remedial Investigation/Feasibility
Study and CERCLA Preliminary Assessment/Site Investigation reports, if they
exist, are also consulted. Many RFAs also include actual site visits to
verify information and gather visual evidence on each SUMU. Because RFAs
represent a single concise document that attempts to synthesize a wide range
of data on a particular facility, ve used RFAs for the purposes of developing
a facility database for the RIA.
EPA has been conducting RFAs over the past two years and ultimately
intends to prepare an RFA for each facility subject to the RCRA Subtitle C
program. Exhibit A-l shows the number of RFAs that had been completed as of
April 16, 1987. The exhibit shows chat EPA has completed RFAs for
approximately eleven percent (624 of 5,661 facilities) of all Subtitle C
facilities. More than 74 percent of these facilities (464 facilities) are
land disposal facilities, five percent (33 facilities) are incineration
facilities, and 20 percent (127 facilities) are treatment/storage facilities.
Because HSVA greatly expanded the scope of the RCRA corrective action
program, the data on facilities and SWHUa subject to the corrective action
requirements are often sketchy and unverified. The quality of data contained
in each RFA varies greatly according to the amount of data available on a
facility and che surrounding environment. Some RFAs contain a large amount of
useful inforoacion on each unit and are very detailed. Others contain more
limited information. Our approach to addressing the data limitations is
presented in Section A.3 of this appendix.
A.1.3 Universe of Subtitle C Facilities Represented
A detailed analysis of the RCRA corrective action program at each f the
5,661 Subtitle C facilities was lnfeasible given the complexity of the
program, the difficulty in determining when actions are necessary, and che
limited availability of data. Thus, only a sample of facilities was
investigated.
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A-4
EXHIBIT A-l
COMPLETED
RFAS BY REGION
AND FACILITY TYPE
(As of April 16
. 1987)
Land
Treatment
Rezion
PJ.SP954J,
Incinerator
and Storage
Total
1
42
1
16
59
2
44
2
25
71
3
50
6
22
78
4
86
4
23
113
5
114
9
19
142
6
73
8
9
90
7
11
0
4
15
8
15
0
4
19
9
19
3
0
22
10
10
0
5
15
rotal
464
33
127
624
Source: U.S. EPA, Hazardous Waste Daca Management Retrieval System, Retrieval
Number F87043, April 16, 1987.
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A- 5
Two factors limited the universe of facilities represented in this
analysis. First, given that RFAs were the best source of information, the
universe was limited to the 624 facilities with completed RFAs. Second,
because corrective action regulations affect primarily facilities requiring
corrective action (i.e., they have only a limited effect on facilities where
corrective action is unnecessary), the universe of facilities from which we
drew the sample did not include facilities for which the RFA indicated that
there is no need for corrective action. If the evidence uncovered during the
RFA supports continued investigation of the facility, the RFA recommends the
preparation of a RCRA Facility Investigation (RFI). An RFI is a detailed
characterization of a facility and the extent of its releases to determine if
corrective measures are necessary.
We assumed that corrective measures were not needed at those facilities
for which the RFA did not recommend an RFI. Therefore, we limited the sample
universe to facilities for which an RFA had been completed and for which the
RFA recommended an RFI.^ Exhibit A-2 shows, for different types of
facilities, the number and proportion of RFAs that recommend RFls. The
exhibit indicates that nearly seventy percent (437 facilities) of all
completed RFAs recommend RFIs. The majority of facilities for which RFIs are
recommended are land disposal facilities (342 facilities), followed by 72
treatment/storage facilities and 23 Incineration facilities, all requiring an
RFI.5
A. 1.4 Methodology Used to Select Representative Survey Sample
In most circumstances, a representative survey sample can be selected by
taking a random sample from the sample universe. In this instance, however,
selection of the survey sample was complicated by the fact that the sample
universe was not entirely representative of the total population of facilities
that might require corrective action. Because the sample universe was limited
to those facilities for which RFAs had been completed and for which the RFA
recommended an RFI, we had to develop a more sophisticated methodology for
selecting the survey sample to ensure that our sample would be
** As explained below these facilities are believed to represent about 62
percent of all facilities. At the remaining 38 percent, environmental damages
and corrective action costs are assumed to be negligible. Analytic results
presented In the RIA, thus, include an adjustment for the fact that, in
addition to the effect observed at facilities represented in the sample, there
will be no effects at facilities not represented in the sample (i.e.,
facilities where an RFI is not required).
5 Because of the HSVA permitting deadlines for land disposal facilities,
most regional EPA offices have focused priorities toward land disposal
facilities. The impact of the deadline is demonstrated by the fact that 31
percent of all land disposal facilities have had an RFA completed, compared
with only three percent of all treatment/storage facilities.
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A-6
EXHIBIT A-2
SEVENTY PERCENT OF ALL COMPLETED RFAs RECOMMENDED RFIs
(As of April 16, 1987)
Facility RFA RFI Percent RFI
Tvt)e Completed Recommended Recommended
Land Disposal 464 342 74%
Incineration 33 23 70%
Treatment and 127 72 57%
Storage
Total 624 437 70%
Source: U.S. EPA, Hazardous tfaste Data Management Retrieval System, Retrieval
Number F87043, April 16, 1987.
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A- 7
as representative as possible of the overall population of Subtitle C
facilities.
The methodology that we developed for selecting the survey sample
consisted of three steps. First, because we expected the characteristics of
SWMUs at each facility to differ across the types of facilities (e.g., land
disposal versus treatment/storage facilities), it was important that the
distribution of facilities within the sample accurately reflect the
distribution of facility types in the actual universe of facilities. Second,
the survey sample also had to reflect the fact that the probability of an RFA
recommending an RFI may differ by facility type (e.g., land disposal
facilities may be more likely to require corrective measures than
treatment/storage facilities). Third, we combined the results of the first
two steps to form a distribution of facility types for selection from the
actual universe of facilities. Ve then adjusted the distribution to reflect
the fact that our sample was chosen only from those facilities with RFAs
calling for RFIs. These three steps are discussed below.
STEP 1: ADJUSTMENT FOR DISTRIBUTION OF FACILITY TYPES
Exhibit A-3 compares the distribution of RCRA Subtitle C facilities for
which an RFA had been completed, by type of facility, with the actual
distribution of facilities. The exhibit shows that the distribution of types
of facilities for which RFAs were completed is not the same as the
distribution of types of all facilities. The sample universe contained a
disproportionately large number of land disposal and incineration facilities
relative to treatment/storage facilities. For example, more than 70 percent
of all Subtitle C facilities are treatment/storage facilities, but only 15
percent of the facilities In the sample universe are treatment/storage
facilities. Therefore, a simple random sample from the subset of facilities
with RFAs may have included too few treatment/storage facilities relative to
land disposal and incineration facilities.
To adjust for this problem, we stratified the survey sample according to
the .three broad categories of facilities (i.e., land disposal, incineration,
and treatment/storage facilities). The ultimate goal of the stratification
process was to generate the appropriate number of facilities that should be
sampled from each stratum of the survey sample in order to reflect the actual
distribution of facility types. Therefore, based on the data presented in
Exhibit A-3, we adjusted the sample to reflect the fact that 26 percent of the
facilities are land disposal facilities, 4 percent are incineration
facilities, and 70 percent are treatment/storage facilities.
STEP 2 : ADJUSTMENT FOR DIFFERING PROBABILITIES THAT AN RFA WILL RECOMMEND
AN RFI ACROSS FACILITY TYPES
The second adjustment was necessary to reflect the varying probabilities
of an RFA calling for an RFI (i.e., the likelihood that there is a potential
for a corrective action) across different types of facilities. For example,
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A-8
EXHIBIT A-3
COMPARISON OF ACTUAL DISTRIBUTION OF FACILITIES
WITH DISTRIBUTION OF FACILITIES HAVIHG COMPLETED RFAS
(As of April 16, 1987)
Type of Number of Facilities with
Facility Facilities \J Percent Completed RFAs 2/ Percent
Land Disposal 1,487 26% 464 75%
Incineration 196 4% 33 5%
Treatment and 3,978 70% 127 20%
Storage
Totals 5,661 100% 624 100%
1/ U.S. EPA, "Summary Report on RCRA Permit Activities for March 1987."
Prepared by State Programs Branch and Information Management Staff, Office of
Solid Vaste, April 13, 1987.
U U.S. EPA, Hazardous Vaste Data Management System, Retrieval Number F87043,
April 16, 1987.
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A- 9
because many land disposal facilities dispose of wastes directly in or on
land, land disposal facilities may be more likely to have an RFA recommend an
RFI than a treatment/storage facility that may typically store wastes in
above-ground containers for shorter periods of time. To reflect such
differences, we assumed that the percentages of RFAs calling for an RFI
presented in Exhibit A-2 for the first 624 RFAs can be used to predict the
likelihood of an RFA calling for an RFI for all facilities. According to
these figures, about 73.71 percent of the RFAs done at land disposal
facilities can be expected to call for an RFI, while at incineration and
treatment/storage facilities the percentages are 69.70 percent and 56 69
percent, respectively. Statistical tests for differences of proportions
suggest that the type of facility is a statistically significant factor in
determining the likelihood that an RFA will call for an RFI.^ Therefore, we
adjusted the sample to reflect the probability of an RFA recommending an RFI
for each facility type.
STEP 3: CALCUIATION OF STRATUM WEIGHTS
Ue made the adjustments described above by multiplying the distribution
of RFAs recommending RFIs for each facility type by the actual distribution of
facility types. For example, as shown in Exhibit A-2, approximately 73.71
percent of all Subtitle C land disposal facilities will need to conduct an
RFI. And, as shown in the second column of Exhibit A-3, approximately 26.27
percent of all Subtitle C facilities are land disposal facilities. By
multiplying 73.71 percent by 26.27 percent, we determined that the unadjusted
"stratum weight" for land disposal facilities in this case was 0.1936. As
shown in Exhibit A-4, we completed this procedure for the other two facility
types, by computing unadjusted stratum weights of 0.0241 and 0.3984 for
incineration and treatment/storage facilities, respectively.
The unadjusted stratum weights represent, by type of facility, the frac-
tion of facilities in the total population that will have RFAs recommending
RFIs. As Exhibit A-4 reveals, 62 percent of all facilities (i.e., the sum of
the unadjusted weights) may require an RFI once all of the RFAs are completed.
Because we drew our sample only from those facilities with RFAs calling for
RFIs, and not from the entire population of facilities, we adjusted the
weights by scaling them to add to one (e.g., we calculated the adjusted weight
for land disposal as 0.1936/0.6161, or 0.3143 out of 1). Exhibit A-4 shows
the adjusted weights for each type of facility. Based on these weights, ve
selected a sample with 31 percent land disposal facilities, 4 percent
incineration facilities, and 65 percent treatment/storage facilities.
^ Using a standard difference of proportions test, we determined that
the difference between the proportion of RFAs calling for an RFI at land
disposal facilities and at treatment/storage facilities was significant at the
0 05 level. The differences between land disposal facilities and incineration
facilities and between incineration facilities and treatment/storage
facilities were not statistically significant at the 0.05 level.
-------
A-10
Type of
Facility
Percentage
EXHIBIT A-4
CALCU1ATI0H OF STRATUM WEIGHTS
Probability
that
RFA will
Recommend
EEI
Unadjusted
Weight
Ad jus ted
Weight
Land
Disposal
26.27%
73.71%
0.1936
0.3143
Incineration 3.46%
Treatment and
Storage 70.27%
69.70%
56.69%
0.0241
0.3984
0.0391
0.6466
Totals
100.00%
0.6161
1.0000
-------
A-11
SELECTION OF ACTUAL SURVEY SAMPLE
The number of available RFAs for each facility type limited the size of
the survey sample. In general, with a sample size of 29 or more
observations,statistical confidence intervals can be constructed that are
about as precise as those based on a larger sample.^ Because the survey
sample for this analysis essentially represented three separate survey samples
(i.e., land disposal, incinerator, and treatment/storage facilities), the
ideal survey sample would contain at least 29 observations in each of the
three sub-samples. However, as noted previously, the three facility type
groups must exist in the survey sample in fixed proportions to reflect the
actual national distribution of facility types. Because the smallest of the
three sub-samples, incineration facilities, represented only 3.9 percent of
the sample, the requirement that there be fixed proportions among the three
facility type groups meant that the size of an "ideal" sample would have been
at least 736 (i.e., 29 divided by 3.91 percent). However, a sample of this
size does not exist since only 624 RFAs have been completed.
The number of available RFAs for treatment/storage facilities further
limited the sample size. Because 65 percent of the sample had to be
treatment/storage facilities and only 72 RFAs recommending RFIs had been
completed for these facilities, the sample size could be no larger than 111
facilities. Ue sought a total of 123 facilities for the sample, including all
available RFAs calling for RFIs at treatment/storage facilities. Vith a
sample of this size, inferences about the total population of facilities can
be made with reasonable confidence; only conclusions based on small subsamples
are potentially limited.**
Ue randomly selected the sample of land disposal and incineration
facilities from a list of RCRA Subtitle C facilities with completed RFAs that
recommended an RFI. The procedure for random selection involved assigning
7 A confidence interval for the mean value of a particular variable in a
large sample can be constructed using the normal distribution. Vith the
normal distribution, a 95 percent confidence interval is developed by
multiplying the standard error of the estimate by 1.96. For samples of less
than 120 observations, the t-distribution (which reflects the greater
imprecision associated with small samples) is used Instead of the normal
distribution. When estimating a 95 percent confidence interval using the t-
dlstribution, the standard error of the estimate is multiplied by a
coefficient that depends on the sample size. For a sample size of 29 (i.e ,
with 28 degrees of freedom), the appropriate coefficient is 2.048. At cvo
significant digits, this is essentially the equivalent to the normal
coefficient (i.e., both 1.96 and 2.048 round off to 2.0).
8 Because of the small size of the incineration subsample, we drew no
conclusions about incinerators but grouped them with treatment/storage
facilities for our analysis.
-------
A-12
each facility a random number using a random number cable. Ue chen selected
the appropriate number of facilities within each strata based on the random
number assigned to each facility. This procedure avoided statistical
preference for facility size, location, or ownership status (e.g., private
versus public). In some instances, however, we eliminated facilities because
certain data (such as geographic coordinates necessary for hydrogeologic
mapping) were unavailable.
Ue attempted to obtain the RFAs for each facility selected for Che sample
by either contacting or visiting the EPA Regional offices. In some instances,
RFAs were either unavailable or insufficient for use in the survey. Of the 77
useable RFAs that we received, only 41 were for treatment/storage facilities.
In order to preserve the fixed proportions among the facility groups we
included only 21 of the 30 available land disposal facilities and three of the
four available incineration facilities in the sample. For the
treatment/storage stratum, however, we included all 41 treatment/storage
facilities in the final survey sample. Ue dropped two facilities (one land
disposal and one treatment/storage facility) at a later stage due to
insufficient data. Thus our final sample consisted of 21 RFAs for land
disposal facilities, three for incineration facilities, and 41 for
treatment/storage facilities.
A. 1.5 General Approach Used for Analyzing Bach Facility
Ue analyzed each of the facilities In the final survey sample using a
series of standardized questionnaires. Ue used the first questionnaire, shown
in Exhibit A-5, to assimilate data at an aggregate facility level. Ue
completed these forms for each facility in the final survey sample. Ue
completed the second questionnaire, shown In Exhibit A-6, for each SUHU at
each facility in the survey sample. Ue developed these forms using actual
RFAs as a guide. Ue designed the forms to provide as much information as
possible in a format that would facilitate subsequent analysis.
A. 1.6 Overview of Collected Data
This section provides an overview of the data collected in our survey of
RFAs for the sample of 65 facilities. A variety of aggregate statistics on
both the facilities and the 893 individual SUMUs at the facilities are
discussed below. Note that, in many cases, data were not available to fully
characterize all units. Section A.3 describes how we supplemented this
information before we modeled the costs and risks associated with corrective
action.
OPERATING STATUS OF THE FACILITIES
The RFAs provided data on the operating status of 58 of the 65 facilities
in the database. Of these 58 facilities, 52 facilities (90 percent) are still
in operation and 6 facilities (10 percent) have been closed. Of those
facilities that have closed, all were reported to have been closed becween
1982 and 1986. Note, however, that several of the facilities that were
-------
A-13
EXHIBIT A-5
SVMD CORRECTIVE ACTION SURVEY QUESTIONNAIRE
FOR FACILITY INFORMATION
Answer all questions below for each RFA reviewed. Where data are either
insufficient, unavailable, ambiguous, or inapplicable, enter "-99" in the
appropriate space.
1 ICF Staff Person completing questionnaire (initials)
2 RFA Contractor-
3 Date of RFA (mo/day/year)
u ICF Staff °erson entering data to PC (initials)
5 Date Questionnaire Entered (mo/day/year)
6 EPA Facility Identification Vumber
7 Facility Name.
8 Facility City and State
9 SIC Code (Use digits even if only 2 or 3 digits are available)
9a Primary - 9b. Secondary -
9c If SIC Code is unavailable, describe activities of
facility.
10. Year industrial activity (l e., ncr necessarily was~e management)
began at facility:
11 Year industrial activity ceased at facility (enter "0" if still open)
12 Distance to nearest drinking water well from facility boundary- meters
13 Is well downgradient? Yes (1) No (0) Unknown (-99)
li Approximate number of individuals using drinking water well:
15. Distance to nearest surface water (e.g., lake, stream, or river)
from facility boundary: meters
16. Is surface water downgradient? Yes (1) No (0) Unknown (-99)
17. Distance to nearest population potentially exposed to air releases
(distance from facility boundary): meters
18. Size of population potentially subject to air exposure:
19. Number of SVMUs identified at facility:
19a. Unregulated SVMUs whose existence is confirmed by RFA.
19b Regulated Subtitle C SVMUs (e.g., all SVMUs that have
nonaged hazardous wastes since November 19, 1980).
19c Total number of confirmed SVMUs (equal to 19a plus 19b)
19d. SVMUs whose existence is speculeted about
but not confirmed by RFA:
-------
A-14
EXHIBIT A-5 (CUHTJUUKD)
20 Are there upgradxent monitoring walls which show ground-water
contamination? Yes (1) No (0) (skip Q21) Unknown (-99)
(skip Q21)
21. If yes, list constituents and concentrations:
••/l 02 03 0U #5 f'6
21a Constituent.
21b Concentration
(At this point, complete one SVMU questionnaire for each SVMU at the
facility The number of SVMU questionnaires completed should be equal to the
number entered for question 19c on the previous page (i.e., do not complete a
questionnaire for SVMUs whose existence is unconfirmed). Following completion
of all SVMU questionnaires for this facility, decide whether you have obtained
definitive release in ormation for all SVMUs. If you have, do not complete
questions 22 through 24 below. Otherwise, if def:nitive release information
has not been obtained for one or more SVMUs, proceed to questions 22 to 2'» )
22. Have there lien any noted releases from facility: Yes (1) No (0)
Unknown (-99)
23 Facility-wide Release Information* (fill in as appropriate)
01 02 03 #4 05
23a. Waste/constituent released
23b. CPA waste code, if available
23c. Quantity of waste released
23d. Release to (check all that apply):
(1) Soil
(2) Groundwater
(3) Surface Water ______
(4) Air
(5) Other
(-99) Unknown
23e. Is release confirmed ("C")
or suspected ("S")'
24. If soil at facility is contaminated, how much soil (throughout facility)
is currently contaminated? (cubic yards)
* This question refers to wastes/constituents which have escaped from the
facility into the environment.
-------
EXHIBIT A-6
SIMU CORRECTIVE ACTION SURVEY QUESTIONNAIRE
FOR UNIT INFORMATION
(Answer all question* bo low for each mm at eacli facility reviewed Wli-jra data are eitlirr mini i n tent, una va i Ubte, aabiguous,
or inapplicable, enter "•99" in I lie appropriate space if no alternative it provided)
I. ICf Staff Person completing qutisi loima i re (initial*) 2 ICf Stair Peison eiiieiiiuj data to HL (initials)
J. CPA facility idenl I r teat ion ntuabor: '• I ac 111 ty name.
5 Sequential SWMU niusber (start w/ 001 for eacli rac.) 6 bWHU name ( > r specilied in MIA)
I. SWMU Status (Chech one).
(l| Unregulated SWMU wliose existence is confirmea by HI A
|2| Regulated Subtitle C land disposal SWMU (i e , landfill, surrace impoundment, waste pile, o> land tieatuuiit unit
that ainagnd hazardous waste arter 1/26/6?)
()) Other regulated Subtitle C SWMU (i o., a unit used to aanage lia/aidous waste .u sum lime altei Noveubei IV, 1980
which is not included in (2) above)
0. Vear SWMU was first used. 9 When did use or bWHU stop (eniei "o" il Mill in mi'l >
10 If no longer in use, how was unit closed? 01
(I) Unit dismantled and reaoved (2) ixcavatiun and decoiiiaalnai ion (3) (iint.i iimieni system installed
ill Unit capped (>) Ho closure aeasures taken |6) lapoiiiidacm closed w/ waste hi place
T| Other - Describe (-99) unknown oi unavailable
II. SWMU Unit lype and Oesign lype
lla. I-dlgit code rroa unit/design type coding sheet _
lib If Qlla is 065, 066, 06/, or 068 (i e , oil see I laneous iiuit), describe _ _ _
12. SWMU Capacity Information (Provide as aany size pai ,. 'is as possible based upon unit/dcsiyn type coding sheet)
12a. Size Variable I.
12b. Size Variable 2:
12c Size Variable 1
-------
EXHIBIT A 6 (GONTIIfUED)
I), lype* end Quantities of Wastes/Constituents Contained in or Handled by Unit.
Note for QIJ: Unlike tlie qnatlloiit in Ql?. vlm.li refer to SWMU opacity, (111 i efti i tn wastes .iLinatly handled or
contained tn the unit. Alto, use suppieacntary form 11 iliure aie aure than l ivu waste typti
Waste Iype I waste type 2 Waste lypu 3 Waste lype 4 Wastu lype J
lit. lype of Waste/Const I tuent
lib. CPA Wane code, if available
tic Quantity or wane contained In unit
(aetrlc ton*| or handled by unit (aetric
tons/year)
lid. la lie In tent ol Hi (enter "l"] or
Nl/yr tenter "2")T
lie Year watte reaoved froa unit (enter
"0" ir still In unil; "-99" ir unknown;
"l" ir inapplicable, e.g.. Incinerator)
14. SWMU Release inforaation
14a. Hat the SWMU released any wattes/constituents to tlie environaent' Yes (I) Suspected (2) No (0| unk.iown(-99)
14b. Were corrective action* taken Tor these releases? Yes (I) Ho (0) unknown (-99)
14c. If so, ror what aedlual (check all that apply) _ 5k»iI Groundwater Surface water Air oilier Unknown •
h
146. Are there still wast«s/constlt«ients that are currently a threat to tlie environaeni7 Yes (l) Suspircteii (?) °
No (0) Unknown)-99)
If so, answer questions I4e. through mh. Use suppleaeniary rona If aore than five waste const luteins have been released
Constituent I Constituent 2 Constituent 1 Constituent 4 Constituent 4
Id*, lype of waste/constituent released
14f. CPA waste code, ir available
I4g. quantity or waste released
1Kb Release to (check all that apply):
(I) So 11 _
(?) Groundwater
jl| Surface Water
111 Air
(5) Other .
