A CDA Economic and Supporting Analyses:
^ Short-Term Regulatory Changes to the
Lead and Copper Rule
Office of Water (4607M) EPA-815-RO-7022 September 2007 www.epa.gov/safewater
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CONTENTS
1 Introduction 4
1.1 Summary of Changes 4
1.2 Summary of Differences With the EA for the Proposed Rule 5
1.3 Document Organization 5
2 Need for the Rule 6
2.1 Public Health Concerns Related to Lead and Copper Exposure 6
2.2 Regulatory History 7
2.3 Comprehensive Review of the LCR 10
2.4 Rationale for the Regulation 17
3 Regulatory Changes and Alternatives Considered 18
3.1 Regulatory change III. A - Minimum number of samples required 18
3.2 Regulatory change III.B - Definitions for compliance and monitoring periods 20
3.3 Regulatory change III.C - Reduced monitoring criteria 21
3.4 Regulatory change HID - Advanced notification and approval requirement 22
3.5 Regulatory change III.E - Requirement to provide sampling results to consumers 24
3.6 Regulatory change III.F -Public education requirements 25
3.7 Regulatory change III.G - Reevaluation of Lead Service Lines deemed replaced 29
4 Costs of Regulatory Changes 30
4.1 Overall Cost Methodologies and Assumptions 31
4.2 Direct Costs Associated with Regulatory Change III.A 35
4.3 Direct Costs Associated with Regulatory Change III.B 39
4.4 Direct Costs Associated with Regulatory Change III.C 40
4.5 Direct Costs Associated with Regulatory Change HID 43
4.6 Direct Costs Associated with Regulatory Change III.E 47
4.7 Direct Costs Associated with Regulatory Change III.F 50
4.8 Direct Costs Associated with Regulatory Change III.G 63
4.9 Summary of Average Annual Costs 66
4.10 Costs to Review and Implement Regulatory Changes 67
5 Indirect Cost and Health Risk Reduction Implications of Rule Changes 69
6 Administrative Requirements 74
6.1 Executive Order 12866: Regulatory Planning and Review 74
6.2 Paperwork Reduction Act 74
6.3 Regulatory Flexibility Act 77
6.4 Unfunded Mandates Reform Act 84
6.5 Executive Order 13132: Federalism 85
6.6 Executive Order 13175: Consultation and Coordination With Indian Tribal
Governments 85
6.7 Executive Order 13045: Protection of Children from Environmental Health Risks and
Safety Risks 86
6.8 Executive Order 13211: Actions Concerning Regulations That Significantly Affect
Energy Supply, Distribution, or Use 86
6.9 National Technology Transfer and Advancement Act 87
REFERENCES 88
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LIST OF EXHIBITS
EXHIBIT ES-2: SUMMARY OF ANNUAL DIRECT COSTS TO SYSTEMS AND STATES FROM REGULATORY CHANGES 2
EXHIBIT ES-3: SUMMARY OF ONE-TIME DIRECT COSTS 3
EXHIBIT 1: SYSTEMS EXCEEDING THE LEAD ACTION LEVEL SINCE 2003 13
EXHIBIT 2: SYSTEMS EXCEEDING THE LEAD ACTION LEVEL SINCE 2000 14
EXHIBIT 3: LEAD 90™ PERCENTILE LEVELS FOR 166 LARGE WATER UTILITIES - THEN AND Now 15
EXHIBIT 4: SUMMARY OF DIRECT AND INDIRECT IMPLICATIONS OF THE LCR SHORT TERM REGULATORY CHANGES 30
EXHIBIT 5: NUMBER OF SYSTEMS BY SIZE CATEGORY AND TYPE SUBJECT TO THE LCR 33
EXHIBIT 6: DIRECT COSTS ASSOCIATED WITH REGULATORY CHANGES 34
EXHIBIT 7: NUMBER OF NTNCWSs AND CWSs IN 11 STATES THAT FAVORED 1 SAMPLE PER TAP IN COMMENTS ON
PROPOSED RULE PLUS ALASKA 36
EXHIBIT 8: NUMBER OF PUBLIC WATER SYSTEMS WITH FEWER THAN 5 TAPS IN 11 STATES 37
EXHIBIT 9: SUMMARY OF ESTIMATED DIRECT COSTS TO SYSTEMS AND STATE/PRIMACY AGENCIES ASSOCIATED WITH
REGULATORY CHANGE III.A 38
EXHIBIT 10: NUMBER OF SYSTEMS EXCEEDING ANNUALLY 40
EXHIBIT 11: SUMMARY OF ESTIMATED DIRECT COSTS TO SYSTEMS AND STATE/PRIMACY AGENCIES ASSOCIATED
WITH REGULATORY CHANGE III.C 42
EXHIBIT 12: ESTIMATED DIRECT COSTS TO SYSTEMS AND STATE/PRIMACY AGENCIES ASSOCIATED WITH
REGULATORY CHANGE III.D 46
EXHIBIT 13: SUMMARY OF DIRECT COSTS ASSOCIATED WITH REGULATORY CHANGE III.E 49
EXHIBIT 14: NUMBER OF SYSTEMS EXCEEDING ANNUALLY 50
EXHIBIT 15: SUMMARY OF DIRECT COSTS ASSOCIATED WITH REGULATORY CHANGE III.F(A)(1) 51
EXHIBIT 16: SUMMARY OF DIRECT COSTS ASSOCIATED WITH REGULATORY CHANGE III.F(B)(1) 52
EXHIBIT 17: ASSUMPTIONS USED TO DERIVE SYSTEM COSTS FOR III.F(B)(2) 54
EXHIBIT 18: SUMMARY OF COST PER SYSTEM FOR ACTIVITIES III.F(B)(2)(i)-(vm) 55
EXHIBIT 19: SUMMARY OF DIRECT COSTS ASSOCIATED WITH REGULATORY CHANGE III.F(B)(2) 55
EXHIBIT 20: SUMMARY OF DIRECT COSTS ASSOCIATED WITH REGULATORY CHANGE III.F(c)(l) 56
EXHIBIT 21: SUMMARY OF DIRECT COSTS ASSOCIATED WITH REGULATORY CHANGE III.F(c)(2) 57
EXHIBIT 22: SUMMARY OF DIRECT COSTS ASSOCIATED WITH REGULATORY CHANGE III.F(c)(3) 58
EXHIBIT 23: SUMMARY OF DIRECT COSTS ASSOCIATED WITH REGULATORY CHANGE III.F(E)(1) 60
EXHIBIT 24: SUMMARY OF DIRECT COSTS TO SYSTEMS ASSOCIATED WITH REGULATORY CHANGE III.F 61
EXHIBIT 25: SUMMARY OF DIRECT COSTS TO STATES ASSOCIATED WITH REGULATORY CHANGE III.F(7) 62
EXHIBIT 26: SUMMARY OF DIRECT COSTS ASSOCIATED WITH REGULATORY CHANGE III.G 65
EXHIBIT 27: SUMMARY OF ANNUAL DIRECT COSTS TO SYSTEMS AND STATES FROM REGULATORY CHANGES 66
EXHIBIT 28: SUMMARY OF DIRECT COSTS ASSOCIATED WITH ONE-TIME COSTS 68
EXHIBIT 29: SUMMARY OF PRELIMINARY COST AND HEALTH RISK REDUCTION IMPLICATIONS OF THE LCR SHORT
TERM RULE CHANGES 70
EXHIBIT 30: SUMMARY OF THE TOTAL BURDEN AND COSTS FROM SEPTEMBER 2007 THROUGH SEPTEMBER 2010 FOR
THE REGULATORY CHANGES 75
EXHIBIT 31: A SUMMARY OF THE BURDEN AND COSTS BY YEAR FOR THE REGULATORY CHANGES - LOWER BOUND
ESTIMATE 76
EXHIBIT 32: A SUMMARY OF THE BURDEN AND COSTS BY YEAR FOR THE REGULATORY CHANGES - UPPER BOUND
ESTIMATE 76
EXHIBIT 33: THE NUMBER OF SMALL SYSTEMS AFFECTED BY THE FINAL RULE CHANGES 78
EXHIBIT 34: THE NUMBER OF SMALL SYSTEMS AFFECTED BY EACH REGULATORY CHANGE 78
EXHIBIT 35: AVERAGE ANNUAL SMALL SYSTEM COSTS BY SYSTEM SIZE CATEGORY 81
EXHIBIT 36: ONE-TIME SMALL SYSTEM COSTS BY SYSTEM SIZE CATEGORY 81
EXHIBIT 37: REVENUE ESTIMATES FOR SMALL SYSTEM SIZE CATEGORIES 82
EXHIBIT 3 8: AVERAGE COSTS PER SYSTEM AND PERCENTAGE OF REVENUE 83
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Economic and Supporting Analyses
Short Term Regulatory Changes to the Lead and Copper Rule
Executive Summary
The Environmental Protection Agency (EPA) is making seven targeted regulatory
changes to the national primary drinking water regulations (NPDWR) for lead and copper. The
intended effect of these regulatory changes is to strengthen the implementation of the Lead and
Copper Rule (LCR) in the areas of monitoring, customer awareness, and lead service line
replacement. Some of these changes clarify the intent of the LCR for provisions that have
generated questions. Other provisions reconsider LCR requirements in light of recent
experiences regarding implementation of the rule. These changes are expected to ensure and
enhance more effective protection of public health through the reduction of lead exposure. The
changes included in today's action do not affect the lead or copper maximum contaminant level
goals, the Action Levels, or the basic regulatory requirements.
This Economic Analysis describes the estimates of annual costs for the seven regulatory
changes to utilities and States, including costs associated with administrative, monitoring,
sampling, reporting, and public notification activities. One-time, upfront costs of rule review and
rule implementation are also estimated. There are two types of annual costs that may result from
the rule changes - direct and indirect. Direct costs are from those activities that are specified by
the rule change, such as costs for additional monitoring or distribution of consumer notices. A
second type of cost may also result when systems and States use the information generated by
directly-related rule activities to modify or enhance practices to reduce lead levels. These
indirect costs, and related health risk reductions, are not quantified for the purposes of this
analysis, but are described qualitatively in Section 5. Exhibit ES-1 summarizes the expected
direct and indirect cost impacts for the seven regulatory changes.
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Exhibit ES-1: Summary of Direct and Indirect Implications of the LCR Short Term Rule
Changes
Bdfe
SfeiiFiS
III.A
III.B
III.C
III.D
III.E
III.F
III.G
lilllfe laiiMOJI?" SSSHiMSae
Number of samples
Monitoring period
Reduced monitoring criteria
Advanced notification and approval
Consumer notice of Lead results
Public Education
Reconsideration of lead service lines
toslMBaiB
Yes
Unqualified
Yes
Yes
Yes
Yes
Yes
totBsikiDi SSsO!
lOISfellferB
Yes
None
Yes
Yes
Yes
Yes
Yes
Six rule changes are expected to result in direct costs: Regulatory Changes IE. A, III.C,
in.D, III.E, ni.F, and EQ.G. For these potential rule changes, costs could be incurred in the areas
of system reporting, tap water monitoring and public education for systems, and State review and
public education for States/Primacy Agencies. Exhibit ES-2 summarizes the annual direct costs
estimated for each rule change. Exhibit ES-3 summarizes the one-time direct costs associated
with implementing the rule changes.
Exhibit ES-2: Summary of Annual Direct Costs to Systems and States from Regulatory
Changes
(4^(5^2006$)
HaplMsip
JSPEGEI
III.A
III.B
III.C
III.D Low
III.D High
III.E
III.F
III.G
TOTAL Low
TOTAL High
Srsms HHM? ©MS sis S'gMiE
'•nrvj-^n
-
-
$61,000
$506,000
$765,000
$136,000
$34,000
-
$736,000
$995,000
fflteifiEJftT?:
-
-
$2,635,000
-
-
-
$110,000
$2,745,000
RMf&Kfm
-
-
-
-
$1,112,000
$825,000
-
$1,938,000
-iTHEfl
-
-
$2,696,000
$506,000
$765,000
$1,248,000
$859,000
$110,000
$5,418,000
$5,677,000
ESHJMfl
Ofes&fiiS
-
-
$82,000
$163,000
$348,000
$163,000
$63,000
-
$471,000
$657,000
UffiMfifilOT
iEamiSygfe
-
-
$2,778,000
$669,000
$1,113,000
$1,411,000
$922,000
$110,000
$5,890,000
$6,335,000
Note: Totals may not add due to rounding.
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Exhibit ES-3: Summary of One-Time Direct Costs
(4th Qtr 2006$)
15J1E ¥
Costs to Systems
Review & Communication
III.A
Total System Costs
Costs to State/Primacy Agencies
Regulation Adoption
III.A
Total State Costs
$10,971,000
$104,000
$11,075,000
$1,488,000
$162,000
$1,650,000
Note: Totals may not add due to rounding.
With regards to potential benefits resulting from the changes, the intent of this
rulemaking is to improve implementation of the lead and copper regulations by clarifying
monitoring, reporting, and notification requirements, and modifying the lead service line test-out
procedure. The revisions do not affect the action levels, treatment techniques such as corrosion
control requirements, or other provisions in the existing rule that directly determine the degree to
which the rule reduces risks from lead and copper.
However, the increase in administrative activities that will result from the revisions will
result in the generation of new information (e.g., more monitoring data, some of which may
show exceedances), and may prompt some systems or individuals to respond to this new
information by taking measures to abate lead and copper exposures and thus reduce the
associated risk. Also, the requirement that treatment changes be approved by the primacy agency
prior to implementation will provide an additional opportunity to identify possible adverse
impacts due to treatment changes, which may lower the risk to consumers. Because the precise
impact of these revisions on the behavior of individuals and systems is not known, EPA has not
quantified the changes in health benefits associated with these revisions. EPA does expect that
overall benefits from the LCR will increase, as a result of the indirect effect of the revisions on
the actions of individual consumers and systems.
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1
Introduction
This document presents an analysis of the costs and potential impacts of the Short Term
Regulatory Changes to the Lead and Copper Rule.
This section provides a summary of the regulatory changes in Section 1.1. Section 1.2
outlines the organization of this document.
1.1 Summary of Changes
The seven targeted regulatory changes to the Lead and Copper Rule (LCR) that are the
focus this document are summarized below.
Summary of Short Term Targeted Regulatory Changes
W 11 l&WfefiMii 11 lrty«i;l^i:^'WiaslMiM»!
Monitoring
III.A
III.B
III.C
Minimum number of samples required
Definitions for compliance and monitoring periods
Reduced monitoring criteria
To address confusion about sample collection
To clarify when compliance and monitoring periods
begin and end
To prohibit systems that exceed the lead Action
Level from initiating or remaining on reduced
monitoring based solely on results of water quality
parameter monitoring
Treatment Processes
III.D
Advanced notification and approval requirement for
water systems that intend to make any change in water
treatment or add a new source of water that could
affect the system's optimal corrosion control
To require systems to obtain state approval to add a
new source of water or change a treatment process
prior to implementation
Customer Awareness
III.E
III.F
Notification of sampling results
Public Education Requirements
To require utilities to provide sampling results to
consumers who are occupants of homes or
buildings that are tested for lead and copper, as part
of the utility's monitoring program
To modify public education requirements by
changing the content of the message to be provided
to consumers, how the materials are delivered to
consumers, and the timeframe for delivery
Lead Service Line Replacement
III.G
Reconsideration of lead service lines deemed replaced
through testing
To require that systems reevaluate lead service
lines classified as "replaced" through testing if the
system resumes a lead service line replacement
program
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1.2 Summary of Differences With the EAfor the Proposed Rule
This EA reflects the final version of the Short Term Changes to the Lead and Copper
Rule. In comparison with the EA that accompanied the proposed Rule, the costs in the EA for
the Final Rule have been updated to reflect a 4th Quarter 2006 price level. In addition, some
burden and cost estimates have been revised based on feedback received in comments on the
proposed Rule. Finally, the burden and cost estimates for some of the regulatory changes have
been modified to reflect specific changes to the requirements. The differences between the Final
Rule and the proposed Rule are summarized in the Appendix L.
1.3 Document Organization
The rest of this document is organized into the following sections:
• Section 2 identifies public health concerns addressed by the rule and provides a
summary of the regulatory history of lead in drinking water, including the recent
review of national implementation of the LCR. It also explains the statutory authority
for promulgating the rule changes and economic rationale for choosing a regulatory
approach.
• Section 3 describes the changes in greater detail and reviews alternative approaches
considered.
• Section 4 presents an estimate of the direct costs of implementing the rule changes to
utilities and State/Primacy Agencies.
• Section 5 discusses the potential indirect cost and health risk impacts that may result
from the rule changes.
• Section 6 discusses analyses performed to evaluate the effects of the rule as specified
by various administrative requirements.
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2 Need for the Rule
The purpose of the Lead and Copper Rule (LCR) is to protect populations from exposure
to lead in drinking water to reduce potential health risks associated with lead. Recent highly
publicized incidences of elevated drinking water lead levels prompted EPA to review and
evaluate the implementation and effectiveness of the LCR on a national basis. As a result of this
multi-part review EPA identified the targeted rule changes that are the subject of this Economic
Analysis. These targeted changes are intended to strengthen the implementation of the LCR in
the areas of monitoring, customer awareness, and lead service line replacement. Some of the
changes clarify the intent of the LCR for provisions that have generated questions. Other
provisions reconsider LCR requirements in light of recent experience. These changes are
expected to ensure and enhance more effective protection of public health through the reduction
in lead exposure.
The following section more fully discusses the need for the targeted rule changes by first
summarizing the health effects associated with exposure from lead to emphasize the on-going
need for reducing that exposure. Next, context on the regulatory history of the LCR is provided.
EPA's recent review of the LCR that resulted in the identification of the targeted rule changes
(among other actions) is described. The section concludes with a description of the regulatory
authority and economic rationale for the regulation.
2.1 Public Health Concerns Related to Lead and Copper Exposure
Although lead is a naturally occurring metal, the highest concentrations of lead are a
result of human activities (ATSDR, 1999). For example, sources of lead include lead-based
paint, contaminated soil, contaminated water, lead crystal or lead-glazed pottery or porcelain,
and industrial processes burning lead-based materials. Lead exposure can cause many serious
health effects, especially for children. For this reason, EPA places a high priority on reducing
lead blood levels (Grumbles, 2004).
Lead can enter the body if it swallowed or inhaled. If contaminated food, drink, soil,
lead-based paint chips, or other objects covered in lead dust are ingested, lead will be delivered
to the stomach. After reaching the stomach, a small portion of lead will enter the bloodstream,
while the other portion will be excreted in urine or feces. In general, a higher portion of lead will
enter the bloodstream for children than for adults (ATSDR, 1999). Once in the blood stream,
lead can be deposited in soft tissues, bones, and/or teeth. If lead particles or dust are inhaled, lead
will first enter the lungs and then be delivered to the bloodstream.
Lead exposure can result in the following health effects: lead can damage the brain and
kidneys, cause infertility in both men and woman, increase blood pressure in adults, and harm
the nervous system causing nerve disorders and muscle and joint pain. Life long exposure to lead
above the Maximum Contaminant Level (MCL) may lead to strokes and kidney disease.
Certain populations are at higher risk because they are exposed to lead more often and/or
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because they are more sensitive to the same exposure than an average individual. Children are
more vulnerable to lead exposure because they are both typically exposed to lead more often and
because they are more sensitive to lead. Children are more likely to be exposed to lead since they
often place their hands on many objects, such as toys, which might be covered in lead dust, and
then place their hands in their mouths. Infants can also be exposed through an exposed mother's
breast milk. Children are more sensitive to lead because children's bodies absorb more of the
ingested lead than adults (ATSDR, 1999). In addition, lead exposure can result in greater health
risks in children as their nervous system is still developing. Health effects in children may
include delayed mental and physical development, decreased IQ, and slight deficits in attention
span, hearing, and learning (Grumbles, 2004). During 1999-2000, approximately 2 percent of
children between the ages of 1 and 5 have blood levels that exceeded CDC's level of concern, 10
mg/dL (CDC, 2003).
Reducing lead exposure for pregnant women is another primary concern for EPA
(Grumbles, 2004). If a mother is exposed to lead, that lead can be passed on to the developing
fetus. Because their nervous systems are just beginning to develop, fetuses are especially
vulnerable to lead exposure.
The Maximum Contaminant Level Goal (MCLG) describes the lowest level of exposure
to a contaminant that does not cause any potential health problems. EPA determined that the
MCLG for lead should be zero, since there is no known safe level of lead in blood (EPA, 2005).
Thus, any exposure to lead, at any concentration, is considered harmful, especially for young
children and pregnant women.
The rule changes are needed to continue the health protection afforded by the LCR
though more timely and useful information regarding lead exposure. These changes will also
promote effective implementation of the LCR provisions that protect citizens from lead in
drinking water.
2.2 Regulatory History
The following section provides a chronology and overview of regulatory actions affecting
the permitable level of lead and copper in drinking water.
Drinking Water Regulations Enacted Prior to 1991
As required by the Safe Drinking Water Act (SOWA), EPA set the National Interim
Primary Drinking Water Regulation for lead in drinking water to 50 parts per billion (ppb) in
1975. This standard was not enforceable and did not require utilities to sample at taps to
determine if they were in compliance.
To limit the amount of lead reaching customer's taps, Amendments to SDWA in 1986
banned the installation or repair of lead pipes, fixtures, solders, and fluxes in any facility that
provides water for human consumption. As defined in section 1417 (d), "lead free" solders and
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fluxes may not contain more than 0.2 percent lead and "lead free" pipes, pipe fittings, and well
pumps may not contain more than 8.0 percent lead. In addition, the 1986 SDWA Amendments
directed EPA to revise the regulations for lead and copper in drinking water. In response to this
directive, the Agency proposed revisions in 1988, and issued the Lead and Copper Rule in 1991.
To limit lead exposure to one of the most sensitive populations, children, the Lead
Contamination Control Act (LCCA) in 1988 required schools to test drinking water and recall
drinking water coolers that leached lead. Furthermore, the LCCA banned new drinking water
coolers with lead parts.
Lead and Copper Rule 1991
On June 7, 1991, EPA promulgated the Lead and Copper Rule (56 FR 26460; LCR),
which set the maximum contaminant level goals (MCLGs) and national primary drinking water
regulations (NPDWRs) for lead and copper. The rule aimed to maximize human health
protection by reducing lead and copper levels at consumers' taps as close to the MCLG, 0 for
lead and 1.3 ppm for copper, as is technologically possible. Since limited technology and
resources made the MCLG unfeasible, EPA set Action Levels at 0.015 mg/L for lead and 1.3
mg/L for copper. Compliance is based on the 90th percentile of tap water samples.
To reduce lead and copper concentrations below the Action Level, the LCR specified that
community water systems (CWSs) and non-transient non-community water systems
(NTNCWSs) must conduct periodic monitoring at the tap and reduce water corrosivity, since
corrosive water can increase the amount of lead and copper that is leached from service lines and
plumbing materials made of lead and/or copper. The rule also required the following.
• Public notification when lead in treated drinking water exceed the lead Action Level
• Treatment of source water if it significantly contributed to high levels of lead or copper
• Replacement of lead service lines in the distribution system if lead levels continued to
exceed the Action Level
Implementation of this rule was phased in based on system size, whereby the largest systems
began monitoring in 1992, and the smallest systems began monitoring in 1993.
Proposed Changes to the Lead and Copper Rule 1996
On April 12, 1996, EPA published a set of proposed minor revisions to improve
implementation of the Lead and Copper Rule. Many of the changes were based upon
recommendations made by a work group composed of Headquarters and Regional EPA staff, and
State drinking water officials. Other changes were a result of legal challenges to the 1991 Lead
and Copper Rule brought on by the American Water Works Association (AWWA) and the
Natural Resources Defense Council (NRDC).
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The goal of the proposed changes was to promote consistent, national implementation of
the LCR, and streamline and reduce reporting burden. Proposed changes included optimizing
corrosion control, streamlining monitoring processes, guidance for site selection, requirements
for public education, guidance for analytical processes, and clarification of reporting
requirements. In addition, EPA requested comments on paperwork burden reductions, many of
which were previously suggested, but EPA did not have sufficient time to consider for LCR
1991.
The minor revisions to the LCR that were ultimately adopted are discussed below under
"Lead and Copper Rule Minor Revisions 2000."
Safe Drinking Water Act 1996
The 1996 Amendments to SDWA added that "lead free" plumbing fittings and fixtures
must meet standards established under section 1417(e) (42 U.S.C. 300g-6(e)). Section 1417(e) of
the SDWA says that either a voluntary standard must be accepted within a year or EPA must
issue a regulation within two years. Furthermore, if a voluntary standard is to be accepted, the
Administrator must provide technical assistance to a qualified third-party in the development of
the voluntary standard and associated testing protocols for examining lead leaching from new
plumbing fittings and fixtures.
In response, EPA published in the Federal Register (FR Vol. 62, No. 163, 44684, Aug.
22, 1997) their view that NSF 61, Section 9 satisfies the requirement of Section 1417(e).
Specifically, EPA felt that NSF 61, Section 9 is an established voluntary standard and therefore,
the obligation to issue a new regulation was not triggered. As a result, any new plumbing fitting
and fixtures must be NSF certified.
Lead and Copper Rule Minor Revisions 2000
On January 12, 2000, EPA published final minor revisions to the Lead and Copper Rule
(LCRMR) based on the comments and discussions of the proposed revisions in 1996. The minor
revisions streamline requirements, promote consistent national implementation, and in many
cases, reduce the burden for CWSs and NTNCWSs water systems. The changes fall into the
following categories: demonstration of optimal corrosion control, lead service line replacement
requirements, public education requirements, monitoring requirements, analytical methods,
reporting and record keeping requirements, and special primacy considerations.
EPA also accepted the definition of "lead free" as defined in the SDWA.
The LCRMR did not change the Action Levels, MCLGs, or the rule's basic treatment
requirements.
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2.3 Comprehensive Review of the L CR
The minor changes to the Lead and Copper Rule described in this document were
identified through a comprehensive national review of compliance and implementation of the
Lead and Copper Rule. The review was initiated in response to high profile Action Level
exceedances experienced by the District of Columbia Water and Sewer Authority (DC WASA).
The purpose of the review was to answer three questions with regards to lead in drinking water:
1. Is this a national problem? Does a large percent of the population receive water that
exceeds the lead Action Level? Do a large number of systems fail to meet the lead
Action Level?
2. How well has the rule worked to reduce lead levels in systems over the past 12 years,
particularly in systems that had demonstrated high lead levels in the initial rounds of
sampling?
3. Is the rule being effectively implemented today, particularly with respect to
monitoring and public education requirements?
The comprehensive review consisted of several elements, including a series of workshops
designed to elicit issues, comments, and suggestions from stakeholders on particular topics, a
review of data to evaluate the effectiveness of the rule, and a review of LCR implementation by
States and utilities. The following section summarizes the DC WASA situation that prompted the
comprehensive review, describes in greater detail the elements of the review, and presents EPA's
findings and next steps resulting from the review.
DC WASA 's Experience with Elevated Lead Levels in Drinking Water
DC WASA is a utility that distributes drinking water to over 500,000 residential,
commercial, and governmental customers in the District of Columbia. The water that DC WASA
distributes is purchased from and treated by the Washington Aqueduct, a division of the US
Army Corps of Engineers.1
From 1994 through 1999, DCWASA met the Action Level for lead under the LCR and
went on reduced monitoring. In August 2002, DCWASA reported to EPA that the 90th percentile
of 53 tap water samples for the compliance period of July 1, 2001- June 30, 2002 exceeded the
Action Level of 15 ppb, at a value of 75 ppb. Subsequent tap sampling also indicated Action
Level exceedances for the period of January - June of 2003 (40 ppb 90th percentile from 104
samples) and July - December of 2003 (63 ppb 90th percentile from 108 samples). As per the
LCR, the Action Level exceedances triggered DC WASA to undertake tap monitoring on a
http://www.dcwasa.com/about/gen_overview.cfm
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regular (i.e., not reduced) schedule, public education, and lead service line replacement.2
Local media coverage of the exceedances and the results of lead service line testing
elevated the visibility of DC WASA's lead levels. Multiple hearings were conducted before
House and Senate committees in 2004 and 2005. EPA conducted a compliance audit that resulted
in an Administrative Order that detailed alleged weaknesses in DC WASA's implementation of
the LCR including the following.
• Failure to take samples within the monitoring period
• Failure to conduct follow-up monitoring of partially replaced lead service lines
• Failure to comply with requirements for public service announcements
• Not using required language in written materials provided to customers
• Failure to report samples and Action Level exceedance
• Failure to perform required activities following exceedance of the Lead Action Level in
the July 2000 - June 2001 monitoring period
Failure to report noncompliance
3
DC WAS A, in coordination with EPA, the Corps of Engineers, and other groups,
implemented numerous measures to address the high lead levels, including adding
orthophosphate as a corrosion control treatment, replacing lead service lines, and conducting
sampling and research. Early results seem to indicate the effectiveness of orthophosphate in
reducing lead levels.4 Preliminary analyses from an ongoing technical review suggest potential
causes of the elevated lead levels including the following.
• Conversion from free chlorine to chloramines for final disinfection
• Detachment of lead particles from piping systems
• Galvanic corrosion of lead service lines
• Grounding currents that affect corrosion of lead bearing components
• City-Wide meter replacement program
2 ADMINISTRATIVE ORDER FOR COMPLIANCE ON CONSENT Docket No. SDWA-03-2004-0259DS
3 ADMINISTRATIVE ORDER FOR COMPLIANCE ON CONSENT Docket No. SDWA-03-2004-0259DS
4 DC WASA, 2004 DRINKING WATER QUALITY REPORT
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• Distribution system pH variations
• Drought conditions and resulting effects on corrosivity of DCWASA water 5
With regards to the implementation of the LCR, the DC WAS A experience highlights
several areas in which the LCR could be improved, including monitoring after lead service line
replacement, defining compliance and monitoring periods, and the impact of treatment changes.
Workshops on Lead in Drinking Water
EPA held five workshops in 2004-2005 to elicit issues and suggestions from stakeholders
on various topics related to lead in drinking water.
• Simultaneous Compliance, May 2004, St. Louis, MO: Expert participants from utilities,
academia, state governments, and other stakeholder groups identified issues, proposed
solutions, and identified information gaps with respect to simultaneous compliance with
the LCR and other rules such as the Total Coliform Rule, the Surface Water Treatment
Rules, and the Disinfection Byproducts Rules. Issues and suggestions were developed for
four topic areas: coagulation impacts on corrosion control; impacts of disinfectant
changes on corrosion control; corrosion inhibitor; and distribution system management.
Among the issues identified by the group were information gaps on impacts of treatment
changes under various water quality conditions/chemistries and the need for additional
guidance on a variety of topics.
• Sampling Protocols, May 2004, St. Louis, MO: Expert participants from utilities,
academia, state governments, and other stakeholder groups identified issues, proposed
solutions, and identified information gaps with respect monitoring and sampling under
the LCR. Topic areas included sampling frequency and triggers; sampling site
selection/location; sampling protocol; and sampling of water quality parameters. The
issues included sampling after treatment changes and Action Level exceedances and the
re-examination of flushing instructions.
• Public Education, September 2004, Philadelphia, PA: Expert participants from utilities,
governments, consumer and environmental groups, and other stakeholder groups
discussed the public education requirements under the lead and copper rule, drinking
water risk communication, and effective communication with the public. Participants
suggested ways to improve risk communication to the public through establishing
partnerships with health departments and other groups, refining the message content,
improving delivery of the message, and spending more time planning and evaluating the
effectiveness of the risk communication.
• Lead Service Line Replacement, October 2004, Atlanta, GA: Expert participants from
" Forensic Analysis of Elevated Lead Levels in District of Columbia Water and Sewer Authority Drinking Water:
Task 5 Data Summary (Draft), Prepared by HDR/EES, June 1, 2005
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utilities, academia, state governments, and other stakeholder groups discussed the
challenges and problems encountered by the participants in implementing lead service
line replacement, as well as strategies and solutions for overcoming those difficulties.
Specific topic areas addressed included monitoring, customer communications,
replacement technologies, and managing inventory. Continued sampling after lead
service line replacement and the need to notify customers of testing results were
mentioned during the discussions.
• Lead in Plumbing, July 2005, Washington, DC: Expert participants from utilities,
academia, state governments, and other stakeholder groups discussed lead in plumbing
fittings and fixtures. Topic areas included NSF standards and testing protocols,
alternative materials, national/state/local/industry/consumer practices, and miscellaneous
issues.
Review of Data to Evaluate Effectiveness of Rule
EPA undertook a review of the lead levels in drinking water systems serving more than
3,300 as reported in the Safe Drinking Water Information System/Federal Version
(SDWIS/FED). Since 2002, States have been required to report to SDWIS the 90th percentile
lead concentrations for systems serving more than 3,300. At the start of the review, SDWIS/FED
had data for only 23 percent of these systems. EPA worked with States to expedite entry of the
90th percentile lead data. The effort was successful, with data available for 97 percent of large
systems and 91 percent of medium systems as of June 1, 2004.
The following exhibits summarize the data on medium and large public water systems
exceeding the Action Level from SDWIS/FED as of January 27, 2005.
Exhibit 1: Systems Exceeding the Lead Action Level Since 2003
Number of systems above Action Level
All systems with data6
% all systems with results above the Action Level
Small
884
64,382
1 .4%
Medium
97
7,388
1 .3%
Large
14
819
1 .7%
Total
995
72,589
1 .4%
Source: For medium and large systems, January 2005 Summary of Lead Action Level,
http://www.epa.gov/safewater/lcrmr/lead data.html: for small systems, Summary, Lead Action Level
exceedances for public water systems subject to the Lead and Copper Rule (For data through September
13,2004).
' Based on system inventory from 2nd Quarter 2005 SDWIS data pull
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Exhibit 2: Systems Exceeding the Lead Action Level Since 2000
Number of systems above Action Level
Systems with monitoring results since 2000
% of Systems with monitoring results since 2000 over AL
Small
2,663
N/A
N/A
Medium
305
7,388
4.1%
Large
37
819
4.5%
Total
3,005
8,207
4.2%
Source: For medium and large systems, January 2005 Summary of Lead Action Level,
http://www.epa.gov/safewater/lcrmr/lead data.html: for small systems, Summary, Lead Action Level
exceedances for public water systems subject to the Lead and Copper Rule (For data through September
13,2004).
Based on the data, 95.8 percent of medium and large systems reporting data since 2000
have 90th percentile values below the Action Level. Since 2003, it appears that number is slightly
higher, with 96.9 percent of medium and large systems under the Action Level. EPA concluded
from this data: "There does not appear to be a widespread problem with elevated lead levels
across the country comparable to that currently being observed in the District of Columbia." 7
EPA also compared Action Level exceedances for 166 large systems serving over 50,000
from immediately after the adoption of the LCR (1992/1993) to the current monitoring results
(2000-2004), summarized in Exhibit 3. In 1992/1993, all 166 of these systems exceeded the
Action Level. In 2000-2004, only 15 of these systems had 90th percentiles that exceeded the
Action Level, "...demonstrating that corrosion control efforts taken by the utilities have largely
been effective in controlling lead levels." 8
http://www.epa.gov/safewater/lcrmr/lead data.html and Summary Lead Action Level exceedances for
medium (3,300-50,000) and large (>50,000) public water systems (Updated as of June 1, 2004)
o
http://www.epa.gov/safewater/lcrmr/reductionplan_comparison.html
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Exhibit 3: Lead 90 Percentile Levels for 166 Large Water Utilities - Then and Now
D Below Action Level D Above Action Level
180
160 J
* 14°
« 120
(0
w 100
1992/1993 Most Recent Data (2000-2004)
Time Period for Monitoring
Source: http://www.epa.gov/safewater/lcrmr/reductionplan_comparison.html
In 2004, EPA carried out a review of the implementation of LCR requirements by States.
EPA asked State programs, who have primary oversight responsibility, a number of questions
about how they implement different aspects of the LCR. The questions were centered on the
following general categories: sampling issues, calculation of the 90th percentile value, treatment
issues, lead service line replacement, public education and enforcement.9
Generally, the State responses to the survey indicate that the States are following the
minimum state requirements of the LCR. However, the information provided to EPA indicates
that many States may not be taking full advantage of the opportunities to oversee implementation
of the rule. Also, the States' responses did highlight a few areas in which there is some confusion
about the requirements of the rule as well as areas in which some States are going above and
beyond the minimum obligations.
Drinking Water Lead Reduction Plan
As a result of the previous activities, EPA determined that the current approach of the
LCR has been effective in reducing drinking water lead levels in the nation's public water
systems and that there does not appear to be a widespread problem associated with high lead
levels in drinking water. However, EPA identified opportunities to improve and clarify specific
9 Source: USEPA, State Responses to EPA Survey on State Implementation, November 2005.
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areas of the LCR and guidance materials. The seven targeted rule changes that are the subject of
this document are key elements of the Drinking Water Lead Reduction Plan.
10
It should be noted that EPA has also identified a number of issues that require longer-
term consideration that will continue to be reviewed as part of potential, more comprehensive
revisions to the rule or guidance. In many cases, these issues require additional data collection,
research, and analysis to fill critical data gaps. Also, some issues require full stakeholder
involvement to support decisions. Issues that are the subject of longer-term consideration include
the following.
• Requirements for consecutive systems
• Broader revisions to monitoring and lead service line replacement requirements
• Revision to lead content in plumbing fittings and fixture requirements
Short-term Regulatory Revisions and Clarifications to the Lead and Copper Rule
Workgroup
In May 2005, EPA formed a work group to consider issues related to the regulatory changes,
called the Short-term Regulatory Revisions and Clarifications to The Lead & Copper Rule
Workgroup (LCRSTR Workgroup). The LCRSTR Workgroup included EPA staff from a variety
of Headquarters and Regional offices, as well as representatives from State drinking water lead
programs. The LCRSTR Workgroup identified alternatives, drafted regulatory language, and
discussed issues related to the changes.
