Final Report
                             of the
              Small Business Advocacy Review Panel
                 on EPA's Planned Proposed Rule
     Effluent Limitations Guidelines and Standards for the
               Aquatic Animal Production Industry
                         June 12, 2002
                        Table of Contents
1.   Introduction. . . . . . . . . . . . . . . . . . . . . . . .1
2.   Background and Regulatory History . . . . . . . . . . . . .3
     2.1  Discussion of Effluent Guidelines. . . . . . . . . . .3
     2.2  Description of the Aquatic Animal Production Rule and its Scope3
3.   Overview of Technology Options. . . . . . . . . . . . . . .4
     3.1  Pond Systems . . . . . . . . . . . . . . . . . . . . .4
     3.2  Flow-Through . . . . . . . . . . . . . . . . . . . . .8
     3.3  Re-circulating Systems . . . . . . . . . . . . . . . .9
     3.4  Net Pen Systems. . . . . . . . . . . . . . . . . . . 11
4.   Applicable Small Entity Definitions . . . . . . . . . . . 12
5.   Small Entities That May Be Subject to the Proposed Regulation12
6.   Summary of Small Entity Outreach. . . . . . . . . . . . . 13
     6.1  EPA's Stakeholder Outreach . . . . . . . . . . . . . 13
     6.2  EPA's Outreach Meeting With Potential Small Entity Representatives13
     6.3  Panel's Outreach Meetings With Small Entity Representatives13
7.   List of Small Entity Representatives. . . . . . . . . . . 14
8.   Summary of Comments from Small Entity Representatives . . 16
     8.1  Number and Types of Entities Affected. . . . . . . . 16
     8.2  Potential Reporting, Record Keeping, and Compliance. 17
     8.3  Related Federal Rules. . . . . . . . . . . . . . . . 17
     8.4  Regulatory Flexibility Alternatives. . . . . . . . . 17
9.   Panel Findings and Discussions. . . . . . . . . . . . . . 21
     9.1  Number and Types of Entities Affected. . . . . . . . 21
     9.2  Potential Reporting, Record Keeping, and Compliance. 21
     9.3  Related Federal Rules. . . . . . . . . . . . . . . . 28
     9.4  Regulatory Flexibility Alternatives. . . . . . . . . 29
     9.5  Cost and Loadings Estimation Methodology . . . . . . 38
     9.6  Economic Achievability . . . . . . . . . . . . . . . 40
     9.7  Community Level Impacts. . . . . . . . . . . . . . . 40
     9.8  Environmental Benefits of Aquatic Animal Production. 40
     9.9  Uncertainty. . . . . . . . . . . . . . . . . . . . . 41
Appendix A:    List of Materials SBAR Panel Shared With SERs During Panel Outreach
Appendix B:    Written Comments the SBAR Panel Received from SERsSBAR Panel Report from the Small Business Advocacy Review Panel
on EPA's Planned Proposal of Aquatic Animal Production Industry
1.   INTRODUCTION
     This report is presented by the Small Business Advocacy Review Panel (SBAR Panel or
Panel), for the proposed effluent limitation guidelines and standards for the Aquatic Animal
Production Industry (Aquaculture), which was convened on January 22, 2002.  Section 609(b) of
the Regulatory Flexibility Act (RFA), as amended by the Small Business Regulatory Enforcement
Fairness Act of 1996 (SBREFA), requires a Panel to be convened prior to publication of the initial
regulatory flexibility analysis (IRFA) that an agency may be required to prepare under the RFA.
In addition to EPA's Small Business Advocacy Chairperson, the Panel consisted of the Director
of EPA's Engineering and Analysis Division (Office of Water, Office of Science and Technology)
and the Director of EPA's Water Permits Division (Office of Water, Office of Wastewater
Management), the Administrator of the Office of Information and Regulatory Affairs within the
Office of Management and Budget (OMB), and the Chief Counsel for Advocacy of the Small
Business Administration (SBA).
     This report includes the following:
         background information on the proposed rule being developed;
         information on the types of small entities that would be subject to the proposed rule;
         a summary of the Panel's outreach activities;
         a summary of the comments and recommendations of the Small Entity Representatives
         (SERs); and
         the SBAR Panel's findings and recommendations with respect to the issues raised in the
         SER comments, and the statutory elements of an IRFA.