(-99) Unknown
if soil around SWMU Is contaainaied. Iiow auch soil'' (cubic yards)
16 Briefly describe the activities suggested by the RiA Tor this unit
I l | No fuither action (?) Additional investigation to deturaina appiopriaie aLiiun
" (!) Specific reaedlal sction
-------
EXHIBIT A-6 (CONTINUED)
Unii/Oesign lypc Coding Sheet
yaLLZteiLatiJ Yee_Laill
001 I incd laiidf 11)
002 On Iined Landfltl
OOJ Unspecified Landfill
00M Land Ireataent
00) Watte
006 Waate
007 Waste
006 Waate
Pile
Pile
PI te
PI le
laperaeable
Other Pad
No Pad
Indoor
pad
Si/o Variable fl kJI2A|
S11 & i
010 Lined Ireataent lapoundaent Surface area ( s<| mirs)
011 Un lined Ireataent lapoundaent Suiface a tea (t><| airs)
01? Unspecified Ireataent lapoundaent Surface area (sq atrsj
Storage Surface laeoundaents
01) Lined Storage lapoundaent
Oil On lined Storage lapouiidaeni
01) Unspecified Storage lapoiuidaent
Surface aiea (sq airs)
Surface aiea (sq aits)
Suiface area j sq atis)
Depth (ucm-is)
ttfl>111 (ai'teis)
Depth (nc-tcis)
Depth (oiuleis)
Cubic aetcis disposed
Cubic aeicis disposed
luliic aeleis disposed
Cubic meteis dispusid
cubic asters disposed
Oeptli |ac-ters|
Deptli jatuleisj
Depth jaateis)
Oeptli (wetets)
Oepth (meters)
Deplli jaeiors)
eO'v. #i tyi^ci
I ill a I d i spoui d ( H I |
I ut a I d i spo^ii'il I HI |
I ota I disposid (Ml)
MuUil Lons/yeai
MeII ic
Me 11 m
Me 11 i c
Melric
Metric
tons disposed
Ions disposed
tons disposed
tuns disposed
tuns disposed
(,.i l loiis/yc.i r
O.i I luns/year
C.i I Ions/year
(..i I Ions
( .iI tons
C.J I I ous
0)6 Lined lapoundaent - Ireataent ur
Storage not specified
01? Unllned lapoundaent - Ireataent
or Storage not specified
018 Unspecified lapoundaent - Ireat-
aent or Storage not specified
019 Com. Storage - laperaeable Pad
020 Cont. Storage - Other Pad
0?l Cont. Storage - No Pad
0?? Cont. Storage - indoor
02S Cont. Storage - Unspecified
Ireataent lanhs
02k Above ground
02) Above ground
026 Above ground
027 Above ground
02S Surface tanks
029 Surface tanks
0)0 SuiI ace tanks
0)1 Surface tanks
0)2 Underground i
UJ3 Undeiground t
0)>i Undeiground t
0)) Underground t
0)6 Unspecified t
tanks - Caibon
tanks - Steel
tanks - Cone,
tanks - Unspec
- Caibun
- Steel
- Coneiule
- Unspei
auks - Carbon
auks - Steel
auks - Cone rem
anks - Unspoc
reataent tank
Surface ares (sq atrs)
Surface area ( sq atrs)
Sulfate aica (sq meters)
Suiface area | si| bus)
Surface aiea jsq mirs)
Surface aiea jsq atrs)
Surlace area jsq aLrs)
Suiface area jsq atrs)
tanks
tanks
tanks
tanks
tanks
tanks
I anks
tanks
tanks
tanks
tanks
tank!
tanki
Utipih (aeters)
Ueplh (meters)
Depth (meters|
f Ihuopsiers
# Ouapsters
f Ouapsters
$ Unapstuis
| Ouapsters
Iota I
• ota |
lota I
• 'I L .1 I
Iota i
local
Iota I
Iota I
loial
lotal
Iota l
lotal
lotal
La I I on*
C.J I I onS
Gal Ions
# Vj y.illon dmms
t Vj ya IIiiii drums
I ¦)*) gallon drums
§ ¦>*> ya I luu di urns
f W gaIlun diuas
combined
coakiuud
combined
l oib i ned
i uabiiieil
Liial. i ned
< null i ned
liwIji nud
tomb,ned
Lumbiuud
i onli uud
comb i ned
combined
capari ty nT all
capar uy ul all
c.ipac i ty ol all
lj|i.il i (y ol all
ul
ul
capat 11y
capai i t y
( apac i ty
< .ipai i t y
i j|iiiL i I y
capacity of
iapac i Iy ol
i .ipac i (y of
capacity ol
ol
a I I
a I I
a I I
.11 I
al I
a I I
a I I
a 11
a I I
tniiks
tanks
tanks
lank s
lankb
t anks
tanks
tanks
I .inks
tanks
tank:*
(anfc s
tanks
ill SWMU
ill SWMU
III SWMU
III SWMU
III SWMII
III SWMII
III SWMII
III SWMII
III SWMU
III SWMU
III SWMII
ill SWMU
III SWMU
I yal
I ya I
I ya I
(yal
(yal
|yal
(ya l
(yal
(yal
j ya I
I yal
I ya I
I gal
J OMi
I OMS
1 OtlS
luos
lUMS
Iniii
Itini
I oiii
tout
tons
I OIK
(out
loni
-------
EXHIBIT A-6 (COHTWUED)
Unit/Pet Ion Ivom 10121
Storage Tankt
OIF Above ground lank* - Carbon
016 Above ground tanks - Slot*I
019 Above ground tank* - Cone.
040 Above ground lank* - Unspec.
041 Surface tanka - Carbon
0*1? Surface tank* - Steel
04) Surface tanka - Concrete
014 Surface tanks - Untpec.
Ok) Underground tanka - Carbon
046 Underground tanks - Steel
04f Underground tank* - Concrete
046 Underground tank* - Untpec.
049 Untpec1 fled ttorage tank
Unt t/Uesign lype Coding Sheet Icunl inueil |
5**o variable JJ 13I2AJ Sj-HB
tankt
tanks
tankt
tanks
tankt
tanks
tankt
tankt
tanks
tanks
tanks
tanks
tanks
Iota I
Iota l
lotal
loial
Iota l
lotal
lotal
luia I
lotal
lotal
Iota I
lotal
lotal
cunbined
Cunb i lip tl
conbinod
coubniL'd
cuabinc-d
cuab mud
coaliinud
coab i ned
coat) inuU
combined
coat) i tied
conbined
coabmed
capaci
Cdpdl I
capaci
i apac i
capaci
cap.ic i
capaci
capaci
Lapaci
capaci
capaci
capaci
CdpAC i
ly «ir
ly of .ill
ty of jI I
ly ol
ly ul
ly ol
ly ol
ly ol
ty ol
ly ol
ly ul
ly or
ty ol
a 11
a l l
al I
at l
a I I
a l l
al I
a I I
al I
al I
tanks
lanks
tank*
tanks
I auks
tanks
lanks
tanks
tanks
tanks
tanks
tanks
tanks
in SWMII
III SWMU
in SWHU
in SWMU
in SWHIJ
Id SWMU
• II SWMU
in SWHU
III SWHU
ill SWHU
III SWHU
ill SWHU
•n SWHU
|ga I Ions
(ga I Ions
(<|a I lout
jgaI Ions
(gallons
j gaI Ions
(gaI Ions
jgaI Ions
iga tIons
| gaI Ions
(gaI Ions
(gal Ions
| ga I loin
Unspecified lanht
050 Above ground tanks - Carbon
051 Above ground tanks - Stoel
05? Above ground tenks - Cone.
051 Above ground tenks - Untpec.
054 Surface tanks - Carbon
055 Surface tankt - Steel
056 Surfece tankt - Concrete
051 Surface tanks - Untpec.
056 Underground tanks - Carbon
059 Underground tanks - Steel
060 Underground tanks - Concrete
061 Underground tanks - Untpec.
062 UntpecIrled storage tank
061 Incinerator
064 Injection Well
065 Wette Irentier Station
066 Haste Recycling Operation
061 Spt11 area
066 Oilier
tanks
tankt
tanks
tankt
tanks
tanks
tanks
tanks
tanks
tanks
tanks
tankt
tankt
throughput capacity (Hi/hour)
Depth (Meters)
Describe In Qllb
Describe in Qllb
Oescribe tn Qllb
Describe hi Ql lb
Iota I
lotal
lotal
lotal
lotal
lotal
lotal
lota I
11.1 a I
total
lotal
iota I
lotal
cuabinud
conb mod
coabiuud
coabmed
cunb i lied
Ciiebined
combined
coabmed
cnbmcd
coablnud
combined
coabmed
coaL.ned
Ciip.lC
cnpac
capac
capac
capac
capac
capac
capac
capac
capac
capac
capac
capac
i ty
• ty
1 iy
• iy
• iy
• iy
»t y
uy
ity
• iy
uy
• ly
uy
ul
ul
ol
or
ol
ol
ul
ur
or
or
or
or
ur
ri 11
a 11
a I I
a I I
d I I
all
»i i
a 11
d 11
a 11
a I I
d I l
d 11
l .inks
tanks
tanks
tanks
tanks
tanks
tanks
tanks
tanks
tanks
tanks
tanks
tanks
ill SWHU
in SWHU
in SWHII
in SWHU
ill SWHU
III SUHU
in SWtllI
in SWHIJ
in SWHU
ill SWHU
III SWHU
in SWMU
ill SWMU
(yd I Inns
(gaI Ions
(ga I Ioiis
(gaI Ions
(gal Ions
(ga I Ioiis
JgaI Ions
IgaI Ions
j ga I Ioiis
(gdI Ions
(gal Ions
(gaI Ions
jga•Ions
>
•
H
00
Below confining layer? (If no, enter "o"; if yes, emer Mt")
-------
A-19
recorded as sclll in operation have submitted closure plans but have not yet
closed.
The average first year of operation among the 37 facilities with opening
dates is 1948. The average age of these 37 facilities is approximately 39
years, while the 6 facilities that have closed had an average operating life
of 32 years. The oldest facility began operation in 1854, while the newest
facility began operation in 1980. Note that the periods of operation refer
only to the period during which the facility was used for the current
production purposes; years during which facilities were used for other
purposes (e g., when owned by other companies or used for making different
products) are not included in the operating age statistic. Also note that the
period of operation does not necessarily reflect the period during which the
facility handled hazardous wastes or constituents.
NUMBER OF SWMUS LOCATED AT FACILITIES
The results of the survey suggest that there are an average of 14 SVMUs
per facility. We classified the SVMUs into three types of units based on
their regulatory status: (1) newly regulated SVMUs, (2) regulated Subtitle C
land disposal SUHUs, and (3) other regulated Subtitle C SVMUs. Newly
regulated SVMUs are regulated under RCRA only by virtue of the HSVA corrective
action requirements (i.e., RCRA Sections 3004 (u) and 3008 (h)). Subtitle C
land disposal SVMUs are landfills, surface Impoundments, waste piles, and land
treatment units that managed hazardous waste after July 26, 1982. We
classified any other Subtitle C units that managed hazardous waste after
November 19, 1980 as other regulated Subtitle C SVMUs. Exhibit A-7 shows the
average and median number of SVMUs by type of facility and type of unit. On
average, of the 14 SVMUs per facility, approximately half are newly regulated
by HSVA corrective action provisions. Approximately six SVMUs per facility
are regulated Subtitle C units: one land disposal unit and five other
Subtitle C units, including treatment and storage units. Note that the number
of SVMUs at each federal facility (an average of 29 per facility) is higher
than the average number of SVMUs at all other types of facilities.
Exhibit A-8 shows the frequency distribution of the total number of SWMUs
located at all facilities surveyed. The exhibit suggests that there are three
broad types of facilities: facilities with approximately six or fewer SWMUs,
facilities with approximately 9 to 15 SVMUs, and facilities with twenty or
greater SVMUs. The total number of SVMUs per facility range from one to 42
SVMUs.
PROXIMITY OF FACILITIES TO DRINKING WATERS. SURFACE WATERS. AND POPUI^TIONS AT
RISK QF AIR EXPOSURE
Where available, we collected information on the proximity of the
facility to drinking water wells, surface waters, and populations potentially
at risk of exposure to air releases. We also collected some information
regarding the approximate numbers of individuals using these water suppLies
and the sizes of populations at risk of releases to the air.
-------
KDilBIT A-7
DISTRIBUTION OF SUMUS BY FACILITY TYPE
~ - - - ~
All Types of Units
Newly
Regulated Units
StiXitle C Land
Disposal Units
Other Subtitle C
Units
RIW0I
of
Faca.
Avg. Ho.
Per Fac.
Median Ho.
Per Fac.
Avg. No.
Per Fac.
Median No.
Per Fac.
Avg. No.
Per Fac.
Median No.
Per Fac.
Avg. No.
Per Fac.
Median No.
Per Fac.
All Facilities
65
14
12
7
S
1
0
5
4
land Disposal Faca.
21
16
13
10
6
2
1
3
2
Incinerator Faca.
3
W
22
10
10
0
0
7
4
IIS Facilities
41
12
11
6
2
0
0
7
4
Federal Facilities
6
29
28
17
16
0
0
12
11
-------
A-21
EXHIBIT A-8
THERE ARE THREE BROAD CLASSES OF FACILITIES BASED ON
FREQUENCY OF SVMUs
t 1 '"I '"I —r
14 IS 17 18 19
i i i r
2021-25 3 0+
Number of SWMUa
-------
A- 22
Drinking Water
The RFAs provided daca on the distance from the facilities surveyed to
nearby drinking water wells for 17 facilities. The data suggest that the mean
distance to drinking water well systems located both up- and down-gradient
from the facility boundaries is approximately 13,000 meters. One facility is
located as far as 100,000 meters from the nearest drinking water well, while
two facilities are located directly above aquifers used by drinking water
wells .
Data on the approximate number of individuals using drinking water wells
located near the facilities surveyed were available for twelve facilities
The data suggest that there are an average of 18,383 individuals using wells
near the facilities surveyed. The largest number of people served by a
drinking water well near a facility is 70,000 individuals.
Nine of eleven facilities for which data on gradient were available were
located upgradient of drinking water veils. For these nine facilities, the
average distance from the facility boundary to the drinking water well system
is approximately 1,400 meters. The mean population using these wells is
estimated to be approximately 30,600 people based on information that was
available for five facilities.
Surface Waters
The survey provided data on the distance from the facility to the nearest
surface water for 38 facilities. The data suggest that the average distance
to the nearest surface water from the facility boundary is 550 meters. The
distance varies from a low value of zero (where surface waters run through a
facility) to a high of 6,400 meters. Of Che 27 facilities for which data on
hydraulic gradient were available, 26 facilities were located upgradient of
surface waters.
Air Exposure
Finally, we obtained information on Che distances to populations
potentially affected by releases of hazardous wastes or constituents to the
air for 25 facilities. The data suggest thac the mean distance Co populations
is approxlaately 1,400 meters. The sizes of the populations potentially
affected by air releases at two facilities are 70 people and 30,000 people.
No data were available on sizes of the populations at the other facilities.
In many instances, Che RFAs described small populations in close proximity to
the facility that were potentially at risk of exposure to air borne
pollutants, but did not provide adequate information on the precise locations
and sizes of these populations for inclusion in the survey results
-------
A- 23
FACILITY INTER-UNIT AREA FACTORS
The Liner Location Model (LLM)^ was used in che RIA Co estimate coses and
risks associated with each regulatory alternative under consideration. The
LLM aggregates all of the surface areas of the units at a particular facility
in order to estimate releases. In reality, of course, the units are not
aggregated together as a single unit but are spread across the facility To
correct for this, we developed a correction factor called the inter-unit area
factor to measure the area between the units at the facility
To determine the appropriate inter-unit area factor for each facility, we
consulted any available facility maps in the RFAs that were properly scaled
and legible. We used the 13 available maps to determine the ratio of the
total facility area to the total unit area, which is the inter-unit area
factor. We found inter-unit area factors ranging from a low of 1 to a high of
21.7. The median inter-unit area factor is about 5.0.
REGULATORY STATUS OF SWMUS
Data on the regulatory status of the 893 SWMUs in the database were
available for 889 units. Of these units, 486 units (55 percent) are regulated
under RCRA only by virtue of the HSWA corrective action requirements, 76 units
(9 percent) are regulated Subtitle C hazardous waste land disposal units, and
327 units (37 percent) are other regulated Subtitle C treatment or storage
hazardous waste management units.
OPERATING STATUS OF SWMUS
Data on the operating status of SWMUs were available for 746 SWMUs. The
data suggest that 53 percent of all units (471 SWKUs) were still in operation
at the time of completion of the RFA. Of the 275 units (31 percent) that are
no longer in use, 25 percent were closed within the past three years. Fifty
percent have been closed since 1980. The average date of first use was 1970,
with the oldest unit first used in 1900 and the newest unit yet to begin
operation. For the 190 units with opening dates that had closed by the time
of completion of the RFA, the average operating life was 12 years, ranging
from 1 year to 73 years of operation.
PROCEDURES USED TO CLOSE UNITS
Data on the procedures used to close SWMUs no longer in use were
available for 258 units (29 percent). These data suggest that the most common
procedure used to close units was a cap, which was used to close 34 percent of
the units for which data were available. Dismantling and removing the unit
was the second most common closure method used; this method was employed at 16
' U.S. EPA, "Liner Location Risk and Cost Analysis Model Phase II
Report." Prepared by ICF Incorporated for Economic Analysis Branch, Office of
Solid Waste, March 14, 1986.
-------
A- 24
percent of Che units for which data were available. The third most common
closure procedure was excavation of wastes and decontamination of remaining
equipment, which was used to close 14 percent of the SUMUs for which data were
available. The degree to which these closure procedures were done in
compliance with RCRA closure standards is unknown. Finally, no closure
measures were taken at 21 percent of Che units that are no longer in use and
for which data on closure were available.
SUMU TYPES AND DESIGNS
The distribution of design types among all 893 SUMUs is presented in
Exhibit A-9. These statistics suggest chat the most prevalent type of SUMUs
in the survey population is unlined landfills (12 percent of all units),
followed by above ground storage tanks (10 percent), underground storage tanks
(8 percent), and container storage areas with pads (8 percent). Other more
prevalent types and designs of SUMUs include unspecified container storage
areas (7 percent), above ground treatment tanks (7 percent), unlined storage
surface Impoundments (5 percent), and waste transfer stations (4 percent).
Types of units in the miscellaneous category Include units ranging from
drainage pipes and drum crushing operacions to trash compactors. Taken as a
group, however, tanks dominate the population of SUMUs, with tanks
constituting more than a third (36 percent) of all units.
Exhibit A-9 also presents the distributions of design types by regulator,
status. These data indicate that unlined landfills are the most common type
of previously unregulated unit (12 percent of all previously unregulated
units), followed by unlined storage surface impoundments and above ground
tanks. Only 2 percent of all regulated Subtitle C units, however, are unlined
landfills. Among Che regulated Subtitle C units, container storage areas with
pads are most prevalent (6 percent), followed closely by above ground storage
tanks (S percent) and unspecified container storage areas (4 percent). In
general, Subtitle C SUMUs seem less likely to be landfills or surface
impoundments than do the newly regulated SUMUs.
SUMU CAPACITY INFORMATION
Data on the sizes and capacities of individual SUMUs were available for
several units. Ue gathered different information for different types of
units. For example, we gathered throughput capacity data for incinerators and
volume data for landfills. In some instances, we obtained both size and
capacity information for a given unit type. The actual parameters that we
sought for each unit type are listed on the unit and design type coding sheet
from the unit questionnaire in Exhibit A-6. Exhibit A-10 provides a summary
of the data obtained on the sizes of various types of SUMUs.
TYPES AND QUANTITIES OF HAZARDOUS WASTES OR CONSTITUENTS CONTAINED IN OR
HANDLED BY SUMUS
Uhere available, we gathered data for each SUMU on: (1) the types of
wastes and constituents contained in or handled by the unit; (2) the relevant
-------
A- 25
EXHIBIT A-9
SVMU TYPES AND DESIGNS
All
Units
SUMU Type and Oeaign
Frequency
Percentage
I arid f ilia
Ltned
12
1.3X
Unlined
111
12.41
Unspec 1 f tad
21
2.4X
Treatment Surfaca Inpocrdntnta
lined
10
1.1X
Unltnad
16
1.8X
Unspecified
19
2.IX
Storage Surfaca Inpoundnenta
Lined
15
1.7X
Unlfned
43
4.8X
Urispec t f i ad
S
0.6X
Unspecified Surface InpocrdMnta
Linad
10
1.1*
Unlined
14
1.6X
Unspeci f i ad
4
0.4X
Container Storas* Araa
Pad
72
8.IX
no pad
11
1.21
Urtapaci f 1 ad
60
6.7X
TrestaMnt Tanks
Above Crocnd
60
6.7X
Surfaca
20
2.2X
Underground
10
1.1*
Unspecified
14
1.6X
Storage Tanks
Above Groml
87
9.7X
Surface
23
2.61
Underground
73
8.2X
Unspecified
16
1.81
Unspecified Tanks
Above Crowwl
a
0.91
Surface
1
0.1X
Undergrouid
4
0.4%
Unspecified
9
1.0X
Land Treatovnt Units
10
1.11
Waste Piles
29
3.21
Incinerators
21
2.41
Injection Weds
11
1.21
waste Transfer Stations
34
3.81
waste Recycling Operations
14
1.61
Spill Ares
14
1.61
Other Units
12
1.31
Totals:
893
100.01
Newly
Ragutated Units
Regulated
Si£titte c units
Frequency
Percentage
Frequency
Percentage
S
0.6X
7
0.8X
98
11.01
13
1.5X
16
1.81
5
0.6X
5
0.6X
S
0.6X
7
0.81
9
1.01
13
1.S1
6
0.71
6
0.71
9
1.01
39
4.41
4
0.4X
3
0.31
2
G.2X
10
1.11
0
0.01
11
1.21
3
0.3X
1
0.11
3
0.3X
17
1.91
55
6.21
4
0.41
7
0.81
2.SI
38
4.JX
3.11
32
3.6X
8
0.91
12
1.3X
6
0.71
4
0.4X
4
0.41
10
1. IX
39
4.41
48
5.4X
3
0.31
20
2.21
4.01
37
4.11
6
0.71
10
1.11
2
0.21
6
0.71
0
0.01
1
0.11
1
0.11
3
0.31
6
0.71
3
0.31
6
0.71
4
0.41
21
2.41
8
0.91
12
1.31
9
1.01
8
0.91
3
0.31
2.21
14
1.61
4
0.41
10
1.11
11
1.21
3
0.31
10
1.11
2
0.21
488
S4.6X
405
45.41
-------
A-26
EXHIBIT A-10
LANDFILLS REPRESENT THE LARGEST AMD MOST
OBSERVED SUMO TYPE
SWMU Tvpc and Design
Landfills
Number of
Observations
60
Capacity
82,047 square meters
(surface area)
Treatment Surface Impoundments
17
23,624 square meters
(surface area)
Storage Surface Impoundments
32
16,648 square meters
(surface area)
Container Storage Areas
42
463 55-gallon drums
Land Treatment 3 76,387 square meters
(surface area)
Vaste Piles 7 3,750 metric tons
(total disposed)
Injection Wells 4 529 meters deep
-------
A- 27
EPA waste codes; (3) the quantity of wastes handled by or contained in the
unit; and (4) the year the wastes were removed from the unit (if applicable)
Some data on the types of wastes and constituents contained in or handled by
the unit were available for 661 SWMUs (74 percent of the units surveyed),
although the quality of the data was frequently poor. Approximately 16
percent of the units had wastes described with EPA waste codes and, for a
significant fraction of the units, only vague waste descriptions (such as
"wastewater" or "rinsewater") were available. Because of these data
limitations, we used professional judgement based on the available data to
assign waste streams to each unit for the modeling of costs and risks
associated with the corrective action rule. The imputation of waste streams
and summaries of waste streams assigned to each unit are presented in Section
A. 3.
Data on the quantities of hazardous wastes or constituents handled by or
contained in the unit were available for 67 SWMUs (8 percent). Finally, the
years in which wastes were removed from units that have been closed were
available for 70 SWMUs. The years of waste removal ranged from 1965 to 1986;
over 77 percent of the units with waste removal daces had their waste removed
after 1980.
SWMU RELEASE INFORMATION
The survey data suggest that of the 658 SWMUs for which data were
available, 183 units (28 percent) have had confirmed releases of hazardous
wastes or constituents to the environment. An additional 139 units (21
percent) were also suspected to have had a release. Corrective measures were
taken for approximately 18 percent of the releases (58 corrective measures at
the 322 SWMUs with confirmed or suspected releases).
The data also suggest that 71 percent of the units with confirmed or
suspected releases (230 SWMUs of the 322 units with confirmed or suspected
releases) may be considered a threat to the environment because they are
currently releasing hazardous wastes or constituents. Of these units, 51
percent are a confirmed threat to the environment, while 49 percent are
suspected of being a threat to the environment. Of the SWMUs that may
represent a threat to the environment, the majority were releasing to soil and
ground water, with releases to surface waters and air somewhat less common.
The most common release was to ground water (115 of the 230 SWMUs that may be
a threat to the environment, or 50 percent). Releases to soil were the second
most common (47 percent), followed by releases to surface waters and air (20
and 6 percent, respectively). Note chat many units reLeased to more than one
media. At five SWMUs, the RFAs noted contaminated soil around the unit,
ranging from 1 cubic yard of contaminated soil to 2,700 cubic yards of
contaminated soil.
In general, data on types and quantities of wastes released were quite
limited. For this reason, we performed no further analysis on types and
quantities of wastes released. The modeling of coses and risks associated
with the corrective action rule includes modeling of quantities of waste
-------
A'28
released. Section A.3 discusses the waste scream assigned co each unit for
Che modeling efforc, which decermines Che cypes of vasces released.
FURTHER ACTIVITIES SUGGESTED FOR INDIVIDUAL SMMUS
Finally, each RFA cypically made a recommendation regarding further
accions needed ac each SUMU. In general, chese recommendations varied from no
furcher action required, Co specific remedial accions, co addicional
investigation (such as ground-water monicoring or soil cescing) Co decermine
appropriace action. According co che daca available for 883 SWMUs, ac 424
SUMUs (48 percenc) che RFAs recommended addicional invescigacions co decermine
appropriace remedial accion. AC 376 unics (43 percenc) no furcher accion was
recommended and ac 83 unics (9 percenc) che RFAs recommended specific types of
correccive measures.
A.2 OVERVIEW OF HYDB0GEOL0GIC MAPPING
To characcerize che hydrogeology of che 65 facilicies in che survey, we
idencified che most appropriace DRASTIC*-® hydrogeologic secting for each
facility using copographical maps and ocher geologic sources, including soil
surveys and rock maps. The DRASTIC syscem provides generally recognized
values for Qepch Co ground water, net Recharge, Aquifer media, £oil media,
Xopography (slope), Impact of the vadose zone, and hydraulic Conductivity of
Che aquifer for each hydrogeologic setting.
Once we had chosen the appropriate DRASTIC setting for each facility, we
mapped che characteristics of the setting to the key hydrogeologic parameters
required for modeling che face and transport of contaminants at the facilicies
using several assumptions. First, we approximated the actual depth co ground
wacer wich che midpoinc of the range of water table depths provided for each
DRASTIC seccing. Similarly, we estimated the aquifer permeability
(conductivity) at each facility as the midpoint of the range of hydraulic
conductivities provided for the chosen DRASTIC setting. Ve converted che
range provided for each DRASTIC setting's net recharge to the nearest LLM
Infiltration setting of O.S inches per year, 1 inch per year, 10 inches per
year, or 20 Inches per year.
In addition, we used field experience and engineering judgement to
develop a consistent methodology for determining the appropriate vadose zone
permeability associated with each DRASTIC setting. Ve firsc matched DRASTIC'S
description of the setting and impact of the vadose zone to the appropriate
U.S. EPA, "DRASTIC: A Standardized System for Evaluating Ground
Water Pollution Potential Using Hydrogeologic Settings." Prepared by Robert
S. Kerr Environmental Research Laboratory, Office of Research and Developmen
February, 1985.
-------
A- 29
type of rock or unconsolidated deposit in Freeze and Cherry's Groundwater ^
Exhibit A-11 summarizes the rationale that we then used to derive a vadose
zone permeability from Freeze and Cherry for each setting. Finally, using
engineering judgement based on the description of the setting, we associated
each DRASTIC setting with up to six of the eleven generic LLM flow field
scenarios depicted in Exhibit A-12. Note chat each flow field defines an
aquifer configuration and a set of ground-water velocities. Exhibit A-13
summarizes all of the hydrogeologic parameters associated with each of the 31
DRASTIC settings assigned to facilities, along with the distribution of
facilities across each setting.