National Drinking Water Advisory Committee Working Group on Public Education
Requirements of the Lead and Copper Rule
As part of the review of the LCR, EPA identified a number of issues relating to the public
education requirements of the LCR. In order to address these concerns, the National Drinking
Water Advisory Council (NOWAC), EPA's advisory body on the Safe Drinking Water Act,
formed a working group to consider possible revisions to the public education requirements. The
charge for the NDWAC Working Group was to 1) review the current public education
requirements for lead in drinking water to make recommendations for improvements; 2) develop
recommended revised language for communicating to the public the risk of lead in drinking
water and how affected persons should respond; and 3) review and make recommendations for
changes to the means of delivery of lead information to the public.11
The NDWAC Working Group met in person four times between October 2005 and April
2006. The Working Group was comprised of 16 individuals representing an array of
backgrounds and perspectives. Collectively, these individuals brought into the discussion the
10 Source: Drinking Water Lead Reduction Plan, EPA 810-F-05-001, March 2005,
http://www.epa.gov/safewater/lcmir/reductionplan_fs.html.
11 70 FR 54375, US EPA, 2005.
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perspectives of State drinking water agencies, environmental and consumer groups, drinking
water utilities, small system advocates, State health officials, and risk communication experts.
The recommendations from the NDWAC Working Group form the basis of the regulatory
changes on public education (III.F).
2.4 Rationale for the Regulation
This section discusses the statutory authority of EPA to regulate lead in drinking water
and the economic rationale for choosing a regulatory approach.
EPA derives its statutory authority to regulate contaminants in drinking water through the
Safe Drinking Water Act. Section 1412(b) (1) (A) of the SDWA requires EPA to establish
National Primary Drinking Water Regulations for contaminants that may have an adverse public
health effect; that are known to occur or that present a substantial likelihood of occurring once in
public water systems (PWSs), at a frequency and level of public concern; and that present a
meaningful opportunity for health risk reduction for persons served by PWSs.
This section addresses the economic rationale for choosing a regulatory approach as
described in Executive Order Number 12866, Regulatory Planning and Review (USEPA
1993). OMB circular A-4 notes that the rationale for regulation is to correct market failure or
other social purposes: "The major types of market failure include: externality, market power, and
inadequate or asymmetric information. Correcting market failures is a reason for regulation, but
it is not the only reason. Other possible justifications include improving the functioning of
government, removing distributional unfairness, or promoting privacy and personal freedom."
Several of the rule changes correct inadequate or asymmetric information. For example,
regulatory change III.E requires that tap monitoring results be provided to consumers, correcting
asymmetric information. Regulatory change III.D changes the timing of information provision to
States, again correcting asymmetric information. Additional information is gathered under
regulatory changes HID and III.G, correcting inadequate information. Regulatory change III.F
provides for the development of better information and the more effective distribution of
information, thereby also correcting a situation of inadequate information.
The other regulatory changes clarify the intent of the LCR, leading to more effective
implementation of the rule thereby improving the functioning of government.
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3 Regulatory Changes and Alternatives Considered
3.1 Regulatory change III. A - Minimum number of samples required
Description of Regulatory Change
EPA is clarifying the minimum sampling requirement for small water systems that have
fewer than five taps by making revisions to § 141.86 (c). These revisions include a clarification
that the term "taps" means "taps that can be used for human consumption", as opposed to taps
not used for human consumption such as hose bibs or at utility sinks. In addition, the revisions
clarify what a system must do to meet the minimum number of samples requirement (five), when
there are fewer than five taps available for sampling. In this situation, those water systems must
sample all taps at least once and take repeat samples on different days until five samples are
obtained.
EPA is adding a provision to § 141.86 (c) that gives States the discretion to allow public
water systems with fewer than five taps to collect one sample per tap that can be used for human
consumption. The requirement is not mandatory and NTNCWSs and CWSs that qualify must
make a request to the State in writing and must be approved by the State in writing or by onsite
verification. Under this alternate sampling schedule, the sample with the highest test result will
be compared to the Action Level to determine compliance. If any sample result is above the
Action Level, it will serve as the system's 90th percentile value. EPA is adding regulatory text
to §141.80 to describe this new compliance determination. The new sampling schedule is also
applicable for NTNCWSs and CWSs that are on reduced monitoring and EPA is adding a
provision to §141.86 (d)(4)(i) for those systems. The provision allows the water system to
reduce sampling frequency to once per year, but in no case can the number of samples required
be reduced below the minimum of one sample per tap that can be used for human consumption.
Rationale for Regulatory Change
In the original Lead and Copper Rule of 1991, the term "site" is used to refer to the
number of samples collected, and there has been confusion as to whether "site" refers to taps or
physical locations. EPA is clarifying that sampling "sites" refer to "taps that can be used for
human consumption". The phrase "that can be used for human consumption" is being added to
the regulations to ensure that samples are taken from taps which would pose the highest risk for
exposure to lead, rather than from taps that are not frequently used for human consumption.
EPA is making clarifications for NTNCWSs and CWSs with fewer than five taps that can
be used for human consumption. In the proposal for this rule, EPA maintained that systems must
take a minimum of five samples in order to adequately capture the variability of lead levels and
that it was more cost effective for small systems to take more samples than install corrosion
control or source treatment based on a small pool of samples taken. EPA is maintaining that
systems must take a minimum of five samples as part of today's rule, however, EPA is also
giving States the discretion to offer the alternative sampling requirement of sampling 100 percent
of taps that can be used for human consumption to water systems with fewer than five taps. This
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alternative sampling schedule alleviates any cost burden for systems associated with taking
repeat samples and is also health protective because it does not allow water systems to ignore a
potential problem by taking repeat samples at taps that have low lead results when they get a
high sample result Under the alternative sampling provision, systems would compare the sample
with the highest result to the Action Level to determine if compliance actions, such as public
education, corrosion control treatment installation, and/or lead service line replacement, are
required.
Alternatives Considered
Several alternative approaches were discussed by the Short-term Regulatory Revisions
and Clarifications to The Lead & Copper Rule Workgroup (LCRSTR Workgroup). These
approaches included retaining the 5 sample minimum requirement for systems, but allowing
States the option to reduce the number of samples to one per tap if the history of data collected at
the system demonstrates that levels have always been below the Action Level with little to no
variability.
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3.2 Regulatory change III.B - Definitions for compliance and monitoring periods
Description of Regulatory Change
EPA is proposing to clarify the terms "compliance period" and "monitoring period" for
purposes of the LCR. The term "compliance period" shall be as defined in Section 141.2 as a
three-year calendar year period within a nine-year compliance cycle. The term "monitoring
period" will refer to the specific period within the compliance period in which a water system
must perform the requirement (e.g., June-Sept ember).
Rationale for Regulatory Change
This change is intended to clarify when systems are required to conduct routine
monitoring under reduced schedules and when they must begin actions (i.e., corrosion control,
public education, lead service line replacement) to remedy a lead Action Level exceedance.
For systems on reduced monitoring, they must monitor either once during each
calendar year or once during each three-year compliance period. The monitoring period is from
June to September or some other four-month period during normal operation where the highest
lead levels are most likely to occur. This change would clarify that a system that exceeds the
Action Level would be determined to be doing so as of the date on which the monitoring period
ended (e.g., on September 30).
This change would also require, for systems on triennial monitoring, samples be taken
during four consecutive months within the compliance period, not over multiple years. These
systems must also conduct their monitoring every three years.
Alternatives Considered
The Short-term Regulatory Revisions and Clarifications to The Lead & Copper Rule
Workgroup considered alternatives for defining the term compliance period.
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3.3 Regulatory change III. C - Reduced monitoring criteria
Description of Regulatory Change
Under the current rule language, systems are eligible for reduced monitoring based on
certain criteria. For small systems, these criteria include having lead and copper levels below
both Action Levels for two consecutive monitoring periods. For all systems, the criteria include
meeting the State-designated water quality parameters with State approval, but without meeting
either the lead or copper Action Level. The rule change specifies that if a system on reduced
monitoring exceeds the lead Action Level, the system must revert to the regular monitoring
schedule for lead tap sampling.
Rationale for Regulatory Change
Monitoring lead levels at the tap is particularly critical for systems that are exceeding the
Action Level. These systems need frequent data on the levels of lead corrosion so that they can
evaluate the effectiveness of any modifications to corrosion control treatment they may be
attempting, and to better inform their consumers of the effectiveness of the system's efforts to
reduce lead levels.
Alternatives Considered
The LCRSTR Workgroup and EPA considered including meeting the copper Action
Level for reduced monitoring under all circumstances (i.e., systems meeting water quality
parameter requirements) as part of this rule change. However, since the current rule does not
contain additional requirements if a copper Action Level is exceeded (such as public education),
EPA determined that copper issues will be considered as part of longer term revisions to the rule.
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3.4 Regulatory change III.D - Advanced notification and approval requirement
Description of Regulatory Change
Under the current rule, Section 141.90(a) (3) requires that systems deemed to have
optimized corrosion control under §141.81(b) (3), systems subject to reduced monitoring
pursuant to §141.86(d) (4), or systems subject to a monitoring waiver pursuant to §141.86(g)
must notify States no later than 60 days after of a treatment change or the addition of a new
source. The rule modification requires that these systems notify States of any long-term change
to be made in water treatment process or additions of new sources in advance and the States
determine when and if these changes may be made through a formal review and approval
process. This gives systems the opportunity to consult with their States as much as they want and
to take other measures necessary to avoid problems with corrosion. It also allows States to design
monitoring programs upfront or require additional actions for the systems under those situations
when it is necessary to ensure that corrosion control is being maintained adequately after the
change has been made.
Rationale for Regulatory Change
EPA proposed that systems be required to provide advanced notification of any change in
treatment or addition of a new source and receive approval from the State prior to making the
change instead of the existing requirement that the system had to notify the State within 60 days
of making a change. The final rule requires systems to provide advanced notification of any
change in treatment that has long term impacts or addition of a new source and receive approval
from the State before implementing the change. When water systems make changes to their
treatment process with long term impacts or add a new source of water, there can be
unintentional effects on the system's optimal corrosion control. EPA believes that State review
and approval of changes in long-term treatment or addition of a new source will provide an
opportunity to minimize any potential impacts on optimal corrosion control. EPA has narrowed
the scope of this provision in the final rule to only long-term changes in treatment. Long-term
treatment changes include the addition of a new treatment process or modification of an existing
treatment process. Modifications include switching secondary disinfectants, switching
coagulants (e.g., alum to ferric chloride), and switching corrosion inhibitor products (e.g.,
orthophosphate to blended phosphate). Long-term changes can include dose changes to existing
chemicals if the system is planning long-term changes to its finished water pH or residual
inhibitor concentration. Long-term treatment changes would not include chemical dose
fluctuations associated with daily raw water quality changes.
Alternatives Considered
The LCRSTR Workgroup considered various lengths for the time period before a change
that notification had to take place, such as at least 60 days. However, limiting notification to 60
days prior to a treatment change could be too short for some major changes. Leaving the States
flexibility to decide on a timeframe through a review and approval process would alleviate such
potentially unnecessary burdens.
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In addition, some Workgroup members believe that source changes should be considered
in addition to new sources for review and approval. This may cause additional burden if some
States and systems do not consider source adjustments as new sources.
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3.5 Regulatory change III.E - Requirement to provide sampling results to consumers
Description of Regulatory Change
Systems take tap samples to test for lead for several purposes, most notably to calculate
compliance with the Action Level. The purpose of this change in rule language is to add the
requirement systems provide consumers (owners and occupants) with the tap monitoring results
for samples taken for routine lead monitoring. The change modifies Sections 141.80(g) and
141.85, and adds a new Section 41.85(e) on the notification of results. This new section specifies
the timing (within 30 days of learning of the results), the content of the notification, and the
method of delivery for the notification. EPA is also adding a reporting requirement to §141.90(f)
for systems to certify they have completed this new consumer notification requirement.
Rationale for Regulatory Change
Community water systems must collect samples from between 5 and 100 households to
calculate the 90th percentile for comparison to the LCR Action Levels. Non community water
systems (including some schools that operate their own water system) must also collect samples.
Currently, systems are not required to notify the occupants of the lead levels measured in
samples taken from their specific taps. This rule change would require systems to provide written
notification to occupants of the households within a specified period and to post or otherwise
notify occupants of non- residential buildings of the results of the lead testing. This would
include staff and parents of students for schools that are tested as non-transient non-community
water systems. While these tap samples are primarily collected to evaluate the effectiveness of
corrosion control or to evaluate the corrosivity of the systems water, the results of the lead
monitoring can provide useful information to the occupants of the location from which the
samples were taken. In addition to the sample results, the notifications will include an
explanation of potential health risks associated with lead in drinking water, methods for reducing
risks, contact information for the utility, and the 90th percentile lead level for the most recently
completed compliance monitoring period reported to the State. Occupants may use this
information to inform any decisions they might make regarding taking actions to reduce their
lead exposure.
Alternatives Considered
The Workgroup considered alternative time frames and including the results of any
testing the utility performs in homes and buildings other than routine monitoring requirements.
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3.6 Regulatory change III.F- Public education requirements
Description of Regulatory Change
The purpose of this regulatory change is to modify the public education requirements of
the Lead and Copper Rule (LCR) in the Code of Federal Regulations §141.85. Water systems
would still be required to deliver public education materials after a lead Action Level
exceedance. However, the content of the message to be provided to consumers, how the
materials are delivered, and the timeframe for delivery will be modified. The changes to the
delivery requirements include additional organizations that systems must partner with to
disseminate the message to at-risk populations as well as changes to the media used to
disseminate information to ensure water systems reach consumers when there is an Action Level
exceedance. EPA has also added a requirement for systems to prepare and submit to States and
letter certifying that the public education activities after an Action Level exceedance have taken
place. Specific changes include the following.
a) Changes to the mandatory text to written materials
The regulatory change requires systems that have a lead Action Level exceedance to
continue to deliver written materials to all customers as well as a number of key organizations.
However, the content of the required written materials is modified to be much shorter and easier
to understand. The mandatory language addresses essential topics such as the opening statement
and health effects language. Community Water Systems and Non- Transient Non-Community
Water Systems are still required to provide information on other topics, but the system may
either use EPA's suggested language or their own words to explain these topics.
b) Changes to better reach at-risk populations
This regulatory change adds organizations to the list of recipients of the public education
materials in order to increase the likelihood that the most vulnerable populations or their
caregivers will receive the information they need to reduce their exposure to lead in drinking
water. This includes requiring the system to send information to licensed childcare centers,
preschools and Obstetricians-Gynecologists and Midwives. In addition, systems are required to
include an informational notice with the printed materials that they send to these organizations to
explain the importance of sharing this information with their customers/patients. Also, systems
are required to directly contact (e.g., phone, in person, etc.) the local health agency rather than
simply delivering brochures to this organization. By directly contacting the local health agency,
utilities can request the health agency's support in disseminating information on lead in drinking
water and the steps that vulnerable populations can take to reduce their exposure.
Systems are also required to complete additional activities from a list of options. The list
of additional activities that systems can choose from includes the following.
• Public Service Announcements
• Paid advertisements such as newspaper or transit ads
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• Information displays in public areas such as grocery stores
• Using the internet or email to disseminate information
• Public meetings
• Delivery to every household (not just bill paying customers)
• Individual contact with customers such as door hangers
• Provide materials directly to multi-family homes and institutions
• Other methods approved by the primacy agency
Systems serving more than 3,300 people must implement three additional public
education activities from the list and systems serving 3,300 or fewer individuals must implement
one additional activity. The system must work in consultation with the State to ensure that the
content of each of these additional activities is appropriate. A system can choose three items
from one, two, or three of these general categories. For instance, a system can do a series of paid
advertisements if that is the most effective way to reach the target populations in their
community.
c) Changes to help systems maintain communication with consumers throughout the
exceedance
Under this change, systems include information in or on the water bill no less than
quarterly as long as there is an exceedance of the lead Action Level, with a provision to allow
systems to work with their primacy agency to deliver this information in a different way if
necessary. In addition, systems with a population greater than 100,000 are required to put the
public education information on their Web site until the system tests below the lead Action
Level.
Currently, systems that exceed the lead Action Level must issue a press release. The
regulatory change requires that systems distribute two press releases per year in order to ensure
systems are maintaining communication with their customers. The systems must send the press
releases to the major newspapers and TV and radio stations which cover the population served
by the water system. States can waive the press release requirement if there are no media outlets
that cover the population served by the system. In addition, the requirement for medium and
large systems to provide two Public Service Announcements (PSAs) per year is removed.
d) Changes to the required timing of completion of public education requirements
While the revision requires systems to complete public education activities within 60 days of
the end of the monitoring period in which the exceedance occurred, there is flexibility for the
State to allow longer for completion of these activities. However, systems must request and gain
State approval on a case-by-case basis for extending this deadline within the 60-day window.
This ensures that the system and the State begin public education actions to reduce exposure as
soon as possible, but allows these actions to continue past the 60-day timeframe as needed for
effective implementation.
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e) Changes to Consumer Confidence Reports
The regulatory change will require all community water systems include information
about the risks of lead in drinking water in their Consumer Confidence Reports on a regular
basis.
Rationale for Regulatory Change
The intention of changing the public education requirements of the LCR is to improve
compliance and ensure that consumers receive the information they need to limit their exposure
to lead in drinking water. Because the sources of lead are frequently within the home and
reduction of lead in drinking water is the responsibility of both the public water systems and the
consumer, EPA wants to ensure that information is delivered and that it is meaningful and useful
to the consumer.
As part of the review of LCR compliance issues, it was determined that many water
utilities did not conduct the required public education, therefore the at-risk population did not get
information they needed to reduce their exposure from lead in drinking water.12 EPA believes
these changes better ensure at-risk populations receive information quickly and are able to act to
reduce their exposure. EPA also believes water systems will be better able to comply with
today's requirements.
During EPA's national review of the LCR, many stakeholders stated that the public
education requirements needed improvement. In September 2004, EPA held an expert workshop
to discuss the public education requirements of the rule. A number of concerns were raised at
this workshop about the effectiveness of the existing public education language and
requirements. Workshop participants stated that the mandatory language in the rule is too long,
cumbersome, and complex to convey to the general public an understanding of the risk posed by
lead in drinking water and an appropriate course of action. Public education must put the risk in
context and convey to the public the appropriate sense of urgency for consumers to act to reduce
exposure. In addition, workshop members called for public education messages to be tailored to
those who are at highest risk for lead exposure. Many participants stated that the mandatory
language and delivery requirements in the current rule were ineffective in providing useful and
timely information to the public.13
In order to address these concerns, the National Drinking Water Advisory Council
(NOWAC), EPA's advisory body on the Safe Drinking Water Act, formed a working group to
consider possible revisions to the public education requirements. The NDWAC Working Group
raised a number of concerns with the public education requirements of the LCR that are
consistent with the concerns expressed at the 2004 workshop. The NDWAC Working Group
recommended that the rule be modified to better ensure that information reaches the most
vulnerable populations (e.g., pregnant women, infants and young children) or their caregivers.
They also recommended changes to ensure that these consumers received information in a more
12 Lead and Copper Rule State File Review: National Report, EPA, March 2006
13 Summary from Public Education Workshop, US EPA, 2004.
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timely manner and continued to receive information throughout any exceedance. They also
recommended changes to ensure that the information is easy to understand and effective in
informing affected consumers and encouraging parents or other caregivers to take actions to
reduce exposure of infants and children to lead. In addition, the NDWAC Working Group
recommended changes to make sure critical information reaches not only bill paying customers,
but those consumers who live in apartments and other housing where residents do not receive
bills.
Finally, the NDWAC Working group was also concerned about the amount of time it
may take to test water, get back the results, calculate the 90th percentile, and finally send out
public education materials. They were concerned that an individual could be drinking water with
high lead levels for months before knowing of the problem. As a result, they recommended
changes to increase the timeliness of public education on lead in drinking water.
The NDWAC recommendations are, in part, modeled after the public education
information under two existing EPA rules, the CCR and the Public Notification Rule (40 CFR
141, Subpart Q). The NDWAC recommendations form the basis for the changes to § 141.85 in
this rulemaking.
Alternatives Considered
The NDWAC Working Group considered many alternatives during their deliberations in
the areas of mandatory language, delivery requirements to make the public education program
more effective, consultation between systems and States, the timing of notification, and means
for targeting vulnerable populations.
Page 28
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3.7 Regulatory change III. G - Reevaluation of Lead Service Lines deemed replaced,
Description of Regulatory Change
Under the existing rule, systems that are replacing lead service lines in response to an
Action Level exceedance may sample lead levels from lead lines. If the sampled lead levels from
an individual service lines is below the Action Level (15 ppb), that line would not have to be
physically replaced, but could be considered replaced towards meeting the goal of 7 percent
replacement. Since these "tested-out" lines are considered replaced, they do not have to be re-
evaluated if water quality conditions or treatments change.
The rule language requires that these "tested-out" lines be re-evaluated if a system
subsequently exceeds the Action Level and is triggered back into further lead service line
replacements. The tested-out lines are put back into the inventory of lead service lines and are
then treated as any other line in the inventory, to be either re-tested and "tested-out" or re-tested
and replaced if the lead levels for the line exceed the Action Level.
Rationale for Regulatory Change
This "test-out" provision was intended for service lines that are not leaching high levels
of lead. However, if a system has again exceeded the Action Level, the previous service line
sample may no longer be representative of the lead concentrations being contributed by the
service line under the new conditions causing the Action Level exceedance. For example, in the
recent case of elevated lead levels in the DC WASA system, the switch from chlorine to
chloramines may have changed the corrosiveness of the water in the distribution system,
potentially elevating lead levels, especially those from the service lines. Service line samples
collected under chlorination may not be representative of service line samples under
chloramination. Re-testing is necessary to determine whether these lines are still contributing
low levels of lead under the new conditions. If not, then the line should be considered for
replacement along with the rest of the inventory of lead service lines.
Alternatives Considered
The workgroup did not consider any alternatives to this rule change.
Page 29
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Costs of Regulatory Changes
This chapter describes the estimates of costs for the regulatory changes to systems and
State Primacy Agencies (States), including costs associated with administrative, monitoring,
sampling, reporting, and public notification activities. There are two types of costs that may
result from the regulatory changes - direct and indirect. Direct costs are costs for activities that
are specified by the regulatory change, such as costs for additional monitoring or distribution of
consumer notices. Indirect costs may also result when systems and States use the information
generated by the directly-related rule activities to modify or enhance practices to reduce lead
levels. These indirect costs, and related health risk reductions, are not quantified for the purposes
of this analysis, but are described qualitatively in greater detail in Section 5 of this document.
The remainder of Section 4 focuses solely on the estimation of direct costs. Exhibit 4
summarizes the expected direct and indirect cost impacts for the seven regulatory changes.
Exhibit 4: Summary of Direct and Indirect Implications of the LCR Short Term
Regulatory Changes
kW'te
[ef'-T;] liTjiE »;3
III.A
III.B
III.C
III.D
III.E
III.F
III.G
faTfe [S|Ti'f;l1]Ip'' i DJ:Mi7ff flJblill
Number of samples
Monitoring period
Reduced monitoring criteria
Advanced notification and approval
Consumer notice of Lead results
Public Education
Reconsideration of lead service lines
Wk SEe S»KH
lly]«5l!'T;f'!t°jfH
Yes
Unquantified
Yes
Yes
Yes
Yes
Yes
illlilfej'^efcrfl;
^M«iw*fBi!iim
lolfJltMlferB
Yes
None
Yes
Yes
Yes
Yes
Yes
The costs associated with the Lead and Copper Rule have been estimated previously in
several documents. Direct costs due to the 1991 Lead and Copper Rule are presented in the Final
Regulatory Impact Analysis of National Primary Drinking Water Regulations for Lead and
Copper, April 1991. This RIA estimates costs for monitoring, coping with source water
contamination, coping with lead leached from solder, coping with lead leached from lead service
lines (including public education, corrosion control, and lead service line replacement), and State
implementation costs.
EPA proposed and adopted minor changes to the LCR. The direct costs for these minor
changes are described in Regulatory Impact Analysis Addendum: Proposed Changes to National
Primary Drinking Water Regulations for Lead and Copper, January 1996. This addendum
estimates changes to costs with respect to the April 1991 RIA, under the same cost categories.
Page 30
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An Information Collection Request was also prepared for the minor rule changes, Information
Collection Request: National Primary Drinking Water Regulations For Lead and Copper, June
1999.
The most recent cost estimates can found in the 2004 Information Collection Request for
Disinfectants/Disinfection Byproducts, Chemical, and Radionuclides Rules, OMB Control
Number: 2040-0204, EPA Tracking Number: 1896.05. The 2004 ICR estimates administrative
burden and costs associated with the LCR for systems and States. Direct system costs are
estimated for community water systems and non-transient non-community water systems to
perform the following activities:
• Conduct monitoring for water quality parameters
• Conduct tap sampling of lead levels for Action Level compliance
• Review sample data, including the calculation of lead and copper 90thpercentile levels
• Submit monitoring data and any other documents or reports to the State
• Record and maintain information
The 2004 ICR also estimates burden and costs for systems that must submit corrosion control
studies, recommend and submit information regarding the completion of corrosion control or
source water treatment installation, conduct public education, or conduct LSL monitoring,
notification, and replacement.
In the 2004 ICR, for the LCR requirements to CWSs and NTNCWSs, the average annual
respondent burden is estimated at 1.72 million hours and $57.9 million for reporting (including
lead service line replacement reporting), recordkeeping, and public education activities of the
LCR. For States, the annual burden incurred by primacy agencies for activities associated with
the lead and copper regulation is approximately 0.21 million hours and $6.8 million. This
estimate includes costs for employing a corrosion control expert and costs to review various
letters and results submitted by water systems in accordance with the LCR.
4.1 Overall Cost Methodologies and Assumptions
As part of its comprehensive review of the Lead and Copper Rule, EPA collected and
analyzed new data on various aspects of LCR implementation. When available, this new
information is the first choice source for use in estimating costs. Sources of the new information
include the following.
• Medium and Large Public Water Systems Exceeding the Action Level Summary from
SDWIS/FED data as of January 27, 2005 provides up-to-date counts of the number of
medium and large systems that have exceeded the Action Level since 2000 and 2003.
Page 31
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• Summary, Lead Action Level exceedances for public water systems subject to the Lead
and Copper Rule (For data through September 13, 2004) provides up-to-date counts of
the number of small systems that have exceeded the Action Level since 2000 and 2003.
• State responses to EPA 's " Survey of States Questions on State Implementation of the
Lead and Copper Rule " (July 2004) provides information on the number of systems that
are conducting lead service line replacement under the LCR, the fraction of systems on
reduced LCR monitoring, and system practices with regard to notification of customers
of sampling results.
If new information was not available about a cost item or assumption, previous analyses
of LCR requirements were reviewed to determine if a suitable estimate was available. The 1991
RIA, the 1996 RIA Addendum, and the various Information Collection Requests were all used as
sources of information and assumptions.
In a limited number of instances, appropriate estimates were not available either from
new analyses or existing documents. For those cost items, the best professional judgment used to
derive estimates.
For the regulatory changes that clarify rule language (III.B), the costs associated with
those activities may have already been included in the original LCR cost estimates as presented
in the 1991 RIA. In these cases, costs for performing these activities are not included in this
analysis.
Inventory of Systems
The primary inventory of systems that will be impacted by the direct costs of the
regulatory changes was derived from a pull of data from the SDWIS/FED system in the 4th
quarter of 2004, available at http://www.epa.gov/safewater/data/pivottables.html and
summarized in FACTOIDS: Drinking Water and Ground Water Statistics for 2004.u The
number of systems covered by the LCR that result from the SDWIS/FED pull for 2004 are
summarized in Exhibit 5.15
14 http://www.epa.gov/safewater/data/pdfs7data_factoids_2004.pdf
15 System inventory data from the 4th Quarter SDWIS/FED data pull is used throughout the analysis to maintain
consistency with data on the number of systems exceeding the Lead Action Level collected during mat time period.
Page 32
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Exhibit 5: Number of Systems by Size Category and Type Subject to the LCR
SDWIS/FED 2004 Data
16
<=100
101-500
501-1,000
1,001-3,300
3,301-10,000
10,001-25,000
25,001-50,000
50,001-75,000
75,001-100,000
100,001-500,000
500,001-1,000,000
>1, 000,000
Grand Total
(
-------
education for systems, and review and consultation for States/Primacy Agencies. Exhibit 6
summarizes the direct cost categories to be estimated for each regulatory change. The following
sections present either the rationale for why direct costs are not incurred, or estimate of direct
costs for each rule provision.
Exhibit 6: Direct Costs Associated with Regulatory Changes
i^syisSsBff
'd*MWW
Regulatory Change III.A
Regulatory Change III.B
Regulatory Change III.C
Regulatory Change III.D
Regulatory Change III.E
Regulatory Change III.F
Regulatory Change III.G
&KAMll&iM&
&mmm
temffiEi
X
tifer? itia?
Cffisifiijte
^mmsim
I^BffciMfiSIi
S!afe'f2g@l3
^mSWimt?,
mm^mlm
X
None - Clarifications of definitions with no direct cost impact
X
X
X
X
X
X
X
X
X
X
X
X
Page 34
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4.2 Direct Costs Associated with Regulatory Change III.A
Activities resulting from regulatory change
Regulatory change III. A clarifies EPA's intent that a minimum of 5 tap samples must be
taken when conducting LCR compliance monitoring. If a system has fewer than the minimum
number of sites required for sampling, then those systems will have to collect multiple samples
on different days from the same site so that the total number of samples per monitoring period is
5. However, III.A gives States the discretion to allow certain systems with fewer than 5 taps on a
case by case basis to take 1 sample per tap. Under this alternate sampling schedule, the sample
with the highest test result will be compared to the action level to determine compliance.
Public water systems with fewer than 5 taps that are in States that allow 1 sample per tap
will undertake a one time activity to document the number of appropriate taps and communicate
this information with the State. States that will allow 1 sample per tap will engage in a one time
effort to review, track, and respond to submittals from the systems with fewer than 5 taps on the
number of appropriate taps for future sampling.
Costs to systems
The systems that will incur costs under this regulatory change are NTNCWSs and CWSs
with fewer than 5 taps in States that allow 1 sample per tap. The following data are used to
estimate the number of systems impacted by the regulatory change and related direct costs.
• The number of NTNCWSs in States that will allow 1 sample per tap: This analysis
assumes that the 11 States that commented favorably on the option of allowing 1 sample
per tap for NTNCWSs with fewer than 5 taps will exercise their discretion under III. A
and permit 1 sample per tap. Note that two States commented unfavorably on the option
and it is assumed States that did not comment at all would not allow the alternative since
the default requirement maintains a minimum of five samples. Exhibit 7 contains
estimates of the number of NTNCWSs in these 11 States.
• The number of CWSs with fewer than five taps in States that will allow 1 sample per tap:
This analysis assumes that the 11 States that commented favorably on the option of
NTNCWSs will also allow permit 1 sample per tap for applicable CWSs. In addition, the
analysis assumes that Alaska will exercise its discretion to allow 1 sample per tap for
small CWSs due to the presence of washeterias in the State. This analysis assumes that
all CWSs with fewer than five taps are a portion of those that serve 100 or fewer people
since EPA believes that CWSs with fewer than 5 taps, even in the smallest system size
category, are relatively unique situations and do not occur frequently. Exhibit 7 contains
estimates of the number of CWSs serving 100 or fewer people in the 11 States plus
Alaska.
Page 35
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Exhibit 7: Number of NTNCWSs and CWSs in 11 States that Favored 1 Sample Per Tap
in Comments on Proposed Rule plus Alaska
AK
IN
Ml
Wl
IL
TX
VT
UT
WA
MD
MN
TN
Total
N/A
686
1631
907
405
785
234
63
315
573
563
46
6208
341
317
744
592
670
2105
319
241
1748
327
484
151
8039
Source: SDWIS/FED data pull from the 4th quarter of 2004.
• The fraction of NTNCWSs that have fewer than 5 taps: No nationally available data
source provides information on the fraction of NTNCWSs with fewer than 5 taps.
However, in their comments submitted on the Draft LCRSTR, MI provided information
that 53% of the NTNCWSs in MI had fewer than 5 taps. In the absence of other data,
this analysis assumes that 53% of the NTNCWSs in the 11 States have fewer than 5 taps.
Exhibit 8 displays the calculation of the number of NTNCWSs with fewer than 5 taps in
the 11 States.
• The fraction of CWSs serving <101 people that have fewer than 5 taps: As stated above,
EPA believes that CWSs with fewer than 5 taps, even in the smallest system size
category, are relatively unique situations and do not occur frequently. In the absence of
any other data source, this analysis assumes that 5% of CWSs serving <101 have fewer
than 5 taps, as displayed in Exhibit 8.
Page 36
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Exhibit 8: Number of Public Water Systems with Fewer Than 5 Taps in 11 States
AK
IN
Ml
Wl
IL
TX
VT
UT
WA
MD
MN
TN
Total
N/A
686
1631
907
405
785
234
63
315
573
563
46
6208
N/A
53%
53%
53%
53%
53%
53%
53%
53%
53%
53%
53%
N/A
364
864
481
215
416
124
33
167
304
298
24
3290
341
317
744
592
670
2105
319
241
1748
327
484
151
8039
5%
5%
5%
5%
5%
5%
5%
5%
5%
5%
5%
5%
17
16
37
30
34
105
16
12
87
16
24
8
402
• The labor and cost estimates per applicable system with <5 Taps: Based on similar
activities, it is estimated that systems will take 1 hour to prepare a letter to States
verifying the number of applicable taps for lead and copper sampling, with a materials
cost of $0.43 for postage and supplies. This analysis assumes that all systems that are
eligible for taking 1 sample per tap will request this option from States.
The one-time direct costs to systems, summarized in Exhibit 9, are estimated to be
$104,000 including $102,500 in labor costs and $1,600 in materials costs. Detailed estimates are
provided in Appendix J.
Costs to States
Regulatory Change III.A will require State/Primacy agencies that exercise their discretion
and allow 1 sample per tap for applicable systems with fewer than 5 taps to verify the
appropriate number of taps per system by reviewing the letters submitted by systems and
responding to systems.
Estimates of state review burden are based on similar activities (such as reviewing a letter
reviewing tap monitoring events). States are estimated to take 1 hour to review and respond to
the letter from systems verifying the applicable number of taps for sampling.
Page 37
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The one-time direct costs to State/Primacy agencies is estimated to be $162,000
($160,700 in labor costs and $1,600 costs for postage and supplies to mail the response letter to
systems), as summarized in Exhibit 9. Detailed estimates are included in Appendix J.
Exhibit 9: Summary of Estimated Direct Costs to Systems and State/Primacy Agencies
Associated with Regulatory Change ni.A
(4* Qtr 2006$)
Costs to Systems
Reporting
Total System Costs
Costs to State/Primacy Agencies
Review Costs
Total State Costs
$102,500
$102,500
$160,700
$160,700
$1,600 $104,000
$1,600 $104,000
$1,600 $162,000
$1,600 $162,000
Note: Totals may not add due to rounding.
Page 38
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4.3 Direct Costs Associated with Regulatory Change III.B
Regulatory Change III.B clarifies the terms "monitoring period" and "compliance
period." Based on the regulatory change, if a system exceeds the lead or copper Action Level
during a monitoring period, the compliance calendar for required actions starts at the end of the
monitoring period, which for most systems would occur on September 30. Under the previous
regulatory language, systems were confused as to whether compliance actions began at the end
of that calendar year (December 31) rather than the monitoring period (September 30).
As a result of the regulatory change, activities triggered by a lead or copper Action Level
exceedance could begin three months earlier (i.e., at the end of September instead of the end of
December), but it is not clear if activities would last any longer. The net result is a change in the
timing of activities, with a difference of three months having an unclear impact on costs,
although there may be health risk implications.
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4.4 Direct Costs Associated with Regulatory Change III. C
Activities resulting from regulatory change
As a result of Regulatory Change III.C, utilities that are conducting LCR compliance
monitoring on a reduced monitoring schedule and that have 90th percentile LCR monitoring
samples that exceed the lead Action Level will be required to resume standard monitoring
schedules for monitoring lead at taps. In addition to monitoring activities, utilities will have to
meet reporting requirements to the State/Primacy agency. State/Primacy agencies will be
involved in review of utility monitoring reports. Supporting calculations and information are
included in Appendix C.
Costs to systems
The systems that will incur direct costs under this regulatory change are those systems
that exceed the lead Action Level and that had been on a reduced monitoring schedule. The
following data are used to estimate the number of systems impacted by the regulatory change
and related direct costs.
• Number of systems exceeding the lead Action Level: This analysis uses the number of
systems that have exceeded the lead Action Level since 2003 as an estimate of the
number of systems that will exceed the lead Action Level each year in the near future.
Exhibit 10 contains estimates of the number of systems exceeding the lead Action Level
annually by size category.
Exhibit 10: Number of Systems Exceeding Annually17
giMmffl
<3.3K
3.3K-10K
10K-50K
50K-100K
>100K
Total
g SMmfiB LMEfi
fipwC HL, SfhicK y$W] "J
884
55
41
7
7
994
1. Data source: USEPA Survey of States - Questions on State Implementation of Lead
and Copper Rule. July 2004.
2. Data Source: www.epa.gov/safewater/lcrmr/lead-data.html, 8/30/05.
Percent of systems on reduced monitoring: In their responses to the EPA survey on LCR
implementation,18 States provided estimates of the percent of systems on reduced LCR
Updated data on the number of systems that have exceeded die Lead AL are not available for use in the EA
supporting the Final Rule. Thus we assume that this data reflects the current annual number of systems exceeding
the Lead AL and use 4th quarter 2004 SD WIS inventory data to maintain consistency.
18 USEPA Survey of States - Questions on State Implementation of Lead and Copper Rule. July 2004.
Page 40
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monitoring (summarized in Appendix C-l). Based on this data, 91 percent of systems are
on a reduced schedule for LCR lead and copper monitoring. In the absence of additional
data, this analysis assumes that systems that will exceed the lead Action Level are on a
reduced monitoring schedule at the same rate as all systems. Therefore, we assume that
91 percent of the systems that exceed the lead Action Level were on reduced monitoring
and will therefore incur direct costs due to regulatory change III.C. This assumption may
be conservative, because systems that are likely to have exceedances are less likely to be
on reduced monitoring.
