I'MTED STATES ENVIRONMENTAL PROTKCTION AGENCY
                                                                         WSG 127
                                                         Date Signed: June 25,1999
                     for Deviation from 40 f PR 35,115 (c) and (h)

FROM;      Robert, Blanco, Director
             Implementation and Assistance Division (46061
             Office of Ground Water and Drinking Water

TO:         Gary M. Kate,  Director
             Grants Administration Division (3903R)
             Office of Grants and Debarment

      The Office of Ground Water and Drinking Water (OGWDW) ss requesting a deviation for
40 CFR 35.1 IS (e) and (h) for the Public Water System Supervision        (PWSS) and the
Underground Injection Control Program (LUC). Section 35,115 (e) allows EPA to use apjQ three
percent of the annual PWSS funds for use on Indian lands. Similarly, section 35,115 (h) allows
EPA to use mus five percent of the annual l)JC funds on Indian lands,

Background

      The PWSS Program has been appropriated 590,000,000 dollars for      and Tribal
Grants for the last two fiscal years. Three percent of the total annual funds for the PWSS
        is traditionally     for the Tribal PWSS Program,  These funds are     to provide
development grants to build the Tribes" capacity for primary enforcement authority (primacy)
and to fond Regional Tribal Direct Implementation Programs.  Recognizing the lack of sufficient
funding in the Tribal drinking water program, the  FY 98 President's Budget  requested an
additional S3,780,500 to support Tribal needs which, in turn, was appropriated, At no time
during the budget formulation process or during the appropriations process, die program or
budget staff raise the issue that this increase would put us in violation of grant regulations.

      As OGWDW staff was negotiating with Regional staff how these additional funds would
be distributed, the Regions recommended that we transfer some of these funds to the U1C
program, as Tribal activities were seriously underfunded in this program as well, A
reprogramming request 01*5475,000 was submitted and approved by EPA's Budget Division last
month.

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