A. 3 DEVELOPMENT OF HYPOTHETICAL FACILITY CHARACTERIZATION
Because many RFAs contained limited information on facilities and SWMUs
subject to the corrective action requirements, we found that many facilities
in the sample were missing information that would be needed for modeling
releases at the facilities. Because of these data gaps, we could not
accurately model the actual facilities found in the sample. Consequently, we
could either develop completely hypothetical facilities based on the data that
we had found or we could fill in the data gaps at the actual facilities with
information from other SVMUs in the sample or outside sources. Because the
development of a reasonable number of completely hypothetical facilities would
require numerous simplifications and assumptions, we decided to supplement the
survey findings at each of the 893 SVMUs with representative data from other
SWMUs or other data sources.
Section A.3.1 describes the SUMU characteristics that were required for
the modeling effort and provides an overview of the gaps in the survey data.
Sections A.3.2 through A.3.7 describe the methodologies that we used to fill
in the missing information.
A.3.1 Overview of Missing Data
In order to estimate the costs and risks associated with the regulatory
options, we needed the following information for each of the 65 facilities:
¦ Hydrogeologic characteristics;
• Annual rainfall (infiltration);
¦ Distance to the nearest downgradient drinking water well, and
¦ Inter-unit area factor.
The hydrogeologic mapping described in Section A.2 provided the hydrogeologic
characteristics and annual rainfall for all facilities. The RFA survey
11 R. Allen Freeze and John A. Cherry, Groundwater. (New Jersey
Prentice-Hall, Inc., 1979) p. 19.
-------
EXHIBIT All
ASSIGNMENT OF VADOSE ZONE PERMEABILITIES
Vadose Ion*
DtASIIC Penatability lationale for Choice of Vadose 2 one Peraeabllity
Cadi Description of Cadi lapact of Vadose Zarm (Cat/Second) Within lange Provided by freeie and Cherry *
Kb lint Hid* Alluvial Vat lay* Sand ft gravel 4.7160E Ot Mi Alluvial Momtaln Valleys Sand I gravel 4.7160E 01 Mitfcoint of range for clean sand
2E Maya lata* land ft (ravel with significant tilt and clay 4.7160E Of lou end of silly sand range
6S Alluvial Noiaitaln Valleys tand 1 travel with aignificart ailt and clay 4.7MK OS Lou end of silty sand range
6C Mountain flanka laddad I taw tone, sandstone. ft shale 4.7I60C-OS Mi<%»int of fractured llaestona t sandstone range
60a Alternating IS, It, t S> • lkin tell lulkid llaestane, sandstone, I (halt 9.412QC 07 Lou end of lla*stone ft sandstone range
(Ok Alternating M. It, A U - Deep legotIth tedded I late tone, aandstone. I shale 4.71601 OS Hi^ioint of fractured I i act tone I sandstone range
Ala liver >llu>|« ultk Overbark tilt/day 4.7160( 05 Ml<%»lnt of silty send range
Mb liver Alluviua altfcout Onrbai tand I gravel 4.71601 01 Hl<4>oint of range for clean sand
7Ae Claclal fill Over taddad tedlaantary lock tilt/clay 9.4S20C 07 MUfcoint of glacial till range
7Ab Slacial (ill Over Out Mask tilt/clay 9.4 HOC 07 Mi
7Eb liver Alluvlia ultbout Owrtal Deposit tand I gravel 4.71601 01 Nit^oint of range lor clean sand 1
It Glacial lake Dapotlts land! travel ulth significant silt and clay 4.7I60C-0S low end of sidy sand range q
76 Thin fill Over MM tedlaantary tilt/day 9.4U0C 07 Ni<^oint of glacial till range
BD Ihlck legolltk Silt/clay 4.7160E OS Midpoint of range for ailt
Bt Mouitaln Create Me taaorphlc/Igneous 4.7160E-04 Midpoint of fractured igneous ft aeteaorphic rock
9C Mountain flank a taddad llaeetene, aandstone. ft shale 4.71601 OS Midpoint of fractured liaeatone ft sandstone range
90a Claclal fill Over Crystalline tedrock tilt/clay 9.41201-07 Mldjwlnt of glacial till range
90b Claclal till Over Out wart tilt/day 9.41201-07 Nl Unconaol. A Saai-conaol. thailou turf. Aq. tand ft gravel 4.71601-01 Midpoint of range for clean aand
tOla liver Alluvlua uttb Overbark Oapoalt tilt/clay 4.71A0I-0) Hitfeoint ol allty aand range
10C twM^> land ft travel 4.ri60C-0l Midpoint of range for clean aand
11A So I ut Ion 1 laestone Karat llaestona 4.7160C02 Mitfeolnt of karat I laes tone range
11C Sweap Karat Ilaestona 4.71601 02 Nl^ioint of karat I lacatone range
110 taaciiea and tare land ft gravel 4.716K-01 Midpoint of range for dean aand
• I. Allan freeie and Jdn A. Cherry, Cromliater, (Dm Jersey: Prentice-HalI, Inc., 1979), p. 19.
-------
A- 31
EXHIBIT A-12
ELEVEN GENERIC GROUND-HATER FLOW FIELDS
USED IN SATURATED ZONE MODELING
B
30M
30 M
MM
MM
10 M/Y
1.000 M/Y
100 M/Y-
1 M/Y
0.05 M/Y
iSm
0.5 M/Y
30M 100 M/Y
100 M/Y
30M
"1
10 M/Y
•om 10 M/Y "»¦
ISM
ttM
10 M/Y
1 M/Y
100 M/Y-
10 M/Y
MM
0 5 M/Y
0.06 M/Y
30M
0.5 M/Y
MM
100 M/Y-
15M
MM
0.05 M/Y
i
0.5 M/Y
1 M/Y
ISM
0.05 M/Y
MMfY
10 M/Y
EXPLANATION
Outflow
Boundary*
10 M/Y-
Ave rag* Linear Groundwater Velocity vectors
Water Table Boundary (Meters/Year) Through Each Layer of Saturated
^ Material with Constant Thickness (Meters).
_ inflow Croas-Hatch Lines Indicate Lay#r is Non-Aquifer
Boundary
NO-FlOW
Boundary
-------
EXHIBIT A-13
HYDROCEO LOGIC SETTINGS
Saturated
Oapth to
Met
Zona
Vedose lone
Percent
MASTIC
Oaacriptlon of Coda
Groutdueter
Infiltration
Peraeability Permeability
Flow
lister of
of All
Coda
(Hater*)
(In/Vr)
(Ca/Second)
(Ca/Second)
fields
Facilities
Facilitiea
16b
West Wide Alluvial Vatlay*
3.0
10
*.00866 02
4.71606-01
C
0
F
2
3.IX
a
Alluvial Mouitaln Vat lays
12.2
1
2.35806-02
4.716Cc-0(
A
B
C
1
1.5X
«
Ptaya lafcea
26.7
1
4.00866-02
4.71606 05
F
1
1.5X
68
Alluvial Nouitaln Valley*
6.9
10
2.35806-02
4.71606-05
B
C
0
F
1
1.5X
AC
Mountain Flarfca
12.2
1
2.38166-03
4.71606-05
8
C
0
1
1.5X
tti
Alternating SSa LS, A SM - Thin Soil
6.9
10
2.38166-03
9.43206-07
B
c
O
1
1.5X
60b
Alternating tS, IS, ft M • Deep Ragoltth
6.9
10
2.38166-03
4.71606-05
B
c
O
2
3.IX
6Fa
River Alluvlua with Owrtaot
6.9
10
7.07406-02
4.71606-03
B
c
F
2
3.IX
6Tb
River Atliwlua without Owrtunt
3.0
10
7.07406-02
4.71606-01
B
c
2
3.IX
7Aa
Glacial fill Over MM Sadiaantary Rock
12.2
10
9.43196 03
9.43206-07
A
B
C
K
3
4.6X
7Ab
Glacial Till Over Outuaah
6.9
10
7.07406-02
9.43206-07
F
K
3
4.6X
The
Glacial Till Ovar Solution llasatono
12.2
10
9.43196-02
9.43206-07
6
F
1
1.5X
71b
Outwash Ovar Bedded Sadlanttary
6.9
20
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-------
A- 33
provided inter-unit area factors for 13 facilities and dovngradient drinking
water well distances for 17 facilities. Section A.3.2 describes our
methodology for completing the facility data for the remaining facilities
In addition to the facility-specific information, we also needed the
following characteristics for each unit at any given facility:
¦ Type of waste managed by the unit (i.e., the unit's waste stream);
a Years of operation;
¦ Type of unit;
¦ Year of waste removal;
¦ Regulatory status; and
¦ Size of unit and quantity of waste managed by the unit.
For three types of units, we could not adequately determine all of the
characteristics required for modeling: waste transfer stations (34 SWMUs),
spill areas (14 SWMUs), and "other" units (12 SWMUs). From the RFAs we could
not adequately determine quantities of wastes handled by waste transfer
stations nor could we find other sources with average waste transfer
quantities. In many cases we could not determine whether a particular station
was transferring waste into the facility or out of the facility. Because
spill areas and "other" units had extremely diverse characteristics, we also
could not adequately model these units. For example, one spill area was a
truck washing area, while another was an old spill of unknown origin. "Other"
units ranged from a paper and packing operation to a centrifugal pump. For
these reasons, spill areas, waste transfer stations, and "other" units were
not modeled and their characteristics were not completed. Our methodologies
for completing the missing information for all other units are described
below.
Based on all of the information given in the RFA, we assigned a waste
stream^ to each of the units using the methodology described in Section
A. 3.3. Approximately 48 percent of the units had valid opening dates from the
RFA Survey, while 31 percent of the SWMUs had valid closing dates and 53
percent of the units were still open at the time of the RFA. Section A.3 4
discusses our methodology for determining opening and closing dates for the
remaining units. From the RFAs we classified all SWMUs into the 68 unit types
listed in Exhibit A-6. In many cases, these unit types were not identical to
the types of units that could be modeled by the Liner Location Model (LLM) and
^ Waste streams characterize the types of waste managed by a unit
Each waste stream contains up to six hazardous constituents at different
concentrations.
-------
A- 34
che RCRA Risk-Cose Analysis (WET)^3 model; Section A.3.5 discusses our
assumptions for converting these unit types into LLM and WET unit types.
The RFA survey provided actual dates of waste removal for 8 percent of
the units. Approximately 22 percent of the SWMUs still contained waste when
the RFA was conducted. For some types of units (e.g., deep well injection),
waste removal is not possible. Section A.3.6 describes our methodology for
determining dates of waste removal based on these facts. From the survey we
knew the regulatory status of over 99 percent of the units. Ve assumed that
any units with unknown regulatory status would be older units that were
unregulated prior to HSWA. Finally, each type of unit required different size
and waste quantity information. Section A.3.7 discusses the information
available from the RFA survey for each type of unit, as well as our
methodology for determining sizes of units and quantities of wastes managed by
SWMUs.
A.3.2 Methodology for Completing Facility Information
The RFA survey and the hydrogeologic mapping provided some information on
all of the required facility characteristics, but inter-unit area and
downgradient drinking water well data were missing for some facilities.
Ue assigned the median inter-unitf area factor, 5.0, to the 52 facilities with
missing inter-unit area factors. At the 48 facilities with missing
downgradient drinking water well distances, we assumed a well at 400 meters.
This distance reflected a conservative assumption that is generally consistent
with available summary data on the distance from facilities to nearby wells.
Because the LLM does not model veils at distances greater than 1,500 meters,
we also assigned the 6 facilities with well distances greater than 1,500
meters, a well distance of 1,500 meters,
A.3.3 Inference of Baste Characteristics
To characterize the wastes managed at the modeled SWMUs, we assigned a
waste stream to each unit from the WET model waste stream data base. The WET
model estimates costs and risks associated with different technologies,
wastes, and environments. Each of the 265 waste streams in the model
represents wastes generated by an average plant or facility within an
industry. In order to model costs and risks associated with corrective
action, we assigned waste streams to each SWMU using the following four steps:
1) Determining the physical characteristics of the SWMU waste (i.e.,
whether the stream is a solid, a liquid, or a sludge);
13 U.S. EPA, "The RCRA Risk-Cost Analysis Model Phase III Report "
Prepared by ICF Incorporated for Economic Analysis Branch, Office of Solid
Waste, March 1, 1984.
-------
A- 35
2) Determining che chemical characteristics of the waste (i.e, whether
the waste is organic or inorganic),
3) Determining the hazardous constituents in the waste; and
4) Assigning a waste steam characterization from the VET model waste
stream data base to each SWMU stream for which Steps 1, 2, and 3 had
been completed.
In reviewing the RFAs to obtain information on waste stream
characteristics, we found that information was often incomplete or too general
for completing all of the above steps. Therefore, we developed a consistent
set of assumptions for completing the waste stream characteristics. These
assumptions are described below.
To determine the physical characteristics of the waste stream, we
reviewed RFA information describing the waste and the SWMU. When adequate
information was not available for determining the physical characteristics of
the waste, we made the following assumptions: (1) all wastes managed in
tanks, surface impoundments, and land treatment units are liquids; and (2) all
wastes managed in landfills, waste piles, and containers are solids.
When adequate information was not available for determining the chemical
characteristics of a waste stream, we made the following assumptions: (1) all
wastes managed in surface impoundments and land treatment units are dilute
aqueous organic wastes; (2) all wastes managed in tanks are aqueous inorganic
wastes; and (3) all wastes managed in landfills and waste piles are inorganic
solids. Finally, when enough information was not available to determine the
hazardous constituents in the waste, we assigned the SWMU the most prevalent
hazardous constituent among all other SWMUs at the same facility.
Once the physical and chemical characteristics and hazardous constituents
for a stream were determined, we assigned a waste stream to each unit using
best professional judgement. For 124 SWMUs, however, we assigned no waste
stream because the unit contained non-hazardous waste or, in a few cases, we
could not adequately determine an appropriate waste stream. We did not model
the costs and risks associated with corrective action at these units. Exhibit
A-14 shows the 10 most common waste streams assigned to the units, including
the hazardous constituents contained in each stream. Exhibit A-15 provides
the distribution of all units across waste streams aggregated by waste stream
category.^
In general, there is no simple way to verify the accuracy of the
assumptions used in the process of characterizing SWMU waste streams. The
^ The first four digits of the six digit waste stream code provide the
general category of the waste.
-------
A- 36
EXHIBIT A-14
HOST PREVALENT WASTE STREAMS ASSIGNED TO UNITS
watt* Strews Description of
Neater Uutt Streea 0
Hazardous Constituents
Neater Percent
of Unitt At I Unit
None *
03.01.02
01.01.16
03.03.01
09.01.10
04.01.01
01.02.06
03.01.01
01.01.12
03.01.06
Wsste stress contains no hetsrdous constituents
1,1,1-Trichloroethene spent solvents and
sludges tram degreesing
Wsstsweter treetaont sludges froa
electroplating operations
Paint
sliest ion si
Methyl Ethyl Ketone spent solvents froai
Manufacture of paint and allied products
Dissolved sir flotation (DAP) float froa
the petroleus refining industry
Waste leaching solution froa acid leaching of saisslon
control dust/sludge froa secondary leed saalting
Trfehloroethene spent solvents and sludges
froa dagreesing
Sludge froa tin plating alll operations
Dtchloroaathane spent solvent
None 124
1,1,1-TrlcMoroothene 46
Niekel, Copper, Chroaius (VI), 33
Lead, Cadaiua
Toluene, Methyl ethyl Ketone, 33
Chroaiua (VI), Leed, Mercury
Methyl Ethyl Ketone 29
Chroaiia, Lead 25
CiMia, Lead, Chroaiia (VI) 24
Tricfiloroetfceno 21
Lead, Chroaliai (VI) 18
Oicfcloroaethene 18
Totala: 371
41
• note that wilts with no waste streaa ruter contained non-hezsrdoua Meats or,
in s few esses, the data art inadequate for waste Identification.
-------
A- 37
EXHIBIT A-15
SUMMARY OF ALL WASTE STREAMS
Waste St real
N uitoer
Percent of
Category
Description of Category
of Units
All Units
None *
Wests strssa contains no hazardous constituents
124
13.9X
01.01
Metal sludges
109
12. a
01.02
Solutions containing heavy aetals
77
8.6X
01.03
Cyanide sludge
6
0.7*
01.04
Biosludges containing heevy aetals
14
1.6X
01.05
Metal sludges with organics
19
2.1X
02.01
Phenols
6
0.71
02.02
Wastewater frosi organic chaaical production
104
11.7X
02.03
Wastewater treatment sludge fraai pesticide production
4
0.5X
02.04
Other eqeous organtca
3
0.3X
03.01
Spent solvents
188
21.IX
03.02
Still bottoas froa solvent recovery
25
2.8X
03.03
Organic/aetal sludges
36
4.OX
03.04
Liquid residues froa organic chaaicel production
13
1.5X
03.05
Solid residues froa organic chaaical production
18
2.OX
03.06
Other concentrated organics
9
1.0X
04.01
Oily waates froa petrolei* refining
80
9.OX
04.02
Other oily Maates
21
2.4X
05.01
Residues froa aatal saelting and refining
6
0.7X
05.03
Other inorganic solid residues
6
0.7X
06.01
Inorganic solids
7
0.8X
06.03
Organic solids
5
0.6X
06.04
Organic liquids
12
1.3X
06.05
Cases
1
0.1X
Totals:
893
100.ox
* Not* that mits with no nut! streea category contained rwvhaxardous westes or,
in icm cum, the data were inadequate for mim identif(cation.
-------
A- 38
characterizations were, however, completed using best professional judgement
and are based on what we believe to be reasonable assumptions.
A.3.4 Estimation of Unit Operating Life
Based on the information that was available from the RFA survey, we
developed an algorithm for completing the operating lives of the 703 SUMUs
that were missing either an opening date or a closing date. Ue applied the
following steps for each unit consecutively until both the opening and closing
dates were determined:
1) If the SWKU was missing an opening date, we substituted the earliest
opening date of all other SWMUs at the same facility.
2) If the SWKU was still missing an opening date, we substituted the
facility opening date.
3) If the SWMU was a newly regulated unit and was missing a closing
date, we assumed that the more stringent regulatory environment
created by HSVA would have forced the unit to close by 1987. As a
conservative assumption, we assumed that all such units closed in
1987 so that the waste would remain in the unit as long as possible.
4) If the SWMU was still missing a closing date, we substituted the
facility closing date (if the facility had already closed when the
RFA was conducted).
5) If the opening date was still missing and the unit may have closed
prior to the completion of the RFA, we calculated the opening date
by subtracting the average operating life^ from the closing date.
6) If the closing date was still missing and the unit may have closed
prior to the completion of the RJA, we calculated the closing date
by adding the average operating life to the opening date.
7) If both the opening and the closing dates were missing, we
substituted the latest closing date of all other units at the same
facility. In a few cases, no other units at the facility had
closing dates. From the RFAs, though, we knew that these units were
all closed. As a conservative estimate, we assumed that they closed
^ To determine average operating lives for this and all subsequent
steps, we first calculated the average operating lives of all similar types of
units (e.g., we calculated the average operating life of all landfills). If
this estimation of average operating life was statistically valid (i.e., the
standard error was less than one), then we applied the estimate to all units
of that particular type. Only the estimate for container storage units was
statistically valid. For the other types of units, we used the average
operating life of all units in the survey, 12 years.
-------
A- 39
in 1986. We then calculated Che opening dace by subtracting the
average operating life from the new closing date.
8) If the opening date was still missing but we knew that the SVMU was
still open, we calculated the opening date by subtracting half the
average operating life from 1987. tfe then calculated the closing
date by adding half the average operating life to 1987.
9) In many cases we knew when the SVMU opened and that it was still
open, but we had to estimate when the unit would close in the
future. Because many units had already been open for longer than
the average operating life, we could not simply add the average
operating life to the opening date to determine the closing date.
Instead, we found the average operating life of all units that had
operating lives longer than the current operating life of the unit
in 1987. If, for example, the unit opened in 1950 and was still
operating in 1987, we calculated the average operating life of all
units that were open for more than 37 years. We then added that
average operating life to the opening year to determine the closing
year. If no other units were operating for longer than the current
operating life of the unit, we assumed that the unit would close in
1988.
10) If the SVMU was a regulated Subtitle C unit, its year of closure
could be no earlier than 1980 (the year in which RCRA was enacted)
or the unit would not have been regulated. If the above steps
assigned a closure date prior to 1980, we changed the date to 1983,
as a more realistic assumption.
The above procedure resulted in an average opening year of 1963; the
units' opening years ranged from 1900 to 1987. The assigned closing years
ranged from 1920 to 2011, with a mean of 1991. The average operating life of
the SUMUs was 28 years; the median operating life was 24 years. Note that the
average operating life after the above calculations was greater than the
average operating life in the original data (which was 12 years) because many
of the 110 units that are still open began operation many years ago; the
operating lives of these units are not Included in the survey estimate of
operating life.
A.3.5 AssuBptloos About Unit Types
In order to model the costs and risks associated with corrective action,
we mapped the 68 types of units in the RFA survey to the 13 unit types in
Exhibit A-16. It was necessary to describe each unit In terms of one of these
unit types because the modeling tools used for the RIA simulate releases for
only a limited set of specific design types. Ue based the assignment of these
unit types on several assumptions. First, release profiles for landfills and
surface impoundments were only available for two liner designs: double
composite and unlined. Because double composite liners were not widely used
and were not required before HSVA was enacted in 1984, we assumed that only
-------
A-40
EXHIBIT A-16
SIMULATED MODEL UNIT TYPES
¦ Lined Landfill
¦ Unlined Landfill
¦ Lined Treatment Surface Impoundment
¦ Lined Storage Surface Impoundment
¦ Lined Disposal Surface Impoundment
¦ Unlined Treatment Surface Impoundment
m Unlined Storage Surface Impoundment
¦ Unlined Disposal Surface Impoundment
¦ Tank
a Deep Well Injection
¦ Waste File
¦ Land Treatment
¦ Spill Area
-------
A-41
Che most recently lined landfills and surface impoundments chac were opened
after 1980 and not closed before 1985 could be mode'led accurately as double
composite lined units. We modeled all other landfills and surface
impoundments as unlined units. Under these criteria, we found that tvo of the
12 lined landfills and one of the 35 lined surface impoundments in the survey
could be considered double composite lined. Ue modeled the remaining lined
landfills and surface impoundments as unlined.
Second, we assumed that all units with no design description (e.g.,
unspecified landfills and unspecified treatment impoundments) were older units
with no liners or pads. Ue also modeled surface impoundments that were not
specified as treatment or storage as disposal impoundments. Waste piles
required an additional classification based on waste pile design types.
Exhibit A-17 lists the WET model design types that we assigned to each of the
survey waste pile types. In addition, we modeled incinerators, waste
recycling operations, and container storage areas as spill areas. Finally,
tanks required specific tank design types from the Hazardous Waste Tank
Failure (HWTF) model.16 Because these design types included sizes, we discuss
the assumptions required for the assignment of tank design types in Section
A.3.7.
A.3.6 Methodology for Determining Dates of Waste Reaoral
The RFA survey provided actual dates of waste removal for 8 percent of
the 893 units. In addition, the model did not require dates of waste removal
for incinerators, injection wells, or waste recycling operations. We assumed
that releases at these units are a function of throughput, and that the waste
is removed at the end of the operating life. The methodology that we
developed for determining the dates of waste removal for the remaining units
is described below.
For the 451 previously unregulated SVMUs with no date of waste removal,
we assumed the waste remained in the unit at closure. However, if the SWMU
was a regulated Subtitle C treatment and storage unit, then the regulations
require clean closure. For the 305 such units, we assumed that the waste
would be removed during the year of closure. Regulated land disposal units
are not required to remove the waste at closure; we assumed that the waste
would remain in the 67 land disposal units with no removal date after closure
A.3.7 Estimation of SSMD Sixes and Quantities of Wastes Managed by SVMUs
As Exhibit A-18 reveals, each type of unit required several size and
waste quantity parameters. In reviewing the RFAs to obtain the necessary
information, we found several data gaps. Because little reliable information
was available on quantities of wastes managed by the units, we estimated waste
quantities from unit sizes. The methodologies that we developed for
^ U.S. EPA, "Hazardous Waste Tanks Risk Analysis." Prepared by ICF
Incorporated and Pope-Reid Associates for Office of Solid Waste, June 1986
-------
A-42
EXHIBIT A-17
MAPPING OF SURVEY WASTE PILE TYPES
TO WET MODEL HASTE PILE TYPES
Impermeable Pad
Other Pad
No Pad
Indoor
Unspecified
WET Model Design
¦ Impermeable Liner with
Periodic Inspections
¦ Synthetic with Clay Liner
¦ No Liner
¦ Indoor
¦ No Liner
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A-43
EXHIBIT A-18
REQUIRED SIZE PARAMETERS BY UNIT TYPE
Simulated Unit Type
Lined Landfill
Unlined Landfills
Line Surface Impoundments
Unlined Surface Impoundments
Tanks
Deep Well Injection
Waste Piles
Land Treatment Units
Spill Area
Surface
Area Depth Throughput
X XX
X XX
X XX
X XX
X XX
NA L X
U XX
V XX
S S X
X - Derived from the RFA data base.
U - Calculated by the VET model based on selected VET model unit design
S - Calculated based on size of release by the spill area algorithm
L - Calculated by the LLM based on the depth to ground water
NA - Not Applicable
-------
A-44
completing Che missing size information and estimating waste quantities are
described below for each unit type.
LANDFILLS
We applied the following methodology to assign sizes and waste quantities
to the 144 landfills in the sample:
1) For the 27 units with surface area and depth information available:
¦ Size - Volume - Surface area x Depth; and
¦ Throughput - Size x Specific gravity / Operating life.