• Additional monitoring events: The frequency for monitoring on a standard schedule
under the LCR is once every 6 months. Reduced monitoring could refer to either
monitoring once every year or once every three years. From the state responses to the
survey, it is impossible to distinguish the number of systems on a reduced monitoring
schedule of once every year from those monitoring once every three years. This analysis
assumes that all systems on reduced monitoring are on the triennial schedule, a
conservative assumption that might slightly over-estimate costs. Thus, a system that was
on reduced monitoring but is placed on a standard monitoring schedule after a lead
Action Level exceedance under regulatory change III.C will incur an additional 5
monitoring events over a 3 year period (6 monitoring events in three years under standard
monitoring instead of 1 monitoring event in three years under reduced monitoring).
• Tap samples per monitoring event: The number of samples collected in each monitoring
period will also change when the utility switches from reduced monitoring to standard
monitoring. The required number of samples varies by system size, with the smallest
systems (serving less than or equal to 100 people) required to take 5 samples per
monitoring event under both standard and reduced monitoring, and the largest systems
(serving > 100,000 people) required to take 100 samples per monitoring event under
standard monitoring, and 50 samples per monitoring event under reduced monitoring.
• Labor and cost estimates per sample: Based on previous EPA documents, the labor
required to collect each lead and copper compliance tap sample is estimated at 2.5 hours.
The labor to analyze the sample for lead and copper is estimated at 1 hour, with a
material cost of $8.16 per sample (also referred to as the materials cost). In addition,
systems must calculate their 90th percentile value to assess compliance and report the
monitoring and compliance results to the State. These activities are estimated to require
1.5 to 2 hours per system, varying by system size, with a materials cost of $0.39 for
postage and $0.04 in materials. The derivation of the labor and cost estimates relating to
compliance monitoring is detailed in Appendix C-2.
The direct Costs to systems, summarized in Exhibit 11, are estimated to be $2,696,000
annually including $2,502,000 in labor costs and $194,000 in materials costs. Detailed estimates
are provided in Appendices C-4 and C-5.
Page 41
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Costs to States
Regulatory Change IH.C will require State/Primacy agencies to review utility monitoring
reports as a result of resuming standard monitoring schedules.
Estimates of state review burden are based on the 2004 ICR page H-12, which estimates
that a State takes 1 hour to review the letter describing a tap monitoring event for each system.
Additionally, States will spend an additional 10 minutes to 1 hour checking the compliance (90lh
percentile) calculations for each monitoring event. The materials cost is limited to postage for
letters sent to utilities regarding review findings.
The direct costs to State/Primacy agencies is estimated to be $82,000 annually including
$81,000 in labor costs and $1,000 in materials costs, as summarized in Exhibit 11. Detailed
estimates are included in Appendix C-7.
Exhibit 11: Summary of Estimated Direct Costs to Systems and State/Primacy Agencies
Associated with Regulatory Change ni.C
(4th Qtr 2006$)
Costs to Systems
Reporting
Tap Monitoring
Total System Costs
Costs to State/Primacy Agencies
Review Costs
Total State Costs
„„*,*.„
$60,000
$2,442,000
$2,502,000
$81,000
$81,000
,,;£i
$1,000
$193,000
$194,000
$1,000
$1,000
^,M
$61,000
$2,635,000
$2,696,000
$82,000
$82,000
Page 42
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4.5 Direct Costs Associated with Regulatory Change III.D
Activities resulting from regulatory change
Regulatory Change III.D revises the current 60-day notification requirement, under which
systems notify States about long-term changes in treatment or additions of new sources that
could cause problems with optimal corrosion control. Rather than requiring systems to notify
States up to 60 days after treatment changes or source additions have been made, systems now
must notify the states in advance and the changes must undergo a formal review and approval
process by the State prior to implementation. All States currently review treatment or source
changes within 60 days after the change. However, some States are already reviewing and
issuing approval before such changes are made. The activities associated with the formal review
and approval process are a new requirement for those States that do not currently have such a
review and approval process. System activities will include preparation of a submittal to the
State and coordination with the State/Primacy agency during the review. State/Primacy agency
activities will include review of system data/reports and coordination with systems.
Costs to systems
In order to estimate the cost of this provision to utilities, information is needed on the
number of systems that will change a treatment or add a source annually, as well as the number
of systems that are located in States that already have a review and approval requirement.
Systems located in these States will not incur additional costs under this provision.
• States with review and approval process: Many States already have a review and
approval process for treatment or source changes. As part of the survey on LCR
implementation19, EPA asked States to respond to the following question: "How do
systems notify the State of treatment changes? Does the State require that systems
provide information about potential effects of treatment changes on corrosion
control?" A summary of State responses is provided in Appendix D-l. Based on the
State responses, 14 States explicitly replied that they currently have a review and
approval process for treatment changes. It should be noted that another nine States
mention a process that requires a permit for treatment changes and eight States refer
to submittal and review of engineering plans for a change. Although not a review and
approval process focused specifically on the impact of a change on corrosion control,
the permitting and plan review processes may be comprehensive enough that they
consider corrosion issues. For the purposes of this analysis, however, we base our
estimates by excluding only the 14 States that specifically consider corrosion issues,
recognizing that other States may also include corrosion issues in their review
processes.
• Number of systems in States without an existing review and approval process: Based
on the characterization of the process for each State and the number of systems in
each State, the number of systems that are not covered by an existing process and
19 USEPA Survey of States - Questions on State Implementation of Lead and Copper Rule. July 2004.
Page 43
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may therefore incur costs under this regulatory change is estimated in Appendix D-l.
Under the alternative in which only the 14 States with explicit review and approval
are excluded from the count, 53,372 systems (of 72,213 CWSs and NTNCWSs) may
incur costs for the regulatory change.
• Fraction of systems that change treatment or add a source each year: Treatment
changes over the next several years are likely, as systems will be faced with new
regulatory requirements, including changes to comply with the already promulgated
Arsenic Rule and the upcoming Long Term 2 Surface Water Treatment Rule and
Stage 2 Disinfectants/Disinfection Byproducts Rule. Together, these regulatory
requirements are estimated to cause 9,243 systems to institute a treatment change,
although not all of these treatment changes will affect corrosion control. Also the
compliance periods for these regulations varies. To account for these expected
treatment changes, and to account for treatment changes and source additions
unrelated to the Arsenic, LT2, and Stage 2 rules, EPA assumed (based on the
projected rule-related treatment changes and expert judgment) that approximately
20% of the systems affected by the LCR will institute a treatment change in the next
ten years. It is assumed that these changes occur uniformly over that 10-year period,
so that approximately one-tenth of these systems (or 2 percent of the total) institute a
treatment change or source addition each year. Appendix D-2 provides additional
detail.
• Based on the 2 percent assumption, the analysis estimates that 1,067 (53,372 X .02)
systems each year would report a treatment change or source addition and incur costs
in States currently not covered by an explicit review and approval program.
• System burden and activities: EPA anticipates that systems will incur additional costs
under this rule change as systems and States more carefully review and consider
possible corrosion impacts of treatment changes or source additions. The activities
and burden associated with the review and approval process are expected to vary
based on the size and complexity of a system, and the nature of the change or source
addition. In the absence of information on the current prevalence of these activities,
EPA has used the best professional judgment to estimate the range of potential
activities and associated costs resulting from the review and approval process. All
systems, regardless of size or complexity, are assumed to undertake additional
activities related to data collection and evaluation, preparation of a submittal to the
State, and coordination with the State. For small systems or systems making relatively
simple changes, considering the corrosion impacts of the change may be a rather
basic process of reviewing water quality data and previous lead monitoring results.
For these systems, additional effort will be incurred by system staff in coordination
with State personnel to assemble water quality parameter and lead data and evaluate
the potential impacts. EPA estimates the burden for this additional effort at 7.5 hours
per system, at an average cost of $231 per system. For larger or more complex
systems making major treatment changes, activities would be more extensive,
including conducting engineering studies to evaluate impacts on corrosion control. To
Page 44
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some extent, systems may already be conducting these studies, resulting in no net cost
due to the regulatory change.
• The current LCR regulatory requirements on notification of treatment changes cause
a system burden of 0.5 hours per treatment change. Therefore, the new system burden
is expected to be 8 minus 0.5 hours or 7.5 hours per treatment change. 20
• Additional burden for engineering studies: Based on best professional judgment,
EPA estimates that between 10 percent and 20 percent of medium and large systems
may incur the additional cost of $20,000 to conduct an engineering study on corrosion
impacts. The $20,000 estimate is based on recent similar studies for medium-sized
systems.
The direct costs to systems are estimated to range from $506,000 to $765,000 annually. These
direct costs are strictly labor costs; material costs are expected to be negligible. Detailed
estimates are provided in Appendix D-3.
Costs to States
Those States that do not already have a review and approval process will also incur
additional costs due to regulatory change HID.
• Activities that States will undertake include review of system data, preparation of
conclusions and letter to systems, and coordination with utilities. The level of effort
associated with these activities is expected to vary based on the complexity of the
change and the type of submittal (amount and type of information). Based on best
professional judgment, State review could range from 4 hours to 8 hours.
• The current LCR regulatory requirements on State review of treatment changes entail
a burden of 0.5 hours per review. Therefore, the new State burden is expected to
range from 3.5 to 7.5 hours per treatment change. 21
• Based on the State responses on existing review and approval processes22, the
analysis assumes that 14 States have existing processes (explicit review and
approval). The remaining States will incur costs under this regulatory change.
The direct costs to State/Primacy agencies are estimated to range from $163,000 to
$348,000 annually. These direct costs are strictly labor costs; material costs are expected to be
negligible. Estimates are summarized in Exhibit 9 and detailed in Appendix D-4.
20 Source: Information Collection Request: Disinfectants/Disinfection Byproducts, Chemical, andRadionuclides
Rules, USEPA, Office of Water, September 2004, page H-27.
21 Source: Information Collection Request: Disinfectants/Disinfection Byproducts, Chemical, and Radionuclides
Rules, USEPA, Office of Water, September 2004, page H-12.
22 USEPA Survey of States - Questions on State Implementation of Lead and Copper Rule. July 2004.
Page 45
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Exhibit 12: Estimated Direct Costs to Systems and State/Primacy Agencies Associated with
Regulatory Change m.D
(4th Qtr 2006$)
Costs to Systems
Reporting
Total System Costs
Costs to State/Primacy Agencies
Review Costs
Total State Costs
]i . «LJI i > ' it-r
$506,000
$506,000
$163,000
$163,000
if l[l ^ _ I rl i I i
I I i I 5 i i i [ | -5
$765,000
$765,000
$348,000
$348,000
(1) 10 percent medium and large systems conduct engineering study and 4 hours for State review
(2) 20 percent medium and large systems conduct engineering study and 8 hours for State review
Page 46
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4.6 Direct Costs Associated with Regulatory Change III.E
Activities resulting from regulatory change
Regulatory Change HIE will require systems to provide written notification to each
owner/occupant of the lead level found in the tap sample collected for LCR compliance
monitoring. Both CWSs and NTNCWSs are required to provide notification on tap sampling
results, but the activities are expected to differ between the two types of systems. In addition,
systems are required to certify to States in a letter that the notification activity has taken place.
Supporting calculations and information regarding Costs to systems associated with this
regulatory change are included in Appendix E.
Costs to systems
In order to estimate the additional direct costs associated with regulatory change III.E,
information is needed on the number of systems that already notify customers of tap monitoring
results and the burden associated with notification activities.
• Number of systems that already notify customers: Based on feedback from
participants in workshops and interactions with States, some systems already notify
customers of monitoring results for their particular establishments. These systems
would not incur costs under the regulatory change. This analysis uses information
from the State survey23 to develop an estimate of the number of systems that currently
notify customers of tap sampling results, as detailed in Appendix E-l. Of 72,213
CWS and NTNCWSs (per 2004 SDWIS/Fed data) subject to the LCR, approximately
11 percent of these systems are estimated to already notify owner/occupants as
derived from USEPA's Survey of States (July 2004). Therefore, this regulatory
change will apply to the remaining 89 percent of systems or 64,273 systems.
• Activities associated with notification: CWSs will prepare a customer notification
letter and mail letters to all owner/occupants for residences where tap samples were
collected. For NTNCWSs, the notification burden will be different, and may consist
of posting a notice on community bulletin boards or web sites.
• Activities associated with reporting to States: CWSs and NTNCWSs will prepare a
letter to the State certifying that they have completed the required notification
activities.
• Burden and costs for CWSs: Labor costs are based on the labor required to prepare a
sample customer notification letter and mail letters to customers. The system burden
is estimated to be 1 hour per monitoring event for systems serving <3,300 people and
1 hour per 20 sample letters for systems serving more than 3,300 people. For
example, systems serving less than 3,300 people will prepare either 5 or 10 customer
USEPA Survey of States - Questions on State Implementation of Lead and Copper Rule. July 2004.
Page 47
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letters for each monitoring event at an estimated time burden of 1 hour. Material costs
include paper, envelopes and postage, estimated at $0.43 per customer letter.
• Burden and costs for NTNCWSs: Costs for NTNCWSs include the labor required to
prepare a consumer notice and post the notice. It is estimated that all systems will
spend 1 hour per monitoring event. It is assumed that material costs are negligible for
NTNCWSs.
• Burden and costs for reporting: Both CWSs and NTNCWSs will incur labor to
prepare a self-certification letter and submit the letter to the State. Based on a similar
activity under the CCR, the labor to prepare the self-certification letter is estimated at
.12 hours per system (PWSS ICR, 2040-0090, page B-5), with materials cost of $0.43
for postage and supplies.
• Frequency of monitoring and number of samples: Of the 64,273 systems affected by
this Regulatory Change, it is assumed that 91 percent of systems are currently on a
reduced monitoring schedule, and 9 percent follow a standard monitoring schedule as
documented in USEPA's Survey of States (July 2004). Although reduced monitoring
can imply a 1 year, 3 year or 9 year monitoring frequency, a 3 year frequency is
assumed for all systems for use in this economic analysis. The number of samples
collected by each system is estimated based on sampling schedules established in 40
CFR 141.86c for standard and reduced monitoring according to population served. In
addition, the number of increased monitoring events that would result from
Regulatory Change #III.C (1,692 additional monitoring events per year) are added to
the total.
The direct costs to systems for compliance with Regulatory Change #IU.E are
summarized in Exhibit 13 and estimated to be $1,248,000 annually including $1,098,000 in labor
costs and $150,000 in material costs. Detailed estimates are provided in Appendix E.
Costs to States
States will incur costs to review and track the self-certification letters from systems.
Based on a similar activity for the CCR, this analysis estimates that States will require 0.10 hours
per system letter (PWSS ICR, 2040-0090, page B-7). The direct costs to States for review under
Regulatory Change #IH.E are summarized in Exhibit 13 and estimated to be $163,000 annually
(all labor costs). Detailed estimates are provided in Appendix E.
Page 48
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Exhibit 13: Summary of Direct Costs Associated with Regulatory Change III.E
(4th Qtr 2006$)
SfQt'ifin^i;" fsfimi SH&ffMt Wciisriit^i]
Costs to Systems
Customer Notice of Lead Results Costs
Self-certification Letter to States
Total System Costs
Costs to States
Review Costs
Total State Costs
$979,000
$120,000
$1,098,000
$163,000
$163,000
$134,000
$16,000
$150,000
$0
$0
$1,112,000
$136,000
$1,248,000
$163,000
$163,000
Totals may not add due to rounding.
Page 49
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4. 7 Direct Costs Associated with Regulatory Change III.F
(a) Changes to the mandatory text of the written materials
(a)(l) Customer Notification
Activities resulting from regulatory change
Regulatory change III.F(a)(l) substantially reduces the mandatory language required for
delivery to all bill paying customers after a lead Action Level exceedance and gives systems
more flexibility in developing the notification. Systems are required to address several topics in
the notification, namely: "sources of lead", "steps to reduce exposure", "what happened", and
"what is being done". This analysis assumed that template language will be provided for the
sources of lead and steps to reduce exposure sections. However, by their nature, the "what
happened" and "what is being done" sections will need to be customized by each system to
reflect their specific conditions. Therefore, the additional activity under this change is the effort
required to develop the sections specific to the system.
Costs to systems
In order to estimate the additional direct costs associated with regulatory change
in.F(a)(l), information is needed on the number of community water systems that exceed the
lead Action Level and the burden associated with language development activities.
• Number of systems exceeding the lead Action Level: This analysis uses the number of
water systems that have exceeded the lead Action Level since 2003 as an estimate of the
number of systems that will exceed the lead Action Level each year in the near future.
Exhibit 14 contains estimates of the number of community and non-community systems
exceeding the lead Action Level annually by size category.
Exhibit 14: Number of Systems Exceeding Annually
^SEKl ©tef liHSHIiS'?
<3.3K
3.3K-10K
10K-50K
50K-100K
>100K
Total
KM^ilMilJteSMl
msmf
473
54
40
7
7
581
EfnMSSasffiai _
3F^f MMfirP^
411
1
1
0
0
413
884
55
41
7
7
994
1. Data source: USEPA Survey of States - Questions on State Implementation of Lead
and Copper Rule. July 2004.
2. Data Source: www.epa.gov/safewater/lcrmr/lead-data.html, 8/30/05.
Page 50
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• Burden to prepare system specific notification language: Because the current notification
after an Action Level exceedance relies solely on mandatory language, the 2004 ICR
does not provide a burden effort for a similar activity. However, the ICR for the Public
Notification Rule (PNR) includes a burden estimate associated with a Tier 2 notification
(notice as soon as possible of an exceedance that does not pose an immediate health
threat). The 3.5 hours of labor per system will be used to estimate the additional burden
associated with developing the new language after an Action Level exceedance.24
The direct costs to systems for compliance with Regulatory Change #IH.F(a)(l) are
summarized in Exhibit 15 and estimated to be $91,400 annually, all in labor costs. Detailed
estimates are provided in Appendix H-2.
Exhibit 15: Summary of Direct Costs Associated with Regulatory Change III.F(a)(l)
(4th Qtr 2006$)
j^FiiOIMsEfi' j^iasglSMlMHifl HiMJiSiEEait
Costs to Systems
Customer Notification Costs
Total System Costs
$91,400
$91,400
$0
$0
$91,400
$91,400
(b) Changes to better reach at-risk populations
(b)(l) Delivery of brochures to organizations
Activities resulting from regulatory change
Regulatory change III.F(b)(l) requires that CWSs exceeding the lead Action Level
distribute brochures to three additional types of organizations - obstetric/gynecologist offices,
licensed child care facilities, and pre-schools. Also, an informational notice must now be
included with the brochures and the public health agency must be directly contacted by phone,
rather than through a mailed brochure.
Costs to systems
In order to estimate the additional direct costs associated with regulatory change
III.F(b)(l), information is needed on the number of community water systems that exceed the
lead Action Level, the number of additional organizations to be contacted, and the burden
associated with distributing brochures to the additional organizations, the development of an
informational notice, and the direct contact with the public health agency.
• Number of community systems exceeding the lead Action Level: The number of CWSs
that exceed the lead Action Level can be found in Exhibit 11.
24 EPA, Public Water System Supervision Information Collection Request, July 2004, Exhibit E. 16, page E-15.
Page 51
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• Number of additional organizations to be contacted: The number of additional
establishments to be contacted is estimated at 193 per 100,000 population served. This
value includes 178 per 100,000 licensed child day care facilities based on the number of
licensed child day care facilities (500,143)25 spread over the national population
(281,422,000)26. The total also includes 15 ob/gyns per 100,000 population (41,900 27
ob/gyns per 281,422,000).
• Burden to contact additional organizations: Systems serving greater than 3,300 will incur
an additional 1 hour in burden to generate and update lists of additional facilities. These
systems will also incur production costs of 0.25 hours for every 100 additional brochures
and applicable mailing and materials costs.
• Burden to develop informational notice: Based on similar activities, this analysis
assumes that developing an informational notice for distribution with the brochures will
take a system 1 hour.
• Burden to directly contact public health agency: Based on similar activities, this analysis
assumes that directly contacting the public health agency through a telephone call will
require an additional 0.5 hours.
The direct costs to systems for compliance with Regulatory Change #III.F(b)(l) are
summarized in Exhibit 16 and estimated to be $43,300 annually, in labor costs and material
costs. Detailed estimates are provided in Appendices H-3 through H-5.
Exhibit 16: Summary of Direct Costs Associated with Regulatory Change IILF(b)(l)
(4th Qtr 2006$)
Costs to Systems
Contacting Additional Orgs
Total System Costs
Baritfdiliii&I'Mr '
$21 ,900
$21,900
r, , III [ (. I ,.||
$21 ,400
$21,400
ii r i i |,p -
$43,300
$43,300
(b)(2) Additional activities
Activities resulting from regulatory change
Regulatory change III.F(b)(2) requires systems to perform additional public notification
activities. Systems are given a choice of 8 activities. Systems serving fewer than 3,300 must
implement 1 activity from the list while other systems must implement 3 activities.
25 M. Cubed for the National Child Care Association, The National Economic Impacts of the Child Care Sector, Fall
2002, page 4.
26 U.S. Census Bureau, U.S. Summary: 2000 (Census 2000 Profile), July 2002,
http://www.census.gov/prod/2002pubs/c2kprofOO-us.pdf.
27 U.S. Census Bureau, Statistical Abstract of the United States: 2006, Table 152, page 113.
http://www.census.gov/prod/2005pubs/06statab/liealdi.pdf
Page 52
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Costs to systems
In order to estimate the direct costs for regulatory change III.F(b)(2), the cost for each of
the activities per system needs to estimated. Exhibit 17 contains a summary of the assumptions
used to derive the cost per system for the eight activities. Detailed calculations can be found in
Appendices H-6 through H-20. Exhibit 18 summarizes the resulting costs per system.
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Exhibit 17: Assumptions Used to Derive System Costs for III.F(b)(2)
.F(b)(2)(i) Public Service Announcements
• Production of a radio PSA involves developing a script for the spot and then producing an audio of the spot.
• For small systems (serving fewer than 10,000) assume produce 1 radio PSA using freelance voice talent and in-
house staff to prepare the content of the PSA. Assume $50 for the voice-over, based on internet quotes from free-
lance talent and 2 hours for the system to develop the contents. Total cost per radio PSA: $95.
• For systems serving greater than 10,000, assume produce 1 radio PSA and 1 TV PSA.
• For a large system to produce a radio PSA, assume they use union talent at a studio. Based on internet quotes,
union talent is about $280 per hour plus $80 per hour for studio time. Also assume that a large system uses a
freelance writer to develop the script at $200 for 2-3 hours of effort. Total cost for radio PSA: $560.
• For a large system to produce a TV PSA, assume on-camera talent at about $560 per hour, plus studio time (based
on internet quotes) and script development. Total cost for TV PSA: $840.
.F(b)(2)(ii) Paid Advertisements
• Assume 1 newspaper advertisement, 10 column inches (about 1/8 of a page), rates derived from internet research.
• Rate per 10 column inch advertisement for system >1,000,000: $5,000
• Rate per 10 column inch advertisement for system 50k to 1 mil: $850
• Rate per 10 column inch advertisement for system 3.3k to 50k: $180
• Rate per 10 column inch advertisement for system <3.3k: $105
.F(b)2(iii) Display Information in Public Areas
• Assumed to involve posting a notice at local grocery stores or other locations. Posting would be free, but costs
incurred to travel to identify and travel to establishments, plus materials cost.
• Assume 1 hour to do 5 postings. Number of postings varies by system size.
.F(b)(2)(iv) Internet Notification
• Assumed to entail email contact with all customers.
• Requires time to develop email and review contact list. Time varies by system size.
• Assume small systems have an email list. Large and medium systems must purchase list.
.F(b)(2)(v) Public Meetings
• For systems serving fewer than 3,300, assume that system reps would bring up the issue for discussion at an
existing town meeting. Assume 2 hours preparation and meeting time.
• For systems serving over 3,300, assume conduct of separate public meeting of 2.5 hours. Effort includes making
logistical arrangements, preparing 30 - 45 minute presentation, attending the meeting, and follow-up activities.
.F(b)(2)(vi) Delivery to Every Household
• Delivery to every postal address, either through mail or distribution of flyers. Based on internet quotes for
distribution of flyers: $.12 to $.25 per piece, based on volume. Assume delivery of a flyer to all households in a
system: $.25 per household for systems serving fewer than 10k, $.17 for systems serving 10-50k, $.12 for systems
serving >50k, $.04 for systems serving >100k (assumes insert into existing mailing).
• Reduce population by 23% to take out the population that lives in multi-family housing, who may not be adequately
reached by flyers). [64 million pop in multifamily/281 million total population = 23%]
.F(b)(2)(vii) Targeted Contact
• Assume system purchases list of targeted populations, such as pregnant women and children.
• Based on Portland experience and internet quotes, assume $250 for purchase of targeted list. Assume that list is
purchased once. This up-front cost is pro-rated over 3 activities and 3 years.
• Assume 1 targeted communication for every 250 population served (approximately 2000 homes for a population
served of 482,500 for Portland).
• Assume $0.44 for materials and postage. Assume 15 minutes for 100 copies production labor.
.F(b)(2)(viii) Provide Materials Directly to Multi-family and Institutions
• Assume an effort to identify multi-family homes and institutions. Assume 165 multi-family units per 100,000
population (in buildings with 10 or more units) from Census.
• Assume 5 minute per establishment to identify multi-family homes and institutions. Assume that identification is
done once. This up-front cost is pro-rated over 3 activities and 3 years
• Assume $0.44 for materials and postage. Assume 15 minutes for 100 copies production labor.
Page 54
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Exhibit 18: Summary of Cost Per System for Activities m.F(b)(2)(i)-(viii)
(4th Qtr 2006$)
System
Size
Category
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
o £
v) oi
•HS
3 0
^- c
s<
$98
$101
$105
$118
$1,400
$1,400
$1,400
(A
£
0)
E
0)
£ 1
r=-"O
$105
$105
$180
$180
$850
$5,000
$5,000
o
^
Q.
_C
re
Q.
0 £
— « 0)
=.<
$24
$26
$111
$137
$696
$1,392
$3,943
o> re
— JE
^ o
^=,-2.
$24
$26
$28
$420
$596
$596
$1,035
V)
O)
_c
?
1
o
&
Q.
3>
$48
$51
$55
$900
$2,400
$3,000
$5,000
Oi
>
LU
Q
1*2
> o
d) d)
Q M
-1 o
il
$7
$30
$166
$435
$1,114
$2,448
$3,874
*j
u
c
o
o
•c
£
O)
.2
:~
•^•
$34
$35
$37
$44
$66
$138
$563
"o
i_
5t
!s E w
111
^5 =
:= 1o
>, o _c
$12
$15
$27
$81
$303
$945
$5,035
Determining which activity or combination of activities systems will regularly choose is
subject to considerable uncertainty. Systems will consider many factors in choosing activities.
Certainly cost will be an important factor, but effectiveness and ability to reach a variety of
audiences may also be considered. In the absence of information on the selection of activities,
this analysis conservatively assumes that all activities are equally likely to be chosen. The
average cost per system for each size category is calculated and assumed to represent the typical
cost for this regulatory change. Because of the uncertainty entailed in this assumption, Appendix
I contains results of sensitivity analyses that calculate per system costs based on alternative
scenarios for choosing activities.
The direct costs to systems for compliance with Regulatory Change #in.F(b)(2) are
summarized in Exhibit 19 and estimated to be $292,700 annually, in labor costs. Detailed
estimates are provided in Appendices H-6 through H-20.
Exhibit 19: Summary of Direct Costs Associated with Regulatory Change HI.F(b)(2)
(4th Qtr 2006$)
S^MIIMfeir SMDillGSsilsirMI IMMlsScaiEal
Costs to Systems
Additional Activities
Total System Costs
$292,700
$292,700
$0
$0
$292,700
$292,700
Page 55
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(c) Changes to help systems maintain communication with consumers throughout the
exceedance
(c)(l) Adding Note to Customer Bills for CWSs that Exceed the Lead Action Level
Activities resulting from regulatory change
Regulatory change III.F(c)(l) requires that CWSs exceeding the lead Action Level
include a specific message on every water bill during the period of exceedance no less than
quarterly, instead of on just one bill per year.
Costs to systems
In order to estimate the additional direct costs associated with regulatory change
III.F(c)(l), information is needed on the number of community water systems that exceed the
lead Action Level, the frequency of billing for water systems, and the burden associated with
adding a message to a water bill.
• Number of community systems exceeding the lead Action Level: The number of CWSs
that exceed the lead Action Level can be found in Exhibit 11.
• Frequency of billing for water systems: This analysis assumes that water systems bill
their customers 4 times per year. Therefore, a water system will need to include the
message on 3 (4-1=3) additional water bills per year.
• Burden to include a message of water bills: The burden to include the message on a
water bill is assumed to be 1 hour per billing cycle. The additional burden for all 3 cycles
is 3 hours, with no material costs.
The direct costs to systems for compliance with Regulatory Change #in.F(c)(l) are
summarized in Exhibit 20 and estimated to be $47,400 annually, in labor costs. Detailed
estimates are provided in Appendix H-21.
Exhibit 20: Summary of Direct Costs Associated with Regulatory Change IILF(c)(l)
(4th Qtr 2006$)
<*4_
Costs to Systems
Adding note to customer bills
Total System Costs
yESEflfififiJST n«l
$47,400
$47,400
III 11 1! If
$0
$0
M&mmi
$47,400
$47,400
Page 56
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(c)(2) Posting notice on website
Activities resulting from regulatory change
Regulatory change III.F(c)(2) requires that CWSs serving greater than 100,000 and
exceeding the lead Action Level post a notice of the exceedance on their website.
Costs to systems
In order to estimate the additional direct costs associated with regulatory change
in.F(c)(2), information is needed on the number of community water systems that exceed the
lead Action Level and serve more than 100,000, and the burden associated with posting a notice
on a website.
• Number of community systems serving more than 100,000 and exceeding the lead Action
Level: The number of CWSs serving more than 100,000 that exceed the lead Action
Level can be found in Exhibit 11.
• Burden to post a notice on a website: The PWSS ICR estimates that the burden for a
similar activity (posting the Consumer Confidence Report to a public internet site) is 0.5
hours per system.28 This analysis assumes that there are no material costs associated with
this activity.
The direct costs to systems for compliance with Regulatory Change #m.F(c)(2) are
summarized in Exhibit 21 and estimated to be $100 annually, in labor costs. Detailed estimates
are provided in Appendix H-22.
Exhibit 21: Summary of Direct Costs Associated with Regulatory Change IILF(c)(2)
(4* Qtr 2006$)
^•WEHt-fSsff ^iTUgfllSliQIIIl 'wMl^iifni
Costs to Systems
Posting to website
Total System Costs
$100
$100
$0
$0
$100
$100
(c)(3) Public Service Announcements and Press Releases
Activities resulting from regulatory change
Regulatory change III.F(c)(3) eliminates the need for systems to submit public service
announcements (PSAs) to radio and TV stations once every 6 months and add the requirement to
submit a press release to these entities once per year while under an Action Level exceedance.
The 2004 ICR assumes that, for a PSA, a system will submit the text of a notice to a radio or TV
28 USEPA, Public Water System Supervision Information Collection Request, July 2004, page B-6.
Page 57
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outlet, not produce a tape or video. Thus, the level of effort required to submit a PSA is
equivalent to the level of effort required to submit a press release in the 2004 ICR. The
substitution of a press release for a PSA does not result in any change in burden. However, the
reduction in frequency from once every 6 months to once every year results in reduced effort of
1 notification per year.
Costs to systems
In order to estimate the additional direct costs associated with regulatory change
IH.F(c)(3), information is needed on the number of community water systems that exceed the
lead Action Level serving more than 3,300 and the reduced burden associated with 1 less
notification per year.
• Number of community systems exceeding the lead Action Level serving more than
3,300: Under the current regulation, only community water systems serving more than
3,300 are subject to the PSA and press release notifications. The number of CWSs that
serve more than 3,300 and exceed the lead Action Level can be found in Exhibit 11.
• Reduction in Burden for PSA's: The 2004 ICR estimates that it takes a system 1 hour to
prepare a press release/PSA that is supplied to 5 radio and 5 television stations. Since
systems will prepare one fewer notifications per year, the annual reduction in burden is 1
hour per system, plus materials and postage.
The direct costs to systems for compliance with Regulatory Change #in.F(c)(3) are
summarized in Exhibit 22 and estimated to be $-4,200 annually, in labor costs and material costs.
Detailed estimates are provided in Appendix H-23.
Exhibit 22: Summary of Direct Costs Associated with Regulatory Change IILF(c)(3)
(4th Qtr 2006$)
Costs to Systems
PSA/Press releases $-3,700 $-500 $-4,200
Total System Costs $-3,700 $-500 $-4,200
d. Changes to the required timing
There are no cost implications associated with changing the timing of notifications.
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e. Changes to the Consumer Confidence Report
(e)(l) Adding an informational statement on lead to Consumer Confidence Report
Activities resulting from regulatory change
Regulatory change III.F(e)(l) requires that all CWSs include an informational statement
on lead in their Consumer Confidence Report.
Costs to systems
In order to estimate the additional direct costs associated with regulatory change
III.F(e)(l), information is needed on the number of community water systems that already
include a lead informational statement in their CCR and the burden associated with including the
lead statement.
• Number of community systems that already include the statement: The number of CWSs
is displayed in Exhibit 5. Some systems are already required to include an informational
statement about lead in their CCRs: systems with the 95th percentile lead level above 15
ppb. There is no method for estimating the number of systems whose 95th percentile
exceeds 15 ppb. There is an estimate of the number of systems with a 90th percentile
exceeding 15 ppb; these are the systems exceeding the Action Level. However, there is
no estimate of the additional number of systems with 90.1th to 95th percentile values
above 15 ppb. As there is no way to account for the systems between the 90th and 95th
percentiles, only systems with an Action Level exceedance are assumed to already
include the statement, resulting in an over-estimate of the cost impacts.
• Burden to include the informational statement in the CCR: This analysis assumes that it
will take systems of all sizes an additional 15 minutes (0.25 hours) to include the
informational statement in their CCR. There are no material costs associated with this
activity.
The direct costs to systems for compliance with Regulatory Change #IH.F(e)(l) are
summarized in Exhibit 23 and estimated to be $354,600 annually, in labor costs. Detailed
estimates are provided in Appendix H-24.
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Exhibit 23: Summary of Direct Costs Associated with Regulatory Change IILF(e)(l)
(4th Qtr 2006$)
.SiFSElJfifflllfflf? .Sifl^EfllfeMilJ Ifts^S-SSMi
Costs to Systems
Adding statement to CCR
Total System Costs
$354,600
$354,600
$0
$0
$354,600
$354,600
Costs to Consult with State and Prepare Self-Certification Letter
There may be several opportunities for systems to consult with States related to these
public education activities. For example, systems are expected to consult with States on the
choice of PE content and activities, on the use of alternative delivery mechanisms besides bill
inserts, and on any needed schedule extensions. The labor associated with consultation with
States on activities is assumed to be 2 hours. In addition, systems will prepare a letter certifying
to the State that the required public notifications and activities have taken place. The labor
associated with the self-certification letter is estimated at .12 hours per system (PWSS ICR,
2040-0090, page B-5), with postage and supply costs of $0.43. Detailed estimates are available
in Appendix H-7.
The costs for systems associated with the changes in public education requirements are
summarized in Exhibit 24.
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Exhibit 24: Summary of Direct Costs to Systems Associated with Regulatory Change IQ.F
(4th Qtr 2006$)
'
a. Changes to the Mandatory Text of the Written Materials
IH.F(a)(1)
Customer Notification
$91,400
$0
$91 ,40000
b. Changes to Better Reach At-Risk Populations
IH.F(b)(1)
III.F(b)(2)
Notify Additional Organizations
Additional Activities i-viii
$21,900
$292,700
$21,400
$0
$43,300
$292,700
c. Changes to Help Systems Maintain Communication with Consumers Throughout the
Exceedance
III.F(c)(1)
III.F(c)(2)
III.F(c)(3)
Customer Bills
Post on Website
PSAs and Press Releases
$47,400
$100
-$3,700
$0
$0
-$500
$47,400
$100
-$4,200
d. Changes to the Required Timing
No cost impact
e. Changes to Consumer Confidence Report
III.F(e)(1)
CCR Statement
$354,600
$0
$354,600
Costs to Consult with State and Self-Certify
Consultations with State
Self-certification letter
$31,600
$1,900
$0
$300
$31,600
$2,100
Total Costs to Systems for PE Requirements (III.F)
TOTAL
$838,000
$21,000
$859,000
Note: Totals may not add due to rounding.
Costs to States (for III.F)
Under Regulatory Change, States will incur costs to review the language of public
notifications after Action Level exceedances and to consult with systems on their additional
activities. States will no longer have to approve changes to the communication activities for
systems serving between 501-3,300, resulting in a slight decrease in burden.
• Burden for review and consultation: The decrease in burden for States to approve a
waiver for systems serving 500-3,301 is assumed to be 0.5 (based on comparable waiver
activities in the 2004 ICR). States will require 2 hours for review and consultation on PE
activities, including message content, choice of activities, alternative mechanisms, and
any necessary schedule extensions. States will also review the self-certification letters at
0.10 hours per letter ((PWSS ICR, 2040-0090, page B-7).
The direct costs to States for compliance with Regulatory Change #m.F are summarized
in Exhibit 25 and estimated to be $63,000 annually, in labor costs. Detailed estimates are
provided in Appendix H-25.
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Exhibit 25: Summary of Direct Costs to States Associated with Regulatory Change EII.F(7)
(4* Qtr 2006$)
Annual Labor Annual Material Total Annual
Costs to States
Review and consultation
Total State Costs
$63,000
$63,000
$0
$0
$63,000
$63,000
Page 62
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4.8 Direct Costs Associated with Regulatory Change III. G
Activities resulting from regulatory change
Under this regulatory change, systems would be required to reevaluate lead service lines
classified as "replaced" through testing if they resume lead service line replacement programs.