     Section 609(b) of the RFA directs the Panel to report on the comments of small entity
representatives and make findings on issues related to identified elements of an IRFA under
section 603 of the RFA.  Those elements of an IRFA are:
         a description of and, where feasible, an estimate of the number of small entities to which
         the proposed rule will apply;
         a description of projected reporting, record keeping, and other compliance requirements
         of the proposed rule, including an estimate of the classes of small entities which will be
         subject to the requirements and the type of professional skills necessary for preparation
         of the report or record;
         an identification, to the extent practicable, of all relevant Federal rules which may
         duplicate, overlap, or conflict with the proposed rule; and
         a description of any significant alternative to the proposed rule which accomplishes the
         stated objectives of applicable statutes and which minimizes any significant economic
         impact of the proposed rule on small entities.
     Once completed, the Panel report is provided to EPA and included in the rulemaking
record.  In light of the Panel report, and where appropriate, EPA may make changes to the draft
proposed rule, the IRFA for the proposed rule, or the decision on whether an IRFA is required.
     It is important to note that the Panel's findings and discussion will be based on the
information available at the time the final Panel report is drafted.  EPA will continue to conduct
analyses relevant to the proposed rule, and additional information may be developed or obtained
during the remainder of the rule development process.  Because the Panel's report is written at a
preliminary stage of rule development, it should be considered in that light.  At the same time, the
report provides the Panel with an opportunity to identify and explore potential ways of shaping
the proposed rule to minimize the burden of the rule on small entities while achieving the rule's
purposes.  Any options identified by the Panel to reduce the rule's regulatory impact on small
entities may require further analysis and/or data collection to ensure that the options are
practicable, enforceable, environmentally sound, and consistent with the Clean Water Act.
2.   BACKGROUND AND REGULATORY HISTORY
2.1  Discussion of Effluent Guidelines
     EPA develops national effluent limitations guidelines and standards on an
industry-by-industry basis, which are intended to represent the levels of pollutant reductions
corresponding to various levels of control.  To develop these technology-based regulations, EPA
first gathers information on the industry practices; characteristics of discharges (e.g., stormwater
flows and pollutants); technologies or practices used to prevent or treat the discharge; and
economic and financial characteristics.  Using this information, EPA identifies the best
technologies that are economically achievable for the industry and sets regulatory requirements
based on the performance of technologies.  States and EPA regional offices issue National
Pollutant Discharge Elimination System (NPDES) permits that implement these technology-based
requirements.  The permits may be more stringent due to water quality considerations, but may
not be less stringent than the national effluent guidelines.
     EPA has issued national technology-based effluent guidelines for over 50 industry
categories.  The effluent guidelines for the Aquatic Animal Production (AAP) Industry if finalized
will be a new category, which would be published at 40 C.F.R. Part 451.
2.2  Description of the Aquatic Animal Production Rule and its Scope
     The AAP effluent guidelines would apply to facilities engaged in the production of aquatic
animal species which are commonly referred to as aquaculture.  Aquaculture facilities in the
United States span a wide range of operations that vary in size, animal production methods,
species, ambient conditions, habitat, and economic considerations. In some aquaculture
operations, the process of concentrating animals in large numbers may have implications for the
environment. Inputs such as feed, oxygen, clean water, chemicals, hormones, and antibiotics are
necessary to maintain a healthy environment for the aquatic organisms being farmed. Similarly, the
outputs of materials from concentrated aquatic animal production also need to be properly
handled and disposed of in order to prevent the contamination of nearby waterways. These
materials may include, depending on the site-specific characteristics of the facility, nutrients,
suspended solids, materials from feedstock, exotic organisms, pathogens, chemicals, hormones,
and antibiotics. The introduction of these materials into natural waterways may contribute to
water quality impairments of the receiving streams.
     Through the effort to develop this effluent guideline, EPA will assess the quality of
wastewater generated and discharged at different types of aquaculture facilities.  EPA will identify
the types of treatment technologies and/or "best management practices" applicable to treating this
wastewater.  EPA also considers the environmental and water quality impacts caused by
aquaculture discharges; the costs and cost effectiveness of treatment and/or practices to address
adverse environmental impacts; and the ability of aquaculture facilities to afford treatment and/or
adopt best management practices.
     In developing the Aquatic Animal Production (AAP) effluent guidelines EPA is
considering facilities engaged in AAP in the following categories: commercial and non-profit
operations, academic/research institutions, Tribal and government facilities.  The facilities under
consideration by EPA include both land-based and open-water operations.  The regulations may
address discharges from these types of facilities that produce finfish, shellfish or other aquatic
animals using various production systems, most notably ponds, raceways, recirculating systems,
floating and bottom culture systems and netpens.