The specific gravity depends on the type of waste managed in the
unit; the VET model waste stream data base provided the specific
gravities used in this and all subsequent specific gravity
calculations.
2) For the 33 units with surface area information only:
¦ Size - Volume - Surface area x TiLM flff^ult depth: and
¦ Throughput - Size x Specific gravity-/ Operating life.
3) For the 84 units with no surface area information:
¦ Size - Median surface area x Utf foPth; and
¦ Throughput - Size x Specific gravity / Operating life.
The LLM default depths depend on the surface area of the unit; the depths
ranged from 3 to 7 meters. We calculated the median surface areas used in
Step 3 from the original data as 4,226 square meters.
The mean surface area for the completed data was 47,382 square meters,
although the median surface area was only 4,226 square meters. The mean depth
was 3.6 meters and the mean throughput was 25,416 metric tons per year.
LAND TREATMENT UNITS
Ten SWMUs in the RFA sample were land treatment units. In order to
assign sizes Co chese units and to determine Che quancicy of wasce chat they
manage, we applied the following methodology:
1) For the 3 units with surface area information:
e Size — Surface area; and
-------
A-45
¦ Throughput - Land treatment waste application rate from the WET
model (i.e., 206 MT/acre/year) x Size.
2) For the 7 units with no surface area information:
¦ Size - Median land treatment unit size from Pope Reid
Associates (PRA) data, 17 acres and
¦ Throughput - Land treatment waste application rate from the WET
model (i.e., 206 MT/acre/year) x Size.
Because land treatment units can be no deeper than 5 feet,^-® we conservatively
assigned all land treatment units a depth of 5 feet. The completed units
handled a mean quantity of 6,213 metric tons per year.
WASTE PILES
There are 29 waste piles included in this analysis. The WET model
creates several waste piles from each waste pile unit. The new piles are
either small (60 cubic meters) or large (2,830 cubic meters), and the sum of
all the waste contained in the piles is the quantity specified for the
original waste pile unit. We used the following methodology to determine the
waste pile sizes and to determine the quantity of waste in the original units:
1) For the 14 units with surface area information:
¦ Size - Large waste pile size modeled in the WET model (2,830
cubic meters); and
¦ Throughput - Surface Area x Estimated height of each pile x
Specific gravity / Residence time.
We estimated the height of each pile to be 3.75 meters, based on the
WET model default value for the height of the 2,830 cubic meter
waste pile size.
2) For the IS units with no surface area information:
^ U.S. EPA, "Draft Document, Engineering Cost Documentation for
Baseline and Proposed Double Liner Rule, Leak Detection System, and CQA
Programs. Cost For Landfills, Surface Impoundments and Waste Piles."
Prepared for Economic Analysis Branch, Office of Solid Waste, March 20, 1987
by Pope-Reid Associates.
18 40 CFR 264.271(c)(1)
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A-46
¦ Size - Small waste pile size modeled in the WET model (60
cubic meters); and
¦ Throughput - Median waste quantity from PRA data (140 cubic
meters) x Specific gravity / Residence time.
For both steps we used the UET model estimate for residence time of 22.5
days. Because waste piles are found on the surface, we assumed that waste
pile depths below the surface would be 0 meters for all units.
After the above calculations, the mean quantity of waste managed at each
unit was about 45,000 metric tons per year.
SURFACE IMPOUNDMENTS
There are a total of 136 surface impoundments in this analysis (including
storage, treatment, and disposal impoundments). We used the following
methodology to determine sizes and waste quantities for these units:
1) For the 41 units with surface area and depth information:
¦ Size - Volume - Surface area x Depth; and
¦ Throughput - Size x Specific gravity / Residence time.
We assumed disposal impoundments would hold waste for the entire
life of the unit (i.e. residence time is equal to the operating life
of the unit). Waste at treatment and storage impoundments, though,
would remain in the unit for five and ten days, respectively.
2) For the 14 units with surface area information only:
¦ Size - Surface area x LLM default depth; and
¦ Throughput - Size x Specific gravity / Residence time.
3) For the 81 units with no surface area information:
¦ Size - Median surface area x LLM default depth; and
¦ Throughput - Size x Specific gravity / Residence time.
We calculated the median surface area for Step 3 from the original data as
2,000 square meters. The default LLM depth for surface impoundments is 2.5
meters.
The mean surface area after completion of the data was 8,124 square
meters. The mean depth was 2.6 meters and the mean quantity was 650,000
metric tons per year.
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A-47
TANKS
The RFA sample included 280 SWMUs that consisted of one or more tanks
We modeled the releases from these tanks using release profiles from the HWTF
model. Because the number and types of tanks within these SWMUs are quite
variable and the HWTF model contains only seventeen tank design types (see
Exhibit A-19), we developed the following methodology for determining the
number of tanks within a SWMU and for matching each tank to the appropriate
HWTF model design type:
1)
We
divided
the tank SWMUs into two categories:
¦
Units
handling organic waste only; and
¦
Units
handling aqueous wastes only.
2)
We
further
divided each of these categories into two subcategories
a
SWMUs
with treatment tanks; and
¦
SWMUs
with storage or accumulation tanks
3) Based on the survey design type, any RFA size information, and the
tank subcategory from Step 2, we assigned the most appropriate HWTF
model tank design type from Exhibit A-19 to each tank SWMU,
adjusting the number of tanks in the SWMU to compensate for any size
differences. For tanks with unspecified survey designs, we selected
the most prevalent design type among all similar units. In some
cases, the number of tanks in the SWMU was unknown. We assumed that
such SWMUS would each contain one tank, and selected the design type
accordingly.
Exhibit A-19 presents the number of tanks that we assigned to each HWTF
model design type. Note that the 31 tanks which contained non-hazardous waste
are not included in this exhibit because they were not included in the
modeling effort. The surface area and depth of the tank units are inherent in
the chosen design. Because the modeling of costs and risks associated with
corrective action assumes that releases from a tank are to the ground area
directly beneath the horizontal tank area, we used the following calculation
to obtain this surface area:
Surface area - Length x Diameter.
Based on the volume given for each type of tank (see Exhibit A-19), we
calculated the length and diameter of the tank for use in the above equation.
To calculate the diameter we assumed an aspect ratio (ratio of length to
diameter) of 3, and that the tank was in the shape of a cylinder. Based on
-------
A-48
these assumptions, we derived the following equation for the diameter of the
tank:
-------
A-49
EXHIBIT A-19
HWTF MODEL TANK TYPES
Number Percentage
HWTFM of Tank of All
Code Design Description Units Tank Units
16 5500 gallon, above ground, cradled, carbon steel 75 25.5
storage or accumulation tank
2 Open 2300 gallon, above ground, cradled, carbon steel 40 13 6
treatment tank
20 4000 gallon, underground, carbon steel storage or accumulation 37 12.6
tank
23 4000 gallon, underground, stainless steel storage or 30 10.2
accumulation tank
3 Closed 2300 gallon, above ground, cradled, carbon steel 26 8.8
treatment tank
15 5500 gallon, above ground, cradled, carbon steel 25 8.5
storage or accumulation tank
18 210,000 gallon, above-ground, ongrade carbon steel 15 5.1
storage or accumulation tank
25 2100 gallon, in-ground, concrete storage or accumulation tank 15 5.1
9 3700 gallon, in-ground, concrete steel treatment tank 12 4.1
7 60,000 gallon, above ground, ongrade, carbon steel 8 2.7
treatment tank
24 4000 gallon, underground, stainless steel storage or 5 1.7
accumulation tank
27 2100 gallon, in-ground, carbon steel storage or accumulation 4 14
tank
17 210,000 gallon, above-ground, ongrade carbon steel 2 0 7
storage or accumulation tank
-------
A- 50
Diameter — (4/3 x Volume)
For above ground tanks, we assigned a depth below the surface of zero (i e ,
the tank was at ground level). For in-ground tanks, we assumed that the depth
would be half the height (i.e., half of the tank was in the ground). Finally,
for underground tanks, we assigned a depth equal to the diameter (height) plus
1.52 meters (i.e., we assumed the top of the tank was five feet underground).
CONTAINER STORAGE AREAS
The RFA survey included 143 container storage areas. At 21 units, the
survey provided the number of dumpsters in the container storage area, and at
42 units the survey included the number of 55-gallon drums. Using these data
and the assumption that each dumpster held 7,640 liters (based on field
experience), we calculated the total storage capacity of the unit. We used
the median capacity among all units with data for units with no volume
information.
To calculate the quantity of waste managed in the container storage areas
(throughput) from these capacities, we used an assumed residence time for the
containers of either 90 days or one year. Prior to the enactment o£ RCRA in
1980 there were no restrictions on the time during which a container could
remain in the storage area, but after 1980 restrictions existed on the storagf
time. Therefore, we assumed a 90 day residence time for units that opened
during or after I960, and a one year residence time for units that opened
before 1980 to calculate the quantity of waste managed as follows:
Quantity - Total storage capacity / Residence time.
If the facility opened before 1980 but operated after that date, we assumed
that the quantity of waste handled each day would be unchanged after the
effective date of the regulations were implemented. However, we included the
effect of the decreased residence time in the calculation of quantities
spilled.
INCINERATORS
The RFA survey provided little information on quantities handled by the
21 Incinerators included in the survey. Four incinerators had capacity
information, but extrapolating capacity to all other incinerators from only
four values would not be statistically valid. For this reason, we assigned
all incinerators with no capacity information the average throughput of 7 000
metric tons per year for incinerators during 1981 from the Westat Survey^.
^ U.S. EPA, "National Survey of Hazardous Waste Generators and
Treatment, Storage and Disposal Facilities Regulated Under RCRA in 1981.
Prepared by Westat, Inc., for Office of Solid Waste, April 1984.
-------
A- 51
WASTE RECYCLING UNITS
We found 14 waste recycling operations at the 65 facilities in the
survey. Five of these units contained non-hazardous waste and, thus, did not
require quantity information for modeling. Of the 9 waste recycling
operations handling hazardous waste, information was available on quantities
of waste handled by 5 units. We used engineering judgement based on
qualitative descriptions in the RFAs to provide quantity estimates for the
remaining four units. The quantities handled by the 9 waste recycling units
with hazardous waste ranged from 55 gallons per day to 20,000 gallons per day.
INJECTION WELLS
The RFA survey included 11 injection wells, but no information was
available on quantities of wastes managed by these units. We assigned all
injection wells the WET model default throughput value of 138,000 cubic meters
per year. We converted this value to metric tons per year using the specific
gravity for each type of waste; the final quantities managed by the wells
ranged from 344,000 to 1,361,000 metric tons per year, with a mean of 662,000
metric tons per year.
-------
APPENDIX B
CORRECTIVE ACTION TRIGGERS
This appendix identifies the constituent-specific concentrations that
trigger corrective actions for the baseline scenario and four regulatory
options analyzed in the RIA. In addition, the appendix explains how
corrective action triggers were developed. The use of different corrective
action triggers is a significant factor in determining the health risk and
costs associated with the baseline scenario and four regulatory options.
Appendix B is comprised of four sections. The first section discusses
the guidelines used in selecting the constituents modeled in the RIA. Section
B.2 then discusses technical detection limits used in the RIA. Section B.3
describes the various possible health-based corrective action triggers used in
the analysis (Maximum Contaminant Levels, Risk Specific-Doses, Reference
Doses, and Liner Location Model calculated 10"^ and 10"^ risk level
concentrations) for each of the 120 constituents modeled. Finally, Section
B.4 discusses the process used to select the appropriate health-based
concentration level for each constituent and identifies the health-based
corrective action concentration used for each regulatory option.
B.l CONSTITUENT SELECTION
In this RIA, the human health risk and corrective action costs associated
with ground-water contamination were analyzed using EPA's Liner Location Model
(LLM). In the LLM, 120 hazardous constituents are modeled. These
constituents are listed in Exhibit B-l. These constituents were selected
during the development of the LLM in 1984 by using Agency background documents
on waste streams and information obtained from RCRA facility site
questionnaires.^- In addition, occasional updates have occurred in conjunction
with various applications of the model.
EPA narrowed its focus to 120 constituents, despite the fact that waste
streams frequently contain a large number of constituents, because "there are
usually one or two constituents that produce much higher (orders of magnitude)
risk projections than the other waste stream constituents. Thus, a few
constituents of concern can be selected and used as indicators of the overall
risk of a multi-chemical waste stream."2 One-hundred eighteen of these
"constituents of concern" were chosen from a list of chemicals that were
either priority pollutants or included in Appendix VIII of 40 CFR 261.
Constituent selection was based upon relative concentration in industry waste
^ U.S. EPA, "Appendix H to EPA's Liner Location Risk and Cost Analysis
Model," 1987.
2 Ibid, H-4.
-------
B-2
EXHIBIT B-l
MODELED CONSTITUEHTS
1 acenapthene
2 ACENAPHTHYLENE
3 ACETALDEHYDE
4 ACETONE
5 ACETONITRILE
6 ACROLEIN
7 ACRYLONITRILE
8 ALDICARB
9 ALLYL ALCOHOL
10 ANILINE
11 ANTIMONY
12 ARSENIC
13 BARIUM
14 8ENZENE
15 BENZO(A)ANTHRACENE
16 BENZO(A)PYRENE
17 BEHZO(B)FLUORANTHEME
18 BENZOTRICHLORIDE
19 BENZYL CHLORIOE
20 BIS(CHLOROMETHYL)ETHER
21 BIS(2>ETHYLEXYL PHTHALATE
22 CADMIUM
23 CARBON DISULFIDE
24 CARBON TETRACHLORIDE
25 CHLORDANE
26 CHLORQACETALDEHYDE
27 CHL0R08ENZENE
28 CHLOROFORM
29 2-CHLOROPHEHOL
30 CHROMIUM (VI)
31 CHRYSENE
32 COPPER
33 CYANIDES
34 CYCLONEXANE
35 DIBENZO
-------
B-3
streams, toxicity (type of effect and potency), and overall environmental
persistence. The remaining two constituents, iron and chloride, are not
considered hazardous and, consequently, were not modeled to assess health
effects. They were left in the data base for completeness of available
constituent information.
B.2 DETECTION LIMITS
Due to the limits of analytic chemistry, not all concentrations of a
particular constituent can be detected with certainty. For each constituent,
the LLM includes a detection limit. The model user can decide whether or not
to override the corrective action triggers developed for the differenc
regulatory options with Che detection limits. If this model option is used,
modeled concentrations below constituent detection limits do not trigger
correccive action. In some cases, detection limits are used as corrective
action triggers for all constituents (as discussed in Section B.4). These
detection limits are identified in Exhibit B-2. In this exhibic, the column
labeled "detectable concentration" displays the original detection
concentrations assigned to each constituent for use in the LLM by EPA in 19B5 ,
and the column labeled "PQLs" contains EPA's recently developed Practical
Quantification Limits for each constituent where available. These values were
obtained on the basis of one of two sources, as described below.
B.2.1 Practical Quantification Limits
Practical Quantification Limits (PQLs) were developed by EPA and
generally represent the lowest concentration of analytes in ground waters that
can be determined reliably within specified limits of precisions and accuracy
by specified methods under routine laboratory operating conditions.^ PQLs
were used as constituent-specific detection limits, where available (i.e., for
85 constituents) . The Agency has developed PQLs for constituents for which it
is feasible to analyze in ground-water samples and for 17 chemicals routinely
monitored in the Superfund program. PQLs have been developed for guidance
purposes and do not constitute regulatory requirements.
B.2.2 LLM Detection Limits
Where PQLs were unavailable, detectable concentration levels established
during development of the LLM were used as detection limits. LLM detectable
concentration levels were used for 33 organic and inorganic constituents.^
For the most part, the detectable concentration values for organics represent
the minimum analytic detection, limits specified for Superfund contractor
laboratories. However, the detectable concentration developed for inorganics
^ 40 CFR Parts 264 and 270, as amended by 52 ffi 25942 (July 9, 1987).
^ Two additional constituents modeled (Iron and chloride) were not
assigned detection limits because they were not modeled to assess health
effects.
-------
B-4
EXHIBIT B-2
DETECTION LIMITS
OatMtia
LfBltt
Corwtitvanti <^/|)
1 untfim
11-02
2 ACBMMTKTIM
11-02
3 AOTUMOTM
51-03
•»
V ACKTOH
11-01
5 AaTOHTRIlI
11-01
6 AOHU1I
11-03
7 AOITLOilTlllI
51-03
8 AiOtCMt
31-03
•*
V ALLTL ALCOHOL
31*03
••
to Minn
11-02
11 MTIMMT
31-02
i2 monic
11-02
13 IMILM
21-02
u uium
21-03
19 m»CA)MTHUam
If *02
16 IWOMimm
11-02
17 mzMDrmauiTmi
11*02
18 uttOTiicnaHSi
31*03
•*
19 MMU CNLCRIM
51-03
••
20 11 KanGROCTNTl )(TK((
11-03
•»
n »i«c2>miTu*n Mrra*L*Tt
11*02
a CMMI1K
12*03
23 CAMOH OIMFIDf
n-a
2* CAMOi (ITUOUIIOI
11*03
29 AOBM
11*04
tt aaomaruMirrM
1C-0S
•
27 fWflMWIM
2f-ai
28 cumai
31-04
29 i-oumm
ji-aj
jo canita
11-02
31 u«riw
tt-02
si com*
M-02
9 CTMHMS
4S-Q2
34 CTOOMIW
M-03
••
33 1IHHO <*,«> MTNUCni
11-02
36 1,2 BIIWin—HUM
21-03
37 1,4 Dicuaamai
21-03
3t 1,2 oiauHrrMM
SC-04
39 1,1 DICXLOKOTM
11-03
*0 1,2 oiaunmat
11-03
*1 OtCBLQMNtTNMB
»-o
•
42 1,2 SICnAOMCMM
5C-04
43 0ICM4MM9MBU
Sf-03
•»
u 1,3 tieauaoMSMM
11-03
41 2,4 OICHUMMMk
M-as
-------
B-5
rahlBIT B-2 (Continued)
DETECTION LIMITS
Oatactlen
Llaltt
Carat ftianti (aa/l)
46 2.6 OICNLOMPHMOt 11-02
47 OIWTMMTt 11-02
48 Diwrttn urruwiM ii-co
49 2.4 OIMTNTLPKIIKX 51-03
50 1,3-OUITWMMMl 11-02
51 2.4 DINITKOTOUJiKI 21-04
52 OINCXI 11-03
53 inouiru 5(-os
54 (PICMIOMNTDIII 5I-(D
55 ITMVUUZMI 21-03
56 ITNYUM 03(1 Of 51-03
57 riUOMaTNtM 11-02
58 UU»IDl« 21-02
59 FOMA101NVD1 51-03
tO NtPTACDLOi 51-OS
61 N1XACML0MB1N21M1 51-04
62 HoucNiarauTMtai si-os
63 MCXACMLOKSTNAM 51-04
64 NOUCNLOnCTCLGPUTWim 51-03
65 HIXAM 51-03
66 NTDCOOUIKM 51-03
67 iano mtmlic MnrroaiM 51-03
-------
B-6
EXHIBIT ft-2 (Continued)
DETECTION LUOTS
0«t*et1en
Halt*
carvtltianta (ao/l)
-------
B- 7
are recorded directly from the Post-Closure Liability Trust Fund Model data
base.^ A detectable concentration of 0.02 mg/1 was assigned to all inorganics
listed in this data base. However, not all LLM inorganic "constituents of
concern" were listed in the Post-Closure Liability Trust Fund Model data base.
To those inorganics not contained in the data base, a default value of 0 02
mg/1 was assigned. These assignments resulted in all modeled inorganic
constituents having a detectable concentration of 0.02 mg/1. In addition, a
default value of 0.005 mg/1 was used for organic constituents.^
B.3 HEALTH-BASED CORRECTIVE ACTION TRIGGERS
Tbe RIA identifies Agency-developed health-based standards for use as
corrective action triggers for certain regulatory options. (A discussion of
the specific corrective action triggers used under the baseline scenario and
each regulatory option is provided in Section B.4.) These triggers were
determined based on a combination of three sets of EPA concentration values
including: Maximum Contaminant Levels, Risk-Specific Doses, and Reference
Doses. In addition, for those constituents lacking an Agency approved health-
based standard, the LLM was used to calculate constituent concentrations that
would result in risk levels for use as corrective action triggers. Each of
these health-based standards is described in more detail in the preamble to
the Proposed Corrective Action Rule.
rnnram|^nf; Levels (MCLs^ for 18 hazardous constituents used in
the RIA are listed in Exhibit B-3. Drinking water standards under the Safe
Drinking Water Act are promulgated as MCLs. Generally, MCLs represent the
allowable lifetime exposure to the contaminant for a 70-kilogram adult who is
assumed to ingest two liters of water per day. However, an MCL is also
required by law to reflect available technology and the economic feasibility
associated with removing a given contaminant from the water supply.
Risk-Specific Doses (RSDs^ that were used in the RIA are listed in
Exhibit B-4. An RSD is an exposure level that corresponds to a specified
cancer risk level. An RSD is calculated using chemical-specific potency
factors developed by the Agency's Carcinogen Assessment Group and an assumed
water consumption rate of two liters per 70-kilogram adult per day over a 70-
year lifetime. RSDs used in the RIA analysis would result in an approximate
risk of 10-*-
^ U.S. EPA, "Appendix H to EPA's Liner Location Risk and Cost analysis
Model, 1986."
® This concentration falls within the middle range of the Contract
Required Quantitation Limits for the Target Compound List of Superfund. The
list for Superfund sample analysis can be found in "Appendix H of USEPA
Contract Laboratory Program" (Revised 8/87).
-------
B-8
EXHIBIT B-3
MAXIMUM CONTAMINANT LEVELS
NCI
Constituent (ag/l) (1)
12 ARSENIC 5E-02
13 BARIUM 1E+00
K BENZENE 5E-03
22 CADMIUM 1E-02
24 CARBON TETRACHLORIDE 5E-03
30 CHROMIUM VI 5E-02
37 1,4 DICHLOROSENZENE 7E-02
38 1,2 DICHLOROETHANE 5E-03
39 1,1 DICHL0R06THYLENE 7E-03
56 FLUORIDES 4E+00
68 LEAD SE-02
69 LINDANE 4E-IJ3
71 MERCURY 2E-03
103 TOXAPKENE SE-03
10S 1,1,1 TfttCHLOROETKANE 2E-01
107 TRICHLOROETHELYNE 5E-03
111 VINYL CHLORIDE 2E-03
116 NITRATE 1E+01
(1) Concentration values for Appendix IX constituents obtained froai EPA Beaorendua
dated April 13, 1987 froe Marc is Willi mm, Director, office of Solid Waste to
David Wagoner, Director, Mate Management Division, Region VII. Meaorandw
listed Agency estsblished MCLs, RfDa, end RSDs based on the Integreted Risk
Inforeatlon Systea (IRIS). Concentration values for non-Appendix IX constituents
obtained froai recent EPA ruleneking. Only constituents modeled for this enelymis
ere shoMn here; MCLs do exist for other constituents. (MCLs hsve been estsblished
for 24 constituents.)
-------
B-9
EXHIBIT B-4
RISK-SPECIFIC DOSE BASED COHCENTBATIONS IN WATER
RSO
Constituent (mg/l) *
7
ACRYL0N1TRILE
7E-03
10
ANILINE
1E-01
12
ARSENIC
2E-04
14
BENZENE
1E-01
15
BEKZOCA)ANTHRACENE
1E-03
16
BENZO(A)PYRENE
3E-04
22
CADMIUM
2E-05
24
CARBON TETRACHLORIDE
3E-02
25
CHLORDANE
2E-03
28
CHLOROFORM
4E-02
35
DIBENZO (A,H) ANTHRACENE
7E-05
38
1,2 DICHLOROETHANE
4E-02
39
1,1 01CHLOROETHYLENE
6E-02
41
01CHLOROMETHANE
3E-01
51
2,4 DINITROTOLUENE
1E-02
54
EP1CNLOROHYDRIN
4E-01
56
ETHYLENE OXIDE
1E-02
61
HEXACHLOR08ENZENE
2E-03
62
HEXACHLOROBUTAD1ENE
5E-02
63
HEXACHLOROETHAME
3E-01
68
PENTACHLORONITR08ENZENE
1E-02
97
1.1,2,2 TETRACHIOROETHANE
2E-02
106
1,1,2 TRICHLOROETHANE
6E-02
107
TRICHLOROETHELYNE
3E-01
108
2,4,6 TRICHLOROPHENOL
2E-01
111
VINYL CHLORIDE
2E-01
• RSOt war* calculated using scorn developed by the Cancer
Auesaaant Grotp to result in a 106-4 lifetime risk.
Source: RSDs derived fro* data presented in EPA aenorandui dated
April 13, 1987 fraai Narcia Williaa, Director, Office of
Solid Waste, to Oavid Wegener, Director, Waate Management
Division, Region VII. Neaorandui Iistsd Agency-established
MCLs, RfOs, and RSDs based on the Integrated Risk Information
Systea (IRIS).
-------
B-10
Reference Dose (RfD) based concentrations used in the analysis are listed
in Exhibit B-5. Reference Doses (RfDs) are "acceptable" exposure levels that
have been established and verified by EPA for many noncarcinogens (analogous
in concept to the Acceptable Daily Intake, or ADI). An RfD represents the
level of exposure which is not likely to result in any adverse effects to
human health. An RfD is calculated by using an uncertainty factor to adjust a
"no observed adverse effect level" (NOAEL). RfDs are reported in mg/kg/day.
However, we have converted appropriate RfDs to concentration levels (og/1 for
use in this analysis) assuming a water consumption rate of 2 liters per day
for a 70-kilogram adult over a 70-year lifetime.