This would only apply to a system that had (1) initiated a lead service line replacement program,
then (2) discontinued the program, and then subsequently (3) resumed the program. When
resuming the program, this system would have to reconsider for replacement any lead service
lines previously deemed replaced through testing during the initial program. If a LSL was
previously determined to be replaced through testing, this means that the sample previously
collected from the LSL had a lead level less than the lead Action Level so the utility was not
required to physically replace it. Utilities affected by Regulatory Change #111.G will need to put
these "tested-out" LSLs back into their inventory of lead service lines that could be considered
for replacement. Once these LSLs are back in the inventory, we assume that they will be either
retested or replaced, with the cost of the additional testing a direct cost of the regulatory change.
The primary activities as a result of this regulatory change include collecting samples from these
LSLs and analyzing them for lead. Replacement of lines that were previously tested-out may also
occur as a result of this change.
Costs to systems
Under this regulatory change, a specific subset of systems would be required to sample
previously "tested-out" lead service lines. Estimating the cost and burden associated with these
activities requires information on several elements.
• Number of systems required to perform lead service line replacement under the LCR: In
the survey of States on LCR implementation29, States were asked "Does the state have
any systems that have been required to initiate lead service line replacement?" Eleven
States responded "Yes" to this question. However, the survey did not ask exactly how
many systems were required to initiate lead service line replacement programs. Six States
provided sufficient information to derive a number of systems within that State required
to perform lead service line replacement - a total of 28 systems. We assume that the
remaining 5 States have 5 systems each (the average number of systems per State for
those States that did specify), plus 1 system for DC (which did not respond to the survey)
for a total of 54 systems required to perform lead service line replacement. (See
Appendix F-3 for details.)
• Fraction of systems that performed required lead service line replacement that
subsequently exceed the lead Action Level: The regulatory change applies only to those
systems that had performed required lead service line replacement (although not
necessarily total replacement); brought compliance lead levels below the Action Level
and suspended lead service replacement; and then subsequently re-exceeded the lead
Action Level. There is no information on this small subset of systems, although at least
29 USEPA Survey of States - Questions on State Implementation of Lead and Copper Rule. July 2004.
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one system has met these criteria (DC WASA). This analysis assumes that systems that
had performed required lead service line replacement (although not necessarily total
replacement), brought compliance lead levels below the Action Level and suspended lead
service replacement will exceed the Action Level at the same rate as the universe of
systems subject to the LCR. Thus, we assume that 1.4 percent of the 54 systems or 1
system will exceed the Action Level and be triggered back into lead service line
replacement each year.
• The number of lead service lines per system: Recent information on the average number
of lead service lines in drinking water systems was presented in EPA's workshop on lead
service line replacement. According to the preliminary findings of a survey being
conducted by Black & Veatch for AWWA, 26 respondent utilities had an inventory of
558,135 lead service lines in 1992. Based on this data, the average number of lead service
lines per system is 21,467. In the absence of specific information on the number of lead
service lines in the subset of systems that have been required to do replacement, this
analysis uses the average value from the Black & Veatch study.30
• The fraction of lead service lines that had been "tested-out" rather than physically
replaced: Costs for this regulatory change apply only to those lead service lines that have
been deemed replaced through "testing-out" in a lead service line replacement program.
Information was available for the lead service line replacement program for one system
(DC WASA) that indicated that for one year (2003), 76 percent of the lead service lines
were deemed replaced through sampling, while 24 percent were physically replaced.
Because this was early in the replacement program, the percent of lines tested out might
be high in comparison with replacement over an entire program. In the absence of
additional data, this analysis assumes that 76 percent of lead service lines are "tested-out"
and would then be put back into the inventory upon re-exceedance.31
• Cost and labor to test lead service lines: The cost and labor to test the lead level of a lead
service line is similar to the tap sampling cost and labor for lead and copper compliance
monitoring. Estimates from previous EPA documents assume 2 hours to collect each lead
service line sample. This estimate is slightly lower than the estimate for collecting
compliance monitoring tap samples, possibly to account for differences in the need to
identify and recruit participants. The labor and material costs to analyze the sample is
assumed to be the same as for compliance monitoring: 1 hour of labor and $9.07 material
costs. Appendix F-l provides details on the derivation of the labor and costs for lead
service line replacement monitoring.
EPA does not have information on the number of systems using the test-out provisions
rather than physically replacing lines, so this approach is conservative because it assumes that all
systems in a lead service line replacement program are using the test-out provisions. Systems
30 Source: Notes from the EPA Lead Service Line Replacement Workshop, December 10, 2004,
http://www.epa.gov/safewater/lcmir/pdfs/suimnary _lcmr_review_lead_line_replacement_workshop_10-26-04.pdf
31 Source: Lead Service Line Replacement Program Annual Report for 2003, District of Columbia Water and Sewer
Authority, September 2003.
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removing lead service lines are not impacted by this change. While the rate at which systems are
triggered back into lead service line replacement might be higher than the initial rate, it is offset
by the conservative assumptions regarding systems using the test-out provisions and the universe
of systems that would stop their lead service line replacement program and later resume it
because of this change.
Replacement of lines that were previously tested-out may also occur as a result of this
change. EPA cannot quantify the costs associated with this change for a number of reasons. As
noted above, EPA does not have information on the number of systems and the number of lines
that have been previously tested-out and could be impacted by this change. This difficulty is
further compounded by the fact that some lines may have been replaced as part of the ongoing
utility replacement programs. In the 1991 final regulatory impact analysis, EPA cited an
AWWA survey that produced an estimate of 1% of lead service lines being replaced per year as
part of ongoing utility replacement programs. After promulgation of the rule, many systems
modified their ongoing utility replacement programs to replace lead lines at a higher rate.
Where lines would have to be replaced, the unit cost of replacement is measured in $ per
foot of line being replaced. The 1991 final regulatory impact analysis provided a range of $26 to
$51 per foot, depending upon system size, as the unit cost for lead service line replacement.
Using the Engineering News Record Construction Cost Index, updated estimates would range
from $41 per foot for small systems to $80 per foot for large systems. The length of the lead
service line owned by systems will also vary, which will affect costs.
The direct Costs to systems as a result of Regulatory Change III.G are therefore estimated
to be $109,000 annually, which includes $101,000 in labor costs and $9,000 in material costs.
Estimates of Costs to systems are summarized in Exhibit 26 and detailed in Appendix F-2.
Costs to States
No direct costs are expected for State/Primacy agencies as a result of Regulatory Change
III.G. The State/Primacy Agencies will review utility Lead Service Line replacement program
annual reports but these costs were captured previously in the Final Regulatory Impact Analysis
of National Primary Drinking Water Regulations for Lead and Copper, April 1991.
Exhibit 26: Summary of Direct Costs Associated with Regulatory Change III.G
(4* Qtr 2006$)
fSniwf ii ftfep Wiinn-fi isMfeiiiftii IfefeTl /i'ii-Kw'
Costs to Systems
LSI Tap Monitoring Costs
Total System Costs
$101,000
$101,000
$9,000
$9,000
$110,000
$110,000
Note: Totals may not add due to rounding.
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4.9 Summary of Average Annual Costs
The estimates of direct annual costs for the regulatory changes are presented in Exhibit
27.
Exhibit 27: Summary of Annual Direct Costs to Systems and States from Regulatory
Changes
(4* Qtr 2006$)
i£Sp3£83$
%}MiFB
III.A
III.B
III.C
III.D Low
III. D High
III.E
III.F
III.G
TOTAL Low
TOTAL High
^ii
L"iPM*i'illJJ?t
-
-
$61,000
$506,000
$765,000
$136,000
$34,000
-
$736,000
$995,000
oSiifiKffM^s
BiIKafefe
-
-
$2,635,000
-
-
-
$110,000
$2,745,000
MSDsifcSMO.
i^tel&s^ftwi
-
-
-
-
$1,112,000
$825,000
-
$1,938,000
m
1 |Tjj ifT[i
-
-
$2,696,000
$506,000
$765,000
$1,248,000
$859,000
$110,000
$5,418,000
$5,677,000
j, INT ji
in ~ - ^
i • " f _^
-
-
$82,000
$163,000
$348,000
$163,000
$63,000
-
$471,000
$657,000
ut' fi \i jl 0
LI I r'J ^
-
-
$2,778,000
$669,000
$1,113,000
$1,411,000
$922,000
$110,000
$5,890,000
$6,335,000
Note: Totals may not add due to rounding.
* One-time costs associated with III.A are summarized in Exhibit 28 with other one-time costs.
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4.10 Costs to Review and Implement Regulatory Changes
Activities resulting from regulatory change
Systems and State/Primacy Agencies will incur one-time upfront costs associated with
reviewing and implementing the overall LCR regulatory changes. For systems, activities include
reviewing the rule changes and communicating with staff and management. For States/Primacy
Agencies, activities include regulation adoption, program development, and miscellaneous
training.
Costs to systems
Systems covered by the Lead and Copper Rule will incur initial costs to read the rule and
communicate requirements to other staff, either informally or through training.
• All systems covered by the LCR will incur costs for the initial activities (72,213).
• The labor associated with one-time rule implementation activities varies based on
system size. For small systems serving fewer than 3,300, it is assumed that systems
take 5 hours to read the rule and communicate relevant information to management
and staff. For medium systems (3,300-lOOk), it is assumed that systems take 8 hours
to read the rule and communicate relevant information to system staff. For the largest
systems (>100k), it is assumed that systems take 40 hours to read the rule and
communicate relevant information to system managers and staff.
The total costs to systems associated with the initial activities are estimated at
$10,971,000 as summarized in Exhibit 28.
Costs to States
Similar to one-time costs for utilities, States will also incur costs to review the regulatory
changes and implement the provisions through regulatory adoption.
• All 57 State or Primacy Agencies will incur initial costs associated with regulatory
review and adoption.
• The labor associated with these initial activities was derived from past experience for
similar drinking water rules. For the Minor Revisions to the LCR, EPA assumed that
™^^^ 10
regulatory adoption activities would require 0.25 FTE. For another recent rule of
similar scope, the Filter Backwash Rule, EPA estimated that regulatory review and
^ Source: Information Collection Request: National Primary Drinking Water Regulations For Lead and Copper,
USEPA, Office of Water, June 1999, page A-B-1.
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adoption activities would require 0.125 FTE.33 The analysis assumed the level of
effort for this rule would be slightly higher than these other two rules because of the
interactive nature of some of the rule provisions: .33 FTE or 600 hours to review and
adopt the regulatory changes.
The total direct costs for initial implementation activities for States is summarized in
Exhibit 28 and detailed in Appendix G-2.
Exhibit 28: Summary of Direct Costs Associated with One-Time Costs
(4th Qtr 2006$)
Costs to Systems
Review Rule & Communication
III.A
Total System Costs
Costs to State/Primacy Agencies
Regulation Adoption
III.A
Total State Costs
TOTAL Rule Implementation Costs
$10,971,000
$104,000
$11,075,000
$1,488,000
$162,000
$1,650,000
$12,725,000
Note: Totals may not add due to rounding.
~3 Source: Economic Analysis for the Filter Backwash Recycling Rule, USEPA, Office of Water, EPA 816-R-01-20,
July 2001, Appendix E-4.'
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5 Indirect Cost and Health Risk Reduction Implications of Rule Changes
The revisions will result directly in increased administrative costs for systems and States
- costs to conduct the increased required monitoring, notification, and testing and to meet the
more tightly specified requirements for these activities. The revisions do not affect the Action
Levels, corrosion control requirements, line replacement requirements, or other provisions in the
existing rule that directly determine the degree to which the rule abates risks from lead and
copper. However, the increase and change in administrative activities that will result from the
revisions will result in the generation of new information (e.g., more monitoring data, some of
which may show exceedances), and some systems or individuals will likely respond to this new
information by taking measures to abate lead and copper exposures. We thus believe the
revisions will have an indirect impact on the degree to which lead and copper control measures
may be implemented, and on the overall benefits and costs from the LCR.
The potential impacts of these revisions on lead and copper abatement measures are quite
speculative. The revisions will require some systems to generate new information which in some
cases may be provided to States and customers. The information that is generated may turn out to
suggest lead and copper threats that would not otherwise have been discovered (or such threats
might be discovered sooner than they otherwise would have). Upon obtaining this information, a
system itself, the State, or some of the system's customers might take actions to address these
threats. The revisions, however, require only the generation of the information. They do not
specifically require adoption of any practices or measures to reduce the levels of lead and copper
in drinking water. It is difficult to project now what the content will be of the information
generated pursuant to the regulation, and it is even further uncertain how systems and individuals
might act in response to the new information when it is developed. For these two reasons - the
lack of any direct requirement in the revisions for systems or individuals to implement exposure
reduction measures, and the uncertainty in tracing the linkages from the regulation to new
information to exposure prevention measures to changes in risks and costs - EPA is unable to
quantify the eventual indirect impacts on risks, benefits, and costs that might ensue from these
regulatory changes. EPA does expect that overall benefits from the LCR will increase, as a result
of the indirect effect of the revisions on the actions of individual consumers and systems. In this
section, we provide a qualitative picture of what some of these indirect impacts might be.
Exhibit 29 summarizes the manner in which each revision might perhaps induce actions
that reduce lead and copper exposures, resulting indirectly in both costs and health risk reduction
benefits. The Exhibit shows only the indirect costs and benefits that might result from the
provisions; the Exhibit does not repeat the direct cost impacts that were estimated in Section 4.
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Exhibit 29: Summary of Preliminary Cost and Health Risk Reduction Implications of the LCR Short Term Rule Changes
fitlflffilfefiififft'K iTifcKtrfS
rWanTfrfl I fe^MiMs
llTiftlf fc?-l SfcTnl lcl
-------
pMTfiMMlr5fiS3 TfjTMffl
^®13nMl IS@5H3lB3
more sites is not expected
systematically to either increase
or decrease a system's likelihood
of being found to exceed the
Action Level.
• Monitoring more sites could either
hasten or delay the time at which
a system will draw a conclusion
from its monitoring as to whether
the Action Level is exceeded.
feMifej ffel %? (MMa! ©LM»
pitchers) might last for only 6
months rather than a year if re-
sampling after 6 months is below
the Action Level.
e fir tSMiliii MMS
GMMfifoiS
after an Action Level exceedance
could result in health risk
reductions. If sampling
demonstrates continued
exceedance, a system would
have quicker feedback on
effectiveness of actions and could
proceed more quickly to other
measures to reduce lead. In the
case of sampling 6 months vs. 12
months after an exceedance,
further actions that would reduce
lead could begin 6 months earlier.
Regulatory change III.D - Advanced notification and approval requirement for treatment change or source addition
• System notifies State of long-term
treatment change or source water
addition prior to implementation
for State approval.
• Some States already require
review and approval, so the
provision has no or little impact in
these States.
• The State may request that the
system provide additional
information or require the system
to conduct sampling or pilot
studies prior to the treatment
change becoming effective. This
could delay implementation of the
treatment change. It could also
result in modification of a change
that could have had negative
impacts.
• A net decrease in treatment costs
may actually occur. Early State
review may avoid potentially
costly mistakes. If a State has
concerns or suggestions about
the impact of a treatment change,
it will be less expensive to modify
treatment before the changes are
made, rather than after the fact.
• Health risk reductions could result
if pre-emptive modifications are
made to proposed treatment
changes that reduce the
possibility of lead leaching.
Regulatory change III.E - Notification of sampling results
• Systems notify customers of tap
monitoring results.
• For dwellings with a tap where the
monitored concentration exceeds
the Action Level, some fraction of
owners/occupants will decide to
act to reduce the concentration,
perhaps replacing lead lateral or
fixtures, installing filters, using
bottled water, adopting flushing
practices or contacting the utility
for further information or request
for additional sampling.
• Owner and/or occupants will bear
the costs of whatever exposure
reduction measures they decide
to implement.
• Reduced lead/copper levels will
reduce health risks for the
occupants of any dwelling where
exposure-reduction measures are
implemented.
• System letters to all homeowners
may improve overall awareness
of sources of lead, and strategies
to reduce exposure to lead.
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Regulatory change III.F - Revisions to public education requirements
• Systems use a variety of methods
to more effectively communicate
with customers about potential
risks due to lead.
For a system with a lead Action
Level exceedance or a lead
detect, a greater fraction of
customers will be made aware of
potential risks due to lead levels
and may act to reduce lead
levels.
Owner and/or occupants will bear
the costs of whatever exposure
reduction measures they decide
to implement.
Inclusion of statement in the CCR
may improve overall awareness
of sources of lead, and strategies
to reduce exposure to lead.
Reduced lead levels will reduce
health risks for the occupants of
any dwelling where exposure-
reduction measures are
implemented.
Regulatory change III.G - Reevaluation of Lead Service Lines deemed replaced through testing
• The system that exceeds the lead
Action Level following a treatment
change will need to identify all
lead service lines that had
previously been determined to be
replaced via sampling. The utility
will need to develop a testing
schedule and contact all affected
homeowners regarding the
testing program.
It is expected that most
homeowners that utilize a lead
service line will be supportive of
the testing program.
Homeowners may be interested
in physical replacement of the
LSL or additional sampling,
particularly if the sample's lead
level exceeds the lead Action
Level.
The cost of retesting a previously
"tested-out" line is a direct cost of
the rule.
If a previously "tested-out" line is
retested and is over the Action
Level, this line will eventually be
replaced, an indirect cost that is
attributable to the rule. However,
it could take many years before
this cost is incurred.
There may be short term
implications associated with
increasing the number of lead
service lines in the baseline. If the
number of lines that need to be
replaced or tested out is
calculated based on the size of
the inventory, a slightly larger
inventory will mean a slight
increase in the number of lines
needed to reach the 7 percent
replacement goal.
If a previously "tested-out" line is
retested and is over the Action
Level, health risk reductions will
occur when the line is replaced.
Note 1 (see Regulatory Change III.C): In statistical terms, type 1 and type 2 errors are errors that can occur while testing a statistical hypothesis.
In this case, the hypothesis may be that 90 percent of samples will have a lead level < 15 ppb. When a utility collects a limited number of samples
thus generating limited lead data points, it is possible that the hypothesis could be rejected (found to be not true) even when it is true (a Type 1
error) or that the hypothesis is not rejected (found to be true) when it is in fact false (a Type 2 error). These errors occur because of sampling
variability and the occurrence of unrepresentative samples. These errors can be minimized by collecting more samples.
Page 72
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As shown in the Exhibit, four regulatory revisions seem more likely than the others to
potentially influence systems or individuals to undertake exposure prevention measures. These
include provisions III.C, III.E, III.F, and III.G. Although it is not feasible to quantify the
monetary value of these possible exposure reductions, the relationship of benefits to costs for
reductions in lead in drinking water exposure in general suggests that benefits would exceed
costs if quantified. For example, in the 1991 RIA for the Lead and Copper Rule, the ratio of
quantified benefits to costs is 6.7 to 1, meaning that there were 6.7 times more benefits than
costs.34 If this relationship continues to hold true, it's likely that any direct and indirect costs for
the regulatory changes that result in exposure reductions would be offset by health risk reduction
benefits.
34 Source: Final Regulatory Impact Analysis of National Primary Drinking Water Regulations for Lead and
Copper, USEPA, Office of Drinking Water, April 1991, page 1-4.
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6 Administrative Requirements
6.1 Executive Order 12866: Regulatory Planning and Review
Under Executive Order 12866, [58 Federal Register 51735 (October 4, 1993)] this action is a
"significant regulatory action". Accordingly, EPA submitted this action to the Office of
Management and Budget (OMB) for review under EO 12866 and any changes made in response
to OMB recommendations have been documented in the docket for this action.
This document represents an analysis of the potential costs and benefits associated with this
action. A copy of this analysis is available in the docket for this action and the analysis is briefly
summarized in Section IV of the preamble for the final rule.
6.2 Paperwork Reduction Act
The information collection requirements in this rule have been submitted for approval to
the Office of Management and Budget (OMB) under the Paperwork Reduction Act, 44 U.S.C.
3501 et seq. The information collection requirements are not enforceable until OMB approves
them.
Need for the Information Collection
EPA requires current information on lead and copper contamination to be provided to
consumers and states. Recent highly publicized incidences of elevated drinking water lead levels
prompted EPA to review and evaluate the implementation and effectiveness of the LCR on a
national basis. As a result of this multi-part review, EPA identified seven targeted rule changes
that clarify the intent of the LCR and enhance protection of public health through additional
information gathering and public education. Consumers and states will use the information
collected as a result of the short-term revisions to the LCR to determine the appropriate action
they should undertake. The rule revisions described in Section 3 of this document are intended to
improve the implementation of the LCR, and do not alter the original maximum contaminant
level goals or the fundamental approach to controlling lead and copper in drinking water.
Section 1401(1)(D) of the SDWA requires that regulations contain "criteria and
procedures to assure a supply of drinking water which dependably complies with such maximum
contaminant levels, including accepted methods for quality control and testing procedures to
insure compliance with such levels and to insure proper operation and maintenance of the
system...." Furthermore, Section 1445(a)(l) of the SDWA requires that every person who is a
supplier of water "shall establish and maintain such records, make such reports, conduct such
monitoring, and provide such information as the Administrator may reasonably require by
regulation to assist the Administrator in establishing regulations.. .,in determining whether such
person has acted or is acting in compliance...." In addition, Section 1413(a)(3) of the SDWA
requires States to "keep such records and make such reports...as the Administrator may require
by regulation."
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Section 1412(b) of the SDWA, as amended in 1996, requires the Agency to publish
maximum contaminant level goals and promulgate NPDWRs for contaminants that may have an
adverse effect on the health of persons, are known to or anticipated to occur in PWSs, or, in the
opinion of the Administrator, present an opportunity for health risk reduction. The NPDWRs
specify maximum contaminant levels or treatment techniques for drinking water contaminants
(42 USC 300g-l). Section 1412 (b)(9) requires that EPA no less than every 6 years review, and if
appropriate, revise existing drinking water standards. Promulgation of the LCR implements these
statutory requirements
Burden Estimate
The universe of respondents for this ICR is comprised of the 52,838 CWSs and 19,375
NTNCWSs, for a total of 72,213 systems, and 57 State primacy agencies. Exhibit 30 presents a
summary of average annual burden and costs for the ICR period of late September 2007 through
late September 2010 for a lower bound and upper bound estimate (depending on assumptions
about the timing of rule implementation).
The average annual system burden is estimated at 189,369 - 271,997 hours. The average
annual system costs are projected at $5.6 to $8.4 million.
The average annual State burden is estimated at 17,628 - 25,125 hours. The average
annual State costs are projected at $0.8 - $1.1 million.
These annual costs reflect the costs to systems and States for the first three years after
rule promulgation and consist of the one-time direct costs for rule review and implementation, as
well as activities related to the seven regulatory changes.
Bottom Line Burden Hours and Costs
The average annual burden and costs for the initial three year period is summarized in
Exhibit 30. The total burden and costs for each regulatory change is explained in Appendices B
and C of the ICR document for the final rule.
Exhibit 30: Summary of the Total Burden and Costs from September 2007 through
September 2010 for the Regulatory Changes
(4th Qtr 2006$)
PWSs
State
Total
72,213
57
72,270
189,369
17,628
206,997
271,997
25,125
297,122
$5.6
$0.8
$6.4
$8.4
$1.1
$9.5
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The estimates of the burden and costs by year are summarized in Exhibit 31 for the lower
bound estimate and Exhibit 32 for the upper bound estimate.
Exhibit 31: A Summary of the Burden and Costs by Year for the Regulatory Changes -
Lower Bound Estimate
(4th Qtr 2006$)
PWSs
State
Total
179,622
15,390
195,012
$4.9
$0.7
$5.6
219,537
18,810
238,347
$6.0
$0.8
$6.9
168,948
18,685
187,633
$5.8
$0.8
$6.6
Note: Totals may not add due to rounding.
Exhibit 32: A Summary of the Burden and Costs by Year for the Regulatory Changes
Upper Bound Estimate
(4* Qtr 2006$)
PWSs
State
Total
485,479
45,389
530,868
$13.9
$2.0
$15.9
165,256
14,993
180,249
$5.7
$0.7
$6.3
165,256
14,993
180,249
$5.7
$0.7
$6.3
Note: Totals may not add due to rounding.
Burden Statement
For the ICR period of September 2007 through September 2010 associated with the
short-term revisions to the LCR, the average burden for systems to implement the requirements
of the short-term LCR revisions is estimated to be 2.6 - 3.8 hours per system per year. The
average annual cost to systems is expected to be $77 - $117 per system per year. System burden
includes time required read and understand the rule requirements and communicate those
requirements to system personnel and management, as well as activities related to the regulatory
changes. The average burden for State agencies is estimated to be 309 - 441 hours per State per
year. This burden includes the time to inform systems of the requirements and perform primacy-
related activities, as well as activities related to the regulatory changes. The estimated annual
State cost is estimated to be $13,500 - $19,300 per State per year.
Burden means the total time, effort, or financial resources expended by persons to
generate, maintain, retain, or disclose or provide information to or for a Federal agency. This
includes the time needed to review instructions; develop, acquire, install, and utilize technology
and systems for the purposes of collecting, validating, and verifying information, processing and
maintaining information, and disclosing and providing information; adjust the existing ways to
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comply with any previously applicable instructions and requirements; train personnel to be able
to respond to a collection of information; search data sources; complete and review the collection
of information; and transmit or otherwise disclose the information.
An agency may not conduct or sponsor, and a person is not required to respond to a
collection of information unless it displays a currently valid OMB control number. The OMB
control numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9. When this ICR is
approved by OMB, the Agency will publish a technical amendment to 40 CFR part 9 in the
Federal Register to display the OMB control number for the approved information collection
requirements contained in the final rule.
6.3 Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) generally requires an agency to prepare a
regulatory flexibility analysis of any rule subject to notice and comment rulemaking
requirements under the Administrative Procedure Act or any other statute unless the agency
certifies that the rule will not have a significant economic impact on a substantial number of
small entities. Small entities include small businesses, small organizations, and small
governmental jurisdictions.
The RFA provides default definitions for each type of small entity. Small entities are
defined as: (1) a small business as defined by the Small Business Administration's (SBA)
regulations at 13 CFR 121.201; (2) a small governmental jurisdiction that is a government of a
city, county, town, school district or special district with a population of less than 50,000; and (3)
a small organization that is any "not-for-profit enterprise which is independently owned and
operated and is not dominant in its field." However, the RFA also authorizes an agency to use
alternative definitions for each category of small entity, "which are appropriate to the activities
of the agency" after proposing the alternative definition(s) in the Federal Register and taking
comment. 5 USC 601(3) - (5). In addition, to establish an alternative small business definition,
agencies must consult with SBA's Chief Counsel for Advocacy.
For purposes of assessing the impacts of today's final rule on small entities, EPA
considered small entities to be public water systems serving 10,000 or fewer persons. As
required by the RFA, EPA proposed using this alternative definition in the Federal Register (63
FR 7620, February 13, 1998), requested public comment, consulted with the Small Business
Administration (SBA), and finalized the alternative definition in the Consumer Confidence
Reports regulation (63 FR 44511, August 19, 1998). EPA stated in that Final Rule that it would
apply the alternative definition to future drinking water regulations (including this one) as well.
After considering the economic impacts of today's final rule on small entities, EPA
certifies that this action will not have a significant economic impact on a substantial number of
small entities. The small entities directly regulated by this final rule are small public water
systems serving 10,000 or fewer people on an annual basis. EPA has determined that 68,286
small systems may be affected by the changes to the LCR. Exhibit 33 provides a summary of
these small systems, by size category and system type.
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Exhibit 33: The Number of Small Systems Affected by the Final Rule Changes
Siftel
<=100
101-500
501-1,000
1,001-3,300
3,301-10,000
Total
®wm
13,766
16,240
5,914
8,298
4,707
48,925
WlWeWS
9,548
6,997
1,925
795
96
19,361
'IWifLSrriFlT!
23,314
23,237
7,839
9,093
4,803
68,286
However, not all of these small entities will incur direct costs for all of the final regulatory
changes. In many cases, only a relatively small subset of these systems will have to change
practices to comply with the regulatory changes. Exhibit 34 provides an estimate of the number
of small systems that will incur direct costs for each of the final regulatory changes.
Exhibit 34: The Number of Small Systems Affected by Each Regulatory Change
fK^HftoTS'^TilsIS!
Regulatory Change #III.A
Regulatory Change #111. B
Regulatory Change #111. C
Regulatory Change* III.D
Regulatory Change #111. E
Regulatory Change #111. F
Regulatory Change #111. G
mmW\ a?;fe i IK m^mtwi] 1 ife/^F
3,692
None - Clarifications of definitions with
no direct cost impact
854
1,009
60,735
49,337
1
Activities and Costs Associated With Rule Changes for Small Systems
EPA has estimated the burden and costs associated with the regulatory changes, as
described in section 4 of this document. The basis for many of these input values and
assumptions are described in detail in the Economic Analysis, Section 4. The following
summarizes the costs estimated for small systems.
One-Time Activities
All small systems subject to the Lead and Copper Rule will be expected to incur some
costs to read the rule changes and communicate requirements as necessary. The level of effort
associated with these activities could range from 5-8 hours for each small system. The average
cost per system for these activities is estimated at $138, for a total cost of $9,404,000 for all
68,286 small systems. This assumes an hourly fully loaded labor cost for small system
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employees ranging from $23.86 to $33.96 (see Appendix B for derivation). One-time costs
range from $124 for systems serving 25-500 to $270 for systems serving 3,301 to 10,000 people.
Activities for Regulatory Change III.A
Under Regulatory Change III.A, small systems with fewer than 5 taps in States that allow
1 sample per tap will prepare and submit to the State a one-time letter verifying the applicable
number of taps and requesting the use of the alternative sampling. Eleven States supported the
alternative sampling in their comments on the proposed rule. EPA estimates that there are 3,692
small systems with fewer than 5 taps in the 11 States (plus Alaska for small CWSs). Preparing
the one-time request letter results in a one time cost of $28 per system across all small
subcategories. Total costs for all small systems likely to be affected by Regulatory Change III.A
are estimated at $104,000 per year.
Activities for Regulatory Change III.C
Under Regulatory Change ni.C, all systems that exceed the lead Action Level are
triggered into regularly scheduled lead tap monitoring. Additional costs are associated with
taking lead samples more frequently and reporting the results to States. EPA estimates that 854
small systems exceed the lead Action Level each year. Changing from reduced tap monitoring to
regularly scheduled tap monitoring would result in an average cost increase of $2,258 per year
per system. Average annual costs for this regulatory change range from $1,300 for the smallest
size subcategory (25-500) to $9,400 for systems serving 3,301 to 10,000. Total costs for all
small systems likely to be affected by Regulatory Change III.C are estimated at $1,929,000 per
year.
Activities for Regulatory Change III.D
Small systems that are changing treatment or adding a source would incur additional
costs under Regulatory Change III.D to prepare data in support of treatment changes or source
addition, to submit the data to the State for review, and to coordinate with the State during the
review. These activities are estimated to take an additional 7.5 hours per system for each
treatment change or source addition. The cost for each small system that is changing treatment or
adding a source is estimated at $196. Average annual costs range from $186 for systems serving
25-500 to $255 for systems serving 3,301 to 10,000 people. The total cost for all small systems
likely to be affected by Regulatory Change EQ.D is estimated at $198,000 per year.
Activities for Regulatory Change III.E
Most small systems are expected to incur additional costs under Regulatory Change III.E
when they are required to notify consumers of tap monitoring results. The activities associated
with notifying customers vary based on the type and size of the system and include the effort to
prepare a self-certification letter for the State. The average cost for small systems to notify
customers is estimated at approximately $17 annually. This estimate assumes one labor hour to
prepare a customer notification letter per system, 0.12 hours to prepare the self-certification
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letter, and $0.43 in material costs per sample for CWSs. EPA assumed one labor hour plus 0.12
hours for NTNCWSs, with negligible material costs. It is important to note that the majority of
small systems are assumed to meet the lead action level and are assumed to be on triennial
monitoring. Therefore, this requirement will only affect them once every three years. Average
annual costs range from $15 for the smallest size subcategory (25-500) to $32 for systems
serving 3,301 to 10,000 people. The total cost to all small systems likely to be affected by
Regulatory Change III.E is estimated at $1,060,000.
Activities for Regulatory Change III.F
Different provisions of Regulatory Change III.F apply to different subsets of systems. All
small community water systems will incur costs to include a statement on lead in the Consumer
Confidence Report (CCR), at an average cost of $7 per system, based on the assumption of 0.25
hours to add an informational statement on lead to the CCR. Small community water systems
that exceed the Lead Action Level will incur costs from a variety of public education activities,
at an average cost per system of $265. Average annual costs for systems in the small size
subcategories that do not exceed the Lead Action Level range from $6 for systems serving 25-
500 to $8 for systems serving 3,301 to 10,000 people. For those systems that do exceed the Lead
Action Level, average annual costs range from $180 to $1,200. The total cost for all small
systems likely to be affected by Regulatory Change III.F is estimated at $569,000.
Activities for Regulatory Change III.G
Regulatory Change III.G applies to systems that had "tested out" lead service lines as part
of a lead service line replacement program and then re-exceeded the Action Level. For the
purposes of subsequent lead service line replacement efforts, the previously "tested-out" lines
would go back into the inventory for possible re-testing and/or replacement. Only a handful of
systems are expected to be in this situation, estimated at 1 system per year. This analysis assumes
that the 1 system is not a small system. There is no evidence that small systems would be
triggered into this regulatory change cost any more frequently than other systems.
Small System Costs
Exhibit 35 summarizes the estimated annual costs per system for three subcategories of
small systems associated with all final regulatory changes. Exhibit 36 summarizes the one-time
costs to small systems for three system size subcategories. Total average annual costs to all
small systems less than 10,000 are estimated at $3.8 million, and total one-time costs to all small
systems less than 10,000 are estimated at $9.5 million.
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Exhibit 35: Average Annual Small System Costs by System Size Category
(4th Qtr 2006$)
Regulatory Change #III.A
Regulatory Change #III.B
Regulatory Change #III.C
Regulatory Change* III.D
Regulatory Change #III.E
Regulatory Change #III.F
Regulatory Change #III.G
Average Cost per System
$30
$0
$1,300
$186
$15
$6 ($180)
$0
$41
SMilSi?
$30
$0
$3,900
$207
$18
$7 ($290)
$0
$67
$30
$0
$9,400
$255
$32
$8 ($1 ,200)
$0
$153
irtsr >M
"iMD 'IEKF'
$30
$0
$2,300
$200
$17
$7 ($270)
$0
$55
Notes: Totals may not add due to rounding.
*Values in parentheses represent costs when there is an AL exceedance
Exhibit 36: One-Time Small System Costs by System Size Category
(4th Qtr 2006$)
III.A
Implementation
Average One-Time Cost
per System
Sd^iSfi
$30
$124
$126
im.-*ifJM
$30
$138
$140
ajsi«jii-«!i;s
$30
$270
$272
^CjAlSua ?*HMK
$30
$138
$140
Note: Totals may not add due to rounding.
Average Costs Per Small System
The average compliance cost for all small systems serving fewer than 10,000 people is
minimal: $55 per system in annual costs. However, there is a fairly wide range in the costs that a
system could face. All systems will incur the $138 one-time implementation cost, but the
additional annual costs could be as low as $0 for small NTNCWSs that already notify customers
of tap monitoring results. Systems that do not already notify customers of results will incur $17
per year. Small CWSs will incur $7 per year to include a statement on the CCR. The roughly 2
percent of systems that are making a treatment change or source addition would incur an
additional $196 in the year they make the change.
At the high end, if a system incurred all annual costs, the total would be $2,743 per year.
As EPA estimates that only 854 small systems will exceed the lead action level, at most only 854
small systems, or 1.3 percent of all small systems, could potentially incur all estimated annual
costs. Those systems that do not exceed the lead action level face a maximum potential annual
cost of $220.
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Measuring Significant Economic Impact of Rule Costs
The costs to small systems are compared against average revenues for small systems
from all revenue sources. Small systems can be one of three types of small entities - small
businesses, small governments, or small non-profits. The revenue estimate used for assessing
impacts to small systems in this rule is derived from two sources: (1) EPA's 2000 Community
Water System Survey (CWSS) and (2) the 2002 Census of Governments. Data from these two
sources are used to calculate average total revenue and water revenue for all small systems
serving less than 10,000 customers and for each of 3 small system subcategories: those serving
25-500 customers, those serving 501-3300 customers, and those serving 3301-10,000 customers.
Analyzing impacts separately for these 3 categories of small systems allows EPA to better
identify potential impacts to the smallest systems, which tend to have the lowest revenues.
These estimates are shown in Exhibit 37. A detailed description of the revenue estimates, and
their associated limitations, is shown in Appendix K of this document.
For this analysis, EPA assumed that estimates of revenue for NTNCWSs are the same as
those for CWSs of similar size. In the 1998 report, An Assessment of the Vulnerability of Non-
Community Water Systems to SDWA Cost Increases, EPA evaluated the affordability of water
service to 20 categories of non-community water systems and their ability to absorb future cost
increases relative to residential users of community water systems. This report found that all of
the non-community water system categories reviewed were less vulnerable to SDWA-related
cost increases than a typical household served by a community water system. In each non-
community category, expenditures on water were found to be a relatively small percentage of
total revenues and in nearly all cases, water expenditures totaled less than 1 percent of total
revenue. Based on this analysis, EPA believes it is reasonable to use CWS-based revenue data as
a proxy for NTNCWS revenues. Because these systems may have larger revenue streams, they
are less vulnerable, financially, than CWSs and can more readily absorb cost increases associated
with new drinking water regulatory requirements.
Exhibit 37: Revenue Estimates for Small System Size Categories:
Total Revenue and Water Revenue ($2006)
System Size
25-500*
501-3,300
3,301-lOK
Aggregate: 25-10K
Total Revenue
$550,000
$1,448,000
$12,643,000
$2,167,000
Water Revenue
$30,000
$220,000
$925,000
$219,000
Source: 2000 CWSS and 2002 Census of Governments
*Note that total revenue for systems serving 25-100 is $220,000 and water revenue is $12,000.