     The schedule for the AAP rulemaking is included in a consent decree between EPA and
the Natural Resources Defense Council (Natural Resources Defense Council, Inc., et al v.
Whitman, D.D.C. 89-2980; January 31, 1992, as modified).  The court-ordered deadline for
proposing the AAP rule is August 14, 2002 with final action by June 2004.
3.   OVERVIEW OF TECHNOLOGY OPTIONS
     Under each of the production types, EPA describes the baseline practices and other
technology options under consideration for regulation at the time of the Panel.  The baseline
option represents EPA's best estimate of the current conditions of the typical facility, which in this
case may include various combinations of practices or technologies that are described in the
baseline discussion.  Option 1 considers additional controls to reduce pollutant loads.  Option 2
would be more stringent than Option 1, therefore costing more, but also further reducing the
amount of pollutants discharged.  The options generally increase in stringency, costs and pollutant
reductions from one option to another.
3.1  Pond Systems
     The effluent guideline requirements may apply to AAP facilities which use ponds to raise
aquatic animals.  For the purposes of this rulemaking pond systems refer to the practice of raising
aquatic animals in a pond, from which there is not a continuous discharge.  Discharges from pond
systems result from either an overflow due to excess precipitation or runoff entering the pond, or
from intentional draining or partial draining of the pond to harvest the animals or repair the
structure. This is a common production system used to produce many different species of fish
including catfish, tilapia, baitfish, hybrid striped bass, shrimp, ornamentals, crawfish and others.
This description of practices and technologies below applies to all pond systems, i.e., watershed
and levee ponds, and are assumed to apply to all species which are raised in pond systems.
Baseline:
A.   Feed Management
            EPA assumes that the following good feed management practices are used at many
facilities:
                      (1)  Use of high quality feeds   using feeds specifically formulated for the
                           aquatic animals being cultured and made with high quality ingredients.
                      (2)  Not overfeeding   feeding only as much feed as the animals can consume
                           in a reasonable period.
                      (3)  Proper storage and handling of feed   storing feed to maintain quality and
                           minimize the production of fines (small feed particles, or dust, that will not
                           be eaten by most animals).
                      (4)  Uniform feed applications   feeding as much of the pond surface as
                           possible to ensure that all of the animals have feed available to consume.
                      (5)  Routine observation of feeding behavior   observing the feeding habits of
                           the animals to ensure that they are consuming food, e.g., watching fish
                           feeding on the surface or using feeding trays for shrimp.
                      (6)  Routine monitoring (for management purposes) of water quality,
                           especially dissolved oxygen, ammonia, nitrite, alkalinity, pH, and other
                           key parameters for the species being cultured.
B.          In-pond Treatment
                 Most organic matter added to and produced within ponds is ultimately decomposed
through natural biological processes (i.e., microbial oxidation).   Ponds can remove over 90% of
solids, phosphorus, and BOD, and over 70% nitrogen through such processes.
C.          Water Management
            EPA assumes that the following practices that can reduce overflow events and draining
frequency are commonly used when appropriate:
                 (1)  Reducing effluent volume through the storage of rainfall, which can be
                      done by reducing the volume of water pumped into ponds to make up for
                      evaporation and seepage.  In most areas, water in ponds evaporates and
                      seeps at a rate that requires some periodic 'topping off' to maintain water
                      volumes.  Operators using this practice do not fully fill ponds when topping
                      off; instead, they leave a 3 to 6 inch reserve below the top of the overflow
                      pipe in anticipation of collecting rainfall. By not completely filling the pond
                      during pumping operations, some or all rainfall is captured, instead of
                      overflowing.
                 (2)  Infrequent draining of ponds, for example only when ponds need to be
                      renovated.
                 (3)  Seine ponds to harvest when possible, instead of draining.
                 (4)  Not using water exchange (i.e., ground water or surface water that is used
                      to displace water of reduced quality in the pond).
                 (5)  Minimizing erosion in ponds with riprap, grass, or other vegetation.
                 (6)  Placement of aerators to minimize the erosion to the pond banks and
                      bottom during operation.
                 (7)  Prompt repair of accidental damage to pond banks from emergency
                      aeration equipment, feeding operations, etc. to reduce additional erosion
                      and damage.
                 (8)  Closing drains in drained ponds, when possible, to keep eroded sediment
                      from washing from the pond.