Risk-based Concentration Levels were also calculated for use as triggers
for constituents for which there were no MCLs, RfDs, or RSDs. For
carcinogens, the concentration levels are based on a 10*^ risk (as calculated
by the LLM). For noncarcinogens without an Agency-approved potency factor, we
approximated an effects threshold by calculating the dose associated with a
10~*> risk level, which provides a better approximation of the NOAEL than a
10"^ risk level. The approximation is done using a continuous dose-response
function for non-carcinogens incorporated in the Liner Location Model.^ These
concentration values are listed in Exhibits B-6 and B-7.
The RIA employed corrective action triggers, similar to the action levels
included in the proposed rule, to determine the year in which corrective
action begins, if at all at a specific facility. In general, the health-
based concentrations used to trigger corrective action under Options B, C and
D in the RIA are the same concentrations used as action levels under the
proposed rule. Differences in the RIA corrective action triggers and the
proposed rule action levels are due to several reasons:
¦ For carcinogens without MCLs or Agency-approved
potency factors, the risk-based concentration
level is based on a 10"^ risk level as
calculated by the LLM rather than the 10'^ risk
level used for the proposed rule action levels.
¦ Constituent-specific health data are constantly
updated, and the corrective action triggers used
for the RIA were developed using available data
in August 1987.
¦ For constituents where the detection limit is
greater than the health*based concentration
level, the detection limit is used in the RIA to
trigger corrective action.
^ See U.S. EPA Draft Report, "Appendix D to EFA's Liner Location Risk
and Cost Analysis Model, January 1985."
-------
B-11
EXHIBIT B-5
REFERENCE-DOSE BASED CONCENTRATIONS IN WATER
»I0 llM
Concantrat ion
Laval*
Conatituant t»fl/l)<1}
4 ACETONE 46*00
8 ALOICAM SE-02
9 ALLTL ALCOHOL 26-01
11 AMTINONT IE-02
11 Ml nm 2E*00
21 IIS{2tHP) 7E-01
23 CJUtlON 01SULF IDE 4E*00
24 CABION TETRACHLORIDE 3E-02
29 CKLOROAHE 2E-03
27 CHL0A06ENZENE 1E-00
28 CHLOROFORM 3E-01
30 CHKKtUM 4t«01
53 CTAMIDES 7E-01
39 1,1 OlCHLOftOCTHTLENE SE-01
41 sichlorocthame 2e*co
4) 2.4 0ICHLOROPNEMOC IB-01
47 DIKTMOATt 71-01
52 OiaOSEB 41-02
54 EPICHtOROHTQRIH 71-02
u etnubenzene «•«
58 FLUOR IDES 2E*00
62 HEWCHLOROaUTAOIMC 71-02
64 NMACHLOROCrCLOPEMTAOlEM 2E-01
« LIMOANE 1E-02
72 METHANOL 21*01
7J NCTNCMTL 9E-01
73 ICTHTL ETNTL aTOKE »«oo
74 «rmrL isoauTTL aroM 2E*oo
13 MtTROHUtM 21-02
8S PHIACNLOROatTtOMUM 3E-01
89 POTACHLOROPKIJO. 1E*00
90 PNUOl 11*00
94 PTRIOIM 71-02
9B TfTIACMLOKKTNCM 71-01
too rouM 1t*01
104 1,2,4 TtlCNLOaOUMnC 71-01
105 1,1,1 TIICMLOROmuat JE*00
io» 1,1,2 ritCHLoraiTwwE 21-01
110 VAMOIUM 7l"01
115 TTE-LIAD Jt-06
116 ii run 4i*oi
119 umttl* 21-01
(1) Concantration valuta for Aepandl» !> conatituant* oetalnad traa EPA aaanranaa
da (ad April 13, 1987 froa Morel* Ullllaaa, Olroetor, Offtca of Soda «•*<• ta
Oavid uasonar, 6tractor, waata Manaawant Olvlatan, Raglan vli. Haaji wttm
liaiad Agancy aatabtiiMd HCLi, RfOa, ard RED* buad on tlx Intagratad llu
Information lyitd (lilt). Coneantratlon valun for non-lepandi 1 IX eonatltuanti
aeztirrnd frm (M lilt dita Mm. eonatltuant* aodalad for tfci* Minn
art alMHi bvra; (fCa da aalat for othar conatItu*nt».
-------
B-12
EXHIBIT B-6
TTM CALCULATED 10E-4 RISK CORCEHTKATIOHS H» WATER FOR CARCINOGENS
Concentration Resulting
In 10E-4 Risk Level
Constituent
-------
B-13
EXHIBIT B-7
LLM CALCULATED 10E-6 RISK CONCENTRATIONS IN WATER FOR NONCARCINOGENS*
Cone «ntr«tion R**ulting
In 10E-6 R1ik Lavwl
Constituent (aa/l)
3
ACETALDEHYDE
4E*00
5
ACETONITRILE
8E-01
6
ACROLEIN
4E-02
18
BENZOTRICKLORIDE
2E-02
19
BENZYL CHLORIDE
8E-01
26
CHLOROACETALDEHYDE
9E-03
29
2-CHLOROPHENOL
6E-01
32
COPPER
1E*00
34
CYCLOHEXANE
te*oo
36
1,2 DICHLOROBENZENE
3E*00
40
1,2 0ICHL0R0ETHENE
1E*00
44
1,3 0ICHLOROPROPENE
2E-02
46
2,6 OICHIOROPMEMOL
1E-MJ0
48
DIMETHYL ALKYLAMINE
2E-01
49
2,4 OINETHYLPHENOL
7E-02
50
1,3*0INITROBENZENE
28-01
53
ENDOSULFAN
8E-01
59
FORMALDEHYDE
7E-02
65
HEXANE
7E*O0
66
HYDROQUINONE
1E-01
TO
MALE1C ANHYDRIDE
48*01
74
NETMYL CHLORIDE
9E-01
77
KTNYL ISOCTAJUTE
2E-02
78
NETNYL ICTHACRYLATE
1E*01
79
MOLYBDENUM
36-03
80
NAPHTHALENE
1W1
81
NAPHTHOQUINONE
1E-01
82
NICKEL
48-02
84
4-NlT*0PttM0l
48-01
85
PARALDEHYDE
48*00
86
PARATHION
78-05
91
PHORATE
38-04
92
PNTHALIC ANHYDRIDE
48*01
93
2-PR0PAM0L
1E-01
96
1,1,1,2 TETRACHLROFT
58*00
99
THALLIUM
1E-02
109
246-TRlNlTROTOLUOIE
88-02
112
XYLENE
28*00
113
ZINC
38*00
118
KDIUM
78*01
* Used to approxinaee "No observed adverse effect level."
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B-14
B.4 TBTGCKRS FOR BASELINE SCENARIO AND REGULATORY OPTIONS
Different corrective action triggers are employed under the baseline
scenario and four regulatory options analyzed in the RIA. Chapter 6 of the
RIA details the four regulatory options considered in the analysis. Below we
discuss the triggers used for the baseline scenario and regulatory options.
Baseline Scenario employs MCLs as well as detection limits as corrective
action triggers. These values are displayed in Exhibit B-8. Prior to the
establishment of HSWA, facilities were required to clean up to either
background levels or MCLs. This alternative used MCLs as triggers when
available. Otherwise, detection limits were used. (All MCL concentrations
exceed the respective detection limits.) Implicit in the use of detection
limits is an assumption that there are no background contaminant
concentrations. A facility must release sufficient quantities of waste to
cause contaminant concentrations in ground water to exceed detection limits
and thereby trigger corrective action.
Option A (Cleanup to Background) used detection limits as corrective
action triggers. A list of these detection limits are provided in Exhibit
B-8. (PQLs were used when they existed.)
Options B. C. aiy< p f n1"e Cleanup to Health-Based Standards.
Deferred Cleanup to Health-Based Standards, and Exposure-Based Approach) used
Agency-approved detection levels to trigger corrective action. Exhibit B-8
identifies the constituent concentrations used as corrective action triggers
for these options. The Agency considered MCLs to be the controlling health-
based standards. Under Options B, C, and D, these MCLs are used as corrective
action triggers.
Of the remaining 100 constituents (two constituents were not modeled), 40
constituents used RSDs or RfD-based concentration levels as corrective action
triggers. Specifically, corrective actions were triggered by RSDs for 14
constituents, and 26 constituents used RfDs as triggers. Some of the
constituents are carcinogens as well as systemic toxicants and have associated
RfDs, as well as RSDs. In those cases, we decided to use RSDs as corrective
action triggers. This decision was based upon Agency policy. For
carcinogenic constituents without Agency-approved levels, triggers were set at
risk levels of 10"^ using LLM potency factors. For noncarcinogenie
constituents without Agency-approved levels, triggers were set at 10~& risk
levels to approximate the no observed adverse effects level.® Ue assigned
these concentration values as triggers for 40 constituents. Detection limits
were used as corrective action triggers for 20 constituents. This resulted
from the detection limit being higher than the appropriate RSD, RfD, or
calculated LLM 10'^ or 10"^ risk level.
8 U.S. EPA Draft Report "Appendix D to EPA's Liner Location Risk and
Cost Analysis Model, January 1985."
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B-15
EXHIBIT B-8
flASKI.THB SCENARIO AND FOCR REGULATORY OPTIONS
Baseline
Option A
Option* B,C,0
Constituents
1 ACENAPTHENE
2 ACENAPHTHYLENE
3 ACETALDEHYOE
4 ACETONE
5 ACETONITRRE
6 ACROLEIN
7 ACRYL0N1TRILE
8 ALD1CAR8
9 ALLYL ALCOHOL
10 ANILINE
11 ANTIMONY
12 ARSENIC
13 BARIUM
U BENZENE
15 BENZO(A)ANTHRACENE
16 BENZ0(A)PYRENE
17 8ENZ0(B)FLU0RANTHENE
18 BENZOTR1CHLORIDE
19 BENZYL CHLORIDE
20 BIS(CHLOROKETHYL)ETHER
21 BIS(2)ETHYLEXYL PHTHALATE
22 CADMILM
23 CARBON DISULFIDE
24 CARBON TETRACHLORIDE
25 CHLORDANE
26 CHLOROACETALDEHYDE
27 CHL0S08ENZENE
28 CHLOROFORM
29 2-CHLOROPHENOL
30 CHROMIUM VI
31 CHRYSENE
32 COPPER
33 CYANIOES
34 CYCLOHEXANE
35 01BE WO (A,H) ANTHRACENE
36 1,2 DICHLOROBENZENE
37 1,4 DICHLOR08EKZENE
38 1,2 0ICHL0R06THANE
39 1,1 DICHLOROCTHENE
40 1,2 DICHLOROCTHENE
41 D1CHL0R0METHAME
42 1,2 DICHLOSOPROPANE
43 D1CHLOROPROPANOLS
44 1,3 OICHLOROPRQPENE
45 2,4 OICMLOMPHENOL
CA
Triggers
-------
B-16
hh I BIT B-8 (Continued)
BASPJHK SCKHABTO ASD FOUR REGULARS? OFTIQ0S
Bm«Ki
rw
Option
A
Option
• B,C,0
CA
Source
CA
Source
CA
Source
Triggers
For
Triggers
For
Triggers
For
Constituents
(mg/l)(1)
Trigger
01
NOAEL Approx.
-------
B-17
EXHIBIT B-8 (Continued)
BASKIJBK SCENARIO AHD POOR. REGULATORY OPTIONS
Baselir*
Option A
Constituents
CA
Tr\ocers
(¦g/UCI)
Source
For
Trigger
CA
Triggers
(¦8/1X2)
Source
For
Trigger
Optic
CA
Triggers
-------
B-18
Recently, the Agency revised several constituent health-based action
levels and presented these new levels in the preamble to the proposed
Corrective Action Rule. Their constituent action levels from the preamble
were compared to the trigger levels for opcions B, C, and D of the RIA, and,
in general, these levels were found to be consistent. The discrepancies that
were found can in large part be explained by the RIA's use of detection limits
when the health-based triggers are below the detection limit, and the RIA's
use of a carcinogenic risk level of 10"^ versus the proposed rule's use of
10"^ or 10"® risk levels. In addition, a few differences arose because some
of the constituent RSDs and RfDs obtained from the April 13, 1987 EPA
Memorandum from Marcia Williams, Director, Office of Solid Waste to David
Wagoner, Director, Waste Management Division, Region VII have been revised.
The Agency has also issued entirely new RSDs and RfDs for several
constituents. These updates and additions, however, lead to a difference of
more than one order of magnitude in the trigger level for three of the 120
constituents modeled: endosulfan, heptachlor and xylene.
-------
APPENDIX C
METHODOLOGY FOR ECONOMIC IMPACT ANALYSIS
This appendix presents the methodology developed for the economic impact
analysis portion of the corrective action RIA. The appendix is divided into
four sections. Sections C.l, C.2, and C.3 present the preliminary analyses
used in the Monte Carlo simulation. First, Section C.l describes ICF's
firm/facility/financial data base (F3DB), which provides extensive information
on owners of hazardous waste treatment, storage, and disposal facilities.
Next, Section C.2 outlines the methodology developed to determine the weighted
average cost of capital (WACC) used in our financial analysis. Section C.3
provides a summary of the ability-to-pay analysis used in the Monte Carlo
simulation. Finally, Section C.4 details the steps performed in the actual
Monte Carlo model.
C.l FIBM/FACIL1TY/FTNAHCIAL DATA BASE (F3DB)
The firm/facility/financial data base (F3DB), a computerized data system,
provides easy access to financial and ownership data concerning owners of
active treatment, storage, and disposal facilities (TSDFs). This system links
data on active TSDFs obtained from EPA's Hazardous Waste Data Management
System (HWDMS) with data on the owners of the TSDFs. The F3DB identifies TSDF
owners based on data from the HWDMS that has been verified using public and
private financial services. The data base also provides information, obtained
from various financial sources, on the finances and ownership of firms that
own TSDFs. For many firms, complete financial data were not available; we
imputed financial variables for these firms.
The purpose of this section is to provide detailed documentation of che
sources used to develop the firm/facility/financial data base and the
methodology used to impute financial variables where data were unavailable.
This section is divided into five main subsections: C.l.l briefly describes
the data base, C.1.2 presents an overview of the data sources used, C.l. 3
outlines the imputations methodology, C.l.U lists and describes the F3DB data
elements, and C.l.5 discusses the limitations of the F3DB.
C.l.l Overview
This subsection identifies the types of facility, facility ownership,
firm ownership, and firm financial data contained in the F3DB. The subsection
also presents a breakdown of the current ownership and financial status of the
firms in the data base.
C.l.1.1 Facility Data
The firm/facility/financial data base includes the 4,958 facilities
defined as active TSDFs on EPA's Hazardous Waste Data Management System
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C-2
(HWDMS) in October 1986. For most of the facilities in the data base, the
following data are included:
¦ Facility name;
¦ EPA facility ID number;
¦ Facility address;
¦ Facility latitude and longitude; and
¦ Facility process codes (i.e., storage or
treatment tank; container; waste pile; landfill;
land treatment; treatment, storage or disposal
surface impoundment; incinerator; ocean
disposal; underground injection well; other
treatment).
C.l.1.2 Ownership and Financial Data
For most facility owners, the data base contains:
¦ The name and owner type (i.e., publicly- or
privately-owned firm; federal, state, or
municipal government; non-profit; bankrupt;
discontinued operations) of the immediate owner;
¦ The name and owner type of the ultimate owner
(i.e., corporate parent), if applicable.
Consistent with the definition of corporate
parent used for the 40 CFR Part 264 Subpart H
financial assurance regulations, an ultimate
owner must own 50 percent or more of the
immediate owner's voting stock.^ If a corporate
parent is foreign based, we have indicated that
the facility has a foreign ultimate owner but
have included financial information for the top
domestic corporate parent.
¦ Selected financial variables for the latest year
that data are available:
Net income;
Net worth;
Current assets;
Current liabilities;
1 40 CFR Sections 264.141(d) and 265.141(d) define parent corporation a
"a corporation which directly owns 50 percent of the voting stock of the
facility which is the facility owner or operator."
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C-3
Total assets;
Total liabilities;
Depreciation, depletion and amortization;
Tangible net worth;
Cash flow;
Net working capital;
Common equity, ticker symbol, and
auditors opinion for publicly-held
firms only;
¦ The date of the financial information;
¦ The company's fiscal year end date;
¦ The company's Standard Industrial Classification
(SIC) Code;
¦ The number of TSDFs owned by each firm;
¦ The year in which the company was founded; and
• The number of employees.
C.l.1.3 Status of TSDFs in the Data Base
Ownership Status. The data base currently includes 4,958 facilities
identified as active TSDFs on the October 1986 KWDMS, classified as follows:
¦ 1,928 are owned directly by publicly-held firms;
¦ 2,340 are owned directly by privately-held
firms;
• 139 are owned directly by bankrupt firms;
¦ 133 are owned directly by firms with
discontinued operations;
¦ 7 are owned directly by non-profit firms;
¦ 291 are owned directly by the Federal
government;
¦ 53 are owned directly by State governments; and
¦ 67 are owned directly by municipalities.
For the 4,540 facilities owned by the private sector (i.e., all TSDFs
excluding those owned by Federal, State, or municipal governments, or non-
profit firms), we have identified 2,305 immediate owners. Ve have also
identified 484 corporate parents or ultimate owners of immediate owners which
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C-4
do not directly ovm any active TSDFs on the data base. Approximately one-
third of all immediate owners (i.e., 735 of the 2,305 firms) are subsidiaries
of private sector parent companies. The ownership status of the 2,789 firms
currently included on the F3DB may be broken down as follows:
¦ 535 firms are publicly held;
¦ 2,027 firms are privately held;
¦ 8 firms are non-profit;
¦ 96 firms are bankrupt; and
¦ 123 firms have discontinued operations.
Financial Status. The F3DB contains financial data on 2,222 of the 2,562
solvent public or privately held firms. Financial information is not included
on the data base for 227 firms which have been identified as either bankrupt,
discontinued operations, or non-profit, as well as an additional 340 firms for
which we have not obtained financial data. Of these 340 firms, 27 are
f\ *
publicly held and 313 are privately held.
C.1.2 Data Sources
This subsection describes the various data sources used to compile the
F3DB. The ownership and financial data gathered from these sources have been
entered directly into the data base. Vhere the required data were missing
from these sources, the available data have been used to assist in the
imputation of missing values.
C.1.2.1 Ownership Characteristics
Ownership information, obtained from HWDMS for each of the TSDFs, has
been checked and verified using Standard & Poor's Compustat financial
services, Business Information Reports (BIRs) from Dun & Bradstreet, the
Directory of Corporate Affiliations, the Wall Street Journal. Mergers
Acquisitions. Corporate Action, and other financial newspapers and magazines.
Ownership information not available on HWDMS has been researched and
collected. For example, for facilities whose immediate owners are
subsidiaries of other firms, ownership information has been provided on their
direct corporate parents and, if the parents are also subsidiaries, ownership
information has been provided for the highest domestic-based corporate
entities associated with the immediate subsidiary owners.
^ Dun & Bradstreet is unable to provide financial data on 123 privately
held firms. For the remaining privately held firms, we are currently imputing
financial data where firm-specific data are not included in the BIRs.
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C-5
C.l.2.2 Financial Characteristics
We obtained financial data for all publicly-held firms from Compustat
Data were based on fiscal year-end financial statements filed with the SEC
Financial information for privately-held firms was obtained from BIRs where
available. Where data were not available, we have imputed financial
variables. BIRs do not supply a figure for "depreciation, depletion and
amortization"; therefore, this figure has been imputed in all instances for
facilities owned by private firms.
C.1.2.3 Data Sources Used for Imputations
Where financial variables were not available from the BIRs. the
information for private firms has been imputed using three sources: Dun &
Bradstreet Industry Norms (D&B Norms), Robert Morris Associates Annual
Statement Studies (RMA), and Ward's Directory of 49.000 Private U.S. Companies
(Ward's). Each of these sources is briefly described below:
¦ Robert Morris Associates Annual Statement
Studies (RMA) is published by Robert Morris
Associates, a national association of bank loan
and credit officers. It contains composite
financial data for manufacturing, wholesaling,
retailing, services, and contracting industries.
RMA collects a large sample of firms' financial
statements for various SIC codes. The data are
averaged and grouped into four asset-size
categories ($0-1 million, $1-10 million, $10-50
million, and $50-100 million). Not all SIC
codes are represented in RMA.
¦ Dun & Bradstreet Industry Norms (D&B Norms) have
been used to supplement RMA when the appropriate
SIC code was not available. Like RMA. n&R Norms
consist of industry averages presented by SIC
code by asset size. However, D&B Norms contains
fewer size categories than RMA.
¦ Ward's Directory of 49.000 Private U.S.
Companies (Ward's) includes sales information
for a large group of small privately-held
companies of approximately $1-10 million in
annual sales in 21 manufacturing and 37 non-
manufacturing SIC industry categories. Sales
information for parent companies of
subsidiaries, divisions, groups, Joint ventures
and affiliates are provided, regardless of size.
The directory provides data on the latest sales
figures, address and phone number of the firm,
name of the chief executive officer, and number
of employees by sales size within their
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C - 6
respective SIC codes. Aggregate data on total
assets and total number of employees are
provided by SIC code. Ward's generally does not
supply information on small firms with fewer
than 100 employees.
C. 1.3 Imputations Methodology
Where complete financial data were not available for private firms, we
have imputed financial variables using industry-average data from RMA and D&B
Norms. This subsection first discusses our approach for imputing financial
variables and then presents the formulae used for most imputations.
C.1.3.1 Approach
Our overall objective in imputing financial values was to derive a value
as close to the actual firm's financial conditions as possible within the data
constraints. Therefore, we have derived missing variables from the
application of accounting and mathematical identities to the available firm-
specific data wherever possible. The following are some of the accounting and
mathematical Identities included on balance sheets that have been used to
impute missing financial variables:
1. Total Assets - Total Liabilities + Net Worth;
2. Total Assets - Current Assets + Fixed Assets +
Other Assets;
3. Total Liabilities - Current Liabilities + Long
Term Liabilities; and
4. Net Worth - Capital Stock + Paid-in Capital +
Retained Earnings.
For example, using identities 1 and 3 above, we have derived total assets
as the sum of current liabilities, long tern liabilities, and net worth, if
all three financial variables were known. As will be discussed next, these
accounting identities were also used in our imputations formulae.
For variables that could not be derived from accounting or mathematical
identities due to limited firm-specific data, we have imputed values by
applying industry-average ratios of financial variables to the data that were
available. In order to impute values that reflect as closely as possible the
firm's actual financial conditions, we have used industry-average data from
RMA or D&B Norms that corresponded to the industry SIC code where the firm had
a large percentage of its business (i.e., the primary or secondary SIC code),
and to the firm's asset size. The firm-specific SIC codes were available from
the BIR. If it was not possible to determine the appropriate asset size
category, we have used average data for all asset sizes for the SIC code that
corresponded to the one in which the company had a large percentage of its
business.
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C-7
Exhibit C-l illustrates a sample page of industry-average data from RMA
for firms with $1-10 million in assets in SIC #8541 (machine tools and metal
working equipment). As shown in the exhibit, for this group of firms, total
current assets are 62.4 percent of total assets. Therefore, where firm-
specific data for total assets were available for a firm in SIC #8541 with $1-
10 million in assets, we were able to impute current assets using RMA
industry-average ratios.
Finally, for firms for which no firm-specific data were available, we
have imputed financial variables from the industry-average sales figure for
that company's largest business sector.
C.l.3.2 Imputations Fonuloe
The following presents seven cases in which formulae have been used to
impute financial variables in the firm/facility/financial data base. The
formula used for a particular imputation depends on the amount of firm-
specific financial data that was available from the BIRs. The seven cases are
presented by decreasing availability of financial data. For example, in Case
I, all but one of the financial variables are available from the BIR: Case VII
describes the steps we have used to impute data when no firm-specific
financial information is available from the BIR. The seven cases are
described below.^
Case I -- The BIR provided all of the financial data •• i.e., net income,
net worth, current assets, current liabilities, total assets, and total
liabilities -- except for depreciation, depletion, and amortization (DD&A).
DD&A has been imputed by multiplying the company's sales figure by the ratio
of DD&A to sales (see (7) in Exhibit C-l for an example of this ratio). BIRs
never include DD&A figures. Therefore, this imputation method has been used
for all imputations in addition to any others that were required.
Case II - - Either (a) the BIR contained all of the financial information
except total assets, or the BIR contained all financial data except net
income, but included two years of complete data for all other variables
including net worth. In the first case, total assets have been derived by
adding current assets, fixed assets, and other assets. In the second case,
the company's net income has been derived by subtracting the net worth of the
previous year from the current year's net worth. This method has been used
only where data from the BIR suggested that a change in retained earnings was
the primary cause for a change in net worth. Ue have also examined trends of
the firm and other firm-specific data for this imputation.
Case III -- The BIR contained the following financial data: current
assets, current liabilities, fixed assets, other assets, and net worth. Net
^ The following cases assume that the imputations are based on industry-
average data from RMA. The formulae used for imputing with D&B Norms are
slightly different.
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C-8
EXHIBIT C-l
SAMPLE DATA FROM RMA FOR SIC CODE #8541 (42, 45)
MACHINE TOOLS AND METAL WORKING EQUIPMENT*
1-10 Million Asset Size Column
Ratios
Assets:
Cash
8.2
Accounts Receivable
23.4
Percent Profit Before Taxes/ 7.9
Inventory
28.4
Tangible Net Worth (5)
Other Current
2.5
Total Current (1)
62.4
Fixed Assets
29.7
Sales/Total Assets (6) 1.5
Intangibles
1.0
Other Non-Current
6.9
Total Assets
100.0
Liabilities:
Percent Depr., Depl., 3.4
Notes Payable
8.7
Amort./Sales (7)
Cur. Mat L/T/D
3.7
Accounts Payable
11.7
Accrued Expenses
7.2
Other Current
5.2
Total Current (2)
36.5
Long Tern Debt
15.7
Other Non-Current
1.8
Net Worth/(Tot. Liab. + N.tf.)(3)
46.1
Total Liabilities and Net Worth
100.0
Income Data:
Net Sales
100.0
Cost of Sales
72.7
Gross Profit
27.3
Operating Expenses
26.5
Operating Profit
0.8
Other Expenses
1.2
Profit Before Taxes (4)
-0.4
* Numbers in parentheses refer to text.