Total revenue shown in Exhibit 37 is comprised of data on water sales, water-related
revenue, and non-water revenue. Water sales consist of the revenue generated by the sale of
water to customers and is generally based on a rate charged per unit of water sold. Water-related
revenue consists of fees, penalties, or other charges related to the provision of water. Water sales
and water-related revenue collectively represent estimates of Water Revenue as shown in Exhibit
37.
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Non-water revenue is another source of funds available to many small systems.
Examples of non-water revenue are revenues from small privately owned systems that provide
water as an essential part of another business. These systems will have revenue from their
primary business and not from the provision of water. Municipal governments may also rely on
general revenue in addition to or in lieu of water revenue to finance system operations. In many
cases, non-water revenues are available to systems to support all or part of system operations;
therefore it is important to include estimates of non-water revenue to fully account for the
resources available to water systems to finance their operations.
Exhibit 38 compares the average costs of the regulatory changes to the average revenues
on a per system basis. As shown below, economic impacts to small systems from the LCR
regulatory revisions are all less than one percent of revenue for each of the small system size
subcategories. However, as discussed in Appendix K of this document and in Section V.C.I of
the final rule, substantial data limitations exist in our revenue data which may limit our ability to
accurately describe the revenues available to small water systems.
Exhibit 38: Average Costs per System and Percentage of Revenue
ALL REVENUE SOURCES
(2006$)
System Size
25-500
501-3,300
3,301-lOK
Aggregate: 25-10K
Number
of
Systems
46,551
16,932
4,803
68,286
Average
Annual Cost
per System
$41
$67
$153
$55
Revenues per
System
$550,000
$1,448,000
$12,643,000
$2,167,000
Average Annual
Cost as Percentage
of Revenue
0.007%
0.005%
0.001%
0.003%
In summary, the costs for each of the small size subcategories below 10,000 represent
less than 1 percent of revenue from all sources. To provide additional information on the
potential economic impacts of the LCR on small entities, EPA also examined the relationship
between costs and revenues for the smallest system size (those serving 25-500 people). Average
total annual revenue for this system size is estimated to be $550,000. As stated above, the
maximum number of small systems (serving less than 10,000 people) that could possibly incur
all annual total costs of $2,743 is 854, those that exceed the lead action level. This maximum
cost represents approximately 0.5 percent of average revenues from all sources for systems in the
smallest size subcategory. However, because of our limited data on small system revenues, we
do not have the ability to develop a distribution of revenues in this subcategory for comparison.
For those systems that do not exceed the lead action level, the maximum potential cost that could
be incurred by systems in the smallest size category is $220, or 0.04 percent of revenue from all
sources. This analysis further supports our conclusion that this final rule will not have a
significant economic impact on a substantial number of small entities.
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6.4 Unfunded Mandates Reform A ct
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public Law No. 104-
4, establishes requirements for Federal agencies to assess the effects of their regulatory actions
on State, local, and Tribal governments and the private sector. Under section 202 of the UMRA,
EPA generally must prepare a written statement, including a cost-benefit analysis, for proposed
and final rules with "Federal mandates" that may result in expenditures to State, local, and Tribal
governments, in the aggregate, or to the private sector, of $100 million or more in any one year.
Before promulgating an EPA rule for which a written statement is needed, section 205 of the
UMRA generally requires EPA to identify and consider a reasonable number of regulatory
alternatives and adopt the least costly, most cost-effective or least burdensome alternative that
achieves the objectives of the rule. The provisions of section 205 do not apply when they are
inconsistent with applicable law. Moreover, section 205 allows EPA to adopt an alternative other
than the least costly, most cost-effective or least burdensome alternative if the Administrator
publishes with the final rule an explanation why that alternative was not adopted. Before EPA
establishes any regulatory requirements that may significantly or uniquely affect small
governments, including Tribal governments, it must have developed under section 203 of the
UMRA a small government agency plan. The plan must provide for notifying potentially
affected small governments, enabling officials of affected small governments to have meaningful
and timely input in the development of EPA regulatory proposals with significant Federal
intergovernmental mandates, and informing, educating, and advising small governments on
compliance with the regulatory requirements.
EPA has determined that this rule does not contain a Federal mandate that may result in
expenditures of $100 million or more for State, local, and Tribal governments, in the aggregate,
or the private sector in any one year. The total upfront costs of this action to States and public
water systems are estimated at $12.725 million, with estimated annual costs to States and public
water systems ranging from $5.9 to $6.3 million. Systems and State/Primacy agencies will incur
one-time upfront costs associated with reviewing and implementing the overall LCR regulatory
changes. For systems, activities include reviewing the rule changes and communicating
requirements to staff. For States/Primacy agencies, activities include regulation adoption,
program development, and miscellaneous communication with systems. Systems and States will
also incur annual costs consisting of the costs to implement the regulation. Annual costs to
systems include the costs of reporting, monitoring, and public education. Annual costs to States
consist of the costs of reviewing water system information. Thus, today's rule is not subject to
the requirements of sections 202 and 205 of the UMRA.
EPA has determined that this rule contains no regulatory requirements that might
significantly or uniquely affect small governments. The regulation applies to all
owners/operators of public water systems, not uniquely to those owners/operators that are small
entities, and, for most systems, requires minimal expenditure of resources. Since these regulatory
revisions affect all system sizes and the impact on the average small system will be 0.11 percent
of revenues, the regulatory revisions to the LCR are not subject to the requirements of section
203 of UMRA.
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Nevertheless, in developing this rule, EPA consulted with State and local officials
(including small entity representatives) early in the process of developing the proposed
regulation to permit them to have meaningful and timely input into its development. EPA held
five workshops in 2004-2005 to elicit concerns and suggestions from stakeholders on various
issues related to lead in drinking water. These workshops covered the topic areas of simultaneous
compliance, sampling protocols, public education, lead service line replacement, and lead in
plumbing. Expert participants from utilities, academia, state governments, consumer and
environmental groups, and other stakeholder groups participated in these workshops to identify
issues, propose solutions, and offer suggestions for modifications and improvements to the LCR.
These workshops are described in greater detail in previous sections of this document.
6.5 Executive Order 13132: Federalism
Executive Order 13132, entitled "Federalism" (64 FR 43255, August 10, 1999), requires
EPA to develop an accountable process to ensure "meaningful and timely input by State and
local officials in the development of regulatory policies that have federalism implications."
"Policies that have federalism implications" is defined in the Executive Order to include
regulations that have "substantial direct effects on the States, on the relationship between the
national government and the States, or on the distribution of power and responsibilities among
the various levels of government."
The final rule does not have federalism implications. It does not have substantial direct
effects on the States, on the relationship between the national government and the States, or on
the distribution of power and responsibilities among the various levels of government, as
specified in Executive Order 13132. The rule is consistent with, and only makes revisions to, the
requirements under the current national primary drinking water regulations for lead and copper.
The existing rule imposes requirements on public water systems to ensure that water delivered to
users is minimally corrosive, to treat source water, remove lead service lines and provide public
education where necessary to ensure public health protection. This rule does not make any
significant changes to these requirements, but, as explained elsewhere in this document, makes
revisions and clarifications to the rule's requirements to enhance the efficiency and effectiveness
of current requirements.
Nevertheless, EPA did consult with State and local officials early in the process of
developing the proposed regulation as described in section on the Unfunded Mandates Reform
Act.
6.6 Executive Order 13175: Consultation and Coordination With Indian Tribal
Governments
Executive Order 13175, entitled "Consultation and Coordination with Indian Tribal
Governments" (65 FR 67249, November 9, 2000), requires EPA to develop an accountable
process to ensure "meaningful and timely input by tribal officials in the development of
regulatory policies that have tribal implications."
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The final rule does not have tribal implications as specified in Executive Order 13175.
This rule does not significantly or uniquely affect the communities of Indian Tribal governments,
nor does it impose substantial direct compliance costs on those communities. The provisions of
this rule apply to all community and non-transient non-community water systems. Tribal
governments may be the owners or operators of such systems, however, nothing in today's
provisions uniquely affects them. EPA therefore concludes that this rule does not significantly or
uniquely affect the communities of Indian tribal governments. Thus, Executive Order 13175 does
not apply to this rule.
6.7 Executive Order 13045: Protection of Children from Environmental Health Risks and
Safety Risks
Executive Order 13045: "Protection of Children from Environmental Health Risks and
Safety Risks" (62 FR 19885, April 23, 1997) applies to any rule that: (1) is determined to be
"economically significant" as defined under Executive Order 12866, and (2) concerns an
environmental health or safety risk that EPA has reason to believe may have a disproportionate
effect on children. If the regulatory action meets both criteria, the Agency must evaluate the
environmental health or safety effects of the planned rule on children, and explain why the
planned regulation is preferable to other potentially effective and reasonably feasible alternatives
considered by the Agency.
This final rule is not subject to the Executive Order because it is not economically
significant as defined in Executive Order 12866. The rule does not change the core LCR
requirements in place to assure the protection of children from the effects of lead in drinking
water, rather the changes will improve the implementation of these provisions. Moreover, EPA
believes that this action is consistent with Executive Order 13045 because it further strengthens
the protection to children from exposure to lead and copper via drinking water, as this rule
enhances the implementation of the LCR in the areas of monitoring, customer awareness, and
lead service line replacement. This rule also clarifies the intent of some unclear provisions in the
LCR. These changes ensure and enhance more effective protection of public health through the
reduction in lead exposure.
6.8 Executive Order 13211: Actions Concerning Regulations That Significantly Affect
Energy Supply, Distribution, or Use
The final rule is not a "significant energy action" as defined in Executive Order 13211,
"Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use"
(66 FR 28355 (May 22, 2001)) because it is not likely to have a significant adverse effect on the
supply, distribution, or use of energy. The rule provides clarifications and modifications to the
existing LCR rule language only.
The final rule does not affect the supply of energy as it does not regulate power
generation. The public and private utilities that are affected by this regulation do not, as a rule,
generate power. The revisions to the LCR do not regulate any aspect of energy distribution as the
utilities that are regulated by the LCR already have electrical service. Finally, these regulatory
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revisions do not adversely affect the use of energy as EPA does not anticipate that a significant
number of drinking water utilities will add treatment technologies that use electrical power to
comply with these regulatory revisions. As such, EPA does not anticipate that this rule will
adversely affect the use of energy.
6.9 National Technology Transfer and Advancement Act
Section 12(d) of the National Technology Transfer and Advancement Act of 1995
("NTTAA"), Public Law No. 104-113, 12(d) (15 U.S.C. 272 note) directs EPA to use voluntary
consensus standards in its regulatory activities unless to do so would be inconsistent with
applicable law or otherwise impractical. Voluntary consensus standards are technical standards
(e.g., materials specifications, test methods, sampling procedures, and business practices) that are
developed or adopted by voluntary consensus standards bodies. The NTTAA directs EPA to
provide Congress, through OMB, explanations when the Agency decides not to use available and
applicable voluntary consensus standards.
The final rule may involve voluntary consensus standards in that it requires additional
monitoring for lead and copper in certain situations, and monitoring and sample analysis
methodologies are often based on voluntary consensus standards. However, the final rule does
not change any methodological requirements for monitoring or sample analysis, only, in some
cases, the required frequency and number of samples. Also, EPA's approved monitoring and
sampling protocols generally include voluntary consensus standards developed by agencies such
as the American National Standards Institute (ANSI) and other such bodies wherever EPA
deems these methodologies appropriate for compliance monitoring.
Page 87
-------
REFERENCES
ADMINISTRATIVE ORDER FOR COMPLIANCE ON CONSENT, Docket No. SDWA-03-
2004-0259DS
Agency for Toxic Substances and Disease Registry (ATSDR). lexicological Profile for Lead.
U.S. Department of Health and Hitman Services. July 1999
Centers for Disease Control (CDC). Surveillance for Elevated Blood Lead Levels Among
Children- United States 1997-2001. Centers for Disease Control and Prevention. Surveillance
Summaries, September 12, 2003. MmWR2003:52 (No. SS-10).
Cubed, M for the National Child Care Association, The National Economic Impacts of the Child
Care Sector, Fall 2002.
District of Columbia Water and Sewer Authority. General Overview. November 2005.
http: //www. dc wasa. com/ab out/gen_overvi ew. cfm
District of Columbia Water and Sewer Authority. Lead Service Line Replacement Program
Annual Report for 2003. September 2003.
District of Columbia Water and Sewer Authority. 2004 DRINKING WATER QUALITY REPORT.
2004.
Grumbles, B. Witness Testimony. Tapped Out? Lead in the District of Columbia and the
Providing of Safe Drinking Water. Subcommittee on the Environment and Hazardous Materials,
July 22, 2004.
HDR/EES. Forensic Analysis of Elevated Lead Levels in District of Columbia Water and Sewer
Authority Drinking Water: Task 5 Data Summary (Draft). June 1, 2005.
United States Census Bureau, U.S. Summary: 2000 (Census 2000 Profile). July 2002.
http://www.census.gov/prod/2002pubs/c2kprofOO-us.pdf.
United States Census Bureau, Statistical Abstract of the United States: 2006.
http://www.census.gov/prod/2005pubs/06statab/health.pdf.
United States Environmental Protection Agency. Final Regulatory Impact Analysis of National
Primary Drinking Water Regulations for Lead and Copper. April 1991.
United States Environmental Protection Agency. Regulatory Impact Analysis Addendum:
Proposed Changes to National Primary Drinking Water Regulations for Lead and Copper.
January 1996.
Page 88
-------
United States Environmental Protection Agency. An Assessment of the Vulnerability of Non-
Community Water Systems to SDWA Cost Increases. September 1998.
United States Environmental Protection Agency. Information Collection Request: National
Primary Drinking Water Regulations For Lead and Copper. June 1999.
United States Environmental Protection Agency. Economic Analysis for the Filter Backwash
Recycling Rule. EPA 816-R-01-20. July 2001.
United States Environmental Protection Agency. Lead and Copper Monitoring Guide. February
2002.
United States Environmental Protection Agency. Summary, Lead Action Level exceedances for
public water systems subject to the Lead and Copper Rule (For data through September 13,
2004). 2004.
United States Environmental Protection Agency. Information Collection Request for
Disinfectants/Disinfection Byproducts, Chemical, and Radionuclides Rules, OMB Control
Number: 2040-0204, EPA Tracking Number: 1896.05. 2004
United States Environmental Protection Agency, Public Water System Supervision Information
Collection Request, July 2004.
United States Environmental Protection Agency. FACTOIDS: Drinking Water and Ground
Water Statistics for 2004. http://www.epa.gov/safewater/data/pdfs/data_factoids_2004.pdf.
United States Environmental Protection Agency. Notes from the EPA Lead Service Line
Replacement Workshop. December 10, 2004.
http://www.epa.gov/safewater/lcrmr/pdfs/summary Icmr review lead line replacement works
hop_10-26-04.pdf
United States Environmental Protection Agency. Summary of Lead Action Level Exceedances.
January 2005. http://www.epa.gov/safewater/lcrmr/lead data.html
United States Environmental Protection Agency. Lead90th Percentile Levels for 166 Large
Water Utilities - Then and Now. January 2005.
http://www.epa.gov/safewater/lcrmr/reductionplan comparison.html
United States Environmental Protection Agency. Consumer Factsheet on: LEAD. March 4, 2005.
http://www.epa.gov/safewater/lcrmr/lead.html
United States Environmental Protection Agency. Information Collection Request for
Contaminant Occurrence Data in Support of EPA's Second Six Year Review of National Primary
Drinking Water Regulations. Draft. June 2005.
Page,
-------
United States Environmental Protection Agency. State Responses to EPA Survey on State
Implementation. November 2005.
United States Environmental Protection Agency. Economic Analysis for the Final Stage 2
Disinfectants and Disinfection Byproducts Rule. EPA 815-R-05-010. December 2005
Page 90
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Appendix A
Derivation of State Labor Rates
Appendix A-1
-------
Appendix A-l: State Labor Rate for Economic Analysis
2007 Salaries and Overhead Costs from ASDWA State Resource Model
From Exhibit A02, Draft Six-Year 2 ICR, August 2006
State Size (a)
Very Small (applies to 9
States, including VI, GU,
AS, NM)
Small applies to 12 States,
including DC and PR)
Medium (applies to 23
total)
Large (applies to 10 total)
Very Large (applies to 2
total)
Weighted Average -All
States and Territories
Professional
Staff
Support
Staff
(adjusted for Fringe
benefits at 22% of base
salary)
$62,720
$62,917
$67,274
$75,950
$111,800
$41,960
$36,470
$41,297
$54,897
$59,908
Hourly
Average:
80% Prof
and 20%
Support
$32.54
$32.02
$34.49
$39.86
$56.35
Hourly Rate
(adjusted for
overhead at
23%)
$40.02
$39.38
$42.42
$49.02
$69.30
Number of
States/
Territories
9
12
23
10
2
56
Weighted
Average
State Labor
Rate (2007)
$360.18
$472.56
$975.66
$490.20
$138.60
$2,437.20
$43.52
(a) State labor costs are from the "2001 ASDWA Drinking Water Program Resource Needs Self
Assessment". In 2000, the United States General Accounting Office used a previous version of this model
to estimate nationwide drinking water program needs for Congress. The tool was later updated and
improved based on comments from 27 States. To make the model easier to use, ASDWA established
suggested salary and benefit ranges (i.e., default values), resource needs for the various NPDWRs, and
other key variables. These hourly estimates are based on the default annual rates for 2007 that are
provided in the model. The model assumes 1,800 work hours per full-time equivalent employee. Hourly
rate labor costs are adjusted to account for fringe benefits (i.e., holidays, sick days, vacation, pension,
health, dental, and life insurance); and overhead (i.e., office space, furniture, utilities, copiers, fax
machines, postage, basic computing needs, etc.).
Appendix A-l
-------
Appendix B
Derivation of System Labor Rates
Appendix B-l
-------
Appendix B-l: Derivation of System Labor Rates
Labor costs for systems were taken from the report Labor Costs for National Drinking
Water Rules prepared by SAIC in October 2003 for EPA's Office of Ground Water and Drinking
Water. Exhibits 20 and 21 of that report summarized recommended average technical wage rates
and average managerial wage rates by system size for EPA to use in cost analyses. These rates
are summarized below.
Wage Rates from SAIC Study: From Exhibits 20 and 21
System Size
25-100
101-500
500-3. 3k
3.3k-10k
10k-100k
>100k
Average:
Average Small (<10k):
Loaded Wage Rate
(2003 $)
Technical
$21 .44
$23.09
$24.74
$25.34
$26.05
$31.26
Managerial
$44.36
$47.78
$51.20
$51.20
$51.20
$51.20
Loaded Wage Rate
(2006 4th Qtr $)
Technical
$23.86
$25.70
$27.54
$28.20
$28.99
$34.79
$28.18
Managerial
$49.37
$53.18
$56.99
$56.99
$56.99
$56.99
Combined Wage
Rate (2006 4th Qtr $)
Combined
$23.86
$25.70
$27.54
$33.96
$34.59
$39.23
$30.81
$27.76
Source: Labor Costs for National Drinking Water Rules, SAIC, October 24, 2003.
These loaded wage rates are updated to a fourth quarter 2006 level using the Employment
Cost Index for wages and salaries in utilities (based on the NAICS classification system)35. The
index value is 93.0 for the first quarter of 2003 and 103.5 for the fourth quarter of 2006, resulting
in a factor of 1.113. To represent the composition of staff at PWSs of smaller sizes (e.g.,
systems serving fewer than 3,300 people), EPA uses only the technical rate. For systems serving
3,300 or more people, EPA uses a ratio of 80 percent technical labor to 20 percent managerial
labor to arrive at a weighted labor rate of $33.96 for systems serving 3,301-10,000 people,
$34.59 for systems serving 10,001-100,000 people, and $39.23 for systems serving greater than
100,000 people.
35 The Bureau of Labor Statistics has discontinued calculating the Employment Cost Index by SIC code
classifications (electric, gas and sanitary services). The comparable NAICS classification is for utilities. Also, BLS
changed the base year for calculating the index (Dec 2005 = 1.00). The change in series classification and index
year does not result in an appreciable difference in the updating. For example, the update factor from 2001 to 2003
used in the exhibit is 1.07 either using SIC or NAICS for the time period.
Appendix B-l
-------
Appendix C
Derivation of Direct Costs for Regulatory Change III.C
Appendix C-l
-------
Appendix C-l: Percent of Systems on Reduced Monitoring
State
AK
AL
AR
AS
AZ
CA
CO
CT
DC
DE
FL
GA
GU
HI
IA
ID
IL
IN
KS
KY
LA
MA
MD
ME
Ml
MN
MO
MS
MT
Navajo
NC
ND
NE
NH
NJ
NM
Nmar
NV
NY
OH
OK
OR
PA
PR
Rl
SC
SD
TN
TX
UT
VA
VI
VT
# CWS and NTNCWS
(1)
656
650
768
22
986
4541
993
1244
6
331
2890
1931
12
128
1286
996
2197
1526
963
467
1290
773
1075
768
3069
1528
1704
1265
903
157
2740
349
794
1142
1477
792
111
359
3573
2288
1255
1211
3348
523
161
830
495
727
5274
514
1865
235
669
% Systems on Reduced
Monitoring
51%
99%
95%
0%
95%
100%
88%
85%
100%
75%
97%
93%
100%
99%
90%
90%
100%
87%
98%
98%
100%
78%
76%
90%
100%
90%
98%
85%
80%
38%
92%
100%
97%
95%
97%
100%
100%
90%
90%
75%
70%
90%
89%
100%
70%
92%
95%
98%
90%
88%
90%
100%
88%
# CWS and NTNCWS on
Reduced Monitoring
335
644
730
0
937
4,541
874
1,057
6
248
2,803
1,796
12
127
1,160
896
2,197
1,328
944
458
1,290
603
820
691
3,069
1,375
1,670
1,075
722
60
2,507
349
770
1,085
1,433
792
111
323
3,216
1,716
879
1,090
2,980
523
113
764
470
712
4,747
452
1,679
235
589
Appendix C-l
-------
WA
Wl
WV
WY
TOTAL
2589
1993
690
363
71,492
100%
80%
90%
93%
2,589
1,594
621
338
65,142
Notes:
(1) System inventory from 4th Quarter 2004 SDWIS Fed data pull. System totals do not include 703
systems in Regions and 18 systems in PW. (71,492 + 703 + 18 = 72,213 total systems).
• Findings: 65,142 of 71,492 CWS and NTNCWS systems are on reduced monitoring
which is equivalent to 91 percent of these systems
• Data source: USEPA Survey of States - Questions on State Implementation of Lead and
Copper Rule. July 2004.
• For states that did not respond to survey, assume 100 percent systems on reduced
monitoring.
Appendix C-3
-------
Appendix C-2I Derivation of estimates of system labor for tap monitoring
Unlike most drinking water regulations that require sampling at entry points to the
distribution system, the LCR requires that tap water samples be collected at kitchen or bathroom
taps of residences and other buildings to capture the impact of distribution system and household
plumbing materials on drinking water lead and copper levels. This requirement significantly
complicates sample collection, requiring that water systems identify potential customers to
monitor based on a tiered system, recruit those customers to participate, and coordinate with
these customers to collect tap samples. Procedures associated with lead and copper tap sampling
include collecting a 1-liter first draw sample from a tap regularly used for consumption where
the water has stood in the pipes for at least 6 hours (e.g., no flushing, showering, etc.). Residents
may collect samples, but they must follow specific instructions as to the sample collection
procedures. Systems then analyze the samples for lead and copper content, calculate the 90th
percentile value for the system to assess compliance, and report the results to the State.36
Sample Collection
In order to collect drinking water samples from customer sites to conduct compliance
monitoring for the LCR, systems undertake the following activities:
• Identification of potential monitoring locations based on the Tier system in the LCR,
• Recruitment of customers at the locations to voluntarily participate in sampling,
• Distribution of sample materials and instructions,
• Coordination with customers during sampling to remind them and answer questions,
• Collection of samples from customer locations, and
• Review of samples and validation that appropriate collection procedures have been
followed.
The labor required by systems to conduct lead and copper tap sampling to assess
compliance with the LCR has been estimated previously by several EPA studies. The April 1991
"Final Regulatory Impact Analysis of National Primary Drinking Water Regulations for Lead
and Copper" estimates that it takes 2 hours for public water system personnel to arrange for and
collect each lead and copper sample.37
These estimates have been refined since the 1991 RIA for the LCR. The June 1999
Information Collection Request states that "sample collection (the labor required for travel,
36 Source: Lead and Copper Monitoring and Reporting Guidance for Public Water Systems, USEPA, Office of
Water, EPA-816-R-02-009, February 2002.
37
Source: Final Regulatory Impact Analysis of National Primary Drinking Water Regulations for Lead and
Copper, USEPA, Office of Drinking Water, April 1991, page 4-9.
Appendix C-4
-------
gaining access to the sampling station, and sample collection) takes 2.5 hours per sample.. ,"38
The estimate of 2.5 hours per sample for lead and copper tap sampling collection is also used in
the 2004 ICR39 and, in the absence of new information, has been applied in this analysis.
Sample Analysis
The cost to analyze a compliance sample for lead and copper is based on the fee charged
by certified commercial laboratories. This fee includes both the cost of labor and materials. The
June 1999 ICR assumed a commercial fee of $30 to analyze a sample for lead and copper.
Updated to current dollars (4th Qtr 2006), the fee is estimated at $36.34 per sample.40 To validate
that the updated analysis fee is reasonable, publicly available estimates of costs were collected as
displayed in the following table.
Source
US EPA
NY State DOH
CWLTI
(non profit in NC)
Hometips.com
Fairfax Water
Fee for Lead and
Copper Analysis of
Drinking Water
$20 -$100
$15 -$50
$24 - lead only
$30 lead and copper
$35 - lead only
$35 per faucet
Citation
http://www.epa.gov/safewater/lead/leadfacts.html
http://www.health.state.ny.us/nysdoh/lead/leadwtr.htm
http://www.leadtesting.org/orderonline.htm
http://www.hometips.com/help/wat5.html
http://www.fcwa.org/water/lead.htm
The updated estimate of $36.34 per sample for lead and copper is well within the range provided
by the USEPA and the NY State Department of Health. It is also very close to the $35 that one
system charges for lead testing (Fairfax Water) and the estimate from a home advice website
from two national laboratories (National Testing Labs and Suburban Water Testing).
Based on OMB guidance in order to be consistent with estimates for other drinking water
rules, the June 1999 ICR assumes that all analysis is conducted in-house for utilities, requiring
that the commercial fee be broken into its labor component and materials component. The labor
required to analyze each sample is estimated at 1 hour, based on the use of the ICP-MS (200.8)
method. The average technical labor rate for 1 hour of technical labor is estimated in the
following table.41
Size Category
<=100
101 to 500
Labor for 1 Hr
$23.86
$25.70
" Source: Information Collection Request: National Primary Drinking Water Regulations For Lead and Copper,
USEPA, Office of Water, June 1999, page A-3.
39 Source: Information Collection Request: Disinfectants/Disinfection Byproducts, Chemical, andRadionuclides
Rules, USEPA, Office of Water, September 2004, page H-43.
40 Updated using the CPI for 1999 to Dec 2006 (201.8/166.6=1.211)
41 Source: Labor Costs for National Drinking Water Rules, SAIC, October 24, 2003, updated.
Appendix C-5
-------
501 to 3,300
3.3K-10K
10K-100K
>100K
Mean
$27.54
$28.20
$28.99
$34.79
$28.18
The materials cost associated with analyzing a compliance sample for lead and copper can then
be estimated by subtracting the labor component of $28.18 from the total fee of $36.34, for an
estimate of $8.16 materials cost per sample.
Sample Reporting: Calculation of 90th Percentile
To assess compliance with the LCR Action Levels, systems must calculate the 90th
percentile of the lead and copper samples. Activities associated with determining compliance
include the following:
• Collection of sampling results,
• Validation that all appropriate samples are included,
• Arrangement of samples by rank order, and
• Determination of the 90th percentile value.
The burden to calculate the 90th percentile levels from monitoring results is estimated as follows
in the June 1999ICR:42
System Size
<=100
101-500
501-10K
10-100K
>100K
Burden
Estimate
0.5 hours
0.5 hours
0.5 hours
0.75 hours
1 hour
These estimates are also used in the 2004 ICR43 and, in the absence of new information, have
been applied in this analysis.
Sample Reporting: Reporting Results to State
' Source: Information Collection Request: National Primary Drinking Water Regulations For Lead and Copper,
USEPA, Office of Water, June 1999, page A-ll.
4j Source: Information Collection Request: Disinfectants/Disinfection Byproducts, Chemical, andRadionuclides
Rules, USEPA, Office of Water, September 2004, page H-27.
Appendix C-6
-------
Systems are required to report the results of the LCR compliance monitoring to the State.
Activities associated with reporting results to States include the following:
• Assembly and organization of monitoring results and compliance calculations,
• Completion of required certifications, and
• Preparation of the cover letter to the State.
The June 1999 ICR estimates that all systems will incur 1 hour to conduct these activities related
to reporting results to States.44 The materials cost for State reporting is the cost of one postage
stamp - $0.39. These estimates are also used in the 2004 ICR45 and, in the absence of new
information, have been applied in this analysis.
Sample Reporting: Total
The total labor associated with reporting compliance monitoring results to the State,
including the calculation of the 90th percentile, is summarized in the following table. An
additional materials cost of $0.39 is also applied.
System Size
<= 100
101-500
501-10K
10-100K
>100K
Burden
Estimate
1.5 hours
1.5 hours
1.5 hours
1.75 hours
2 hours
Source: Information Collection Request: National Primary Drinking Water Regulations For Lead and Copper,
USEPA, Office of Water, June 1999, page A-ll.
45 Source: Information Collection Request: Disinfectants/Disinfection Byproducts, Chemical, andRadionuclides
Rules, USEPA, Office of Water, September 2004, page H-27.
Appendix C-7
-------
Appendix C-3I Estimates of labor for State review of tap monitoring results per
monitoring event
System Size
<=500
501 to 3,300
3.3K-10K
10K-50K
50K-100K
>100K
State Burden to Review
Tap Monitoring Letter
1.0
1.0
1.0
1.0
1.0
1.0
State Burden to Check
Compliance Calculations
10 minutes
15 minutes
30 minutes
45 minutes
45 minutes
1 hour
Notes:
Data Source: Information Collection Request: Disinfectants/Disinfection Byproducts, Chemical, and
Radionuclides Rules, USEPA, Office of Water, September 2004, page H-12.
Appendix C-&
-------
th
Appendix C-4: Regulatory Change HLC System Reporting Cost (4m Qtr 2006$)
System Size
Category
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
Total
# Systems
that Exceed
Lead AL [1,2]
402
298
184
55
41
7
7
994
# Systems
Affected by
Regulatory
Change [3]
366
271
167
50
37
6
6
903
Total
Additional #
Monitoring
Events Due to
Regulatory
Change [4]
1,830
1,355
835
250
185
30
30
4,515
System
Reporting
Burden
(Mrs.) Per
Monitoring
Event [5]
1.5
1.5
1.5
1.5
1.75
1.75
2
—
Total System
Reporting
Burden (Mrs.)
[6]
2,745
2,033
1,253
375
324
53
60
6,841
Total Labor
Cost [7]
$65,496
$52,235
$34,494
$12,734
$10,994
$1,816
$2,354
$180,123
Annual
Labor
Cost [8]
$21 ,832
$17,412
$11,498
$4,245
$3,665
$605
$785
$60,041
Total
O&M
Cost [9]
$787
$583
$359
$108
$80
$13
$13
$1,941
Annual
O&M
Cost
[10]
$262
$194
$120
$36
$27
$4
$4
$647
Total
Annual
Costs
$22,094
$17,606
$11,618
$4,281
$3,691
$610
$789
$60,688
Notes:
1. Assume 884 CWS and NTNCWS serving <3,300 people exceed the lead AL each year based on SDWIS/Fed database for monitoring period
ending after January 2003. (Data source: USEPA Survey of States - Questions on State Implementation of Lead and Copper Rule. July 2004).
2. For systems serving >3,300 people, the # systems is based on systems that have exceeded the lead action level since 2003. data source:
www.epa.gov/safewater/lcrmr/lead-data.html, 8/30/05.
3. Of CWS and NTNCWS that exceed the lead action level, assume 91% of these systems are on reduced monitoring based on USEPA Survey
of States July 2004.
4. Total additional monitoring events in the 3 year period 2005-2007 is the total monitoring events for standard monitoring (6 periods in 3 years)
less reduced monitoring (1 period per 3 years) multiplied by the number of systems. Assume each system was operating on a reduced
monitoring schedule (once per 3 years) when the AL was exceeded; "total" means total for 3 year period.
5. Based on 1999 ICR Page H-27 Assumptions of Reporting Burden for Tap Sample Letter and Tap Sample Calcs.
6. Total system reporting burden equals the system reporting burden per monitoring event multiplied by the additional monitoring events.
7. Wage rates from SAIC contract study, "Labor Costs for National Drinking Water Rules" (2003) updated to 4th Qtr 2006. Total labor cost equals
hourly labor rate multiplied by total burden.
8. Annual labor cost equals total labor costs divided by 3.
9. Total O&M costs include 1 postage stamp @ $0.39, plus $.04 for materials per monitoring event.
10. Annual O&M cost equals total O&M costs divided by 3.
Appendix C-9
-------
th
Appendix C-5: Regulatory Change m.C System Tap Water Monitoring Costs (Lead and Copper Monitoring) (4 Qtr 2006$)
System
Size
Category
<=100
101 to 500
501 to 3,300
3.3K-10K
10K-50K
50K-100K
>100K
Total
# Systems
that
Exceed
Lead AL
[1,2]
402
298
184
55
41
7
7
994
# Systems
Affected
by
Regulatory
Change [3]
366
271
167
50
37
6
6
903
Total
Additional #
Tap Samples
Due to
Regulatory
Change [4]
9,150
14,905
18,370
11,000
12,210
1,980
3,300
70,915
Total
Burden for
Sample
Collection
and
Analysis
(Mrs) [5]
32,025
52,168
64,295
38,500
42,735
6,930
11,550
248,203
Total Labor
Cost [6]
$764,117
$1,340,705
$1,770,684
$1,307,383
$1,451,195
$239,709
$453,107
$7,326,899
Annual Labor
Cost [7]
$254,706
$446,902
$590,228
$435,794
$483,732
$79,903
$151,036
$2,442,300
Total O&M
Cost [8]
$74,664
$121,625
$149,899
$89,760
$99,634
$16,157
$26,928
$578,666
Annual
O&M Cost
[9]
$24,888
$40,542
$49,966
$29,920
$33,211
$5,386
$8,976
$192,889
Total
Annual
Cost
$279,594
$487,443
$640,195
$465,714
$516,943
$85,289
$160,012
$2,635,188
Notes:
1. Assume 884 systems serving <3,300 people exceed the lead AL each year based on SDWIS/Fed database for monitoring period ending after
January 2003. (Data source: USEPA Survey of States - Questions on State Implementation of Lead and Copper Rule. July 2004).
2. For systems serving >3,300 people, the # systems is based on systems that have exceeded the lead action level since 2003. data source:
www.epa.gov/safewater/lcrmr/lead-data.html, 8/30/05.
3. Of systems that exceed the lead action level, assume 91% of these systems are on reduced monitoring based on USEPA Survey of States July
2004.
4. Assume systems required to change from reduced monitoring schedule (one monitoring period per 3 years) to standard monitoring (monitoring
every 6 months), "total" means total samples per 3 year period. Sampling schedule based on system size as summarized in Table 5.2.a below.
For example, systems serving between 101 and 500 people are required to monitor 10 sites for standard monitoring and 5 sites for a reduced
monitoring schedule. Since there are 271 systems in this category that are on reduced monitoring, the total additional number of tap samples to
be collected in each 3 year period equals (10x6x271)-(5*1*271) or 14,905.
5. Assume 3.5 hours average labor for collection and analysis per sample (source: ICR, page H-43).
6. Wage rates from SAIC contract study, "Labor Costs for National Drinking Water Rules" (2003) updated to 4th Qtr 2006
7. Annual cost equals total costs divided by 3.
8. Use average O&M cost per sample $8.16 as described in document, "Derivation of estimates for tap monitoring"
Appendix C-10
-------
Appendix C-6: Sampling Schedule per 40 CFR 141.86c
System size
<=100
101 to 500
501 to 3,300
3,301 to 10,000
10,001 to 100,000
>100,000
Standard Monitoring
# Sites
5
10
20
40
60
100
Reduced Monitoring
# Sites
5
5
10
20
30
50
Appendix C-ll
-------
th
Appendix C-7: Regulatory Change HLC State Review Costs (4™ Qtr 2006$)
System Size
Category
<=500
501 to 3,300
3.3K-10K
10K-50K
50K-100K
>100K
Total
# Systems
that Exceed
Lead AL
[1,2]
700
184
55
41
7
7
994
# Systems
Affected by
Regulatory
Change [3]
637
167
50
37
6
6
903
Total
Additional Tap
Monitoring
Events Due to
Regulatory
Change [4]
3,185
835
250
185
30
30
4,515
Total State
Review
Burden
(Mrs.) [5]
3,726
1,044
375
324
53
60
5,581
Total
Labor
Cost [6]
$162,180
$45,425
$16,321
$14,090
$2,285
$2,611
$242,913
Annual
Labor Cost
[7]
$54,060
$15,142
$5,440
$4,697
$762
$870
$80,971
Total
O&M
Cost [8]
$1,917
$503
$151
$111
$18
$18
$2,718
Annual
O&M
Cost [9]
$639
$168
$50
$37
$6
$6
$906
Total
Annual
Costs
$54,699
$15,309
$5,490
$4,734
$768
$876
$81,877
Notes:
1. Assume 884 systems serving <3,300 people exceed the lead AL each year based on SDWIS/Fed database for monitoring period ending after
January 2003. (Data source: USEPA Survey of States - Questions on State Implementation of Lead and Copper Rule. July 2004).
2. For systems serving >3,300 people, the # systems is based on systems that have exceeded the lead action level since 2003. data source:
www.epa.gov/safewater/lcrmr/lead-data.html, 8/30/05.