                 (9)  Aerating ponds to maintain oxygen levels and other water quality
                      parameters.
D.          Discharge Management
            EPA assumes a variety of practices are used to reduce TSS and other pollutants from
reaching receiving waters during draining and overflow events.
            (1)  Placement of riprap around discharge points that are prone to erosion to reduce
                 scouring from the flowing water.
            (2)  Properly sized drainage ditches which convey water efficiently and minimize
                 erosion.
            (3)  Vegetate all outside slopes of ponds, drainage ditches (when possible) and any
                 other bare soil areas.
Option 1:
            This option includes baseline practices as appropriate to the particular facility, plus the
establishment of a best management plan, which may include requirements to consider some or all
of the following:  aquatic animal pathogens, nonnative species, and the use of drugs and
chemicals.
            The goal of this option is to control conventional and nutrient pollutants in the discharge
and minimize the discharge of drugs and chemicals through the development and implementation
of a best management plan.  The AAP facility would be expected to provide written
documentation of a best management plan and keep necessary records to establish and implement
the plan.
            EPA is tentatively referring to this plan as the Pollutant Analysis at Critical Control Points
(PACCP), with the idea that it would be patterned after the Hazard Analysis and Critical Control
Points (HACCP) methodology that the U.S. Department of Agriculture and the Food and Drug
Administration developed for ensuring safe processing and importation of fish and shellfish
products.
Components of the PACCP plan would include:
            (1)  Identifying the specific practices including those described above under the
                 baseline practices, which are or would be implemented to control the discharge of
                 conventional pollutants and nutrients.  These practices would be described in the
                 PAACP and specific maintenance, inspection and record keeping practices
                 associated with the proper operation of these practices would be identified and
                 implemented.
            (2)  A health management portion which includes an assessment of the potential animal
                 health problems that may be encountered at a facility and the environmental
                 problems that may result from disease outbreaks.  The health management plan
                 outlines the necessary corrective actions to be taken for minimizing the impacts of
                 disease outbreaks.
                      It would also outline procedures for routine observation of the relative
                      health of the aquatic animals (e.g., observing feeding behavior, noting
                      flashing, or increasing surveillance after periods of low dissolved oxygen),
                      and a list of practices that prevent stress.  Some examples of practices
                      include:
                           Feeding high quality feeds
                           Not overfeeding
                           Maintaining water quality
                 (3)  A drug and chemical plan which would list all drugs and chemicals that will be
                      used, the conditions for use, the practices for safe handling and storage, and
                      actions to be taken to minimize their use (e.g., maintaining water quality to
                      minimize stress).
                 (4)  A nonnative species escapement plan that includes an assessment of the potential
                      problems associated with escaped animals.  For cultured species that are generally
                      considered to be native to an area (as defined by state agencies), this plan would
                      provide documentation of this.  For nonnative species the plan would include the
                      identification of possible ways that escapement might occur, how the facility would
                      minimize if not prevent escapement, and what actions are necessary by the facility
                      operators if escapement occurs.
Option 2:
The goal of option 2 is to further reduce conventional and nutrient pollutants discharged from
pond facilities by establishing a numeric limit for TSS based on expected removal of pollutants
using Option 2 technologies.
       EPA has evaluated several technologies and believes that the following technologies
would enable pond operators to meet a numeric limitation on TSS:
            (1)  Ponds that are seined and then drained may benefit from holding of the water one
                 or more days prior to draining to allow solids to settle in the pond.
            (2)  Vegetated ditches at least 700 feet in length, designed according to NRCS
                 standards.
            (3)  Settling basins for portions of pond drainage discharges.
            This option would include requirements for pond facility operators to monitor the TSS
discharge of drainage water at the point of discharge from the facility.
Option 3 :
       The goal of this option is to further reduce BOD5 and nutrients in effluents using
biological treatment of effluents or constructed wetlands.
3.2    Flow-Through Systems
       The effluent limitations guidelines may apply to culturing systems used to raise aquatic
animals where water "flows through" the system.  Several species are produced using this type of
system the primary species raised in this type of system include trout and salmon.  A flow through
system mimics the action of a flowing stream, wherein water flows continuously through
raceways which house the fish.  The intake water used to operate these systems is often diverted
from an existing stream or is fed by a spring.
Baseline :
Feed Management
       EPA assumes the following good feed management practices are widely used:
       (1)  Use of high quality feeds   using feeds formulated for the aquatic animals being
            cultured and made with high quality ingredients.