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C-9
worth has been used to impute net income and the other missing financial
variables. Net income has been imputed by multiplying net worth by the ratio
of. profit before taxes to tangible net worth (see (5) on Exhibit C-l). The
product is equal to imputed profit before taxes. We have applied a 46 percent
tax rate to derive after-tax profit -- i.e., net income. We have derived
total assets by adding fixed assets, current assets and other assets from the
BIR. Where fixed assets, current assets, and other assets were not available,
we have imputed total assets by dividing current assets by the ratio of
current assets to total assets (see (1) on Exhibit C-l). Where current assets
were not available, total assets have been imputed from net worth by dividing
net worth by the ratio of net worth to total liabilities plus net worth (see
(3) on Exhibit C-l). Where current assets were not available, current assets
have been imputed by multiplying imputed or derived total assets by the ratio
of current assets to total assets (see (1) on Exhibit C-l).
Current liabilities have been imputed using the following formula:^
Ratios enclosed in brackets have been taken directly from RMA (see (2) and (3)
on Exhibit C-l).
Case TV -- The BIR Included only sales data. In this case, sales data
have been vised to impute missing financial variables. To impute net income,
sales has been multiplied by the percentage ratio of profit before taxes to
sales (see (4) on Exhibit C-l). The result is imputed profit before taxes.
To adjust to an after-tax basis, we have applied a 46 percent tax rate to
derive imputed net income.
Net worth has been derived from imputed net income. First, the
percentage ratio of profit before taxes to tangible net worth (see (5) on
Exhibit C-l) was multiplied by 54 percent to adjust to an after-tax basis.
Imputed net income was then divided by this ratio to produce imputed net
worth.
Because current assets and net worth were not available, total assets
have been imputed by dividing sales by the ratio of sales to total assets (see
(6) on Exhibit C-l). Total liabilities have been derived by subtracting
imputed net worth from imputed total assets. Current assets, current
liabilities, and DD&A have been imputed in the same manner as in Case III.
Current Liabilities - Total Liabilities x
rCurrent Liabillties/fTotal Liabilities + Net Worth)!
1 - [Net Worth/(Total Liabilities + Net Worth)]
4
rcLfTL+mm _ tl x (cl/ta)
CL - TL x I . NW IA . EH
CL/TA
TL/TA
(TL+NW) TA TA
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C-10
Case V - - The BIR contained at least three months of interim data and the
fiscal ygar end date was known. Interim balance sheet variables have been
incorporated into the data base directly from the BIR without modification
Balance sheet variables (i.e., net worth, total assets, total liabilities,
current assets, and current liabilities) report the financial position of a
company at a particular point in time; therefore, their validity is the same
whether the data pertain to an interim period or the fiscal year end. Annual
sales, net income, and DD&A figures have been extrapolated to the fiscal year
and based on the interim figure. Where sales, net income or DD&A were not
available from the BIR. they have been imputed using the same methods
described in Cases III and IV.
Case VI -- The BIR contained no firm-specific financial information but
provided the pnmhpr of employees and SIC code. Financial variables have been
imputed from the firm's sales figure if it was available from Ward's. If
sales data were not available from Ward's. the average value of sales per
employee figure for the applicable SIC code included in Ward's has been used.
This figure has been multiplied by the number of employees to obtain an
estimate of sales for that company. For the remainder of the variables, the
approach described in Case IV has been used.
Case VII -- The BIR reports only the company's SIC code. In these cases,
a sales figure has been assigned by obtaining the average sales figure for
that SIC code from RMA. Average sales has been obtained by dividing net sales
for all companies by the number of firms within the SIC code. This produces
an industry average sales per firm figure, which has been used to impute the
other variables as described in Case IV.
C. 1.4 Data. Eleaents
This subsection lists and describes the elements of the F3DB as found on
a display or printout of the database.
C.1.4.1 TSDF Ownership and Financial Data on the Fira/Facility /Financial
Data Base
The following data elements are included on the firm/facility/finaneial
data base:
¦ TICK is the ticker symbol for the owner firm. Tickers for publicly-held
firms are provided by Securities & Exchange Commission filing lists.
Tickers for privately held firms are assigned sequentially.
¦ SEQNO is the sequence number of the ticker symbol for the immediate owner
firm, used to identify multiple subsidiaries of a parent firm. Each
subsidiary of a firm will have a unique SEQNO; the TICK for the
subsidiary will be that of the parent. A SEQNO with a zero value
indicates a firm with no corporate parent. Such a firm may or may not
have subsidiary firms.
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C-ll
INTERSEQ is the sequence number of the ticker symbol for the direct
parent of the immediate owner.
IMMEDNAM is the immediate owner name. An immediate owner name
accompanied by a blank ultimate owner name identifies a firm that has no
corporate parent.
INTERNAM is the direct parent owner name. A facility with a parent is
always accompanied by an immediate owner and an ultimate owner name. The
ultimate owner is the highest domestic-based corporate entity associated
with the immediate and the parent owners. Tickers and sequence numbers
are derived from the ultimate owner.
ULTNAM is the ultimate owner name. If there is no direct parent between
an immediate owner and an ultimate owner, then the ultimate owner is the
direct parent of the immediate owner. An ultimate owner can own
facilities directly (i.e., in some cases it will be an immediate owner),
or indirectly through its subsidiaries.
OWNTYP is the owner type of the firm (1 - Federal, 2 - State, 3 -
municipal, 4 - public firm, 5 - private firm, 6 - nonprofit firm, 7 -
bankrupt firm, 8 - discontinued operations).
JOINTOWN flags subsidiaries with joint owners (i.e., two parents that
each own 50 percent of the subsidiary). If a subsidiary has joint
owners, then JOINTOWN - "Y".
FCID is EPA's 12-digit facility identification number. The first two
digits are the abbreviation for the State in which the facility is
located.
F0R0VN flags firms which have foreign parents. If a firm has a foreign
parent, then F0R0WN - "Y".
FORNAM is the name of the foreign owner identified by the F0R0VN flag.
Financial data for foreign owners are not included.
FACNAM is the name of the facility associated with a specific FCID.
FIRMDATE is the year the firm came into existence. (Available for
private flrns only.) A missing value is represented by a zero.
LOVFAC is the number of facilities owned immediately by a firm.
INFODATE is the date of the financial data. A missing value is
represented by a zero.
FYREND is the month ending the fiscal year for the firm. A missing value
is represented by a zero.
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C-12
EMPLOYE is the number of employees at the firm. (Available for private
firms only.) A missing value is represented by a negative zero.
SIC identifies the firm's primary Standard Industrial Classification Code
taken directly from the BIR or from Compustat.
NETWRT is the net worth value. Net worth is often referred to as
stockholders' equity or owners' equity, and represents the sum of paid-in
capital, or the stated value of the capital, including both common and
preferred stock, retained earnings, and appropriated surplus. A missing
value is represented by a negative zero.
NWFOOT is the footnote indicating method of imputation for the net worth
value, if the net worth value has been imputed. If net worth has not
been imputed, NWFOOT is blank.
TOTASS is the total assets of the firm, representing total liabilities
plus net worth. A missing value is represented by a negative zero.
TAFOOT is the footnote indicating method of imputation for total assets,
if total assets have been imputed. Otherwise, TAFOOT is blank.
TOTLIB is the total liabilities of the firm. TOTLIB is set equal to
TOTASS minus NETWRT.
CURASS is the current assets of the firm. Current assets include those
tangible assets that can be readily turned into money (e.g., cash on
hand). A missing value is represented by a negative zero.
CAFOOT is the footnote indicating method of imputation for the current
assets value, if current assets have been imputed. Otherwise, CAFOOT is
blank.
CURLIB is the current liabilities of the firm. Current liabilities are
short-term liabilities to be paid within one year or less, such as
salaries, taxes due, accrued interest, or accounts payable.
CLFOOT is the footnote indicating method of imputation for the current
liabilities value, if current liabilities have been imputed.
NETINC is the net income value for the firm. Net income, also referred
to as net earnings, represents the difference between total sales and
total costs of goods sold plus expenses over a given period. A missing
value is represented by a negative zero.
NIFOOT is the footnote indicating method of imputation for the net income
value, if net income has been imputed. Otherwise, NIFOOT is blank.
DDANDA is the depreciation, depletion, and amortization value for the
firm. Depreciation reflects the decline in the value of a physical ass
resulting from normal usage and wear; depletion refers to the allowance
-------
C-13
made for the shrinkage or exhaustion of a product, nearly always a
natural resource; amortization of assets is a method of gradually
reducing the book value of a fixed asset by spreading its depreciation
over a period of time, and amortization of debt refers to gradually
retiring an obligation by making regular payments of both principal and
interest over a period of time. A missing value is represented by a
negative zero
¦ DDFOOT is the footnote indicating method of imputation for the
depreciation, depletion and amortization, if DDANDA has been imputed.
Otherwise DDFOOT is blank.
¦ TANNWRT is the tangible net worth value for the firm. If tangible net
worth is missing, then it is set equal to net worth.
¦ CSHFLOW is the cash flow value for the firm. Cash flow, or a firm's net
profits plus allowance for depreciation, is set equal to DDANDA plus
NETINC.
¦ NWCAP is the net working capital value for the firm. Net working capital
is set equal to CURASS minus CURLIB.
¦ TOTDBT is the total debt value of the firm. (Available only for public
firms.) A missing value is represented by a negative zero.
¦ COMEQTY is the common equity value for the firm. (Available only for
public firms.) A missing value is represented by a negative zero.
¦ USAASS represents assets in the U.S. for the firm. (Available only for
public firms.) A missing value is represented by a negative zero.
¦ OPNION is the auditor's opinion of the firm. (Available only for public
firms.) A missing value is represented by a negative zero.
C. 1.4.2 Other Data I teas On The Fixa/Facllity/Financial Data Base
The following data elements are also Included on the firm/facility/
financial data base:
Locatlonal data items:
¦ Facility Street
¦ Facility City
¦ Facility Zip Code
¦ Facility County Code
Facility Owner Street Address
-------
C-14
Facility Owner City
Facility Owner State
Facility Owner Zip Code
Facility Operator Name
Facility Operator Street Address
Facility Operator City
Facility Operator State
Facility Operator Zip Code
Owner/Operator Zip Code
Permit status date items:
¦ RCRA Permit Application or Permit Status
¦ Part £ Flag
¦ Loss of Interim Status Flag
Process code data items:
¦ Permit/Closure Process Indicator
¦ Permit/Closure Process Code
¦ Interim Status Capacity Process Code
C.1.5 F3DB Limitations
The major limitation of the F3DB is that the data base has complete
financial information on owners or operators of only 3,945 facilities, whereas
the total number of facilities is currently estimated to be 5,661. This
limitation arises for several reasons:
¦ The F3DB does not contain information on about
700 facilities. These facilities were not
considered active facilities subject to RCRA at
the time of the last F3DB update; in the
intervening months, EPA has added this group of
facilities to its list of regulated facilities
as tracked by HWDMS. The F3DB has yet to
reflect this change.
-------
C-15
¦ Although government-owned facilities are not
excluded from the corrective action rulemaking,
financial information on government owners or
operators is not available from the F3DB. The
standard measures of ability to pay for firms
are generally inapplicable to government
financial information; for example, a government
does not earn net income, making a cash flow
figure based on net Income impossible to
calculate. The impact of the regulation on
municipalities is, however, discussed in general
terms in the Regulatory Flexibility Analysis
presented in Chapter 11.
¦ Of the 4,540 facilities in the F3DB owned by
private sector firms, the owners or operators of
only 3,945 facilities are actually examined. As
discussed earlier, 272 of these facilities are
owned by bankrupt firms or are discontinued
operations of solvent firms; thus, there is no
current financial information available on the
owners or operators of these facilities. The
other 323 facilities are excluded mainly because
recent changes in facility ownership have made
existing financial information obsolete. These
facilities are owned or operated by a diverse
array of firms, including small firms with
multiple name changes that HWDMS has been unable
to track, as well as very large firms that have
become privately owned through buyouts and do
not publicly disclose financial details.
Therefore, it is not expected that the group of
firms excluded have any particularly unusual
financial characteristics.
Another limitation is that some or all of the financial information for a
portion of the firms examined was not available from data sources that were
consulted; rather, financial information for some privately-held firms were
imputed from industry average data according to SIC code and firm size.5
These imputations represent the best available estimate of financial data for
these firms, but the actual data may vary from the imputed data.
Finally, although the F3DB contains only one year of financial data, a
firm's performance may vary from year to year. Predicting the future impacts
of corrective action costs based on one year of data may affect the accuracy
of our results.
3 Imputations were done for at least one variable for about 79 percent
of firms owning facilities in the data base.
-------
C-16
C.2 METHODOLOGY FOR CALCULATING WEIGHTED AVERAGE COST OF CAPITAL
This section presents our methodology for estimating the weighted average
cost of capital (WACC) used in our analyses. The first part, subsection
C.2.1, describes the procedure we used to estimate the WAAC for the total
economic impact analysis. The second part, subsection C.2.2, provides a
summary of the methodology used to determine the WAAC for the assessment of
small business impacts in the regulatory flexibility analysis.
C.2.1 Weighted Average Cost of Capital -- Total Analysis
This analysis uses a two-step procedure to determine the discount rate,
or real cost of capital, for obtaining present value amounts for corrective
action costs. The first step is to derive the nominal cost of capital for 20
industries representing a substantial percentage of firms in the F3DB using
the standard weighted average cost of capital (VACC) formula. The second step
is to derive a real cost of capital by dividing the estimated nominal cost of
capital by the expected inflation rate.
The 20 industries used to determine a weighted average cost of capital
were chosen based on their relative importance in the F3DB; they represent
over 50 percent of the facilities in the data base. These Industries were
identified by their three-digit SIC codes. Firms in over 100 other industries
own the rest of the facilities; these industries were excluded to simplify the
analysis.
The WACC has been used to estimate the cost of capital for many years.®
As typically derived at the firm level:
VD VE
WACC - Kd (1-t) + Ke
VE + vD vE + vD
where:
VD - Value of long-term debt in the firm's capital structure;
VE — Value of equity (or net worth) in the firm's capital structure;
Kd - Expected cost of debt (this is the same as the bondholders' expected
rate of return);
t - Corporate income tax rate (assumed to equal 34 percent -- the
maximum federal Income tax rate for corporations); and
^ See Richard Brealey, Stewart Myers, Principles of Corporate Finance
(New York: McGraw-Hill, Inc., 1981) pp. 411-415.
-------
C-17
Kg - Expected cost of equity (the same as the shareholders expected rate
of return).
While cost of capital calculations are typically made at the firm level,
this analysis is conducted at the industry level. An industry cost of capital
is merely the aggregation of its component firms' cost of capital. The
estimated industry cost of capital is derived here by finding each variable in
the UACC equation for each firm in an industry and averaging each variable for
input into the equation.
Firm-specific data for the firms within each industry are drawn
primarily from the F3DB and from the Value Line Investment Survey.7
Information from the F3DB is used to calculate the debt and equity weights in
the industry capital structure. For each firm in the F3DB in the SIC codes
examined, the debt and equity weights, or [Vq/(Vj) + Vg)] and [Vg/(Vg + Vp)],
are weighted by that firm's proportion of total assets in the group of F3DB
firms; these weighted debt and equity weights for the component firms are then
added to obtain the industry debt and equity weights, presented in Exhibit
C-2.
These debt and equity weights from data in Che F3DB are in book value
terms rather than market values, which financial theorists suggest using.
However, financial managers, lenders, and credit rating agencies typically
characterize a firm's capital structure in terms of book value weights, it is
believed that the use of book values has little impact on the results.
Having estimated the relative weights for debt and equity, we next
estimated the cost of equity using the capital asset pricing model (CAPM).^
As typically derived at the firm level:
KE - Rf + fi (Rm - Rf)
where:
Kg — Expected cost of equity;
Rf - Expected risk-free rate of return;
7 Value Line, Inc., The Value Line Investment Survey (New York: Value
Line, Inc., 1987).
® J.K. Butters, W.E. Fruhan, Jr., D.W. Mullins, T.R. Piper, Case
Problems in Finance. (Illinois: Richard D. Irwin, Inc., 1981), pp. 106.
^ Brealy and Myers, p. 131.
-------
C-18
EXHIBIT C-2
INDUSTRY DEBT AND EQUITY WEIGHTS
3-digit
SIC Industry Name VE/fVE+VD)
249 Miscellaneous Wood Produces 0.536
281 Industrial Organic Chemicals 0.448
282 Plastics Materials and Synthetic 0.373
Resins, Synthetic Rubber, Synthetic
and Other Man-made Floors, Except
Glass
283 Drugs 0.576
284 Soap, Detergents, and Cleaning 0.436
Preparations, Perfumes, Cosmetics,
and Other Toilet Preparations
285 Paints, Varnishes, Lacquers, 0.460
Enamels, and Allied Products
286 Industrial Organic Chemicals 0.519
287 Agricultural Chemicals 0.464
289 Miscellaneous Chemical Products 0.513
291 Petroleum Refining 0.390
307 Miscellaneous Plastics Products 0.402
331 Blast Furnaces, Steel Units, 0.309
and Rolling and Finishing Mills
347 Coating, Engraving, and Allied 0.446
Services
349 Miscellaneous Fabricated Metal 0.476
Products
367 Electronic Components and 0.487
Accessories
371 Motor Vehicles and Motor Vehicle 0.425
Equipment
372 Aircraft and Parts 0.426
495 Sanitary Services 0.514
516 Vholesale Trade Chemicals and 0.313
Allied Products
739 Miscellaneous Business Services 0.421
VD/(VD+VE)
0.464
0.552
0.627
0.424
0.564
0.540
0.481
0.536
0.487
0.610
0.598
0.691
0.554
0.524
0.513
0.575
0.574
0.486
0.687
0.579
Source: F3DB
-------
C-19
& - A measure of the volatility of the expected return on the firm's
stock relative to the market's volatility; and
Rjj - Expected return on the market portfolio.
We are interested in aggregating an industry's cost of equity rather than
determining that of an individual firm in the industry. Therefore, we
developed an estimate of an industry's beta by aggregating over all
component firms in an industry. Betas for firms listed in the F3DB were
obtained from Value Line.
Betas are only meaningful and available for firms whose stock is publicly
traded. Further, betas are not readily available for all publicly traded
firms. For most industries, therefore, only a very small number of betas
could be obtained for firms in the F3DB. If these betas were used to
calculate industry averages, the results would be subject to substantial error
due to the small sample size.
To alleviate this problem, SIC code-defined industries were matched to
industry groupings in Value Line. The firms in Value Line industries that
were close to the SIC industries were used for obtaining betas for the
industries. The SIC code industries are matched with Value Line industries in
Exhibit C-3. Value Line has many more betas for each industry grouping than
were available for F3DB firms, therefore, the average betas should be more
reliable indicators of the true average among the F3DB firms.
The betas for each firm in the Value Line groupings had to be adjusted
before using them in the weighted average cost of capital formula. Because
each firm is financed with a combination of debt and equity, a stock's beta in
Value Line measures both the financial risk of the firm (the risk of having to
meet interest payments on debt) and the business risk of the firm (the risk
that the business will generate a satisfactory rate of return). However, the
debt/equity structure of the Value Line firms may be very different from the
debt/equity structure of the F3DB firms for which we are estimating a cost of
capital. When averaging betas for Value Line firms to estimate an expected
rate of return, the main concern is the business risk of the industry; the
financing risk depends on Che level of debt firms decide to use and is
unrelated to the business risk. Therefore, we adjust the Value Line betas for
financial risk, then readjust according to the average financial risk of the
F3DB firms.
-------
C-20
EXHIBIT C-3
SIC CODE/VALUE LINE INDUSTRY COMPARISON
i-digit
SIC
Value Line
SIC
Industry Name
Industry Name
249
Miscellaneous Vood Products
Furniture/
Home Furnishing
281
Industrial Organic Chemicals
Chemicals * (specialty)
282
Plastics Materials and Synthetic
Chemicals *
Resins, Synthetic Rubber, Synthetic
(specialty)
and Other Man-made Floors, Except Glass
283
Drugs
Drugs
284
Soap, Detergents, and Cleaning
Household
Preparations, Perfumes, Cosmetics,
Products
and Other Toilet Preparations
285
Paints, Varnishes, Lacquers,
Chemicals *
Enamels, and Allied Products
(specialty)
286
Industrial Organic Chemicals
Chemicals (diversified)
287
Agricultural Chemicals
Chemicals (basic)
289
Miscellaneous Chemical Products
Chemicals * (specialty)
291
Petroleum Refining
Petroleum (Integrated)
307
Miscellaneous Plastics Products
Furniture/Home
Furnishings
331
Blast Furnaces, Steel Units,
Steel (integrated)
and Rolling and Finishing Mills
347
Coating, Engraving, and Allied
Metal Fabricating
Services
349
Miscellaneous Fabricated Metal
Metal Fabricating
Products
367
Electronic Components and
Electronics
Accessories
371
Motor Vehicles and Motor Vehicle
Auto & Trucks;
Equipment
Auto Parts
372
Aircraft and Parts
Aerospace and Defense
(selected)
495
Sanitary Services
Ind. Serves.
516
Wholesale Trade Chemicals and
Chemicals
Allied Products
(diversified)
739
Miscellaneous Business Services
Industrial Services
* Firms within the Chemicals-Specialty Value Line grouping were selected
according to relevant SIC codes.
-------
C-21
To adjust betas for business risk (by "removing" financial risk), each
beta must be multiplied by the ratio of [VE/(VE + VD)].^ The betas are then
averaged for each industry. The average betas for business risk of a given
industry must then be readjusted for the average debt/equity mix of all of the
F3DB industries, thus adjusting the average beta for the average debt/equity
mix in any given industry.
Ue used each industry beta together with the expected excess return on
the market (R^, - Rf) to determine the total industry risk premium. In other
words, the industry premium is measured as the degree to which the overall
market return exceeds the risk-free return, adjusted for the risk of the
industry. The long-term (1926-1976) average excess return on the market of
8.8 percent as measured by Ibbotson and Sinquefield is an estimate of this
expected excess return.^ By use of this value, we assumed that the excess
return is fairly constant over time.
Ue estimated the expected risk-free rate using a government bond rate.
U.S. Treasury debt is considered to be the most risk-free investment available
on the market. An examination of the Wall Street Journal revealed that long-
term government bonds currently provide a yield of about 8.5%.
The last rate needed to calculate the VACC is the expected return on
debt. Ue used a typical return on a long-term medium grade industrial bond.
An analysis of rates of industrial bonds rated BB by Standard and Poor's
suggests this rate is now approximately 11 percent.^
The beta for a firm is a weighted average of the debt and equity
betas: £ firm - £ debt * [VD/(VD +VE) ] + £ equity * [VE/(VE + VD) ] . The beta
for debt, however, is visually assumed to be zero (the returns are guaranteed
barring bankruptcy). Therefore, the equation narrows to & firm - £
equity * [Vg/(Vg + VD)]. The beta from Value Line is the beta of the stock,
or £ equity. The beta of the firm, or the beta that reveals the risk of the
business, is therefore equal to the beta of equity from Value Line multiplied
by the proportion of equity in the value of the firm. See Brealy and Myers,
p. 175.
H R.G. Ibbotson, R.A. Sinquefield, Stocks. Bonds. Bills, and
Inflation: Historical Returns (1926-1978^. (Virginia: Financial Analysis
Research Foundation, 1979), p. 23.
^ This is the average of five 30-year Treasury bonds as found in the
Uall Street Journal. June 22, 1987.
From Standard and Poor's Monthly Bond Book. June, 1987.
-------
C-22
The final step in estimating a real cost of capital is dividing the above
derived nominal cost of capital by an expected inflation rate.^ Value Line
forecasts an average 4 percent annual inflation rate, as measured by the GNP
deflator, over the next three to five years.^ Correspondingly, a 3.5-4.0
percent inflation rate is forecast by the 1987 Economic Report of the
President.^ Thus, we used an inflation rate of 4 percent for this analysis.
Exhibit C-4 presents estimates of the current real cost of capital for
the 20 selected industries. As shown in the exhibit, the average real cost of
capital among all of these industries is 9.49 percent. This is the discount
rate assumed to be used by the universe of firms in analyzing corrective
action costs.
C.2.2 Weighted Average Cost of Capital -- Regulatory Flexibility Analysis
m Methodology for calculating weighted average costs of capital
The regulatory flexibility analysis uses the same two-step procedure as
in Section C.2.1 to determine the cost of capital for discounting corrective
action costs. First, we derive a nominal cost of capital using the standard
weighted average cost of capital formula; second, we derive a real cost'of
capital by adjusting the nominal rate by the expected rate of inflation.
The weighted average costs of capital derived separately for small and
large firms are different from the rate derived for all firms in the economic
impact analysis. Small and large firms may have different discount rates
because the financial risks of the firms may be different; specifically, small
firms may have a higher percentage of debt than large firms because investors
perceive more risk of bankruptcy and, therefore, may be less willing to invest
equity capital in small firms. This difference is reflected in the
calculation of the weighted average cost of capital for small and large firms.
Exhibits C-5 and C-6 show the difference in these calculations.
As in Section C.2.1, the weighted average cost of capital was calculated
using the standard formula by averaging data from key industries. To develop
the costs of capital as shown in the Exhibits C-5 and C-6, we established the
10 most prevalent SIC codes for the large and small groups, and calculated
debt to equity ratios weighted by asset size for Industry. Note that the
industries used for small firms were all represented in the calculation of
^ The equation is: [1 + (Nominal cost of capital/100)]
[1 + (Expected Inflation Rate/100]
15 Value Line. March 6, 1987, p. 1.
Council of Economic Advisors, Economic Report of the President.