3. Of systems that exceed the lead action level, assume 91% of these systems are on reduced monitoring based on USEPA Survey of States July
2004.
4. For the 3 year period, 2005-2007, assume systems have 5 additional tap monitoring events due to switching from a reduced monitoring
schedule (once in 3 years) to standard monitoring (every 6 months). Refer to Table 5.1 above.
5. Use 2004 ICR Estimates of State burden on page H-12. The ICR estimates state burden to be 1 hour to review sample letter and between
0.17 hours and 1 hour to review sample calculations, depending on system size.
6. Use state labor rate of $43.52/hour (Source: Information Collection Request for Contaminant Occurrence Data in Support of EPA's Second Six
Year Review of National Primary Drinking Water Regulations (August 2006)).
7. Annual cost equals total cost divided by 3.
8. Unit O&M cost per event is $0.43 per letter (postage & materials) per 2004 ICR page H-12. Assume state sends one letter to utility for each tap
monitoring event and two additional letters to each utility regarding WQP monitoring.
Appendix C-12
-------
Appendix D
Derivation of Direct Costs for Regulatory Change III.D
Appendix D-l
-------
Appendix D-1I State responses on review and approval of treatment or source changes
State
AK
AL
AR
AS
AZ
CA
CO
CT
DC
DE
FL
GA
GU
HI
IA
ID
IL
IN
KS
KY
LA
MA
MD
ME
Ml
MN
MO
MS
MT
Navajo
NC
ND
NE
NH
NJ
NM
Nmar
NV
NY
OH
OK
OR
PA
No
Require
ment
Inform
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Review &
Approval
(explicit)
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Plan
Submittal
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Permit
Yes
Yes
Yes
Yes
Yes
No
Response
Yes
Yes
Yes
Yes
# CWS and
NTNCWS in
States without
explicit
review/approval
process
650
768
4541
993
6
331
2890
12
128
996
2197
1526
963
1075
768
1528
1704
1265
157
2740
349
794
1142
1477
792
111
359
2288
1255
1211
3348
# CWS in States
without explicit
review/approval
process
619
728
4541
830
3
331
1881
10
115
752
1792
840
911
502
399
965
1463
1170
154
2174
320
606
698
607
645
79
253
1318
1135
874
2135
Appendix D-2
-------
State
PR
Rl
SC
SD
TN
TX
UT
VA
VI
VT
WA
Wl
WV
WY
Total
No
Require
ment
Yes
1
Inform
Yes
Yes
Yes
Yes
19
Review &
Approval
(explicit)
Yes
Yes
14
Plan
Submittal
Yes
8
Permit
Yes
Yes
Yes
Yes
9
No
Response
Yes
Yes
6
# CWS and
NTNCWS in
States without
explicit
review/approval
process
523
161
495
5274
514
1865
235
669
2589
1993
690
363
53,372
# CWS in States
without explicit
review/approval
process
467
83
467
4489
451
1263
98
435
2274
1086
536
276
40,499
Appendix D-3
-------
Appendix D-2I Systems changing treatment in response to upcoming regulations
In an effort to verify the reasonableness of the assumption that 2 percent of systems will
report a treatment change or addition of a new source each year, a review of the number of
systems that are expected to change treatment due to upcoming drinking water regulation was
conducted. Over the next several years, systems will be faced with new regulatory requirements
that could result in treatment changes, including changes to comply with the already promulgated
Arsenic Rule and the upcoming Long Term 2 Surface Water Treatment Rule, the Stage 2
Disinfectants/Disinfection Byproducts Rule, and the Groundwater Rule. We use estimates of the
number of systems that are projected to change treatments to comply with three Rules (Arsenic,
LT2 and Stage 2)46 as a reasonableness check on the assumption about the number of systems
that will submit treatment or sources changes for review under the LCR.
• Arsenic - 4,100 systems (Data source: Arsenic in Drinking Water EA, pp. 6-25, 6-27;
• LT2 -2,882 systems (Data source: USEPA, Office of Water, Economic Analysis for the
• Final Long Term 2 Enhanced Surface Water Treatment Rule., EPA 815-R-06-001,
December 2005. Exhibit 6-1, page 6-3);
• Stage 2 D/DBP - 2,261 systems (Data source: USEPA, Office of Water, Economic
Analysis for the Final Stage 2 Disinfectants and Disinfection Byproducts Rule, EPA 815-
R-05-010, December 2005, Exhibit ES-7a, page ES-17).
Together, these regulatory requirements are estimated to cause 9,243 systems to institute a
treatment change, although not all of these treatment changes will impact corrosion control. The
Stage 2 and LT2 treatment changes are projected to take place within a 6 year compliance period
for large systems (with the possibility of 2-year extension) and 8 years for small systems (with
the possibility of 2-year extension) according to page ES-5 of the Stage 2 EA and page ES-6 of
the LT2 EA. The period of compliance for the Arsenic rule is 5 years. Depending on the range of
years for compliance periods for the LT2 and Stage 2 Rules (6-8 years), approximately 1,400 -
1,600 systems may change treatment, although not all of these changes will impact corrosion
control.
To account for these expected treatment changes, and to account for treatment changes
unrelated to arsenic, LT2, and Stage 2 rule, EPA assumed (based on the projected rule-related
treatment changes and expert judgment) that approximately 20% of the systems affected by the
LCR will institute a treatment change in the next ten years. It is assumed that these changes
occur uniformly over that 10-year period, so that approximately one-tenth of these systems (or 2
percent of the total) institute a treatment change each year.
Using the 2 percent estimate, 1,067 (53,372 X .02) systems each year would report a
treatment change or source addition and incur costs in that year in States currently not covered
by an explicit review and approval program. The estimate for the number of systems is 552 if
States with a permitting or plan approval process are also excluded.
46 An estimate of the number of systems that may change treatment due to the Ground Water Rule is not publicly
available with sufficient certainty at this time.
Appendix D-4
-------
th
Appendix D-3: Regulatory Change HLD System Review Costs (4m Qtr 2006$)
# CWS and NTNCWS Affected by Reg Change
III. D1 Each Year:
Total System Burden (Mrs.)2
# CWS Affected by Reg Change III.D Each Year3
# CWS That Must Conduct an Engineering Study
Each Year4
Annual Cost5
High Estimate
1,067
8,005.80
810
25.92
$765,083
Low Estimate
1,067
8,006
810
12.96
$505,883
Notes:
1. The number of CWS and NTNCWS affected by Regulatory Change III.D is based on the USEPA
Survey of States Questions on State Implementation of Lead and Copper Rule (July 2004). Survey
results show that 14 States explicitly require review and approval of potential effects of treatment changes
on corrosion control. 53,372 systems in States other than these 14 States would be affected by this
Regulatory Change. It is assumed that each year 2% of systems have a treatment or source change that
requires review and approval (per the 1999 ICR, page B-8). Therefore the number of systems to be
affected by this regulatory change each year is estimated to be 53,372 x0.02= 1,067 systems.
2. It is assumed that all systems will each spend 8 hours to prepare a submittal letter, coordinate with
State, and participate in a meeting with the State primacy agency. The current system of notification for
treatment changes requires a burden of 0.5 hour (per 1999 ICR) so this is deducted from the 8 hours for
a total of 7.5 hours per system. The burden assumption is based on consensus of expert panelists on
11.21.05.
3. The number of CWS affected by Reg Change III.D is based on survey results from the USEPA Survey
of States Questions on State Implementation of the LCR (July 2004) as described in Notes 1 and 2. The
number of CWS for each State affected by Reg Change III.D was determined using the USEPA
"Factoids: Drinking Water and Groundwater Statistics for 2004". It is assumed that each year
2% of systems have a treatment or source change that requires review and approval (per the 1999 ICR,
page B-8). Therefore the most conservative estimate is 40,499 CWS x 0.02 = 810 CWS and the
conservative estimate is 21,080 CWS x 0.02 = 422 CWS.
4. Assume that 10 to 20 percent of medium and large systems must conduct an engineering study due to
Reg Change III.D based on consensus agreement of expert panelists on 11.21.05. Since 99 percent of
NTNCWS are small systems (serving <3,300 people), it is assumed that only medium and large CWSs
must conduct an engineering study. Assume 16% of CWS are medium or large systems based on the
USEPA "Factoids: Drinking Water and Groundwater Statistics for 2004". For the most conservative
estimate assume that 20% medium and large systems conduct an engineering study. For the
conservative estimate, assume that 10% conduct engineering studies. Therefore, the most conservative
estimate equals 810 CWS x 0.16 x 0.20 = 26 systems. The conservative estimate equals 422 CWS x
0.16x0.10 = 7 systems.
5. Annual cost is equal to the total system burden (hours) multiplied by a labor rate of $30.81 per hr.
(average of wage rates from SAIC contract study, "Labor Costs for National Drinking Water Rules" (2003)
updated to 4th Qtr 2006 plus $20,000 for an engineering study for a subset of medium and large CWS.
Appendix D-5
-------
th
Appendix D-4: Regulatory Change HLD State Review Costs (4m Qtr 2006$)
# Systems Affected by Reg Change III.D1:
State Burden (Mrs.)2
Annual Labor Cost3
High Estimate
1,067
8,006
$348,424
Low Estimate
1,067
3,736
$162,598
Notes:
1. The number of systems affected by Regulatory Change III.D is based on the USEPA Survey of States
Questions on State Implementation of Lead and Copper Rule (July 2004). Survey results show that 14
States explicitly require review and approval of treatment changes. 53,372 systems in States other than
these 14 States would be affected by this Regulatory Change. It is assumed that each year 2% of
systems have a treatment or source change that requires review and approval (per the 1999ICR, page
B-8). Therefore the number of systems to be affected by this regulatory change each year is estimated to
be 53,372 x 0.02 = 1,067 systems.
2. For the most conservative estimate, it is assumed that States spend 8 hours to review each system's
data/reports, coordinate with system and make approval decision and formalize with management. For
the conservative estimate, it is assumed that States spend 4 hours per system for the same activities.
These estimates are based on a consensus agreement of expert panelists on 11.21.05. The current
system of notification for treatment changes requires a State burden of 0.5 hour (per 1999 ICR);
therefore, the most conservative estimate for new state burden is 7.5 hours and the conservative estimate
is 3.5 hours per system.
3. Use state labor rate of$43.52/hour (Source: Information Collection Request for Contaminant
Occurrence Data in Support of EPA's Second Six Year Review of National Primary Drinking Water
Regulations (August 2006)).
Appendix D-6
-------
Appendix E
Derivation of Direct Costs for Regulatory Change III.E
Appendix E-l
-------
Appendix E-l: Derivation of the Number of Systems That Do Not Notify Customers of Tap
Monitoring Results (IILE)
As part of EPA's review of the Lead and Copper Rule, States and primacy agencies were
asked a variety of questions dealing with the implementation of the LCR. Several questions dealt
with the issue of whether systems provide customers (i.e., homeowners or other drinking water
consumers) who participate in lead tap sampling with the results of that sampling. The responses
to these questions are used as a basis for estimating how many systems currently provide lead
sampling results to customers and will therefore not incur additional costs due to regulatory
change IILE.
Primacy agencies were asked the following question:
"Although not required by Federal regulation, do systems provide homeowners
with lead sampling results derived from any volunteer sampling program? Does
the state make any recommendations to public water systems in this area?"
We focused our analysis on answering three questions:
• Are systems required to notify homeowners with lead sampling results derived from any
volunteer sampling program?
• Do States encourage systems to notify homeowners with lead sampling results derived
from any volunteer sampling program?
• Do homeowners receive notification of lead sampling results derived from any volunteer
sampling program?
44 States indicated whether the notification of testing results to households was required
by State law. The response of each State is summarized in Table E-l.
Wisconsin is the only State that currently requires systems to notify households with lead
sampling results derived from their home. This regulation is formalized in 809.541(12) Wis.
Adm. Code. Texas currently requires systems to notify households if the sample from their house
is above the action limit. Prior to 1993, Florida required systems to notify households if the
sample from their home was above action limit. This requirement was terminated after the State
realized that there was no federal action requiring such notification.
Many States, however, encourage systems to notify homeowners of sampling results, as
summarized in Table 2. 52.4 percent of all States that responded encourage systems to notify
households with lead sampling results derived from any volunteer sampling program. 10 States,
23.8 percent of all States that responded, encourage systems to notify households for specific
situations. For example, 7 States only encourage systems to notify households if lead levels are
greater than the action limit (as indicated by "If Sample is > AL" in Table E-2). 3 States only
encourage systems to notify households if an occupant specifically requests the sampling and/or
results (as indicated by "If Results are Requested" in Table E-3).
Appendix E-2
-------
In addition, many States are aware of at least some systems in the State that notify
homeowners at the current time, as summarized in Table E-3. 29 States indicated whether
households are notified of testing results, while 11 States did not have any data or knowledge
indicating whether households were notified of testing results.
The State responses to the three questions were evaluated to determine the overall
notification status for the State in Table E-4. The categories for notification are as follows:
• Required
• Large systems only
• Encouraged by State
• If greater than Action Level
• Upon request by homeowner
• If greater than Action Level and upon request
• Sometimes
• If greater than 100 ppb
• None
• Unknown
For each of these categories, we assigned a percent of systems in that State that notify
customers, also shown in Table E-4.
• Required: 100 percent
• Large systems only: 100 percent of large systems
• Encouraged by State: 16 percent. This value was derived from Rogers Diffusion
of Innovation Theory that postulates that for a new technology or practice, 3.5%
percent of affected parties will be "innovators" and 12.5% will be "early
adopters" who will adopt a practice or technology without being required.47 We
assume that this same principle applies to the adoption of an encouraged, but not
required, practice for drinking water systems, such as notification of customers.
• If greater than Action Level: 10 percent
• Upon request by homeowner: 5 percent
• If greater than Action Level and upon request: 15 percent
• Sometimes: 5 percent
• If greater than 100 ppb: 1 percent
• None: 0 percent
• Unknown: 0 percent
We calculate the number of systems per State by size category that are already notifying
customers by multiplying these assumed percentages by the number of systems. We estimate the
number of systems not notified, who would therefore incur costs under the new rule provision,
47 Rogers, Everett, Diffusion of Innovation, Free Press; 4th edition (February 1, 1995).
Appendix E-3
-------
by subtracting the number of systems that notify from the total number of systems. Table E-5
displays the number of systems that notify and that do not notify by system size.
Appendix E-4
-------
Notification Required by States
State
AK
AL
AR
AZ
CO
CT
DE
FL
GA
HI
IA
IN
KS
KY
LA
MA
MD
ME
MN
MO
MS
MT
Is Direct
Notification
Required?
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
If Sometimes
Required, When is
Notification
Required?
* Prior to 2003, If
sample was > AL
State
Navajo
NC
ND
NE
NH
NJ
NV
NY
OH
OK
PA
Rl
SC
SD
TN
TX
UT
VA
VT
Wl
WV
WY
Is Direct
Notification
Required?
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
Sometimes
No
No
No
Yes
No
No
If Sometimes
Required, When is
Notification
Required?
If sample is > AL
Appendix E-5
-------
Is Notification Encouraged?
State
AL
AR
AZ
CO
CT
DE
FL
GA
HI
IA
IN
KS
KY
LA
MA
MD
ME
Ml
MN
MO
MS
Is
Notification
Encouraged?
No
Sometimes
Sometimes
No
No
Yes
Yes
Yes
Sometimes
Yes
No
Yes
No
No
Yes
Yes
Sometimes
Sometimes
No
Sometimes
Yes
If Sometimes
Encouraged, When is
Notification
Encouraged?
If Sample is > AL
If Results are Requested
If Sample is > 100 ppb
If Sample is > AL
If Sample is > AL
If Sample is > AL
State
Navajo
NC
ND
NE
NH
NJ
NV
NY
OK
OR
Rl
SC
SD
TN
TX
UT
VA
VT
WA
WV
WY
Is
Notification
Encouraged?
Sometimes
Sometimes
Yes
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
Yes
No
Yes
Sometimes
Yes
Yes
Yes
Yes
No
Sometimes
If Sometimes
Encouraged, When is
Notification
Encouraged?
If Results are Requested
If Sample is > AL
If Results are Requested
If Sample is > AL
Appendix E-6
-------
Notification Received by Households At Current Time
State
AL
ASPA
AR
AZ
DE
GA
IA
ID
IL
KS
KY
LA
MD
ME
Ml
MN
MO
MS
MT
Navajo
NE
NH
NJ
NM
NV
NY
OH
OK
OR
PA
Rl
SC
SD
TN
TX
UT
VA
Wl
WV
WY
Do Homeowners
Receive Notification?
Unknown
Sometimes
No
Sometimes
No
Sometimes
Sometimes
Unknown
Sometimes
Unknown
No
No
Unknown
Sometimes
Sometimes
Sometimes
Sometimes
Yes
Unknown
Sometimes
Unknown
Yes
Sometimes
Unknown
No
Sometimes
Unknown
Yes
Yes
Unknown
Sometimes
Sometimes
No
Sometimes
Sometimes
Sometimes
Yes
Unknown
No
If Sometimes Received,
When Is Notification
Received?
If Sample is > AL
If Results are Requested
Depends on System
Depends on System
Depends on System
Large Systems
Depends on System
If Sample is > AL
Depends on System
Depends on System
If Requested, If > AL
If Requested, Depends
on System
Large Systems
Depends on System
Depends on System
Depends on System
If Sample is > AL
Does System Provide
Indirect Notification?
CCR, If Requested
CCR
If Requested
If >AL than CCR
CCR
Appendix E-7
-------
Summary of Notification by State and Assumed Percent of Systems Notified
State Summary of Notification
AK
AL
ASPA
AR
AZ
CA
CO
CT
DE
FL
GA
HI
IA
ID
IL
IN
KS
KY
LA
MA
MD
ME
Ml
MN
MO
MS
MT
Navaio
NC
ND
NE
NH
NJ
NM
NV
NY
OH
OK
OR
PA
Rl
SC
SD
TN
TX
UT
VA
VT
WA
Wl
WV
WY
UDon Reauest
None
>AL
> AL, Upon Request
Upon Request
Unknown
None
None
Encouraqed
Encouraqed
Encouraqed
>100 ppb
Encouraqed
Unknown
Sometimes
None
Encouraqed
None
Upon Request
Encouraqed
Encouraqed
> AL, Larqe
>AL
>AL
>AL
Encouraqed
Unknown
Upon Request
>AL
Encouraqed
Encouraqed
Encouraqed
>AL, Upon Request
Unknown
None
Upon Request
Unknown
Encouraqed
Encouraqed
Unknown
Larqe
Encouraqed
None
Encouraqed
>AL
Encouraqed
Encouraqed
Encouraqed
Encouraqed
Required
None
Greater than AL
Percent of Systems Notified
5%
0%
10%
15%
5%
0%
0%
0%
16%
16%
16%
1%
16%
0%
5%
0%
16%
0%
5%
16%
16%
10/100%
10%
10%
10%
16%
0%
5%
10%
16%
16%
16%
15%
0%
0%
5%
0%
16%
16%
0%
0/100%
16%
0%
16%
10%
16%
16%
16%
16%
100%
0%
10%
Appendix E-&
-------
Summary of the Number of Systems that Notify Customers of Monitoring Results and the
Number of Systems that Do Not Notify
cws
<=100
101-500
501-1,000
1,001-3,300
3,301-10,000
10,001-50,000
50,001-100,000
100,001-250,000
250,001-500,000
500,001-1,000,000
>1, 000,000
TOTAL
Total
Number of
Systems
13,766
16,240
5,914
8,298
4,707
3,057
484
259
63
32
18
52,838
Systems
Notifying
Customers of
Monitoring
Results
1,472
1,685
656
903
480
304
50
23
7
3
1
5,583
Systems Not
Notifying
Customers of
Monitoring
Results
12,294
14,555
5,258
7,395
4,227
2,753
434
236
56
29
17
47,255
Percent
of
Systems
Not
Notifying
89%
90%
89%
89%
90%
90%
90%
91%
89%
89%
93%
NTNCWS
<=100
101-500
501-1,000
1,001-3,300
3,301-10,000
10,001-50,000
50,001-100,000
100,001-250,000
250,001-500,000
500,001-1,000,000
>1, 000,000
TOTAL
Total
Number of
Systems
9,548
6,997
1,925
795
96
13
1
0
0
0
0
19,375
Systems
Notifying
Customers of
Monitoring
Results
1,206
870
204
77
7
1
0
0
0
0
0
2,365
Systems Not
Notifying
Customers of
Monitoring
Results
8,342
6,127
1,721
718
89
12
1
0
0
0
0
17,010
Percent
of
Systems
Not
Notifying
87%
88%
89%
90%
93%
92%
100%
Appendix E-9
-------
th
Appendix E-2: Regulatory Change IILE System Public Education Costs (4m Qtr 2006$)
System Size
Category
CWSs:
<100
101-500
501-1K
1K-3.3K
3.3K-10K
10K-50K
50K-100K
100K-500K
500K-1M
>1 M
NTNCWSs:
<100
101-500
501-1K
1K-3.3K
3.3K-10K
10K-50K
50K-100K
100K-500K
500K-1M
>1 M
Total
Number
of
Systems
[1]
13,766
16,240
5,914
8,298
4,707
3,057
484
322
32
18
9,548
6,997
1,925
795
96
13
1
72,213
Percentage
of Systems
that Do Not
Currently
Notify
Customers
[2]
89%
90%
89%
89%
90%
90%
90%
91%
89%
93%
87%
88%
89%
90%
93%
92%
100%
89%
Subtotal
Systems
Affected by
Reg
Change
III.E [3]
12,252
14,616
5,263
7,385
4,236
2,751
436
293
28
17
8,307
6,157
1,713
716
89
12
1
0
64,273
# Systems
Affected by
Reg Change
III.C that are
Affected by
Reg. Change
III.E [4]
158
131
108
44
32
5
5
189
126
29
16
1
1
846
Total
Annual
Monitoring
Events [5]
6,237
7,326
2,760
3,570
2,136
1,395
221
153
14
8
4,393
3,228
887
378
45
8
32,757
Total
Customer
Notification
Letters [6]
31,186
51,089
39,237
48,989
59,735
58,648
9,316
10,810
945
555
310,510
-
-
-
-
-
-
Annual
System
Burden
(hrs) [7]
6,237
7,326
2,760
3,570
2,987
2,932
466
541
47
28
4,393
3,228
887
378
45
8
35,831
Annual
System
Labor
Cost [8]
$148,817
$188,270
$76,015
$98,305
$101,423
$101,431
$16,113
$21,205
$1,853
$1,089
$104,805
$82,953
$24,423
$10,416
$1,529
$264
$978,910
Annual
System
O&M Cost
[9]
$13,410
$21,968
$16,872
$21,065
$25,686
$25,218
$4,006
$4,649
$406
$239
$0
$0
$0
$0
$0
$0
$133,519
Total
Annual
System
Cost
$162,227
$210,239
$92,887
$119,370
$127,109
$126,649
$20,119
$25,853
$2,259
$1,328
$104,805
$82,953
$24,423
$10,416
$1,529
$264
$1,112,429
Appendix E-10
-------
Notes:
1. Number of CWS and NTNCWS systems per SDWIS/FED Data 2004.
2. Data source: USEPA Survey of States - Questions on State Implementation of Lead and Copper Rule
(July 2004).
3. The number of systems affected by Reg. Change III.E equals the total number of CWS and NTNCWS
systems (see Note 1) multiplied by the percentage of systems that currently do not notify their customers
(see Note 2). For example, 89% of 13,766 CWSs serving <100 people do not notify customers; therefore,
these 12,252 (13,766 x 0.89) systems are affected by Reg. Change III.E.
4. Regulatory Change III.E will also affect systems that are affected by regulatory change III. C that
exceeded the lead action level while on reduced monitoring and had to revert to standard monitoring, and
do not currently notify their customers of lead test results. The number of systems affected by regulatory
change III. C is based on the number of systems exceeding the lead action level as reported in the SDWIS
Fed data 2003. The number of CWS and NTNCWS are listed separately in this table because the
NTNCWS have a different burden requirement. NTNCWS are not required to prepare notification letters
for each sample but provide general notification through bulletin board notices. It is also assumed that
91% of these systems are on reduced monitoring based on USEPA Survey of States July 2004.
5. For the subtotal of systems affected by Reg. Change III. E, it is assumed that 9% of systems use a
standard monitoring schedule with 6 monitoring events in 3 years or 2 monitoring events each year. It is
also assumed that 91% of systems are on a reduced monitoring schedule with 1 monitoring event in 3
years. In addition, systems affected by Reg. Change III.C that are also affected by Reg. Change III.E use
a standard monitoring schedule with 2 monitoring events each year.(Source: USEPA Survey of States -
Questions on State Implementation of Lead and Copper Rule. July 2004). For systems affected by Reg.
Change III. C, assume all systems have reverted to a standard monitoring schedule.
6. The number of customer notification letters on lead monitoring results is based on the sampling
schedule for standard and reduced monitoring as summarized in Table 7. la. It is assumed that one
letter is sent for each sampling site required by 40 CFR 141.86c.
7. For CWSs, assume burden of 1 hour per monitoring event for systems serving <3,300 people. For
systems serving > 3,300 people, assume burden of 1 hour per 20 letters For NTNCWSs, assume 1 hour
per monitoring event for all system sizes. Burden estimates based on recommendations of Expert
Review Panel (November 2005).
8. Wage rates from SAIC contract study, "Labor Costs for National Drinking Water Rules (2003) updated
to 4th Qtr 2006.
9. O&M costs estimated at $0.43 per letter including $.39 postage and materials ($. 01 paper and $. 03
envelope).
Appendix E-11
-------
th
Appendix E-3: Regulatory Change IILE System Reporting Costs (4m Qtr 2006$)
System Size
Category
CWSs:
<100
101-500
501-1K
1K-3.3K
3.3K-10K
10K-50K
50K-100K
100K-500K
500K-1M
>1 M
NTNCWSs:
<100
101-500
501-1K
1K-3.3K
3.3K-10K
10K-50K
50K-100K
100K-500K
500K-1M
>1 M
Total
Number of
Systems [1]
13,766
16,240
5,914
8,298
4,707
3,057
484
322
32
18
9,548
6,997
1,925
795
96
13
1
72,213
# Systems
Affected by Reg
Change III.C
366
271
167
50
37
6
6
217
143
33
18
1
1
1,316
Total Annual
Monitoring
Events
7,386
8,391
3,192
4,011
2,375
1,552
246
168
15
9
5,049
3,668
996
420
48
8
37,534
Total Self
Certification
Letters to
State
7,386
8,391
3,192
4,011
2,375
1,552
246
168
15
9
5,049
3,668
996
420
48
8
37,534
Annual
System
Burden (hrs)
[2]
886
1,007
383
481
285
186
30
20
2
1
606
440
120
50
6
1
4,504
Annual
System
Labor Cost
$21,146
$25,879
$10,550
$13,255
$9,678
$6,440
$1,021
$789
$73
$41
$14,456
$11,312
$3,293
$1,389
$197
$34
$119,553
Annual
System
O&M cost
[3]
$3,176
$3,608
$1,373
$1,725
$1,021
$667
$106
$72
$7
$4
$2,171
$1,577
$428
$181
$21
$4
$16,140
Total
Annual
Costs
$24,322
$29,487
$11,923
$14,979
$10,700
$7,107
$1,127
$861
$79
$45
$16,627
$12,889
$3,721
$1,570
$218
$38
$135,693
1. Assumes all systems will prepare self-certification letter
2. Assumes .12 hours to prepare self-certification letter to State based on estimate to prepare self-certification for the CCR.
3. Assumes $0.43 postage and materials cost ($0.39 postage, $0.01 paper and $0.03 envelope).
Appendix E-ll
-------
th
Appendix E-4: Regulatory Change HLE State Reviewing Costs (4tn Qtr 2006$)
System Size
Category
CWSs:
<100
101-500
501-1K
1K-3.3K
3.3K-10K
10K-50K
50K-100K
100K-500K
500K-1M
>1 M
NTNCWSs:
<100
101-500
501-1K
1K-3.3K
3.3K-10K
10K-50K
50K-100K
100K-500K
500K-1M
>1 M
Total
Number of
Systems [1]
13,766
16,240
5,914
8,298
4,707
3,057
484
322
32
18
9,548
6,997
1,925
795
96
13
1
72,213
# Systems
Affected by Reg
Change III.C
366
271
167
50
37
6
6
217
143
33
18
1
1
0
1
Total Annual
Monitoring
Events
7,386
8,391
3,192
4,011
2,375
1,552
246
168
15
9
5,049
3,668
996
420
48
8
0
37,534
Total Self
Certification
Letters to
State
7,386
8,391
3,192
4,011
2,375
1,552
246
168
15
9
5,049
3,668
996
420
48
8
0
37,534
Total Annual
Hours to
Review (hrs)
[2]
739
839
319
401
238
155
25
17
2
1
505
367
100
42
5
1
0
3,753
Total
Annual
Labor Cost
$32,143
$36,520
$13,894
$17,455
$10,337
$6,753
$1,070
$730
$67
$38
$21,973
$15,963
$4,337
$1,829
$211
$36
$0
$163,355
1. Assumes all systems file self-certification.
2. Assumes . 10 hours to review and files self-certification letter by State based on estimate to review and file self-certification for the OCR.
Appendix E-l 3
-------
Appendix F
Derivation of Direct Costs for Regulatory Change III.G
Appendix F-l
-------
Appendix F-l: Derivation of estimates for lead service line replacement sampling
Under the existing rule, systems that are replacing lead service lines in response to an
Action Level exceedance may sample lead levels from lead service lines to determine if physical
replacement is required. If the sampled lead levels from an individual service line is below the
Action Level (15 ppb), that line would not have to be physically replaced, but could be
considered "replaced" towards meeting the annual goal of 7 percent replacement. The sampling
of lead service lines associated with lead service line replacement activities is similar to LCR
compliance sampling in that tap samples from residential homes are used. The service line
samples will either require access to the house or a separate set of instructions for taking the
sample if sampling is performed by the customer. In addition, sampling needs to be carried out in
a way to ensure that levels of lead in the service line (as opposed to household plumbing) is
measured. Often, the change in water temperature is used to determine if the water is from the
service line. However, in many climates, the temperature change approach may not work, so
additional time will be needed to determine the volume of water to flush to reach the service line
(determining the diameter and length of the service line and household plumbing to estimate the
volume of water to flush to reach the service line). Systems incur costs to collect and analyze
these samples.
Sample Collection
In order to collect drinking water samples from customer sites to conduct monitoring for
lead service line replacement, systems undertake the following activities:
• Notification of customers at locations targeted for lead service line replacement,
• Distribution of sample materials and instructions,
• Coordination with customers during sampling to remind them and answer questions,
• Collection of samples from customer locations, and
• Review of samples and validation that appropriate collection procedures have been
followed.
The labor required by systems to sample lead service lines for lead content has been
estimated previously by EPA. The June 1999 Information Collection Request states that "Each
sample will require a collection burden of 2 hours.. ,"48 The estimate of 2.0 hours per sample for
lead and copper tap sampling collection is also used in the 2004 ICR49 and, in the absence of new
information, has been applied in this analysis. It should be noted that this estimate is slightly less
(2.0 hours instead of 2.5 hours) than the estimate of similar sampling to assess compliance with
48 Source: Information Collection Request: National Primary Drinking Water Regulations For Lead and Copper,
USEPA, Office of Water, June 1999, page A-7.
49 Source: Information Collection Request: Disinfectants/Disinfection Byproducts, Chemical, and Radionuclides
Rules, USEPA, Office of Water, September 2004, page H-2.
Appendix F-2
-------
the LCR. Compliance sampling entails a different set of up-front activities, including
identification and recruitment of participants. Lead service line replacement up-front activities
are a bit different in mainly notifying customers of sampling and possible lead service line
replacement. It is expected that less time is needed to recruit participants for lead service line
sampling as compared to LCR compliance monitoring because the participant may receive a
direct benefit (removal of lead service line if lead level is greater than 15 ppb). These
differences in up front activities offer a possible explanation for the difference in collection
burden between LCR compliance monitoring and lead service line sampling.
Sample Analysis
Previous documents estimated the cost to analyze a water sample for lead content as
being half the cost to analyze a sample for both lead and copper content. The method most
commonly used at the current time (ICP-MS (200.8) method) provides estimates for both lead
and copper. Therefore, this analysis assumes that the cost to analyze a sample for only lead is
the same as the cost to analyze for both lead and copper.
The cost to analyze a compliance sample for lead is based on the fee charged by certified
commercial laboratories. This fee includes both the cost of labor and materials. The June 1999
ICR assumed a commercial fee of $30 to analyze a sample for lead and copper. Updated to
current dollars (4th Qtr 2006), the fee is estimated at $36.34 per sample.30 To validate that the
updated analysis fee is reasonable, publicly available estimates of costs were collected as
displayed in the following table.
Source
US EPA
NY State DOH
CWLTI
(non profit in NC)
Hometips.com
Fairfax Water
Fee for Lead and
Copper Analysis of
Drinking Water
$20 -$100
$15 -$50
$24 - lead only
$30 lead and copper
$35 - lead only
$35 per faucet
Citation
http://www.epa.gov/safewater/lead/leadfacts.html
http://www.health.state.ny.us/nysdoh/lead/leadwtr.htm
http://www.leadtesting.org/orderonline.htm
http://www.hometips.com/help/wat5.html
http://www.fcwa.org/water/lead.htm
The updated estimate of $36.34 per sample for lead and copper is well within the range provided
by the USEPA and the NY State Department of Health. It is also very close to the $35 that one
utility charges for lead testing (Fairfax Water) and the estimate from a home advice website from
two national laboratories (National Testing Labs and Suburban Water Testing).
Based on OMB guidance in order to be consistent with estimates for other drinking water
rules, the June 1999 ICR assumes that all analysis is conducted in-house for utilities, requiring
that the commercial fee be broken into its labor component and materials component. The labor
50 Updated using the CPI for 1999 to Dec 2006 (201.8/166.6=1.211)
Appendix F-3
-------
required to analyze each sample is estimated at 1 hour, based on the use of the ICP-MS (200.8)
method. The average labor rate for 1 hour of labor is estimated in the following table.
51
Size Category
<= 100
101 to 500
501 to 3,300
3.3K-10K
10K-100K
>100K
Mean
Labor for 1 Hr
$23.86
$25.70
$27.54
$28.20
$28.99
$34.79
$28.18
The materials cost associated with analyzing a compliance sample for lead can then be estimated
by subtracting the labor component of $28.18 from the total fee of $36.34 for an estimate of
$8.16 materials cost per sample.
51 Source: Labor Costs for National Drinking Water Rules, SAIC, October 24, 2003, updated.
Appendix F-4
-------
Appendix F-2: Regulatory Change III.G System Tap Water Monitoring Costs (4th Qtr
2006$)
# Systems Affected by Reg Change III.G [1]:
# Systems that re-exceed lead AL and continue LSI replacement [2]
Annual # LSI Samples per System [3]
Estimated # Samples in Sampling Pool [4]
Estimated # Samples that need to be Retested [5]
Total Labor Cost [6]
Total O&M Cost [7]
Annual Labor Cost [8]
Annual O&M Cost [8]
Total Annual Cost
54
1
1,431
21,465
16,313
$1,507,994
$133,117
$100,533
$8,874
$109,407
Notes:
1. Systems that have been required to conduct a lead service line replacement program may potentially
be affected by Reg. Change III.G if they discontinue the program, then later re-exceed the lead action
level. The number of systems was estimated based on survey responses from the USEPA Survey of
States Questions on State Implementation of Lead and Copper Rule (July 2004). Six states indicated the
specific number of systems that have been required to initiate LSL replacement programs (total of 28
systems). Five other states indicated that they had systems that were required to have LSL programs but
did not indicate the specific number of systems. For these 5 States, it is assumed that each State has 5
systems with LSL programs required by State, for a total of 25 systems. One system is added for
DCWASA. The total number of systems affected by Reg. Change III.G is assumed to be 28+25+1= 54
systems.
2. Assume 1.4% systems re-exceed lead action level and are required to continue LSL replacement
program (data source: www. epa. gov/safewater. Icrmr) Assumption is based on current exceedance rate
for lead action level by medium and large systems.
3. If a system re-exceeds the lead action level, samples must be collected from each lead service line
previously deemed to be replaced through testing. The number ofLSLs per system that have previously
been replaced through testing is estimated based on a utility survey completed by Black and Veatch in
July 2005. Twenty-six utilities reported that 558,135 LSLs in 1992 or 21,467 LSLs per system. Assuming
each utility conducts LSL replacements at a rate of 7% per year or over 15 years, this equals 21,467
divided by 15 or 1,431 LSLs per system per year
(www.epa.gov/safewater/lcrmr/pdfs/summary_lcmr_review_lead_line_replacement_workshop_10-26-
04.pdf).
4. Assume that a system conducts a LSL replacement program for 15 years upon initial exceedance of
the lead action level based on LCR requirements. The number of samples in the sampling pool is equal to
the number of systems that re-exceed the lead AL, x (annual # samples per system) x 15 years.
5. Assume the utility replaces 24% ofLSLs and tests-out the remaining 76% based on data from
DCWASA (2003). The number of samples that needs to be retested equals the number of samples in the
sampling pool x 76%.
6. Assume burden is 3 hours for sample collection and analysis as described in Appendix F-1. Use
system labor rate of $30.81 per hour (average of wage rates from SAIC contract study, "Labor Costs for
National Drinking Water Rules" (2003) updated to 4th Qtr 2006.
7. Use average O&M cost per sample $8.16as described in Appendix F-1.
8. Assume the systems conduct retesting over a 15 year period (based on LCR requirements for LSL
replacement programs).
Appendix F-5
-------
Appendix F-3: States with at least 1 system required to initiate lead service line
replacement
State
AK
AL
AR
AS
AZ
CA
CO
CT
DC
DE
FL
GA
GU
HI
IA
ID
IL
IN
KS
KY
LA
MA
MD
ME
Ml
MN
MO
MS
MT
Navajo
NC
ND
NE
NH
NJ
NM
Nmar
NV
NY
OH
OK
OR
At Least One
System Required
to Do LSLR
Yes
Consent Decree
Withdrawn
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Number of
Systems (If
Specified)
1
14
2
1
Number of
Systems Assumed
5
1
1
5
5
14
2
5
1
Appendix F-6
-------
PA
PR
Rl
SC
SD
TN
TX
UT
VA
VI
VT
WA
Wl
WV
WY
Total
Yes
Yes
Yes
11
9
1
28
9
1
5
54
* Requirement withdrawn before LSLR started due to not longer exceed AL
Notes:
(1) Average number of systems performing LSLR in States that specified:
28 systems in 6 States, average of 5 systems per State
(2) Assumed 5 systems for States that did not specify number (Wl, MT,
MA, AZ, IL)
(3) Added DC WASA
Appendix F-7
-------
Appendix G
Derivation of Direct Costs for Initial Rule Activities
Appendix G-l
-------
th
Appendix G-l: System Rule Implementation Costs (4 Qtr 2006$)
System Classification
CWS, 25-100
CWS, 101-500
CWS, 501-3,300
CWS, 3,300-10,000
CWS, 10.001-100K
CWS, >100K
NTNCWSs, 25-100
NTNCWSs, 101-500
NTNCWSs, 501-3,300
NTNCWSs, 3,300-10,000
NTNCWSs, 10,001-100,000
NTNCWSs, >1 00,000
Total
# Systems [1]
13,766
16,240
14,212
4,707
3,541
372
9,548
6,997
2,720
96
14
0
72,213
Burden Per
System (Mrs.)
[2]
5
5
5
8
8
40
5
5
5
8
8
40
Total Burden
(Mrs.)
68,830
81,200
71,060
37,656
28,328
14,880
47,740
34,985
13,600
768
112
0
399,159
Total Labor
Cost [3]
$1,642,284
$2,086,840
$1,956,992
$1,278,722
$979,866
$583,742
$1,139,076
$899,115
$374,544
$26,080
$3,874
$0
$10,971,135
Notes:
1. Number of systems per SDWIS/FED Data 2004.
2. Burden estimate based on consensus agreement of expert panels on 11.21.05, adjusted to reflect
comments received.
3. Wage rates from SAIC contract study, "Labor Costs for National Drinking Water Rules" (2003) updated
to 4th Qtr 2006 dollars.
Appendix G-l
-------
th
Appendix G-2: State/Primacy Agencies Rule Implementation Costs (4 Qtr 2006$)
# States/Primacy Agencies
[1]
57
Burden
Estimate per
State (Hours)
[2]
600
Total Burden
(Mrs.)
34,200
Labor Rate
($/hr) [3]
$43.52
Total Labor
Cost
$1,488,433
Notes:
1. The LCR Regulatory Changes apply to 50 states, 6 territories and 11ndian Tribe, fora total of 57
entities.
2. Burden includes regulation adoption, program development and miscellaneous training. (Approximately
.3 FTE or 4 months ofFTE)
3. Use state labor rate of$43.52/hour (Source: Information Collection Request for Contaminant
Occurrence Data in Support of EPA's Second Six Year Review of National Primary Drinking Water
Regulations (August 2006)).
Appendix G-3
-------
Appendix H
Derivation of Direct Costs for Regulatory Change III.F
Appendix H-l
-------
Appendix H-l. Summary of Cost Estimates for New Public Education Requirements for
th
LCR Short Term Revisions (4m Qtr 2006$)
Activity Table Requirement Affected Party A"n "al
III.F(a) Appendix
III.F(b)(1) Appendix
III.F(b)(2) (i-viii) Appendix
III.F(a) Changes to Mandatory Text
u 0 Customer Systems that Exceed „.„. .__
H'2 Notification LAL $91'400
III.F(b). Activities to Better Reach At-Risk Populations
H-3 _ Notify 3 CWS that Exceed LAL $21,900
Organizations
H-6 Additional Activities CWS that Exceed LAL $292,700
Annual
Material
Cost
$0
$21,400
$0
III.F(c) Communication Activities with Consumers throughout a Lead Exceedance
III.F(c)(1) Appendix H-21 Customer Bills CWS that Exceed LAL $47,400 $0
III.F(c)(2) Appendix H-22 Post on Website a^9e . . .. a $100 $0
III.F(c)(3) Appendix H-23 Press Releases CWS that Exceed LAL -$3,700 -$500
III.F(e) Appendix
III.F(g) Appendix
III.F(f) Appendix
III.F(e) Change in Requirements for CCR Statements
H-24 CCR Statement CWS that Don't
Exceed LAL
III.F(g) System Cost for Reporting and Consultation with State
H"7 CStatelt&tlLetterth CWS that Exceed LAL $33,500
III.F(f) Cost to State Primacy Agency
H-25 Review State Primacy Agency $63,000
Total for All Affected Parties $901 ,300
Subtotal Water Systems $837,900
$0
$200
$0
$21,200
$21,200
Total Cost
$91,400
$43,300
$292,700
$47,400
$100
-$4,200
$354,600
$33,700
$63,000
$922,500
$859,200
Appendix H-2
-------
Appendix H-2. III.F(a) Customer Notification - Additional Burden and Costs for Systems
th
that Exceed the Lead Action Level (4m Qtr 2006$)
System Size
Category
CWS
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
NTNCWS
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
Total
# Systems that
Exceed Lead AL
[1,2]
185
155
133
54
40
7
7
217
143
51
1
1
994
Annual
System
Burden
(hrs) [3]
648
543
466
189
140
25
25
760
501
179
4
4
3,479
Annual
System
Labor Cost
[4]
$15,449
$13,942
$12,820
$6,418
$4,843
$847
$961
$18,122
$12,863
$4,916
$119
$121
$91,421
Annual
System O&M
Cost [5]
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Total Annual
System Costs
$15,449
$13,942
$12,820
$6,418
$4,843
$847
$961
$0
$0
$18,122
$12,863
$4,916
$119
$121
$91,421
Notes:
1. Additional customer notification requirements affect only systems that exceed the lead action level.
For systems serving <3,300 people, the # systems is based on SDWIS/Fed data for the monitoring period
ending after January 2003. (Data source: USEPA Survey of States - Questions on State Implementation
of Lead and Copper Rule. July 2004).
2. For systems serving >3,300 people, the # systems is based on systems that have exceeded the lead
action level since 2003. data source: www.epa.gov/safewater/lcrmr/lead-data.html, 8/30/05.
3. Assume burden to prepare additional language for customer brochure is 3.5 hours for all systems
based on Public Notification Rule. Tier 2 violation.
4. Loaded wage rates from SAIC contract study, "Labor Costs for National Drinking Water Rules (2003)
updated to 4th QTR 2006.
5. Mailing and productions costs are covered in the existing regulation.
Appendix H-3
-------
Appendix H-3. IILF(b)(l) Notify Organizations: Costs to Deliver Brochures to Preschools,
Licensed Daycares and OBGYNs for CWSs that Exceed the Lead Action Level (4
2006$)
th
Qtr
System Size
Category
CWS
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
100-500K
500K-1M
>1 M
Total
# Systems that
Exceed Lead
AL[1,2]
185
155
133
54
40
7
4
1
2
581
Annual
System
Burden for
Contacting
Organizations
(hrs) [3]
185
155
133
135
100
18
11
5
15
756
Annual
System
Labor Cost
[4]
$4,414
$3,984
$3,663
$4,585
$3,462
$614
$420
$201
$569
$21,911
Annual System
O&M Cost
$85
$303
$754
$2,630
$7,317
$3,981
$6,367
$5,887
$33,732
$21,436
Total Annual
System
Costs
$4,500
$4,287
$4,417
$7,215
$10,779
$4,595
$6,787
$6,088
$34,301
$43,347
Notes
1. Additional requirements affect only systems that exceed the lead action level. For systems serving
<3,300 people, the # systems is based on SDWIS/Fed data for the monitoring period ending after January
2003. (Data source: USEPA Survey of States - Questions on State Implementation of Lead and Copper
Rule. July 2004).
2. For systems serving >3,300 people, the # systems is based on systems that have exceeded the lead
action level since 2003. data source: www.epa.gov/safewater/lcrmr/lead-data.html, 8/30/05.
3. All CWSs that exceed the lead action level need to send a brochure with a cover letter to daycare
centers and preschools, obstetrician and gynecologists, and one public health agency. Table 4.a
summarizes new notifications requirements by system size. For systems serving <3,300, the only new
burden is 1 hour per system to develop a cover letter and assumes that systems will use a template
provided by USEPA. For systems serving 3,300 to 100,000 people, assume new annual burden
requirements of 1 hours per system to update list of organizations; 1 hour per system to develop a cover
letter; 0.25 hour per 100 additional brochures for production; and 0.5 hours per system to contact the
public health agency. For systems serving > 100,000 people, assume an annual burden of 2 hours per
system to update list of organizations^ hour per system to develop a cover letter; 1 hour per 20 additional
brochures for production; and 0.5 hours per system to contact the public health agency.
4. Loaded wage rates from SAIC contract study, "Labor Costs for National Drinking Water Rules (2003)
updated to 4th Qtr 2006.
5. For systems serving <3,300 people, new O&M burden is equal to the material cost for a cover letter for
each current notification per system ($0.01 per notification). For systems serving >3,300 people, new
O&M burden equals $0.44 per brochure ($0.39 postage, $0.02 for 2 sheets paper and $0.03 envelope)
multiplied by the number of additional notifications (Table 4.a) multiplied by the number of systems that
exceed the lead action level, plus $0.01 for a cover letter for each current notification per system.
Appendix H-4
-------
Appendix H-4. Detail on Notifying Organizations
System Size
Category
<100
101-500
501-1K
1K-3.3K
3.3K-10K
10K-50K
50K-100K
100-500K
500K-1M
>1 M
Average
Population
Served per
System1
46
196
567
1,465
4,474
16,840
52,423
146,713
542,647
1,554,621
Additional
Notifications Per
System2
0
0
1
3
9
33
101
283
1,047
3,000
Current # of
Notifications Per
System
5
5
5
5
5
46
90
239
872
2535
Notes
1. Data source: USEPA, Community Water System Survey 2000, EPA 815-R-02-005b, December 2002,
Table 40. See Appendix H-5 for details.
2. Assume total of 193 new organizations per 100,000 population including 178 licensed day care
facilities/preschools per 100,000 population (per National Child Care Association); and 15 ob/gyns per
100,000 population (per 2006 Statistical Abstract).
Appendix H-5
-------
Appendix H-5. Average Population Served per System Size
System Size
<100
101-500
501-1K
1K-3.3K
3.3K-10K
10K-50K
50K-100K
100-500K
500K-1M
>1 M
Total
Number of CWSs
13,766
16,240
5,914
8,298
4,707
3,057
484
322
32
18
52,788
Total Population
in System Size
827,126
4,130,005
4,354,314
15,783,290
27,346,264
66,857,216
32,951,452
61,352,680
22,551,546
36,341,784
213,602,347
Average
Population Per
System1
46
196
567
1,465
4,474
16,840
52,423
146,713
542,647
1,554,621
4,046
Notes:
Data source: USEPA, Community Water System Survey 2000, EPA 815-R-02-005b, December 2002,
Table 40.
1. Average population per system is equal to the total population in the specified system size class
divided by the number of CWSs in the specified size class. The average population per system was
reduced by 23% to account for multiple family housing that was formerly included in the population data
per consensus of EPA phone meeting 3.2.06.
Appendix H-6
-------
Appendix H-6. IILF(b)(2)(i-viii) Additional Activities for CWSs that Exceed the Lead
th
Action Level (4m Qtr 2006$)
System Size
Category
CWS
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
Total
# Systems that
Exceed Lead AL
[1,2]
185
155
133
54
40
7
7
581
Average
Annual Costs
Per System for
All Activities
[3]
$44
$49
$89
$289
$928
$1,865
$3,231
Number of
Activities [4]
1
1
1
3
3
3
3
Total Annual
System Cost
$8,142
$7,541
$11,772
$46,886
$111,380
$39,162
$67,856
$292,739
Notes
1. These additional requirements affect only CWSs that exceed the lead action level. For systems
serving <3,300 people, the # systems is based on SDWIS/Fed data for the monitoring period ending after
January 2003. (Data source: USEPA Survey of States - Questions on State Implementation of Lead and
Copper Rule. July 2004).
2. For systems serving >3,300 people, the # systems is based on systems that have exceeded the lead
action level since 2003. data source: www.epa.gov/safewater/lcrmr/lead-data.html, 8/30/05.
3. See detail on separate worksheet entitled "Add'l. Activities", Column L rows 8-14
4. For new regulatory provision 7A-H, systems serving <3,300 people must complete 1 activity while
systems serving >3,300 people must complete 3 activities each year.
Appendix H-7
-------
Appendix H-7. IH.F(g) Consultation with State and Self-Certification Letter for CWSs
th
that Exceed the Lead Action Level (4tn Qtr 2006$)
System Size
Category
CWS
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
Total
#
Systems
that
Exceed
Lead AL
[1,2]
185
155
133
54
40
7
7
581
Annual
System
Burden for
Consultation
with State
[3]
370
310
266
108
80
14
14
1162
Annual
System
Labor Cost
for
Consultation
with State
$8,828
$7,967
$7,326
$3,667
$2,767
$484
$549
$31,589
Annual
System
Burden for
Preparing
Self-
Certification
Letter [4]
22.2
18.6
15.96
6.48
4.8
0.84
0.84
69.72
Annual
System
Labor Cost
for Self-
Certification
Letter
$530
$478
$440
$220
$166
$29
$33
$1,895
Annual O&M
for Self
Certification
Letter
$80
$67
$57
$23
$17
$3
$3
$250
Total
Annual
System
Costs
$9,437
$8,512
$7,822
$3,911
$2,950
$516
$585
$33,734
Notes:
1. These additional requirements affect only CWSs that exceed the lead action level. For systems
serving <3,300 people, the # systems is based on SDWIS/Fed data for the monitoring period ending after
January 2003. (Data source: USEPA Survey of States - Questions on State Implementation of Lead and
Copper Rule. July 2004).
2. For systems serving >3,300 people, the # systems is based on systems that have exceeded the lead
action level since 2003. data source: www.epa.gov/safewater/lcrmr/lead-data.html, 8/30/05.
3. Systems activities include consultation with state on additional activities, content of cover, discussion of
alternative mechanisms, and discussion of extending deadlines at a burden of 2 hours per system.
4. Systems will also prepare a letter self-certifying that PE activities have taken place and that materials
have been distributed, at a burden of .12 per letter per year, with $0.43 O&M costs ($0.39 postage, $0.01
paper, $0.03 for envelope).
Appendix H-8
-------
th
Appendix H-8. Cost of Each Additional Activity for F(b)(2)(i-viii) (4m Qtr 2006$)
System Size
Category
CWS
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
A. Public
Service
Announcements
$98
$101
$105
$118
$1,400
$1,400
$1,400
B. Paid
Advertisements
$105
$105
$180
$180
$850
$5,000
$5,000
C. Display
in Public
Areas
$24
$26
$111
$137
$696
$1,392
$3,943
D. Internet
Notification
$24
$26
$28
$420
$596
$596
$1,035
E. Public
Meetings
$48
$51
$55
$900
$2,400
$3,000
$5,000
F. Delivery
to Every
Household
$7
$30
$166
$435
$1,114
$2,448
$3,874
G.
Targeted
Contact
$34
$35
$37
$44
$66
$138
$563
H. Materials
Directly to
Multi-Family &
Ints
$12
$15
$27
$81
$303
$945
$5,035
Average
Annual Cost
Per System
for All
Activities
$44
$49
$89
$289
$928
$1,865
$3,231
Notes
A. See Appendix H-
B. See Appendix H-
C. See Appendix H
D. See Appendix H
E. See Appendix H-
F. See Appendix H-
G. See Appendix H
H. See Appendix H-
9 for details.
10 for details.
•11 for details.
•12 for details.
13 for details.
18 for details.
-19 for details.
20 for details.
Appendix H-9
-------
th
Appendix H-9. Cost for Activity F(b)(2)(i) Public Service Announcements (4 Qtr 2006$)
System Size
Category
CWS
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
Price Per PSA
Radio1
$98
$101
$105
$118
$560
$560
$560
Price Per PSA
TV2
$840
$840
$840
$840
$840
$840
$840
Total PSA
Radio
1
1
1
1
1
1
1
Total PSA
TV
0
0
0
0
1
1
1
Total Cost
Per
System
$98
$101
$105
$118
$1,400
$1,400
$1,400
Notes:
1. For systems serving <10,000 people, assume they use free-lance talent for voice-over of an
announcement developed by the system. Assume 2 hours of system labor to write the announcement,
$50 to produce spot using freelance voice talent.
For systems serving >10,000 people, assume $560 for production of a radio PSA including $280 to
produce the audio using union talent, $80 for 1 hour of studio time, and $200 for developing the script.
2. Assume $840 for production of a TV PSA including $560 to produce the audio using union talent, $80
for 1 hour of studio time, and $200 for developing the script.
Appendix H-10
-------
th
Appendix H-10. Cost for Activity F(b)(2)(ii) Paid Advertisements (4111 Qtr 2006$)
System Size
Category
CWS
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
Cost Per 10 Inch
Newspaper
Advertisement [1]
$105
$105
$180
$180
$850
$5,000
$5,000
Number of
Times
Published
1
1
1
1
1
1
1
Total Per
System
$105
$105
$180
$180
$850
$5,000
$5,000
Notes
1. Assume 10 column inches (1/8 page) per advertisement. Rates range from $105 per 10 column inch
for local weekly newspapers to $5,000 for the Washington Post based on a random search of six
newspapers.
Appendix H-11
-------
th
Appendix H-ll. Cost for Activity F(b)(2)(iii) Display in Public Area (4m Qtr 2006$)
System Size
Category
CWS
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
Number of
Posting [1]
5
5
20
20
100
200
500
Hours to Post
[2]
1
1
4
4
20
40
100
Materials
Cost [3]
$0.20
$0.20
$0.80
$0.80
$4.00
$8.00
$20.00
Total Cost
Per System
$24
$26
$111
$137
$696
$1,392
$3,943
Notes:
1. It is assumed that small and medium systems may post a notice at the local grocery store, Laundromat
or similar establishment. Assume that systems serving <500 people would need 5 such postings, and
systems serving between 501 and 10,000 people may need 20 postings. It is assumed that the posting is
free but each system spends 1 to 2 hours in travel time.
2. Burden hours based on estimated travel time between postings.
3. Assume material cost equals $0.04 per posting.
4. Loaded wage rates from SAIC contract study, "Labor Costs for National Drinking Water Rules (2003)
updated to 4th QTR 2006.
Appendix H-12
-------
th
Appendix H-12. Cost for Activity F(b)(2)(iv) Internet Notification (4 Qtr 2006$)
System Size
Category
CWS
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
Hours to
Compose
Email & Check
Email List
1
1
1
5
10
10
20
Materials Cost
$0.00
$0.00
$0.00
$250.00
$250.00
$250.00
$250.00
Total Cost
Per
System
$24
$26
$28
$420
$596
$596
$1,035
Notes
1. It is assumed that small systems may prefer to notify customers via e-mail, and would have a pre-
existing list of customer e-mail addresses.
Assume that it would take systems 1 hour to compose and send out the e-mail.
2. Large systems would purchase email list and verify it.
Appendix H-l 3
-------
th
Appendix H-13. Cost for Activity F(b)(2)(v) Public Meetings (4 Qtr 2006$)
System Size Category
CWS
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
Total Cost Per System
$48
$51
$55
$900
$2,400
$3,000
$5,000
Notes
1. For systems serving <3,300 people, assume that system representatives would bring up the issue for
discussion at an existing town meeting. Assume 2 hours for preparation and meeting time.
2. See detailed cost estimates on separate worksheet for systems serving >3,300 people based on cost
of USEPA public stakeholder meetings not including cost of meeting space.
Appendix H-14
-------
Appendix H-14. Cost for Activity F(b)(2)(v) Public Meetings for Systems Serving 3,301-
th
10,000 People (4m Qtr 2006$)
Activity
Pre-meeting logistical arrangements1
Preparation of presentation/talking points2
Attend meeting3
Post meeting, including notes4
Total
Management
Rate: $ 56.99
Hours Cost
0 $0
2 $ 113.98
3 $ 170.97
0 $0
5 $ 284.95
Technical
Rate: $ 28.20
Hours Cost
6 $ 169.20
12 $ 338.40
3 $ 84.60
0 $
21 $ 592.20
Total
$
$ 169.20
$ 452.38
$ 255.57
$
$ 877.15
Estimated Total 5 $ 900
Hours 26
Notes
1. Select date, research and select site, negotiate with site for use, publicize meeting, set up room
including electronics (microphones, sound system, presentation).
2. Prepare 30 minute presentation including consultation with health experts and technical personnel as
necessary, 30-50 slides, feedback from management, practice presentation
3. Based on WASA, 1.5 hour open house, one hour presentation/Q&A, 15 minutes before and after, fora
total of three hours, one senior management, one technical staff
4. Prepare and review meeting transcript or notes, follow up with attendees as appropriate
5. The estimated cost, $877.15, is rounded to the nearest hundred, $900.00.
Appendix H-l 5
-------
Appendix H-15. Cost for Activity F(b)(2)(v) Public Meetings for Systems Serving 10,001-
th
50,000 People (4m Qtr 2006$)
Activity
Pre-meeting logistical arrangements1
Preparation of presentation/talking points2
Attend meeting3
Post meeting, including notes4
Total
Management
Rate: $56.99
Hours Cost
0 $0
8 $ 455.92
6 $ 341.94
0 $0
14 $ 797.86
Technical
Rate: $ 28.99
Hours Cost
10 $ 289.90
30 $ 869.70
6 $ 173.94
8 $ 231.92
54 $ 1,565.46
Total
$
$ 289.90
$ 1,325.62
$ 515.88
$ 231.92
$ 2,363.32
Estimated Total 5 $ 2,400
Hours 68
Notes
1. Select date, research and select site, negotiate with site for use, publicize meeting, set up room
including electronics (microphones, sound system, presentation).
2. Prepare 30 minute presentation including consultation with health experts and technical personnel as
necessary, 30-50 slides, feedback from management, practice presentation
3. Based on WASA, 1.5 hour open house, one hour presentation/Q&A, 15 minutes before and after, fora
total of three hours, one senior management, one technical staff
4. Prepare and review meeting transcript or notes, follow up with attendees as appropriate
5. The estimated cost, $ 2,363,32 is rounded to the nearest hundred, $2,400.
Appendix H-16
-------
Appendix H-16. Cost for Activity F(b)(2)(v) Public Meetings for Systems Serving 50,001-
th
100,000 People (4m Qtr 2006$)
Activity
Pre-meeting logistical arrangements1
Preparation of presentation/talking points2
Attend meeting3
Post meeting, including notes4
Total
Management
Rate: $56.99
Hours Cost
0 $0
10 $ 569.90
6 $ 341.94
0 $0
16 $ 911.84
Technical
Rate: $ 28.99
Hours Cost
20 $ 579.80
40 $ 1,159.60
6 $ 173.94
6 $ 173.94
72 $ 2,087.28
Total
$
$ 579.80
$ 1,729.50
$ 515.88
$ 173.94
$ 2,999.12
Estimated Total 5 $ 3,000
Hours 88
Notes
1. Select date, research and select site, negotiate with site for use, publicize meeting, set up room
including electronics (microphones, sound system, presentation).
2. Prepare 30 minute presentation including consultation with health experts and technical personnel as
necessary, 30-50 slides, feedback from management, practice presentation
3. Based on WASA, 1.5 hour open house, one hour presentation/Q&A, 15 minutes before and after, fora
total of three hours, one senior management, one technical staff
4. Prepare and review meeting transcript or notes, follow up with attendees as appropriate
5. The estimated cost, $ 2,999.12, is rounded to the nearest hundred, $3,000.
Appendix H-l 7
-------
Appendix H-17. Cost for Activity F(b)(2)(v) Public Meetings for Systems Serving >100,000
jth
People (4m Qtr 2006$)
Activity
Pre-meeting logistical arrangements1
Preparation of presentation/talking points2
Attend meeting3
Post meeting, including notes4
Total
Management
Rate: $56.99
Hours Cost
0 $0
10 $ 569.90
12 $ 683.88
0
22 $1,253.78
Technical
Rate: $ 34.79
Hours Cost
20 $ 695.80
40 $ 1,391.60
18 $ 626.22
28 $ 974.12
106 $ 3,687.74
Total
$
$ 695.80
$ 1,961.50
$ 1,310.10
$ 974.12
$ 4,941.52
Estimated Total 5 $ 5,000
Hours 128
Notes
1. Select date, research and select site, negotiate with site for use, publicize meeting, set up room
including electronics (microphones, sound system, and presentation).
2. Prepare 30 minute presentation including consultation with health experts and technical personnel as
necessary, 30-50 slides, feedback from management, practice presentation
3. Based on WASA, 1.5 hour open house, one hour presentation/Q&A, 15 minutes before and after, fora
total of three hours, one senior management, one technical staff
4. Prepare and review meeting transcript or notes, follow up with attendees as appropriate
5. The estimated cost, $ 4,941.52, is rounded to the nearest thousand, $5,000.00.
Appendix H-18
-------
th
Appendix H-18. Cost for Activity F(b)(2)(vi) Delivery to Every Household (4 Qtr 2006$)
System Size
Category
CWS
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
Average
Population Per
System1
46
196
1,091
4,474
16,840
52,423
248,896
Persons Per
Household2
2.57
2.57
2.57
2.57
2.57
2.57
2.57
Delivery Cost
Per
Household3
$0.39
$0.39
$0.39
$0.25
$0.17
$0.12
$0.04
Total Per
System
$7
$30
$166
$435
$1,114
$2,448
$3,874
Notes
1. Data source: USEPA, Community Water System Survey 2000, EPA 815-R-02-005b, December 2002,
Table 40. See Appendix H-5 for details.
2. Data source: US Census, Current Population Reports, America's Families and Living Arrangements:
2003, Table 1.
3. Assume delivery to every postal address either through mail or distribution of flyers. Mailing costs
would be $0.39 each. Assume systems serving <3,300 people send notice through mail ($0.39 each).
Assume systems serving >3,300 people distribute flyers at a cost of $0.25 per piece for systems serving
3,301 to 10,000 people; $0.17 per piece for systems serving 10Kto 50K; a $0.12 per piece for systems
serving 50K to 100K, and $0.04 for >100K (materials cost only, assumes inclusion with existing mailing).
Appendix H-19
-------
th
Appendix H-19. Cost for Activity F(b)(2)(vii) Targeted Contact (4m Qtr 2006$)
System
Size
Category
CWS
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
Average
Population
Per
System 1
46
196
1,091
4,474
16,840
52,423
248,896
Upfront
Cost For
List2
$250
$250
$250
$250
$250
$250
$250
Pro-rated
Upfront
Cost
$28
$28
$28
$28
$28
$28
$28
Number
of
Targeted
Contacts3
1
1
4
18
67
210
996
Labor for
Production
0.25
0.25
0.25
0.25
0.25
0.52
2.49
Labor
Costs for
Production
$6
$6
$7
$8
$9
$18
$98
Material
Cost4
$0.44
$0.44
$1.92
$7.87
$29.64
$92.26
$438.06
Total
Cost
$34.18
$34.64
$36.58
$44.14
$66.06
$138.18
$563.48
Notes
1. Data source: USEPA, Community Water System Survey 2000, EPA 815-R-02-005b, December 2002,
Table 40. See Appendix H-5 for details.
2. Assume $250 for purchase of targeted list.
3. Assume 1 targeted communication for every 250 population served (based on Portland, OR targeted
contact experience of approximately 2000 homes for a population served of 482,500).
4. Use $0.44 for unit materials and printing cost for letter, envelope and postage.
Appendix H-20
-------
Appendix H-20. Cost for Activity F(b)(2)(viii) Provide Materials Directly to Multi-Family Homes and Institutions (4
2006$)
th
Qtr
System
Size
Category
CWS
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
Average
Population
Per
System1
46
196
1,091
4,474
16,840
52,423
248,896
Multi-
Family
Per
100,0002
4,035
4,035
4,035
4,035
4,035
4,035
4,035
Number
of Multi-
Family
Per
System
2
8
44
181
679
2115
10043
Time to
Identify
Multi-
Family
(Mrs)3
0.17
0.67
3.67
15.08
56.58
176.25
836.92
Upfront
Labor
Cost4
$4
$17
$101
$512
$1,957
$6,096
$32,832
Pro-rated
Upfront
Labor
Cost
$0.44
$1.90
$11.22
$56.91
$217.47
$677.39
$3,648.03
Labor
Burden for
Production
0.5
0.5
0.5
0.5
1.6975
5.2875
25.1075
Labor Cost
for
Production
$12
$13
$14
$17
$59
$183
$985
Material
Cost5
$0.08
$0.32
$1.76
$7.24
$27.16
$84.60
$401.72
Total
Cost
$12
$15
$27
$81
$303
$945
$5,035
Notes:
1. Data source: USEPA, Community Water System Survey 2000, EPA 815-R-02-005b, December 2002, Table 40. See Appendix H-5 for details.
2. Data source: U.S. Census Housing Survey for buildings with more than 10 units each.
3. Assume five minutes per establishment to identify multi-family homes and institutions.
4. Loaded wage rates from SAIC contract study, "Labor Costs for National Drinking Water Rules (2003) updated to 4th Qtr 2006. Annual labor cost
equals hourly labor rate multiplied by annual burden.
5. Assume a materials cost of $0.04 per notice.
Appendix H-21
-------
Appendix H-21. IILF(c)(l) Customer Bills: Cost to Add Note to Customer Bills for CWSs
th
that Exceed the Lead Action Level (4m Qtr 2006$)
System Size
Category
CWS
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
Total
# Systems that
Exceed Lead AL
[1,2]
185
155
133
54
40
7
7
581
Annual
System
Burden for
Adding
Notes to
Customer
Bills(hrs) [3]
555
465
399
162
120
21
21
1,743
Annual System
Labor Cost [4]
$13,242
$11,951
$10,988
$5,501
$4,151
$726
$824
$47,383
Annual
System O&M
Cost
$0
$0
$0
$0
$0
$0
$0
$0
Total Annual
System Cost
$13,242
$11,951
$10,988
$5,501
$4,151
$726
$824
$47,383
Notes:
1. Additional customer notification requirements affect only CWSs that exceed the lead action level. For
systems serving <3,300 people, the # systems is based on SDWIS/Fed data for the monitoring period
ending after January 2003. (Data source: USEPA Survey of States - Questions on State Implementation
of Lead and Copper Rule. July 2004).
2. For systems serving >3,300 people, the # systems is based on systems that have exceeded the lead
action level since 2003. data source: www.epa.gov/safewater/lcrmr/lead-data.html, 8/30/05.
3. All CWS that exceed the lead action level need to include a note on customer bills. Assume all
systems use quarterly billing. Current requirements call for adding a note to one bill each year, so new
burden is adding a note to 3 bills each year per system. Assume 1 hour per billing period per system per
year, which equals 3 hours per system per year. No additional O&M costs.
4. Loaded wage rates from SAIC contract study, "Labor Costs for National Drinking Water Rules (2003)
updated to 4th Qtr 2006.
Appendix H-22
-------
Appendix H-22. IILF(c)(2) Post on Website: Cost for Posting Notice on Website for CWSs
th
that Exceed the Lead Action Level and Serve >100,000 People (4m Qtr 2006$)
System Size
Category
CWS
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
Total
# Systems that
Exceed Lead AL
[1,2]
185
155
133
54
40
7
7
581
Annual
System
Burden for
Posting on
Website
(hrs) [3]
0
0
0
0
0
0
3.5
3.5
Annual System
Labor Cost [4]
$0
$0
$0
$0
$0
$0
$137
$137
Annual
System O&M
Cost
$0
$0
$0
$0
$0
$0
$0
$0
Total Annual
System
Costs
$0
$0
$0
$0
$0
$0
$137
$137
Notes:
1. Additional requirements affect only systems that exceed the lead action level. For systems serving
<3,300 people, the # systems is based on SDWIS/Fed data for the monitoring period ending after January
2003. (Data source: USEPA Survey of States - Questions on State Implementation of Lead and Copper
Rule. July 2004).
2. For systems serving >3,300 people, the # systems is based on systems that have exceeded the lead
action level since 2003. data source: www.epa.gov/safewater/lcrmr/lead-data.html, 8/30/05.
3. CWSs that serve more than 100,000 people that exceed the lead action level must post a notice on
their website. Assume burden of 0.5 hours per system (source: ICR (PWSSICR, 2040-0090, page B-6).
No O&M costs.
4. Loaded wage rates from SAIC contract study, "Labor Costs for National Drinking Water Rules (2003)
updated to 4th Qtr 2006.
Appendix H-23
-------
Appendix H-23. IILF(c)(3) Press Releases: Cost for Press Releases for CWSs that Exceed
th
the Lead Action Level (4m Qtr 2006$)
System Size
Category
CWS
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
Total
# Systems that
Exceed Lead AL
[1,2]
185
155
133
54
40
7
7
581
Annual
System
Burden for
Press
Release
(hrs) [3]
0
0
0
-54
-40
-7
-7
-108
Annual
System
Labor Cost
[4]
$0
$0
$0
-$1,834
-$1,384
-$242
-$275
-$3,734
Annual
System
O&M Cost
[5]
$0
$0
$0
-$232
-$172
-$30
-$30
-$464
Total Annual
System Costs
$0
$0
$0
-$2,066
-$1,556
-$272
-$305
-$4,198
Notes
1. Additional requirements affect only CWSs that exceed the lead action level. For systems serving
<3,300 people, the # systems is based on SDWIS/Fed data for the monitoring period ending after January
2003. (Data source: USEPA Survey of States - Questions on State Implementation of Lead and Copper
Rule. July 2004).
2. For systems serving >3,300 people, the # systems is based on systems that have exceeded the lead
action level since 2003. data source: www.epa.gov/safewater/lcrmr/lead-data.html, 8/30/05.
3. Systems serving more than 3,300 people that have exceeded the lead action level have a reduced
burden as compared to current requirements. Current requirements are 2 public service announcements
(PSAs) and 1 press release (PR) to 8 entities. New requirements are 2 PRs to 8 entities. Assume 1 hour
of burden per system for each PSA or PR per 2004 ICR. Therefore, the burden for new requirements
equals one less hour per system as compared to current requirements.
4. Loaded wage rates from SAIC contract study, "Labor Costs for National Drinking Water Rules (2003)
updated to 4th Qtr 2006.
5. The reduced burden for annual system O&M cost equals the materials and postage for 10 PSAs (5 to
TV and 5 to radio stations) at $0.43 each ($0.39 postage, $0.01 paper and $0.03 envelope) for a total
savings of $4.30 per system.
Appendix H-24
-------
Appendix H-24. IILF(e) CCR Statement: Cost to Add Statement to Consumer Confidence
th
Report for CWSs that Don't Exceed the Lead Action Level (4m Qtr 2006$)
System
Size
Category
<100
101-500
501-3.3K
3.3K-10K
10K-50K
50K-100K
100K-500K
500K-1M
>1 M
Total
Total
Number
of CWSs
[1]
13,766
16,240
14,212
4,707
3,057
484
322
32
18
52,838
#
Systems
that
Exceed
Lead AL
[2,3]
185
155
133
54
40
7
7
581
Additional
Systems
Affected by
New
Requirement
[4]
13,581
16,085
14,079
4,653
3,017
477
315
32
18
52,257
Annual
System
Burden to
Add
Statement
to CCR
(hrs) [5]
3,395
4,021
3,520
1,163
754
119
79
8
5
13,064
Annual
System
Labor Cost
$81,011
$103,346
$96,934
$39,502
$26,090
$4,125
$3,089
$314
$177
$354,586
Annual
System
O&M
Cost
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Total
Annual
System
Costs
$81,011
$103,346
$96,934
$39,502
$26,090
$4,125
$3,089
$314
$177
$354,586
Notes:
1. Number of CWS systems per SDWIS/FED Data 2004.
2. For systems serving <3,300 people, the # systems is based on SDWIS/Fed data for the monitoring
period ending after January 2003. (Data source: USEPA Survey of States - Questions on State
Implementation of Lead and Copper Rule. July 2004).
3. For systems serving >3,300 people, the # systems is based on systems that have exceeded the lead
action level since 2003. data source: www.epa.gov/safewater/lcrmr/lead-data.html, 8/30/05.
4. Under the new requirement, all systems will have to include an informational statement in their CCR.
Currently, all systems whose 95th percentile sample is above the lead action level include an
informational statement in their CCR. The estimated number of systems affected by this requirement are
the total number of systems affected by the LCR less the systems that exceed the lead action level.
These estimates are conservative because we are including some systems that are already required to
provide this information in their CCR (systems whose 95 percentile sample exceeds the lead action level).
5. Assume burden hours to add statement to Consumer Confidence Report regarding lead issues will be
15 minutes per system, for all system sizes.
Appendix H-25
-------
Appendix H-25. Changes to State Burden for Review and Consultation Activities (4 * Qtr
2006$)
Customer Notification Review
Review and Filing of Self-
Certification Letter
Consultation on Activities
Total
Number of
Affected States1
57
57
57
Net Change in
State Burden
(Hours)2346
236
58
1,162
1,456
Labor Rate
($/hr)5
$43.52
$43.52
$43.52
Total Labor Cost
$10,272
$2,529
$50,572
$63,372
Notes:
1. The LCR Regulatory Changes apply to 50 states, 6 territories and 11ndian Tribe, for a total of 57
entities.
2. States no longer have to approve changes for systems serving between 501 and 3,300 people.
Assume 0.5 hours savings for each of the 184 systems in this size category (Refer to Table 1 above). The
total reduction in burden equals 92 hours (184 * 0.5 hours).
3. For customer notification, States need to review additional language for 994 systems that are
estimated to exceed the LAL at an estimated 20 minutes per system. The total new burden to States
equals 328 hours (994 systems * 0.33 hours). The net new burden to States equals 328 hours minus 92
hours equals 236 hours.