(Washington, D.C.: U.S. GPO, 1987), p. 58.
-------
EXHIBIT C-4
WEIGHTED AVERAGE COST OF CAPITAL
UACC • [Vd/tVd»Va))fcK1t) ~ [Va/(Vd»Va)]Ka
Ka • If ~ •(«¦ • If) RI-8.5X «a-Rf«8.8K Kd-IU t-34K Inflation^.OX
SIC
code
Va/(Vd»Va) V4/(V**Vd)
industry
AWE SETA
(VALUE IIIK)
INDUSTRY AVC
KM ADJ
rat DMT
!(!¦•>«)
Ka ¦
Rf*•
NOMINAL
UACC
REAL
UACC
249
¦¦¦¦¦¦¦¦¦¦¦¦¦¦¦¦»*
0.536
0.464
0.79
1.47
12.936
21.436
7.26
14.8S8
10.441
281
0.448
0.552
0.73
1.63
14.344
22.844
7.26
14.242
9.848
282
0.373
0.627
0.73
1.96
17.248
25.748
7.26
14.156
9.765
283
0.576
0.424
0.85
1.48
13.024
21.524
7.26
IS.476
11.035
284
0.436
0.564
0.63
1.44
12.672
21.172
7.26
13.326
8.967
28S
0.460
0.540
0.58
1.26
11.088
19.588
7.26
12.931
8.587
286
0.519
0.481
0.71
1.37
12.056
20.556
7.26
U.161
9.770
287
0.464
0.536
0.72
1.55
13.640
22.140
7.26
14.164
9.773
289
0.511
0.487
0.73
1.42
12.496
20.996
7.26
14.307
9.910
291
0.390
0.610
0.56
1.44
12.672
21.172
7.26
12.686
8.3S2
307
0.402
0.598
0.63
1.57
13.816
22.316
7.26
13.313
8.954
331
0.309
0.691
0.38
1.23
10.824
19.324
7.26
10.988
6.719
347
0.446
0.554
0.59
1.32
11.616
20.116
7.26
12.994
8.648
349
0.476
0.524
0.59
1.24
10.912
19.412
7.26
13.044
8.696
367
0.487
0.511
0.86
1.77
15.576
24.076
7.26
15.449
11.009
371
0.425
0.575
0.69
1.62
14.256
22.756
7.26
13.846
9.467
372
0.426
0.574
0.78
1.83
16.104
24.604
7.26
14.649
10.239
(95
0.514
0.486
0.76
1.48
13.024
21.524
7.26
14.592
10.184
316
0.313
0.687
0.71
2.27
19.976
28.476
7.26
13.901
9.520
739
0.421
0.579
0.76
1.81
15.928
24.428
7.26
14.488
10.084
WEIGHTED AVERAGE
•1 NUMBER Of (IMS IN SIC CODE
u.an 9.«i
-------
C-24
EXHIBIT C-5
WEIGHTED AVERAGE COST OF CAPITAL FOR SMALL FIRMS
ma ¦ (Vd/(Vd»v«)]U<1-t) ~ (V«/34X
Inf latii
**¦4.011
1NOUSTRY
IMXJSTRf AVG
SIC
v«/(Vd»v«) vd/(v**vd>
AVG KTA
KTA AOJ
K* »
NOMINAL
REAL
COM
(VALUE I IK)
for our
•(Ra-Rf)
Rf«8(Ra-Rf> Kd<1
-t)
UACC
UACC
249
0.536
0.464
0.79
1.47
12.936
21.436
7.92
15.165
10.735
281
0.448
0.S52
0.73
1.63
14.344
22.844
7.92
14.606
10.198
286
0.519
0.481
0.71
1.37
12.056
20.556
7.92
14.478
10.075
289
0.513
0.487
0.73
1.42
12.496
20.996
7.92
14.628
10.219
331
0.309
0.691
0.38
t.23
10.824
19.324
7.92
11.444
7.158
347
0.446
0.554
0.59
1.32
11.616
20.116
7.92
13.359
S.999[
367
0.487
0.513
0.66
1.77
15.576
24.076
7.92
15.788
11.331
495
0.514
0.486
0.76
1.48
13.024
21.524
7.92
14.912
10.49?
316
0.313
0.687
0.71
2.27
19.976
28.476
7.92
14.354
9.956
739
0.421
0.579
0.76
1.81
15.928
24.428
7.92
14.870
10.452
WEIGHTED AVERAGE
bt number or rims in sic com
14.329 9.932
-------
C-25
HQUBIT G~6
WEIGHTED AVERAGE COST OF CAPITAL FOR LARGE FIRMS
«cc > tVd/8.5X •a-Kf*8.tt UiUl t-S4X Inflation-^.OX
(NOUSTtr 1N0USTKY AVO
SIC
Vt/(Vd»V«) Vd/(V**-Vd)
AVC SETA
KTA A0J
K« •
NGNI HAL
IEAC
CODC
(VALUE UK)
FOB OCIT
B(Ra-Bf)
Rf*«
-------
C-26
cost of capital in Section C.2.1; moreover, only two industries in the large
firm group were not in the Section C.2.1 calculation, SIC codes 366
(Communications Equipment) and 491 (Electric Utilities).
The only other difference from the Section C.2.1 cost of capital
calculation is the estimated cost of debt. Because small firms have more risk
of bankruptcy, they tend to have higher costs of debt. To accommodate
thisassumption, the cost of debt for small firms was increased by one
percentage point to 12 percent.^
The betas for firms in an industry, as in C.2.1, were adjusted for the
debt/equity ratio of that firm, then averaged for the industry.^-® Next, the
average industry betas were readjusted for the average debt/equity ratio for
firms in the industry. The betas were then multiplied by the market premium
and used in the weighted average cost of capital formula.
Exhibits C-S and C-6 present the calculations. Ve calculated a cost of
capital of 9.932 for small firms and a cost of capital of 9.456 for large
firms. As would be expected, the cost of capital used in Chapter 10 (9.49) is
between the costs of capital developed for small and large firms; the cost of
capital in Section C.2.1 is an average of these two groups.
(2) Methodology for obtaining present value of costs and annualizing
Once the proper discount rates have been established, the costs of
corrective action developed in the analysis may be discounted and annualized
for both small and large firms. We used the annualization period equal to the
period for the corrective action cost flows for each facility, up to a maximum
of fifty years. This is the same approach that was used in Section C.2.1.
C.3 ABILITY TO PAT AHALYSIS
This section is divided into four parts, starting with a discussion of
the types of owners and operators evaluated. Next, we discuss the general
concept of ability to pay, followed by a description of the five ability to
pay rules considered for use in this analysis. In the fourth section, the
five rules are used to test ability of RCRA firms to pay for regulatory costs,
along with a breakdown of the results by Important SIC codes. Based on these
results, we specify an ability to pay test for the financial analysis.
^ It is difficult to estimate the cost of debt for small firms because
it often depends on a firm's relationship with a bank; small firms rarely use
the debt markets. The 12 percent level was deemed appropriate because it is
currently about 3 1/2 points above the prime lending rate, a typical spread
for commercial lenders.
As in C.2.1, the betas were not available for actual firms in the
F3DB, therefore betas were obtained from firms in similar industries providec
by Value Line.
-------
C- 27
C.3.1. Corporate Stxucture -- Types of Owners or Operators Examined
Because many firms that directly own TSDFs are in turn owned by parent
corporations, a key aspect of this analysis is determining which entity will
fund potential corrective action costs when there are multiple layers of
ownership. For example, parent firms may allocate their funds only to
facilities owned directly or they may spread their resources to facilities
owned by their subsidiaries as well. This subsection discusses the
assumptions made in this analysis regarding the resources available from
parent and subsidiary owners of TSDFs.
The F3DB identifies both immediate and ultimate owners of TSDFs. A
facility's immediate owner is defined as the firm that is the direct owner of
the facility. The ultimate owner, if one exists, is defined as the corporate
parent of the firm that owns the facility, or, if the chain of ownership
involves more than one firm, as the firm that is the most senior of the
corporate parents. This analysis tests the ability to pay of immediate owners
only and does not consider the resources of any corporate parent.
Although EPA intends to vigorously pursue corporate parents through
litigation when immediate owners fail to provide funds for corrective action,
the success rate of such activity is difficult to predict. "Piercing the
corporate veil" provided by the legal structure of the parent-subsidiary
relationship and forcing ultimate owners to pay may be a complex and resource -
intensive task. Therefore, our analysis addresses only the ability to pay of
immediate owners.
This approach will, however, somewhat underestimate the number of
facilities for which ability to oav is demonstrated. Some parent firms will
most likely provide financial resources for corrective action at facilities
owned by their subsidiaries.
C.3.2 The Concept of Ability to Pay
A firm's ability to pay for regulatory costs is best defined as the
availability of financial resources to cover those costs. This definition
reveals the approximation inherent in measuring a firm's ability to pay
because the financial resources available to meet regulatory costs may be
evaluated in a number of different ways.
The first step in an ability-to-pay analysis is determining the
appropriate threshold for separating firms that are able to pay from those
that are not. For example, a firm could be considered to have sufficient
reserves up to the point at which it becomes insolvent, i.e., the point at
which it is unable to meet its other cash obligations such as interest
payments and accounts payable. This threshold considers the firm able to pay
only until the obligation induces bankruptcy. In contrast, a firm could be
considered to have sufficient reserves up to the point at which it has
sufficient cash to reinvest to maintain current plant and equipment. This
threshold considers the firm able to pay only until it can no longer sustain-
-------
C-28
its ongoing operations; it is thus likely to be less stringent than the first
measure. Either measure could potentially be a valid indicator of a first's
ability to pay, depending on how one wants to assess the burden on the firm.
Five ability-to-pay rules were examined for potential use in this
analysis. These rules, described in the next subsection, are varied according
to the different possible thresholds of ability to pay. There is no single
"correct" measure of ability to pay; therefore, in the following discussion,
we present the pros and cons of each type of measure and the ability-to-pay
threshold it involves. Then, after analyzing preliminary ability to pay
results for each rule, we specify one rule to be used in the analysis of
impacts of corrective action costs.
C.3.3 Ability-to-Pay Rules
This subsection describes the five ability-to-pay rules that we
considered using for the economic impact analysis. The following subsection
discusses how we selected one rule from this group for use In the analysis.
Rule 1: Ability to oav is eoual to cash flow minus ten percent of total
liabilities: This formula Is derived from the "Beaver ratio," which is a
ratio of cash flow to total liabilities greater than or equal to 0.1.^ The
Beaver ratio tests a firm's ability to pay based on a bankruptcy threshold; it
has been found in at least two studies to be among the best single predictors
of firm bankruptcy.Cash flow is measured as net income plus depreciation,
depletion, and amortization, or NIDDA.
A Beaver ratio greater than 0.1 assures a substantial margin of safety in
a firm's cash flow position, and indicates that the firm currently has
sufficient excess cash flow to meet both the normal investment needs of a
business and the possibility of deterioration in future cash flows. The
implicit assumption in this rule is that firms can oav for corrective action
out of their cash flow up to that amount where their Beaver ratio equals the
critical value of 10 percent, the point at which thev would no longer have
sufficient cash flow to assure that bankruptcy will not occur in the future.
Rule 2: Ability to oav is eoual to net Income: Using net income as a
measure of ability to pay is a modification of the Superfund Financial
Named for its developer, William Beaver, "Financial Ratios as
Predictors of Failure," Empirical Research In Accounting: Selected Studies.
1966.
20 Ibid.. Table 3. See also Background Document for the Financial Test
and Municipal Revenue Test: Financial Assurance for Closure and Post-Closure
Care. Appendix A, U.S. EPA, November 30, 1981, where the Beaver ratio was
found to be one of the most effective single ratio tests among bankruptcy pre tc
-------
C-29
Assessment System (SFAS).2^- Under SFAS, a firm's ability to pay is considered
to be equal to its predicted future residual cash flow, which is measured as a
weighted average of cash flow (net income plus depreciation) for the past
three to five years, minus the amount of investment required to sustain the
firm at its current earnings. By assuming that the amount of required
sustaining investment is equal to the firm's annual depreciation, the SFAS
measure of future residual cash flow becomes equivalent to the weighted
average of net income for the past three to five years. The threshold for
this ability-to-pay test is the level of resources above that required to
sustain a firm's current operations, as opposed to the bankruptcy threshold of
the previous test.
Because the financial data base used to perform this analysis only
contains one year of data for firms, time series data were not available to
predict net income. Therefore, the amount firms are considered to be able to
pay under Rule 2 is assumed to be equal to the firms' latest year of net
income.
Rvl? Ability to oav is equal to 50 percent of net income: This rule
is based on the same assumptions as the second ability-to-pay rule, differing
only in that a portion of net income is assumed to be available for corrective
action costs. This test is intended to test the sensitivity of the second
ability to pay rule. Moreover, it is possible that net income does not
accurately represent the cash flow available to pay for regulatory costs. For
example, if a company used straight-line depreciation of its fixed assets, the
assumption that depreciation represents the required sustaining investment of
the firm may be inaccurate (i.e., the replacement cost of assets may be much
more substantial). An ability-to-pay rule of only 50 percent of net income
may offset the potential for inaccuracies in the net income figure.
RulS 4; Ability to oav is equal to three percent of total assets: This
measure reflects the assumption that over the long term, firms' net income
will average a given return on assets. Therefore, the measure is similar to a
measure of net income. Under this ability-to-pay rule, it is assumed that an
average return on assets is six percent and that half this return, or three
percent, is available for corrective action costs.22 The threshold level for
ability to pay is that necessary to sustain current operations; the average
return on assets is not set at a level to test for bankruptcy.
Rule 5; Ability to Day is equal to five percent of total assets: This
rule is based on the same assumptions as the fourth ability-to-pay rule,
21 See Superfund Financial Assessment System. Technical Support Document.
Industrial Economics, Inc., prepared for U.S. EPA Office of Policy and
Resource Management, May 25, 1982.
22 see "Flexible Regulatory Enforcement Policies for Corrective Action,"
prepared by ICF Inc. for U.S. EPA, Office of Policy, Planning and Evaluation,
September 12, 1985. The six percent figure represents an average return on
assets for all manufacturing firms over the period 1970 to 1983.
-------
C- 30
differing only with respect to the percentage return on assets that is
available to firms for corrective action costs. It was designed to test the
sensitivity of ability to pay Rule 4.
Each of the ability-to-pay rules reflects different aspects of a firm's
financial situation. The two rules (Rules 4 and 5) that are based only on
total assets characterize ability to pay in terms of a stock of resources,
which reflect resources built up over past years, rather than in terms of its
flow variables (e.g., net income, cash flow) which represent a current
period's performance. Ability-to-pay Rules 1 through 3, by contrast, focus on
the flow variables of a single year to determine ability to pay. Thus, one
unprofitable year for a firm resulting in negative cash flow (Rule 1) or
negative net Income (Rules 2 and 3) would result in the firm being considered
unable to meet its corrective action obligations. Although stock variables
reflect the pool of resources available to the firm at a particular time, flow
variables may better reflect the ability of the firm to generate resources in
the future.
C.3.4 Estimated Ability to Pay
This section examines the ability of F3DB firms to pay for regulatory
costs in general using the different ability to pay rules presented in Section
C.3.3. This preliminary analysis enables us to choose an appropriate ability-
to-pay rule for use in the computer simulation model (described in Section
C.4) that generates our final results. As a supplement to our analysis of
F3DB firms, we also present a breakdown of firms by selected industries (SIC
codes) to demonstrate the widely different potential effects of the corrective
action rulemaking on different industries.
(1) Examining the set of abllltv-to-pav rules
A stochastic computer simulation model, described in Section 13.4, is
used in this analysis to test the degree to which firms affected by the
corrective action rule nay be able to pay for the costs of the regulation. To
choose the appropriate ability-to-pay rule for use in the model, we
preliminarily tested the firms described in Section 10.1 for their ability to
pay for a range of generic costs without regard for the probability of those
costs being incurred. Ve repeated this analysis for each of the five abillty-
to-pay rules described in Section C.3.3 to determine how different rules
affected the results. As discussed in Section C.3.1, we tested only Immediate
owners of TSDFs.
In order to determine the amount of funds available for a specific
facility, some assumptions must be made about the manner in which the
resources of the immediate owner of the facility are allocated. For this
portion of the analysis, two scenarios were developed which represent
different assumptions about the allocation of funds from firms to facilities:
either all funds are divided equally among facilities (equal allocation) or
available funds are applied to successive facilities until exhausted
(successive allocation).
-------
C-31
The results of this analysis are shown in Exhibits C-7 through C-10. In
Exhibits C-7 and C-8, the firms are tested by the five ability-to-pay rules
assuming that they allocate resources equally among facilities. Exhibit C-7
shows the number of facilities for which regulatory costs are fully funded for
costs ranging from $0 to $10 million; Exhibit C-8 provides a close-up view of
the low end of the cost range. Because many firms own more than one facility,
the percentage of firms passing an ability-to-pay test for a given cost level
is translated into the percentage of facilities for which regulatory costs can
be met by immediate owners. Exhibits C-9 and C-10 reveal the number of
facilities at which compliance costs can be paid given the successive resource
allocation assumption for the same cost range.
The results are very similar between the two allocation principles. In
each case, the percentage of facilities covered decreases steadily as the
costs increase, with sharper declines in the lower cost intervals (see
Exhibits C-8 and C-10). The declines in the lower cost intervals may be
attributed to the fact that some firms have very low or negative incomes; they
will fail the tests measuring net income for almost any compliance costs.
The different ability-to-pay tests behave similarly under both the equal
and successive resource allocation approaches. The Beaver ratio test is the
most stringent in the lower cost intervals (less than $100,000), but it is
soon overtaken by the SO percent of net income test. The 5 percent of total
assets test is the least stringent; it projects about 20 percent more
facilities to be covered than the most stringent test.
Of the five ability-to-pay tests examined, the Beaver ratio test is the
most attractive test to single out for the economic impact analysis. There
are two major reasons for this choice:
1. Throughout most of the cost range, under both
allocation principles, the Beaver ratio test
results are within 5 percent of the net income
test and the 3-percent of total assets test, and
within 10 percent of the other two "sensitivity"
tests. Therefore, results for the Beaver ratio
test are unlikely to vary significantly from
other potential tests.
2. The Beaver ratio test has been validated by
previous studies as a predictor of bankruptcy.
Firms with a Beaver ratio less than the critical
value face a significantly higher chance of
bankruptcy than firms that have cash flow in
excess of 10 percent of total liabilities.
The Beaver ratio test, as discussed earlier, assures a margin of safety
in a firm's cash flow position for meeting its obligations. A firm could be
expected to pay for corrective action costs up to the point at which its
Beaver ratio equals the critical value of 10 percent. At that point, the firm
could commit more funds to corrective action costs (either by using any
-------
EXHIBIT C-7
FACILITIES FDR WHICH CORRECTIVE ACTION COSTS ARE FUNDED
EQUAL ALLOCATION AMONG FACILITIES
100.00%
90.00%
60.00%
70.00%
60.00%
40.00%
30.00%
20 00%
10 00%
0 00%
4
0
0
2
6
10
(Millions)
COST OF CORRECTIVE ACTION ($)
BEAVER + NET INC O 50% NET IN' A 3% TOTAL ASSETS X 5% TOTAL
-------
EXHIBIT C-8
FACILITIES FOB. WHICH CORRECTIVE ACTION COSTS ARE FUNDED
(For First $100,000 of Costs)
EQUAL ALLOCATION AMONG FACILITIES
o
z
3
It.
W
o
<
*.
IL
o
I-
z
w
u
ec
100 00%
95 00ft H
90 00* H
85.00% H
80 00% -
75.00% H
70 00% H
65 00% -
BEAVER
+ NET INCOME
i 1 r
40 60
(Thousands)
COST OF CORRECTIVE ACTION (S)
O 50% NET INCOME A
o
3% TOTAL ASSETS
100
5% TOTAL ASSETS
-------
QHIBIT C-9
FACILITIES FOB UHICH CORRECTIVE ACTION COSTS ARK FUNDED
SUCCESSIVE ALLOCATION AMONQ FACILITIES
too.oox
60 00%
70.00%
60 00*
40 00*
20 00%
10 00%
0 00%
6
4
e
2
10
'Millions)
COST OF COP 1VE ACTION (S)
rpavfr + NFT INCOME O 60% NET INw^oAE A 3% TOTAL ASSETS X 6V. TOTAL ASSt . -
-------
EXHIBIT C-10
FACILITIES FOR UUICU CORRECTIVE ACTION COSTS ARE FUNDED
(For first $100,000 of Costs)
SUCCESSIVE ALLOCATION AMONG FACILITIES
100 00%
96.00%
96.00%
94.00%
92.00%
90.00%
66.00%
66 00%
84.00%
62.00%
80.00%
78 00%
76 00%
74 00%
72 00%
70 00%
BEAVER
NET INCOME
T
40 60
(Thousands)
COST OF CORRECTIVE ACTION 1$)
O 60% NET INCOME A
o
U»
3% TOTAL ASSETS
6% TOTAL ASSETS
-------
C-36
positive income or by liquidating assets), but it would likely be in danger of
eventually going bankrupt. Therefore, in the computer simulation model the
Beaver ratio test is used to measure the funds available to pay for corrective
action costs. If a simulated firm is unable to provide funds for corrective
action for all facilities owned without failing the Beaver ratio test, it is
counted as facing an "adverse impact." A firm facing an adverse impact may be
able to pay for costs by allowing its Beaver ratio to fall below the 10
percent threshold, but such a firm would face an increased risk of bankruptcy.
Thus, our analysis does not make predictions of bankruptcy per se; rather, it
assumes that firms suffer significant impacts if the costs of corrective
action threaten to reduce their Beaver ratio past the critical point.
(2) Ability to Pav in Selected Industries
To assess how the corrective action regulations may affect different
types of industries, we analyzed the performance of firms for several common
SIC codes. Although this analysis does provide an indication of how some types
of industries may be able to cover the corrective action costs more easily
than others, it does not assess the actual Impacts of the regulations on these
industries. To perform the analysis, we used two of the ability*to-pay tests,
the Beaver ratio test and the net income test. The Beaver test, as discussed
above, is the test selected for the simulation of economic impacts; the net
income test is added to test the sensitivity of the results of the industry-
specific analysis.
The results of our analysis are depicted in Exhibits C-ll through C-16.
Each exhibit depicts the percentage of facilities with costs covered by firms
in an SIC code group. Note that in some industries, not all firms are able to
pass the tests even with no corrective action costs. For example, over 20
percent of facilities in the petroleum refining industry (Exhibit C-14) cannot
pass the Beaver test with zero corrective action costs.
Exhibits C-ll through C-13 show industries that have a relatively low
ability to pay. For these industries, the number of facilities with adequate
funding by immediate owners drops severely in the lower cost range, indicating
that net income levels are low. For example, for the sanitary services
industry, the percentage of facilities at which costs can be funded drops from
close to 100 percent at $1,000 to 25 percent at $1 million. A similar pattern
occurs for both the coating and engraving industry and the miscellaneous wood
products industry. The fact that net income levels are low may mean that
firms in these industries are relatively small or it may mean that industry
returns are relatively poor.
Exhibits C-14 through C-16 show industries that have a higher ability to
pay; these industries maintain a higher percentage of facilities covered than
the entire universe of firms for a given level of costs. For example, the
petroleum refining Industry is estimated to be able to fund costs at 70 to 80
percent of its facilities even at cost levels above $5 million. Firms in the
motor vehicle industry and the aircraft industry are estimated to be able to
pay for compliance costs up to $10 million for about 80 percent of facilities
In comparison, the entire sample of firms owning TSDFs is able to fund costs
-------
EXHIBIT C-Il
INDUSTRIES WITH RELATIVELY LOU ABILITY TO PAY:
SIC 495 -- SANITARY SERVICES
FACILITIES FOR WHICH CORRECTIVE ACTION COSTS CAN BE MET
bi
5
ui
-------
EXHIBIT C-12
100%
90%
INDUSTRIES WITH RELATIVELY LOW ABILITY TO PAY:
SIC 347 -- COATING, ENGRAVING, AND ALLIED SERVICES
FACILITIES FOR WHICH CORRECTIVE ACTION COSTS CAN BE MET
Ui
5
80%
z
<
o
M
«t
O
o
X
o
<
M
O
«*
U.
U
u
-------
EXHIBIT C-13
INDUSTRIES WITH RELATIVELY LOU ABILITY TO PAY:
SIC 249 -- MISCELLANEOUS WOOD PRODUCTS
FACILITIES FOR WHICH CORRECTIVE ACTION COSTS CAN BE MET
Ui
5
ui
(0
z
4
u
M
H
U
o
o
X
o
z
J
IA
Ui
o
4
II.
IL
o
I-
z
Ui
u
100%
90%
80%
70*
BOX -
60% -
40% -
30% -
20% -
10% -
0%
TfTTTIIIHMlHMim
1
TESTED 48 FIRMS OUHIHG 62 FACILITIES
1 1
4 6
(Millions)
COST OF CORRECTIVE ACTION (S)
+
T~T~T
10
BEAVER TEST
NET INCOME TEST
-------
EXHIBIT C-14
INDUSTRIES WITH RELATIVELY HIGH ABILITY TO PAY:
SIC 291 -- PETROLEUM REFINING
<
o
V*
h-
(A
O
u
X
o
X
*
I-
<
u
111
o
u.