4. State labor rate of$43.52/hour (Source: Information Collection Request for Contaminant Occurrence
Data in Support ofEPA's Second Six Year Review of National Primary Drinking Water Regulations
(2006)).
5. For consultation on activities, review of cover content, discussion of alternative mechanisms, and
discussion of extending deadlines, States need to review activities with CWSs that exceed the LAL once
per year at 2 hours per year.
6. For review and filing of letter from CWSs that exceed the LAL self-certifying that additional PE activities
have taken place, States will require . 10 hours per system per year, based on similar activity for the CCR.
Appendix H-26
-------
Appendix I
Uncertainty Analysis for III.F(b)(2) Activities
Appendix H-l
-------
Uncertainty Analysis for Choosing Activities IILF(b)(2)(i)-(viii)
Due to the uncertainty in predicting the selection of activities (i) through (viii) by systems
to comply with Regulatory Change III.F(b)(2), three alternative selection scenarios have been
developed to illustrate the potential range of costs. The three scenarios represent predicted
activity selection based on different considerations:
• Cost as the sole consideration
• Cost as a primary consideration, with other factors as a secondary considerations
• Other factors as a primary consideration.
Cost as the sole consideration
To simulate a situation in which cost minimization is the sole criteria for choosing
activities, this analysis assumes that systems will choose the three least costly activities. The
average cost per system is calculated as the average of the three least costly activities. The
selection of activities and resulting average costs are presented in Table 1-1.
Table 1-1: Activity Selection and Resulting Average Cost Per System:
Cost as Sole Consideration (4th Qtr 2006$)
System
Size
Category
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
=.<
0%
0%
0%
0%
0%
0%
0%
o
£1
3
Q.
_c
re
5 !§
r^~ $*
E.<
33%
33%
0%
0%
33%
0%
0%
1 o
E ~
at re
= 1C
•> o
^,-z.
0%
33%
33%
33%
0%
33%
33%
O)
c
0)
0)
o
Q.
•£•
0%
0%
0%
0%
0%
0%
0%
£
0)
O
*j
£2
> o
Q W
~" O
il
33%
0%
0%
0%
0%
0%
0%
S
re
o
^3
O)
H
:^
<^-
0%
0%
33%
33%
33%
33%
33%
IT
•- oa
o
w —
.5 E w
o3 re c
*J 4" O
re ~ 'j
-— * 3 +rf
:S n 12
> o c
33%
33%
33%
33%
33%
33%
0%
O) c
re c
S -s
> w
^f ^^
^^ CO
"^ k.
£J o>
0 0
§ 0
$14
$22
$30
$182
$355
$560
$999
Appendix H-2
-------
Although cost is an important consideration, it is not usually the sole consideration.
Systems may choose more costly activities to reach a broader range of audiences in a more
effective manner. To simulate a situation in which cost is a primary , but not the sole, factor for
choosing activities, this analysis assumes that less costly activities are more likely to be chosen
and the more costly activities will be chosen, but at a lower rate. For each system size category,
the activities are characterized as "more likely", "likely", and "unlikely" to be chosen based on
the cost per system. The two lowest cost activities are classified as "more likely", the two
highest cost activities are classified as "unlikely" and the middle four activities are classified as
"likely". To calculate a weighted average cost per system given the activity choices, more likely
activities are assigned a probability of 25 percent (i.e., the activity is chosen 25 percent of the
time), likely activities are assigned a probability of 10 percent, and the unlikely activities are
assigned a value of 5 percent. The resulting selection of activities and weighted average cost per
system are presented in Table 1-2.
Table 1-2: Activity Selection and Resulting Average Cost Per System:
Cost as the Primary (but not sole) Consideration (4th Qtr 2006$)
System
Size
Category
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
'5 I
V) oS
•- c
•§ o
"• £
=.<
5%
5%
10%
10%
5%
10%
10%
0)
E
0)
•c w
— "O
=.<
5%
5%
5%
10%
10%
5%
5%
o
3
re
Q.
(ft
O J§
— " 9i
••=.<
10%
10%
10%
10%
10%
10%
10%
1.1
J- -*±
^^ o
C m
•> o
=.2
10%
25%
25%
10%
10%
25%
25%
O)
_c
?
0)
0)
o
2
3
Q.
£-
10%
10%
10%
5%
5%
5%
5%
0)
LU
0
02
Q W
—• o
il
25%
10%
5%
5%
10%
10%
10%
Contact
T3
0)
Ul
H
;—
£-
10%
10%
10%
25%
25%
25%
25%
tj
5*
* | w
P '<** ^
3 ^
:= 1/5
.>, o £
25%
25%
25%
25%
25%
10%
10%
0)
O) r-
2
0) *^
> w^
£ Q-
0 O
5 O
$28
$35
$62
$184
$608
$1,202
$2,325
The third scenario reflects a best guess estimate of activity choices if cost were not a
factor. The members of the NDWAC working group were asked to rank the activities on a scale
of 1-8, with 1 representing activities most likely to be chosen and 8 for activities least likely to
be chosen within each system size category. The NDWAC working group members were not
provided information on the cost per system, so their responses reflect considerations other than
cost. Due to time constraints, only a limited number of responses were received. The rankings
were averaged across the responses, so that each activity had an average ranking. The activities
with the two lowest average ranking were characterized as most likely and assigned a probability
of 25 percent. The activities with the two highest average ranking were considered unlikely and
assigned a probability of 5 percent. All other activities were considered likely and assigned a
Appendix H-3
-------
probability of 10 percent. The resulting activity choices and weighted average cost per system
are displayed in Table 1-3.
Table 1-3: Activity Selection and Resulting Average Cost Per System:
th
Other Factors as the Primary Consideration (4 Qtr 2006$)
System
Size
Category
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
E.<
5%
5%
5%
10%
25%
25%
25%
o
B
3
Q.
_C
re
Q.
~ " 82
E.<
25%
25%
25%
25%
10%
10%
10%
1 o
£ ••!=
a) re
•£ o
= 'f
•> o
=.2
5%
10%
10%
25%
25%
25%
10%
M
O)
_c
«
0)
Q.
>
10%
10%
10%
5%
5%
5%
5%
$
LU
O
+j
02
~ .c
0) 0)
Q W
™ " O
il
25%
25%
25%
10%
10%
10%
10%
Contact
'S
s>
H
\^
^
10%
5%
5%
5%
10%
10%
10%
tj
I-
w —
•SI «
Cu ^
^Ss
-— ^ 3 +rf
:= to
.>, o _c
10%
10%
10%
10%
5%
5%
5%
0)
O) c
TO C
S -K
> w
^f ^^
^^ CO
~u 5
£ Q-
0 0
§ 0
$33
$40
$101
$268
$824
$2,134
$3,043
Table 1-4 summarizes the weighted average cost per system for each system size and for
each of the three scenarios. Across all system sizes, the weighted average cost per system is
lowest for the scenario in which activities are chosen with cost as the only consideration and
highest when other factors are the primary consideration. Table 1-4 also displays the total costs
for III.F(b)(2) for each scenario. It should be noted that the total cost under the highest of the
three scenarios, the other factors as the primary consideration scenario at $276,952 is lower than
the cost of III.F(b)(2) reported in the main section of the Economic Analysis ($292,700) based
on an un-weighted average of all activities. Thus, the costs reported in the Economic Analysis
may overstate actual costs that will be experienced.
-------
System Size
25-100
101-500
501-3,300
3.3K-10K
10K-50K
50K-100K
>100K
Total Costs
Weighted Average Cost Per System
Cost as Sole
Consideration
$ 14
$ 22
$ 30
$ 182
$ 355
$ 560
$ 999
$ 114,997
Cost as Primary
Consideration
$ 28
$ 35
$ 62
$ 184
$ 608
$ 1,202
$ 2,325
$ 195,532
Other Factors
Primary
Consideration
$ 33
$ 40
$ 101
$ 268
$ 824
$ 2,134
$ 3,043
$ 276,952
Appendix H-5
-------
Appendix J
Derivation of Direct Costs for Regulatory Change III.A
Appendix J- 1
-------
th
Appendix J-l: Regulatory Change IILA One-Time System Reporting Cost (4™ Qtr 2006$)
11
States
that
Favor 1
Sample
& Alaska
AK
IN
Ml
Wl
IL
TX
VT
UT
WA
MD
MN
TN
Total
#
NTNCWS
By State
[1]
N/A
686
1631
907
405
785
234
63
315
573
563
46
6208
%of
NTNCWS
With <5
taps [2]
N/A
53%
53%
53%
53%
53%
53%
53%
53%
53%
53%
53%
#
NTNCWS
With <5
taps
N/A
364
864
481
215
416
124
33
167
304
298
24
3290
CWS
Serving
<100By
State [1]
341
317
744
592
670
2105
319
241
1748
327
484
151
8039
%of
CWS<100
With <5
taps [6]
5%
5%
5%
5%
5%
5%
5%
5%
5%
5%
5%
5%
#of
CWS
<100
With <5
taps
17
16
37
30
34
105
16
12
87
16
24
8
402
Total
Systems
with <5
Taps
17
380
901
511
249
521
140
45
254
320
322
32
3692
One-Time
System
Burden for
Verification
Letters [3]
17
380
901
511
249
521
140
45
254
320
322
32
3692
One Time
System
Labor Cost
for
Verification
Letters [4]
$472
$10,551
$25,016
$14,188
$6,913
$14,465
$3,887
$1,249
$7,052
$8,885
$8,940
$888
$102,507
One-Time
System
O&M Costs
for
Verification
Letters [5]
$7
$163
$387
$220
$107
$224
$60
$19
$109
$138
$138
$14
$1,588
Total
System
One-Time
Cost for
Verification
Letters [5]
$479
$10,714
$25,403
$14,407
$7,020
$14,689
$3,947
$1,269
$7,161
$9,022
$9,079
$902
$104,094
Notes:
(1) Number ofNTNCWSs and CWSs <100 in States derived from "SDWISFED GPRA, summ inv, compl trends, FY96-04 FINAL" at
http://www.epa.gov/safewater/data/pivottables.html
(2) Percent of small systems with <5 taps from data supplied by Ml in comments to the draft LCRSTR.
(3) Assumes 1 hour per system to verify number of taps, prepare letter, and submit to State
(4) Assumes average labor cost per hour for small systems of $27.76
(5) Assumes O&M cost equals $0.43 per letter ($0.39 postage, $0.01 paper and $0.03 envelope).
(6) Assumes relatively rare occurrence of CWSs with fewer than 5 taps: 5%
Appendix J- 1
-------
th
Appendix J-2: Regulatory Change HLA One-Time State Review Cost (4m Qtr 2006$)
Number of
Letters for
State Review
3692
One-Time
Burden for
State Review
of Verification
Letters [1]
3692
State Labor
Cost to Review
and Document
Number of
Taps [2]
$160,681
State O&M
Costs to Mail
Approval
Letter
$1,588
Total One-Time
State Costs
$162,269
Notes:
(1) Assumes 1 hour of State labor required to review and track letters from NTNCWSs with <5 taps
(2) Assumes State labor costs of$43.52perhour.
Appendix J- 2
-------
Appendix K
Derivation of Revenue Estimates for Small Systems
-------
Revenue Estimates of Community Water Systems Serving
10,000 or Fewer People
Contract No. 68-C-02-069
Work Assignment No. 4-09
Prepared/or:
Mr. Brian Rourke, Work Assignment Manager
U.S. Environmental Protection Agency
Office of Ground Water and Drinking Water
1201 Constitution Ave, NW, EPA East
Washington, DC 20460-0003
Prepared by:
The Cadmus Group, Inc.
57 Water Street
Watertown, MA 02472
July 12, 2007
-------
-------
Revenue Estimates of
July 12, 2007 Community Water Systems
This document provides an estimate of community water system (CWS) revenue for systems
serving 10,000 or fewer people.32 The estimates are based on two sources of information:
EPA's 2000 CWS Survey and the 2002 Census of Governments fielded by the Census Bureau.
CWS revenue and municipal government revenue for publicly owned CWSs are combined to
provide an estimate of the total resources available to CWSs serving 10,000 or fewer people.
CWS revenue comes from three sources:
• Water sales. This revenue is generated by the sale of water to customers and is
usually based on a rate charged per unit of water sold.
• Water-related revenue. This revenue consists of transfers from municipal
government general funds, fees, penalties, or other charges related to the provision of
water, but not tied directly to the sale of water. Note: Water sales and water-related
revenue together are referred to as "water revenue. "
• Non-water revenue. Systems also may have non-water revenue. For example,
combined drinking water and wastewater systems may have revenue from sewerage
charges. These sources of revenue are excluded from this analysis, with two
important exceptions. Ancillary systems - small privately owned systems (generally,
serving populations of 3,300 or fewer people) that provide water as an essential part
of another business - will have revenue from their primary business and often do not
report any water revenue at all. Municipal governments may rely on general revenue
in addition to or in lieu of water revenue to finance their systems. In many cases,
these sources of revenue are available to systems to support their operations;
therefore, they must be included to fully account for the resources available to water
systems.
Exhibit 1 reports revenue of systems by the source of revenue and the size of the system. The
estimates are based on data from the 2000 Community Water System Survey (CWSS) and the
2002 Census of Governments. For each source, it reports the average revenue for systems with
that source of revenue in the top portion of the table; in other words, it excludes systems with
zero revenue from that source. The middle portion of the table shows the number of systems in
the nation with that source of revenue. The bottom portion of the table reports the number of
observations in the sample on which the estimates are based. (Because the exhibit excludes
systems that report zero revenue from each source, the revenue figures from each source cannot
be summed to reach the total. See below for a more detailed explanation.)
52
Community water system means a public water system which serves at least 15 service connections used by year
round residents or regularly serves at least 25 year-round residents.
-------
July 12, 2007
Revenue Estimates of
Community Water Systems
Exhibit 1: Average Revenue of Community Water Systems Serving 10,000 or fewer
People by Source (Dollars are in 2006 Dollars)
Population Served
Water Revenue
Water Sales
Revenue
Water Related Revenue
General Fund
Transfers
Other Water
Related
Revenue
Total Water
Related
Revenue1
Total
Water
Revenue1
Non-water
Revenue of
Privately
Owned
Ancillary
Systems
Municipal Non-
water System
Revenue (Net
of Transfers to
Water System)
Total
Revenue,
Including
Municipal
Government
Revenue1
Mean Revenue
25-100
101-500
Subtotal, 25-500
501-3,300
3,301-10,000
Subtotal, 25-10,000
10,207
36,797
26,979
197,270
806,916
191,252
9,356
7,325
7,346
25,602
255,226
61,519
8,733
5,506
6,084
29,641
104,241
35,894
8,735
5,976
6,472
31,129
119,406
39,581
12,067
40,152
29,753
220,212
924,690
218,702
561 ,670
2,917,969
1,641,430
3,429,775
687,113,152
5,843,880
139,709
274,364
266,141
1,481,239
6,159,156
2,068,030
219,745
792,880
552,581
1,447,859
12,642,535
2,166,712
Number of Systems
25-100
101-500
Subtotal, 25-500
501-3,300
3,301-10,000
Subtotal, 25-10,000
6,511
11,121
17,632
13,333
4,574
35,540
4
399
403
747
251
1,401
1,355
6,206
7,561
10,159
4,227
21,947
1,359
6,206
7,565
10,288
4,227
22,080
8,056
12,772
20,828
13,673
4,852
39,353
3,736
3,160
6,896
13
43
6,951
345
5,307
5,652
10,954
4,060
20,667
10,118
14,015
24,133
13,250
4,628
42,011
Observations
25-100
101-500
Subtotal, 25-500
501-3,300
3,301-10,000
Subtotal, 25-10,000
81
119
200
201
155
556
1
4
5
11
11
27
23
72
95
163
143
401
24
72
96
165
143
404
101
138
239
205
166
610
32
24
56
1
1
58
11
68
79
172
139
390
112
141
253
200
157
610
1. While each row is based on the most accurate information available, columns do not sum. See the Basis of Estimate below for additional information about this table.
Source: 2000 Community Water System Survey questions 26 and 27.
US Census Bureau's 2002 Census of Governments (Volume 4, Number 4), Table 13.
-------
Revenue Estimates of
July 12, 2007 Community Water Systems
Many systems do not have each source of revenue. Exhibit 2 reports the percentage of systems
that reported positive revenue from each revenue source. According to the CWSS,
approximately 82 percent of systems reported revenue from water sales. Less than 3 percent
reported transfers from the general fund (the percentage is higher for publicly owned systems),
and 51 percent reported other water-related revenue. Overall, 80 percent of systems reported
revenue from water sales or water related revenue.
Judging from the percentage of systems reporting, it would appear that fewer systems reported
positive water revenue than reported positive water sales. This apparent contradiction is due to
different response rates to the various revenue questions in the survey. Some systems reported
water sales, but could not provide their water-related revenue. Total water revenue for these
systems therefore was not available and these systems are excluded from the estimate of the
percentage of systems reporting positive total water revenue. Other systems reported their total
water revenue, but could not distinguish between water sales and other water revenue. They are
included in the estimate of the percentage of systems that reported positive water revenue but are
not included in any of the components. If we limit the analysis to systems that provided data on
all revenue components, approximately 81 percent of systems reported positive water revenue.
Less than 1 percent of these systems reported zero water sales revenue. (In other words, they
relied solely on water-related revenue.)
Approximately 20 percent of small systems do not charge directly for water, either through water
sales or water-related charges. Among some subclasses of systems, the percentage of systems
that do not charge for water is substantially higher. For example, according to the CWSS, 92
percent of ancillary systems reported zero water revenue. Systems without water revenue may
rely - directly or otherwise - on other sources of revenue.
-------
July 12, 2007
Revenue Estimates of
Community Water Systems
Exhibit 2. Percentage of Systems Reporting Positive Revenue, by Revenue Source and Population Served
Population Served
25-100
101-500
Subtotal, 25-500
501-3,300
3,301-10,000
Subtotal, 25-10,000
Water Revenue
Water Sales
Revenue
60.8%
77.9%
70.6%
97.6%
95.8%
81 .8%
Water Related Revenue
General Fund
Transfers
0.0%
2.4%
1 .4%
5.3%
5.0%
2.9%
Other Water
Related
Revenue
12.5%
44.1%
30.4%
76.0%
89.5%
51.0%
Total Water
Related
Revenue1
12.5%
44.1%
30.4%
77.0%
89.5%
51 .3%
Total Water
Revenue1
59.2%
74.6%
68.1%
97.5%
95.8%
80.25%
Non-water
Revenue of
Privately
Owned
Ancillary
Systems
36.1%
22.2%
28.1%
0.1%
0.9%
15.93%
Municipal
Non-
water System
Revenue
(Net of
Transfers to
Water
System)
3.4%
37.9%
23.4%
82.7%
87.7%
49.2%
1. While each row is based on the most accurate information available, columns do not sum. See the Basis of Estimate below for additional information
about this table.
Source: EPA's 2000 Community Water System Survey, questions 26 and 27.
-------
Revenue Estimates of
July 12, 2007 Community Water Systems
Sources of Data
The 2000 CWSS collects data on all three sources of revenue. It asks each system for water
sales and water-related revenue. The survey also asks ancillary systems to report non-water
related revenue because many of these systems do not charge directly for water. (The survey
does not ask for non-water revenue of other systems.) Because so many ancillary systems do not
charge for water, estimates of the resources available to these systems include survey data from
their main source of revenue.
The 2000 CWSS collected data from 104 ancillary systems. The response rate on the question
about non-water revenue was relatively low; approximately 50 percent of these systems provided
data on their non-water revenue. It is not clear whether this non-response introduces bias into
the estimate of non-water revenue of ancillary systems. The revenue reported also varies greatly.
While some of the ancillary systems are small water systems, often mobile home parks, they also
may be relatively large companies and their water revenue may be a very small part of their total
revenue. Other ancillary systems may have very limited revenue from their other sources.
Mobile home parks, for example, may fund all their expenses - water-related and other wise -
from pad fees that may be quite modest. The estimates of non-water revenue of ancillary
systems are therefore not precise.
Approximately 6 percent of publicly owned systems serving 10,000 or fewer people report zero
water revenue in the survey; nearly half of publicly owned systems serving 100 or fewer people
report zero water revenue. For these systems to operate, they must have other sources of revenue
that are not included in the survey. Even systems run as public enterprise funds may have access
to funds from the general fund of their municipality. Therefore, estimates of water revenue do
not fully describe the financial resources available to these systems. To account for this potential
resource of publicly owned systems, therefore, data from the US Census Bureau's 2002 Census
of Governments were used to estimate total municipal revenue of cities and towns that provide
water to 10,000 or fewer people. Non-water revenue of municipalities is the difference between
the total revenue of the municipality and the revenue generated by its water system. Many
municipalities transfer money from their general funds to their water systems. To avoid double
counting these transfers, they are excluded from the estimate of municipal non-water revenue
and included as part of water revenue.
Basis of the Estimates
The 2000 CWSS sample is used to calculate the average water system revenue estimates.
The estimates are weighted by the inverse of the sampling probabilities, corrected for overall
non-response. Four systems were dropped from the analysis because they were outliers
(resorts or other special cases). If they had been included, the revenue estimates would have
been higher.
-------
Revenue Estimates of
July 12, 2007 Community Water Systems
Not every system reported revenue from each source in the CWSS. For example, of the 610
systems that reported revenue from any source, 54 did not report positive water sales
revenue. These systems are excluded from the calculation of average water sales revenue.
Therefore, total revenue is not equal to the sum of revenue from each source. Before we can
sum the components, we must account for systems that did not report revenue from an
individual revenue source.
Exhibit 3 summarizes how water revenues are calculated based on the average revenue
reported for each source and the percentage of systems with each source of revenue. (Details
may not sum to the total due to rounding.) The calculation can be divided into two parts. The
first part is shown in lines A through I. We sum the sources of revenue, adjusting for
systems that reported zero revenue from each source. For example, the average water sales
revenue of all systems with water sales is $191,252 (line A, the last column). Approximately
82 percent of systems reported positive water sales (line B). The average water sales revenue
of all systems, including those reporting zero water sales revenue, is $156,538, or line A
multiplied by line B. This calculation is repeated for general fund transfers (lines D through
F) and other water-related revenue (lines (G through I). The sum of these products is
$176,658, and is shown in line J (i.e., the sum of lines C, F, and I).
The second part of the calculation is shown in lines J through M in Exhibit 3. We make two
adjustments to the sum shown in line J. First, we account for systems that reported revenue from
only one or two of the three sources of revenue. For example, some systems reported their water
sales revenue but did not know how much general fund or other water-related revenue the
received. While we can estimate their water sales revenue, their total revenue is unknown. We
must exclude systems that did not report revenue from water sales, general fund, and other
water-related revenue when we derive water revenue to ensure it includes revenue from all
sources. Furthermore, some systems reported total water revenue, but could not divide their
revenue by source. These systems are included in the estimate of water revenue, but excluded
from the estimates of one or more of the components of revenue. The net effect of these
adjustments is -$1,141 for all systems (line K). This must be added to the total on line J.
Second, approximately 20 percent of all systems that did not report water revenue (line M).
These systems must be removed to estimate the average water revenue of systems with positive
water revenue. Line N reports the adjusted total water revenue of systems with water revenue.
As we cannot distinguish between systems that did not respond to a revenue question and
systems who, in fact, have zero revenue to report, we may be over-estimating the percentage of
systems with no revenue for any given revenue category. Thus, in calculating the average
revenue for all small systems, we may be underestimating revenue by assuming that a non-
response equals a zero.
-------
July 12, 2007
Revenue Estimates of
Community Water Systems
Exhibit 3. Calculation of Average Total Water Revenue
Population Served
A
B
C
D
E
F
G
H
1
J
K
L
M
Average Water Sales Revenue of Systems Reporting Positive Water Sales Revenue:
Percentage of Systems Reporting Positive Water Sales Revenue
Average Water Sales Revenue (A*B)
Average Transfers from the General Fund of Systems Reporting Positive General Fund Transfers:
Percentage of Systems Reporting Positive Water-Related Revenue that Reported General Fund Transfers
Average General Fund Revenue (D*E)
Average Other Water-Related Revenue of Systems Reporting Positive Other Water-Related Revenue:
Percentage of Systems Reporting Positive Water-Related Revenue that Reported Other Water-Related Revenue
Average Other Water-Related Revenue (G*H)
Sum of Average Water Sales, General Fund Transfers, and Other Water-Related Revenue (C+F+I)
Adjust for systems not reporting all components of water system revenue
Percentage of Systems Reporting Positive Water Revenue
Average Water Revenue of Systems Reporting Positive Water Revenue (J+K)/L
25-
100
10,207
60.8%
6,205
9,356
0.0%
3
8,733
1 2.5%
1,091
7,299
-153
59.2%
12,067
101-
500
36,797
77.9%
28,672
7,325
2.4%
177
5,506
44.1%
2,429
31 ,279
-1,311
74.6%
40,152
Subtotal,
25-500
26,979
70.6%
19,040
7,346
1.4%
102
6,084
30.4%
1,847
20,989
-735
68.1%
29,753
501-
3,300
197,270
97.6%
192,499
25,602
5.3%
1,365
29,641
76.0%
22,535
216,399
-1 ,749
97.5%
220,212
3,301-
10,000
806,916
95.8%
773,148
255,226
5.0%
12,687
104,241
89.5%
93,340
879,175
6,905
95.8%
924,690
Total,
25-
10,000
191,252
81 .8%
156,538
61,519
2.9%
1,796
35,894
51 .0%
18,323
176,658
-1,141
80.3%
218,702
-------
July 12, 2007
Revenue Estimates of
Community Water Systems
The non-water revenue of publicly owned systems is based on the Bureau of the Census estimate
of total revenue of municipalities with fewer than 10,000 people. Exhibit 4 shows how we
estimate the non-water system revenue of municipalities. According to the 2002 Census of
Governments, there were 16,745 municipalities (line B of exhibit 4) with populations under
10,000 in 2002. The total revenue of these municipalities was $34,944,647,000 in 2002 (line A).
Average revenue per municipality is line A divided by line B, or $2,086,871 (line C). Based on
the US Bureau of Labor Statistics, Consumer Price Index, the cumulative change in consumer
prices between 2002 and 2006 was 13.8 percent (line D). The inflation-adjusted estimate is
$2,375,157, shown in line E.
Exhibit 4: Calculation of Non-water System General Fund Revenue
of Publicly Owned Systems
A Total General Revenue for Municipalities with fewer than 10,000 people 34,944,647,000
B Number of Municipalities 16,745
C Average Revenue per Municipality (A/B)
D Percentage Change in Consumer Price Index, 2002-2006
E Inflation-Adjusted Revenue per Municipality [C*(1+D)]
2,086,871
13.8%
2,375,157
The Census Bureau does not provide estimates of municipal revenue for each of the size
categories we use. To estimate municipal revenue for each size category, we assume it is
proportional to the publicly owned systems' water revenue. The calculation is shown in Exhibit
5. Column 1 of the table shows the estimate of water revenue of publicly owned systems, by the
size of the system. (These estimates are derived from the survey data.) Column 2 shows the
ratio of average water revenue for each size category to the average water revenue for all systems
serving populations of 10,000 or less. This ratio is multiplied by the inflation-adjusted revenue
per municipality, or $2,375,157 to arrive at the estimate of municipal revenue for each size
category. This result is shown in column 3.
Exhibit 5. Calculation of Non-water System General Fund Revenue of Publicly
Owned Systems by System Size
Population Served
25-100
101-500
Subtotal, 25-
500
501-3,300
3,301-10,000
Total
(1)
Water Revenue
20,748
40,746
39,525
219,981
914,708
307,127
(2)
Average Water
Revenue of Systems
in Each Size
Category in Column 1
Divided by Revenue
of All Systems
Serving 10, 000 or
Fewer People
0.068
0.133
0.129
0.716
2.978
1.000
(3)
Muanicipal Revenue
(Average municipal
revenue (line E from
exhibit 3) multiplied
by the percentage in
column 2)
160,458
315,110
305,666
1,701,220
7,073,864
2,375,157
-------
Revenue Estimates of
July 12, 2007 Community Water Systems
Source: EPA's 2000 Community Water System Survey, question 26.
Total revenue is a weighted average of system revenue and non-system revenue. The calculation
is shown in Exhibit 6. Line A reports total water system revenue for systems that report positive
revenue (from exhibit 3). Lines B, C, and D calculate average municipal general fund revenue of
publicly owned systems, net of system revenue and transfers to the system. Lines E, F, and G
calculate the percentage of systems that are publicly owned and potentially have access to
municipal revenue.
We assume that privately owned systems that provide water as an essential part of another
business have non-water revenue. According to the CWSS, average non-water revenue for small
systems that report it is $5,843,880 (the last column of line H). The CWSS reports that 16.3
percent of small systems have this non-water revenue (line I).
The resources available to water systems is the weighted average of water revenue, municipal
revenue for publicly owned systems, and non-water revenue of privately owned systems.
Column J of exhibit 6 shows how total system revenue is calculated.
-------
Community Water Systems
Exhibit 6. Calculation of Total Revenue
Population Served
A
B
C
D
E
F
G
Average Water Revenue of Systems Reporting Positive Water Revenue (Line M from Exhibit 3)
Total General Revenue for Municipalities with fewer than 10,000 people (from Exhibits)
Total System Revenue of Publicly Owned Systems
Municipal Revenue, Net of Water System Revenue and Transfers to the Water System (B-C)
Number of Publicly Owned Systems
Number of Privately Owned Systems
Percentage of Systems that are Publicly Owned [E/(E+F)]
25-1 00
12,067
160,458
20,748
139,709
345
9,773
3.4%
101-500
40,152
315,110
40,746
274,364
5,307
8,708
37.9%
Subtotal,
25-500
29,753
305,666
39,525
266,141
5,652
18,481
23.4%
501-3,300
220,212
1 ,701 ,220
219,981
1 ,481 ,239
10,954
2,296
82.7%
3,301-
10,000
924,690
7,073,864
914,708
6,159,156
4,060
567
87.7%
Total,
25-10,000
218,702
2,375,157
307,127
2,068,030
20,667
21 ,344
49.2%
H Average Non-water Revenue of Private Systems Reporting Positive Non-Water Revenue
I Percentage of Systems Reporting Positive Non-water Revenue
561,670 2,917,969 1,641,430 3,429,775 687,113,152 5,843,880
36.1% 22.2% 28.1% 0.1% 0.9% 15.9%
J Total Revenue (A+D*G+H*I)
219,745
792,880
552,581 1,447,859 12,642,535 2,166,712
10
-------
Co:
Conclusions
The average revenue available to small systems serving 10,000 or fewer people is $2,166,712.
This estimate includes revenue from all sources. This estimate includes non-water business and
government revenue that will be used for purposes other than financing the operations of the
water system. But it provides the best estimate of the financial situation of these water systems.
Efforts to estimate the resources available to small water systems are complicated by several
factors. First, there are few sources of data on small systems. The CWSS is one of the only
surveys to systematically collect data on small system finance. Its focus is system operations and
finance, so it does not collect information about non-water system finance that would inform this
analysis. The Census of Government data fill some of the gaps and help portray a complete
picture of small system finance.
Second, small systems are a relatively diverse group that finances its operations many different
ways. Some charge directly for water, but many do not. For example, a homeowners'
association may provide water as one of its services, but it may not charge its members a
separate water fee; rather, it pays its water-related expenses out of general fees its charges its
members. A small town may pay for water services out of general fund revenue and not charge
its residents for water. The water revenue, as we define it, is in fact zero in both cases. But both
the homeowners' association and the small town have resources to pay for repairs and
improvements to their water system. Other demands are placed on these resources, so further
analysis is required to determine whether those resources are sufficient to meet the needs of the
water system.
Finally, the data that are available on small system finances are often incomplete. This is due, in
part, to the relative complexity of small system finance. Systems may not respond to financial
questions because it is difficult to distinguish water- from non-water-revenue. As shown in
Exhibit 2, some systems provided data on some sources of revenue but not others. To produce
the best estimates, we use all the data available for each question rather than limiting the analysis
to only those systems that answered all the questions. These estimates provide the best estimates
available of the resources available to small systems.
-------
Co:
References
US Bureau of Labor Statistics, Consumer Price Index, series CUUROOOOSAO, accessed at
http://data.bls.gov/cgi-bin/surveymost on 3/15/07.
US Census Bureau, 2002 Census of Governments (Volume 4, Number 4), Table 13, accessed at
http://www.census.gov/govs/www/cog2002.html on 7/16/06.
US Environment Protection Agency, 2000 Community Water System Survey, questions 26 and
27, estimated using sample data.
-------
Co:
Appendix L
Summary of Differences Between the Proposed and Final Rule
-------
Community Water Systems
Appendix L-l: Summary of Differences Between the Proposed and Final Rule
(Differences Are Highlighted)
Provision
A. Minimum # of Samples
Required
B. Definitions for
Compliance and Monitoring
Periods
C. Reduced Monitoring
Criteria
D. Advanced Notification
and Approval for Treatment
Changes
E. Consumer Notice of
Lead Tap Results
July 2006 Proposed Revisions
Clarifies the minimum number of samples requirement (five).
Clarifies that "compliance period" is a 3-year calendar year
period as defined in 141.2.
"Monitoring period" is specific period in which a water system
must provide required monitoring (e.g., June - September).
Also will define more precisely when the "start date" for
compliance calendar and actions occur.
Systems on triennial monitoring must monitor once every 3
calendar years.
Systems that meet water quality parameters must also meet
the Lead Action Level, but not necessarily the Copper Action
Level to go to reduced monitoring.
Copper will be dealt with during next set of revisions.
Systems must provide notice of change or source addition in
advance and the State must approve the change.
Systems must notify consumers who occupy homes or
buildings tested with results.
Final Rule Revisions
Clarifies the minimum number of samples requirement (five).
Allows State discretion to allow PWS to sample 100 percent
of taps if there are fewer than five taps that can be used for
human consumption in the system.
Clarifies that "compliance period" is a 3-year calendar year
period as defined in 141.2.
"Monitoring period" is specific period in which a water system
must provide required monitoring (e.g., June - September).
Also will define more precisely when the "start date" for
compliance calendar and actions occur. States have
discretion to extend deadlines for completing public education
activities.
Systems on triennial monitoring must monitor once every 3
calendar years.
Systems that meet water quality parameters must also meet
the Lead Action Level, but not necessarily the Copper Action
Level to go to reduced monitoring.
Copper will be dealt with during next set of revisions.
Systems must provide notice of long-term change or source
addition in advance and the State must approve the change.
Systems must notify consumers who occupy homes or
buildings tested with results.
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Community Water Systems
Provision
F. Public Education
Requirements
G. Reevaluation of Lead
Service Lines Deemed
Replaced Through Testing
H. Other Issues Related to
LCR
July 2006 Proposed Revisions
Content - shortened introductory statement and flexibility on
body of statement, changed health effects language.
Delivery - Add licensed child care centers, preschools, Ob-
Gyns, and midwives to list of organizations. Include a cover
letter
-Systems directly contact local health agencies by phone or in
person
- Additional activities: >3,300 pick 3, <3,300 pick 1 : public
service announcements, paid ads, information displays in
public areas, using internet or email, public mtgs, delivery to
every household, individual contact with customers, materials
to multi-family homes and institutions, other methods
approved by State
-Systems exceeding Lead Action Level must: include
information on water bill as long as they have the
exceedance; must post public education material on website if
they serve >100,000; issue 2 press releases per year. No
public service announcements required
Timeframe - systems must deliver most public education
materials within 60 days after end of monitoring period in
which exceedance occurred. Flexibility for State to allow
longer for completion of water bill delivery and selected
additional activities
CCR - all CWS that detect lead must include informational
statement. NDWAC recommended changes to statement
language.
Applies to a system that (1 ) exceeds the action level, (2) tests
out one or more service lines, (3) brings lead levels below the
action level for two consecutive 6-month monitoring periods
and discontinues replacing lead service lines, and (4) later
exceeds the action level again. That system would have to
reinitiate lead service line replacement considering all lead
service lines including those that had previously tested out of
the replacement program.
Final Rule Revisions
Content - shortened introductory statement and flexibility on
body of statement, changed health effects language.
Delivery - Add licensed child care centers, preschools, Ob-
Gyns, and midwives to list of organizations. Include an
informational notice
-Systems directly contact local health agencies by phone or in
person
-Additional activities: >3,300 pick 3, <3,300 pick 1: public
service announcements, paid ads, information displays in
public areas, using internet or email, public mtgs, delivery to
every household, individual contact with customers, materials
to multi-family homes and institutions, other methods
approved by State
-Systems exceeding Lead Action Level must: include
information on water bill as long as they have the
exceedance; must post public education material on website if
they serve >100,000; issue 2 press releases per year. No
public service announcements required
Timeframe - systems must deliver most public education
materials within 60 days after end of monitoring period in
which exceedance occurred. Flexibility for State to allow
longer for completion of all activities
CCR -all CWS must include informational statement.
NDWAC recommended changes to statement language.
Applies to a system that (1) exceeds the action level, (2) tests
out one or more service lines, (3) brings lead levels below the
action level for two consecutive 6-month monitoring periods
and discontinues replacing lead service lines, and (4) later
exceeds the action level again. That system would have to
reinitiate lead service line replacement considering all lead
service lines including those that had previously tested out of
the replacement program. Provision added for State
discretion when systems have already completed a 15-year
replacement program.
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Community Water Systems
Provision
Plumbing Component
Replacement
POU and POE Treatment
Site Selection in Areas with
Water Softeners and POU
Water Quality Parameter
Monitoring
July 2006 Proposed Revisions
Specifically define plumbing component replacement as
corrosion control treatment when 100% of plumbing fittings
and fixtures are directly controlled by the system.
Specifically define POU/POE as corrosion control treatment
when 100% of taps are directly controlled by the system.
Allow lead and copper tap samples at taps with POU/POE
under certain conditions
Synchronize water quality parameter sampling with lead and
copper sampling.
Final Rule Revisions
No revisions made. Current rule provides flexibility for
systems to implement.
No revisions made. Current rule provides flexibility for
systems to implement.
No revisions made. Monitoring issues will be dealt with during
next set of revisions.
No revisions made. Monitoring issues will be dealt with during
next set of revisions.
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