11.
o
u
cc
100%
90% -
80% -
70%
60% -
50% -
40% -
30% -
20% -
10% -
0%
FACILITIES FOR WHICH CORRECTIVE ACTION COSTS CAN BE MET
0
1
o
COST OF cor
BEAVER TEST
(Millions)
TIVE ACTION (S)
+
NET INCOME TEST
-------
EXHIBIT C-15
INDUSTRIES WITH RELATIVELY HIGH ABILITY TO PAY:
SIC 371 -- MOTOR VEHICLES AMD MOTOR VEHICLE EQUIPMENT
FACILITIES FOR WHICH CORRECTIVE ACTION COSTS CAN BE MET
I-
bi
2
ID
a
z
<
o
M
t-
«l
o
o
X
u
<
M
o
«*
k.
o
a
100*
90* -
eo* -
70* -
eo* -
60* -
40* -
30* -
20* -
10* -
0*
1
2
T
o
•t>
TESTED 39 FIRMS OWNING 229 FACILITIES
1 1 1 1
4 0
(Millions)
COST OF CORRECTIVE ACTION ($>
BEAVER TEST + NET INCOME TEST
~r
8
10
-------
EXHIBIT C-I6
INDUSTRIES WITH RELATIVELY HIGH ABILITY TO PAY:
SIC 372 -- AIRCRAFT AMD PARTS
FACILITIES FOR WHICH CORRECTIVE ACTION COSTS CAN BE MET
100% -m
90% -
00* -
70* -
60% -
50% -
40%
30% -
20% -
10% -
0%
n
io
COST OF COR
(Millions)
IVE ACTION it)
+
uct mrnuF TFST
-------
C-43
of $5 million to $10 million for only about 30 to 50 percent of its facilities
(see Exhibits C-7 through C-10).
C.4 MONTE CARLO MODEL
Based on the previous analyses (Sections C.l through C.3), we developed a
Monte Carlo model to simulate the economic impacts of the corrective action
regulations. The major steps in the stochastic approach are detailed below.
The corresponding steps are depicted in a flow diagram in Exhibit C-17.
CI') Simulate a Firm -- The program begins by simulating a firm with a
certain level of ability to pay (using the Beaver ratio test) and a certain
number of facilities owned. These parameters are simulated for each firm by
drawing from probability distributions based on the data in the F3DB. The
probability distributions for ability to pay and number of facilities,
therefore, are set up using actual data, ensuring that the random values
chosen will be realistic. Exhibits C-18 and C-19, respectively, present these
distributions. Note that the ability to pay distribution is actually
presented as an "inability to pay" distribution, with all firms (i.e., 100
percent) being unable to pay at the highest cost.
(2^ Simulate Facilities -- Once the firm's ability to pay and its number
of facilities have been selected, we simulate each facility owned by the firm.
Using a probability distribution based on the corrective action cost data from
the LLM, a facility is randomly assigned a flow of corrective action costs,
called a cost stream. Only the first fifty years of costs are used because
the planning horizon for a firm is highly unlikely to exceed fifty years.
Moreover, only those corrective actions that begin in the first ten years are
examined; firms are unlikely to begin planning for later actions at the outset
of the regulations.
The model keeps track of the costs for each simulated facility so that it
can test the firm's ability to pay against the costs of all facilities owned
by the simulated firm. Some facilities will not have to face corrective
action costs; the probability of a facility having no corrective action costs
is incorporated into the probability distribution from which facility costs
are randomly selected. The cost distributions for simulated facilities will
vary depending on which regulatory alternative is analyzed.
(3) Simulate Financial Assurance Costs for Firm X -- If a facility seeks
a permit under RCRA Section 3004(u), it will be required to provide financial
assurance in the event of a corrective action, representing an additional cost
of the rulemaking that must be estimated.^ In addition, if a facility does
40 CFR 264.101 currently requires owners or operators of TSDFs to
provide financial assurance for corrective action. The October 24, 1986
proposed rule (51 ££ 37854) gives details on the financial assurance
requirements, including the amount of coverage required for a facility and the
types of mechanisms allowed for providing coverage.
-------
EXHIBIT C-17
FLOW CHART FDR SIMULATION OF ECOHOKIC IMPACTS
START
Simulate a firm
Simulate firm's abillty-to-pay (AtP) & number of facilities
Simulate a facility
Simulate facility's 60-year corrective action costs
Add facility's cost
stream to firm's total
corrective action costs
/ Last\
No /facility at
\thls firm >
-------
EXHIBIi o-17 (Continued)
No
Yes
No
Yes
AATC greater
V than AtP /
Given X.
/ firm's total ^
costs, does firm pass
v financial /
test
Costs covered at
all facilities
No financial assurance
costs Incurred
Costs not
covered at some
or all facilities
Calculate firm's annualized after-tax costs (AATC)
Calculate financial
assurance costs &
add to firm's total
costs
AtP distributed sequentially
among all facilities
requiring corrective action
until all funds depleted
Calculate number of firms with adverse impacts,
number of facilities covered, and total costs not
covered. Store results.
-------
EXHIBIT C-17 (Continued)
A
/ Havs
'enough firms
b««n simulate
-------
EXHIBIT C-18
DISTRIBUTION OF INABILITY TO PAY FOR CORRECTIVE ACTION
M
2
gc
u.
Ik
o
IU
O
K
III
CL
IU
>
=»
2
a
u
100*
90* -
ao* -
70* -
60* -
60* -
40* -
30* -
20* -
10*
BEAVER TEST
i 1 1 1 i 1 1 1 1 1 1 r
10 20 30 40 50 100 ISO 200 300 500 700 1000 • 1000
MILLIONS OF DOLLARS - UPPER BOUND OF INTERVAL
-------
EXHIBIT C-19
DISTRIBOTIGH OP BOA FACILITIES GUNKD
9B%
•4%
68%
80*
76%
78%
NUMBER OF RCRA FACILITIES OWNED
-------
C-49
not seek a permit under RCRA Section 3004(u) , it may be required to undertake
corrective action under RCRA. Section 3008(h). Although EPA has proposed but
not finalized the specific details of its financial assurance for corrective
action program, the Agency intends to pursue financial assurance for all
corrective actions regardless of the authority used to required the action.
This simulation assumes that the financial assurance rules, although only
proposed, are applicable to ensure that all economic impacts of the corrective
action rulemaking are evaluated. Therefore, to estimate the impacts of the
financial assurance rules, the model assumes that all facilities, and thus all
firms, will require financial assurance.
The financial assurance requirements allow several different mechanisms
to be used to provide coverage, including a financial test, letter of credit,
trust fund, and surety bond (as explained below, our analysis only addresses
the use of the financial test and the trust fund). These mechanisms must be
used to provide coverage for the amount of a corrective action cost estimate
at a facility. The mechanisms each have different costs; therefore, the use
of the mechanisms must be estimated to properly gauge the total costs of
providing assurance.
The financial test, a set of criteria through which a firm may
demonstrate that it has the financial resources necessary to fund its
obligation, is virtually costless.^ We thus assume that firms eligible to
use the financial test will always do so. If a firm passes the test, then it
does not have to purchase an assurance mechanism; if a corrective action is
incurred, the firm is expected to make arrangements necessary to pay for those
costs. The first step in estimating financial assurance costs is, therefore,
to estimate whether a firm is able to use the financial test.
The model determines whether or not the firm will pass the financial test
and incur no financial assurance costs. The frequency distribution for firms
passing the financial test is determined through an analysis of the firms in
the F3DB. Because the corrective action rule requires owners or operators
using the financial test to pass the test for all Subtitle C financial
assurance requirements, we analyzed the F3DB firms for their ability to pass
the test to cover the summation of potential closure/post-closure care costs,
liability coverage, and corrective action costs. We estimated closure/post-
closure costs and liability coverage amounts for each firm based on the type
24 Background Document for the Financial Test and Municipal Revenue
Test: Financial Test for Closure and Post-Closure Care. Appendix B, U.S. EPA,
Office of Solid Waste, November 30, 1981, p. 11-14.
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C-50
of facilities owned by each firm.^5 The results of the F3DB analysis
determine the likelihood that a simulated firm will be able to use the test.
If the firm does not pass the financial test, it is assumed by the model
to use a trust fund that is funded over a specified pay-in period. This
approach, while conservative in that a firm may actually be able to obtain a
less expensive mechanism such as a letter of credit, ensures that the firm
sets aside funds for corrective action financial assurance. In addition,
there is no centralized source of Information regarding the degree to which
TSDFs use financial assurance mechanisms such as letters of credit.
The model mav understate the use of the financial test because it assumes
that a firm will either use the financial test for all obligations or none of
them. In reality, firms may use the financial test for one type of cost
(e.g., liability coverage) and obtain other assurance mechanisms for the other
types of coverage. However, modeling the firm's decision rules for using the
financial test for a portion of costs would require use of currently
unavailable firm-specific information on the costs and availability of
mechanisms and the combinations of mechanisms to be used. Moreover, if the
financial test is used for corrective action and other mechanisms for the
other costs, the costs of the other mechanisms may outweigh the cost savings
of using the financial test for corrective action.
Under the terms of the October 24, 1986 proposed rule, a firm is require'
to fund the trust fund only for the amount of corrective action costs that art
estimated to occur in years after the pay-in period. In other words, the
trust fund requirements assure that funds for future costs are available by
shifting the costs from the time they would have been incurred to the pay-in
period of the trust fund. To simulate this regulation in the model, all
corrective action costs that are expected after the pay-in period are shifted
to the pay-in period. In each year of the pay-in period the trust fund
deposit is the total of the costs shifted divided by the pay-in period. These
costs are added to the corrective action costs that are already expected to be
incurred during the pay-in period.
(5^ Determine Annualized Costs for Firm X -- After the corrective action
cost flows are adjusted for financial assurance requirements, the costs of
corrective action for all facilities owned by a simulated firm are added for
each year in the fifty-year period analyzed. Although the firm's corrective
action costs may vary widely from year to year, financing allows the firm to
smooth costs over time and lessen the impact of higher costs in any particular
year. To simulate this effect, the model first discounts the firm's cost flow
to present value using the discount rates determined in Section C.2 and
^ Data on estimated costs of closure and post-closure care were
obtained from estimates by Pope-Reid and Associates, in a memorandum to U.S.
EPA, Office of Solid Vaste, September 13, 1985. The amounts for liability
coverage, under Subtitle C requirements, are $8 million for firms owning or
operating at least one land disposal facility and $2 million for firms owning
or operating any other Subtitle C facility.
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C-51
adjusted for taxes. Next, the present value amount is annualized using the
formula presented in Section C.2. The annualization period reflects the
period over which corrective costs are incurred, subject to a maximum of 50
years and a minimum of 10 years (50 years is the modeling period and 10 years
is the assumed minimum period over which debt can be financed).
The regulation specifies the financial assurance trust fund pay-in period
for a facility as either one-half of the corrective action period, or 20
years, whichever is shorter. The model, however, does not address the
corrective action period on a facility basis. Instead, the corrective action
period is modelled on a firm basis. In the analysis, the various corrective
action periods for all the facilities owned by each firm are combined and an
average duration for corrective action is determined for each regulatory
alternative. Then, the model compares one-half of the corrective action
period to 20 years and chooses the appropriate pay-in period for each
regulatory alternative. Exhibit C-20 displays the pay-in periods for each
regulatory alternative.
(6) Test Simulated Firm for Ability to Pav -- When the annualized costs
of corrective action are determined, the model compares the results to the
ability to pay figure chosen in Step 1. If the firm is able to pay for the
sum of the corrective action costs for all of its facilities, then all of the
facilities are considered to be covered. If a firm faces no costs at any of
its facilities, then it is assumed to not face any adverse impacts regardless
of its ability to pay. If the firm is unable to pay all of the costs, then
the model estimates the number and percentage of facilities that can be
covered and the number and percentage that cannot be covered using a
modification of the successive allocation approach.
The successive allocation approach assumes that a firm will fund
corrective action costs at each facility successively until funds are
exhausted or all costs are covered. Under this approach, the facilities must
be ordered in some manner before costs can be allocated. For example, a firm
may attempt to cover costs at as many facilities as possible by paying for the
least expensive actions first. Alternatively, a firm may fund the most
expensive actions first, or may not follow any pattern at all. The model
makes the simplifying assumption that the funds are divided equally but
successively among all of a firm's facilities requiring corrective action.
For example, if a firm has only half of the funds required to cover corrective
action costs at all of Its facilities, then ve assume that half of its
facilities will receive sufficient funds to cover their costs and half will
not be funded.
The model keeps a running total of the number and percentage of firms and
facilities for which corrective action costs may go unfunded, and the amount
of those unfunded costs. This information is adjusted after each simulation
of a firm and its facilities.
m Continue Simulations Until Margin of Error Is Reduced to Satisfactory
Levels -- The model calculates the degree of error in the estimated percentage
of facilities for which corrective action may be funded based on the number of
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C- 52
EXHIBIT C-20
DETEBMHIAXION OF TRUST FUND PAY-IN PERIOD
Regulatory
Lve
Baseline
Option A
Option B
Option C
Option D
Average
Corrective Action
Period (years)
More than 40 years
26
More than 40 years
27
26
Trust Fund
Pay-in Period
(years)
20
13
20
13
13
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C- 53
iterations performed. The model continues to simulate firms until the error
is reduced to a satisfactory level.
For this analysis, 5,000 iterations were conducted for each model run.
Separate runs were conducted for small and large firms as defined by criteria
established under the Regulatory Flexibility Act for the baseline and each
regulatory option. The estimates of economic impacts on the entire population
of firms was determined using a weighted average of the results for small and
large firms. We used this approach because the probability distributions for
ability to pay and facility ownership are significantly different for small
and large firms. Combining data on these firms into a single probability
distribution would entail such wide ranges that the results would be subject
to a great deal of error. Moreover, the firms had to be separated into small
and large populations to examine the effects of the corrective action program
on small businesses as required by the Regulatory Flexibility Act. Economic
impacts on small and large firms as distinct groups are discussed in Chapter
11.
Given the nature of the model, results are produced for the simulated
population of firms and facilities rather than the actual members of the
regulated community. The results of the analysis are in percentage terms that
relate to the simulated set of firms and facilities. To extrapolate the
results to the regulated community, these percentages must be multiplied by
the actual number of small or large firms (or facilities owned by those firms)
known to exist in order to obtain approximations of the impacts on the actual
RCRA universe of firms and facilities.
The total number of firms encountering adverse impacts is determined by a
summation of the small and large firm results. The percentage of large firms
estimated by the model to encounter adverse impacts is multiplied by 1,295 to
estimate the number of large firms adversely impacted; the percentage of small
firms estimated to encounter adverse impacts is multiplied by 1,102 to
estimate the number of small firms adversely impacted.^
The total number of facilities in each category is again determined by
adding the results for the large and small firm groups. The model generates
the percentage of facilities owned by each group that are in each category;
26 These numbers are approximations based on the following logic. Ue
know that there are 5,661 total RCRA facilities (see Section 10.1), and we
know that firms own 92 percent of facilities for which ownership information
exists (4,540 of 4,958). Therefore, multiplying 5,661 by 92 percent, we
estimated that 5,208 facilities are owned by firms. Next, we know that large
firms own about 75 percent of facilities at a rate of 3 facilities per firm,
compared to 25 percent owned by small firms at a rate of 1.2 facilities per
firm. Applying these weights of small and large to the 5,208 facilities gives
a result of 1,295 large firms and 1,102 small firms.
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C-54
these percentages are multiplied by 3,885 for large firms and 1,323 for small
We established in footnote 26 that approximately 5,208 facilities are
owned by firms. We know that of facilities for which ownership information
exists, 75 percent are owned by large firms and 25 percent are owned by small
firms. We therefore extrapolate this percentage to the estimated number of
facilities and obtain results of 3,885 facilities owned by large firms and
1,323 facilities owned by small firms.
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APPENDIX D
This Appendix presents a summary of 46 Superfund Records of Decision
(RODs) taken from EPA's fiscal year 1987 ROD annual report. These RODs were
chosen as representative sites requiring corrective action for hazardous waste
releases to ground water, soil, surface water, and air, and are presented to
support the media-specific discussions in Chapter 4.
Each ROD was summarized to present the area of contamination, the state
in which the site is located, the corrective action activities taken at the
site, an indication of the principal media of concern, and the annualized cost
for the total corrective action effort. As this Appendix illustrates,
corrective action activities often must be taken to address releases to two or
more media at a single site.
-------
REPRESENTATIVE CERCLA CORRECTIVE ACTION ACTIVITIES FOR RELEASES TO All HEDIA
FACJLIIY
(ACREAGE) STATE
CORRECTIVE ACTIONS
CONTAMINATED HEOIA ** ANNUALIZEO ***
GU SOIL SW AIR COSTS
NA
(2*5)
2 NJ
(115)
NJ
DE
PA
6 PA
(2 houses)
KV
a IN
(40)
CO
(4 5 miles
of streets)
Site gradation and Installation of permeable soil cap
over 1,000 c.y. of contaminated sludge and soils
GU puplni and treatment (odor control)
Uaste pile stabilization and cap Installation with
IN collection layer
Treatment of gaseous eaiasions, UQ I AQ both toring
Installation of 65-acre cap with gas collection system
Piaplng and treatment of shallow GU
Canstruction of surface runoff controls
Provision of alternate drinking water s^yly,fencing, and
CU aonitoring
Construction of landfill cap
GU and leachata extraction and pretreataent
GU aonitoring and perimeter fencing
Backfilling and capping of landfill including gas
venting syatesi
Installation of SW drainage ditches
GU ami toring to determine reaediat action
Installation of RCRA cover on landfill with gas
venting systea
Diversion of SU and extension of public water st^jply to 12 houses
Excavation of burled waste and drum for offslte disposal
Sailing, puling, and treatment of GU, sampling of SU
Olsaantllng of 2 bouses
Packaging, sealage, and disposal of radioactive materials
Excavation and disposal of local contaminated soils
Sewer reaoval and replacement of 200 ft of sewer line
Drue reaoval and disposal
Soil capping with gas venting systea
Riverbank erosion protection and SU treatment
GU, gas, I air aonitoring, and evacuation of T families
Consolidation of 2,500 c.y. contaainated soils and sedinents
Installation of soil cover over landfill with drainage blanket
Extension of pU>l ic Mater supply
Establishment of GU, SU and sedinents aonitoring
(No action alternative)
Evaluation of problea and design of institutional controls
X X
K *2,400,000
XXX
X X
X *8,200,000
X *2,500,000
X X X X *2,300,000
X X X X <2,700,000
X X X X
XXX
$670,000
>350,000
*710,000
*319,000
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to NJ
(60)
11 NY
(K/A)
12 DE
(N/A)
13 KT
(N/A)
K IN
(5)
IS AL
(3)
16 FL
(11)
17 Ml
(10)
18 OH
(3.5 nile
channel)
19 IX
(183)
20 CA
(4,400)
21 UA
(320)
Capping of 29-acre landfill with gas collection system
Reaovat and offslte disposal of lagoon sediments and liquids
Construction of slurry wall,GU and SU interceptor systems
luchiti treatment and offslte disposal
Hydraulic dredging 1 offslte disposal of 23,000 c.n. sediment
SU trutaent and disposal
Harsh restoration t longtera Monitoring
Excavation and reaoval of 25,000 c.y. sludge,soils, I SU
Inatallatlon of synthetic liner, cover and cap for storage area
Installation of GU recovery wells ft monitoring system
SU diversion and onsite pond drainage
Consolidation of pond sediments, sludge and materials
Inatallatlon of clay cap and Monitoring system
Excavation of 1,600 c.y. of pond sediments
Dilution of pondwater from three onsite ponds
GU monitoring and pond sediment consolidation
Excavation, reaovat, ft disposal of USI's and swamp waste oils
Diversion of surface nnoff
Gradation and revegetatlon of swamp area
Soil excavation and incineration
RCM landfill closure
Leachate collection, treatment, ft onsite disposal
SU treatment and cover systca for sludge pond waste
Drainage of wetlands
Removal and treatment of 250 c.y. sludge for offsite disposal
Purging and treatment of GU for three years
Excavation of 52,000 c.y. brook sediments
(36,000 solidified I stored onsite, 16,000 thermaliy treated)
Treatment of wastewater from sediment dewatering
Onsite Incineration of 150,000 c.y. sludges and soils
Backfilling of excavated areas with residue ash
Treatment and discharge of contaminated SU
Capping of 2.5 acres with soil/cement mixture
Major SU diversions and dam enlargements
Hydrogeologic studies and periaenter controls
Excavation and processing of 22,000 c.y. of sludge and
waste from onsite ponds
Capping of waste ponds
SU diversion and monitoring system
SOIL SU AIR
XXX
X X
x x
x
X X
X X
X X
X X
X X
X X
X X
X X
ANN. COSTS
<1,500,000
*6,300,000
(355,000
1130,000
(220,000
1740,000
(120,000
(330,000
(5,600,000
(16,800
(15,300,000
(550,000
-------
GU SOIL SU AIR ANN. COSTS
- Removal and incineration of 190,000 c.y. soil X X X X $11,400,000
- GU extraction and treatment
- Wetland restoration,levee construct ion,brook relocation
- GU and Air Monitoring
- Excavation and treatment of 10,600 c.y. soils and sediments XXX 11,200,000
- Restoration, reflrading, and revegetation of
excavated wetlands
- GU extraction and offsite treatnent
- Excavation, treatment,I backfilling of 28,000 c.y. x X X >950,000
of tolls and sediments
- Construction of secure landfill
- Treatment of local wells via air stripping
- Extension of public drinking water to local residents
- Gradation, compaction, and capping of 65-acre landfill x x X x >1,900,000
- Installation of SU drainage system with perimeter ditches
- Installation of Methane vent illation systea and perimeter fencing
- Initiation of GU monitoring
- Excavation and offsite disposal of 6,500 c.y. soil X x >990,000
- Filling and gradation of extracted area
- Extraction and onsite treatment of GU
- Perimeter fencing and monitoring
- Excavation and onsite treatment of 10,000 c.y. soils X X >2,100,000
- Offsite disposal of 4,000 c.y. soils In RCRA landfill
- Evaluation of extent of GU contamination
- Provision of alternate water si^ty for local residents
- Removal and offaite disposal of storage tank t contents XXX >1,100,000
• Excavation of 2,700 c.y. surface soils, lagoon sediments,
and liquids
- Site cover installation
- GU extraction and treatment
- Excavation and removal of 3,900 c.y. soils x x >515,000
- Oralnage and removal of 192,000 gallons of lagoon
liquid and sediments
- Removal of all tanks, buildings, and contaminated debris
- Excavation and consolidation of 3,600 c.y. soils x x >180,000
- Blodegradation of soils in onsite treatment bed
- Construction of SU diversion dikes and sedimentation channels
- Capping of excavated t consolidated contaminated XXX >2,500,000
soils and sediments
- Site grading, and revegetation of soil cover and cap
- Construction of flood retention t SU management basins and ditches
- Pimping, treatment, and monitoring of GU
-------
- Excavation,onsite incineration, and backfilling of
9,000 c.y. tolls
- GU recovery and treatment
- Excavation and offsite disposal 8,000 c.y. soils
- Extraction, offalte treatment, I reinjection of GU
• Backfilling of excavated areas
- Excavation, aeration, I treatment of contaminated soils
- Recovery, treatment, and reinjection of GU
- Collection and disposal of free oil
- Excavation, stabilisation I solidification, and
onslte placement of 57,000 c.y. of soils
- lapleaentatIon of Institutional land use controls and
GU monitoring
- Excavation, fixation,! onslte disposal of 94,000 c.y.
of aoll and 20,000 c.y. of pond sediments
- Treatment and discharge of SW and GU aquifers
- Removal of 20,000 c.y. onalte soli for offsite disposal
- Removal of offsite soils 1 sediments to backgromd
concentrations
• Removal of 3,800 c.y. of battery casings
- improvement of site drainage I cleaning of contaminated
facilities
• SW diversion
- Excavation of 4,600 c.y. sludge and 20,500 c.y. soils and
sediments for onslte incineration
- Ql pimping and treatment
- Extension of public water supply
- Excavation, onsite treatment and storage of soils and
sludges
- Installation of irrigation and leachate collection systems
- Removal of contaminated standing waters
- Backfilling and capping of excavated areas
- Excavation, treatment, and offsite disposal of
4,000 c.y. of sludges, sediments, and soils
- Removal, treatment, and disposal of 110,000 gallons of
aqueous lagoon wastes
- Excavation and onsite incineration of 25,530 c.y. soils
- Replacement of excavated soils with clean fill
- Conventional industrial cleaning of the site
GU SOIL
X X
X X
X X
X X
X X
X
SU AIR
X
ANN. COSTS
(620,000
12,800,000
1471,000
$900,000
>2,400,000
SI,700,000
XXX S3.800.000
X X $130,000
X X S210.000
x
S4,300,000
-------
GU SOU SU *1* MM emit
42 HI - Excavation, aeperatlon, and offsite disposal ol i 12,600 000
«/*• 15,000 c.y. of waste Materials and tolls
*5 1> - taaovat and disposal of surf act structures in offsite fill X * SJ,000,000
(13.5) • Cwavatian and disposal offsite of 22,500 c.y. soils
- Construction of Multi-layer alta cap and 10 ft deep slurry nail
¦ Of treetMint and Monitoring at depth
NO - Excavation, containerliatIon, and offsite
(»/*) Incineration of 20,000 c.y. of aolls X *J,300,000
- excavation, SMqpling,ov*fpacking, and offsite
disposal of buried druse
45 CO • (xcavatlon and onslte disposal of contealnated soils X x *350,000
(110) - Provision of alternate Mater simply to 5-7 residences
- Install MM out 11 layer cap
- Conduct Mfplaasntal 11/11, nine r eel mm t (on, end
9 year* of Of Monitor I no
46 at - Halted excavation and offsite disposal of 350 tons of X X (520,000
(N/A) contaalnated soils
* Installation of 15 thai low GU extraction nails
- Extraction and onslte treatsmt of GU
* ¦ figure* taken froa EPA FT 87 MO annual report.
'• ¦ Coluans Marked "K" denote principal Media(e) of concern during corrective action
activities. A Marked coluan does not aean that contaMlnatlon of that Media
necessarily exceeded health based standards.
••• ¦ Annual lied corrective octIon costs Include the capital cost discounted over ten years end the
first year operetlon and Maintenance costs (ell estlMatee rounded to two significant figures).
N/A ¦ Not Available froa report.
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