       (2)  Not overfeeding   feeding only as much feed as the animals can consume in a
            reasonable period.
       (3)  Proper storage and handling of feed   storing feed to maintain quality and
            minimize the production of fines (small feed particles, or dust, that will not be
            eaten by most animals).
       (4)  Uniform feed applications   feeding as much of the flow-through systems surface
            as possible to ensure that all of the animals have feed available to consume.
       (5)  Routine observation of feeding behavior   observing the feeding habits of the
            animals to ensure that they are consuming food, e.g., watching fish feeding on the
            surface or using portholes or other observation techniques.
       (6)  Routine monitoring (for management purposes) of water quality, especially
            dissolved oxygen, ammonia, nitrite, alkalinity, pH, and other key parameters for
            the species being cultured.
Quiescent Zones.
       EPA assumes that quiescent zones are used in raceway flow through systems and use
approximately the last 10% of the length (linear) of the raceway to serve as a settling area for
solids.  The goal of quiescent zones (QZ) practices is to reduce the TSS (and associated
pollutants) in the effluent.
Sedimentation Basins and primary settling of collected solids.
       The goal of sedimentation basins and primary settling is to collect and store the solids
captured in quiescent zones or other in-system practices.  Some facilities use sedimentation basins
for treating all of the flow, which is called full flow settling.  Other facilities collect solids in a
system (e.g., by QZ or other in-system removal practices) which are conveyed to a sedimentation
basin for solids holding and dewatering, (called off-line settling).  EPA assumes that sedimentation
basins are sized according to the estimated settling time for the physical properties of particle
sizes in the effluent and the desired final effluent quality.
Option 1:
  This option includes baseline practices plus the establishment of a best management plan,
which may include components designed to minimize potential problems associated with the
introduction and/or discharge of aquatic animal pathogens, as well as nonnative species, and the
use of drugs and chemicals.  The details outlines for the development of a PACCP plant for this
options would be similar to the one described for PACCP plans at pond systems.
Option 2:
  The goal of option 2 is to further reduce solids discharged from flow-through facilities by
establishing a numeric limit for TSS from settling basins or other primary settling systems.  EPA
has identified several technologies that it believes would enable facility operators to meet this
requirement including microscreen filters,  polishing ponds, and chemical additions.
Option 3:
       This option would address the control of pathogen indicator organism discharges.  The
goal of disinfection is to reduce human health pathogens and overall bacterial levels that are
generated in and discharged from solids treatment systems that store fish manure.  According to
EPA, sampling data shows elevated levels of pathogen indicator organisms and bacteria may
discharge from manure storage facilities, such as sedimentation basins, to waters of the United
States.  EPA believes that several treatment technologies can be used to disinfect effluent
discharges from solids treatment processes including chlorine, ozone, and UV.
3.3    Recirculating Systems
       EPA also may apply the effluent limitations guidelines to discharges from recirculating
systems that are used to raise aquatic animals.  This type of system initially requires substantially
more capital investment and expertise to operate compared to pond or flow through systems.
Thus, the species grown in this system tend to be high value (cost) species.  A recirculating
system mimics a stream, but maintains the fish in tanks and recirculates the water through the
tanks with water treatment to refresh the water prior to returning it to the tank.   Species raised in
this type of system for commercial production typically include tilapia and hybrid striped bass and
ornamental species.
Baseline :
Feed Management
       EPA believes that the following good feed management practices are widely used in this
category:
       (1)  Use of high quality feeds   using feeds formulated for the aquatic animals being
            cultured and made with high quality ingredients.
       (2)  Not overfeeding   feeding only as much feed as the animals can consume in a
            reasonable period.
       (3)  Proper storage and handling of feed   storing feed to maintain quality and
            minimize the production of fines (small feed particles, or dust, that will not be
            eaten by most animals).
            (4)  Uniform feed applications   feeding as much of the flow-through systems surface
                 as possible to ensure that all of the animals have feed available to consume.
            (5)  Routine observation of feeding behavior   observing the feeding habits of the
                 animals to ensure that they are consuming food, e.g., watching fish feeding on the
                 surface or using portholes or other observation techniques.
Sedimentation Basins and primary settling of collected solids:
            The goal of sedimentation basins and primary settling is to collect and store the solids
captured in solids filters internal to the recirculating system or through other in-system practices.
EPA assumes that recirculating systems generate a maximum of about 10% of the system volume
per day and believes that sedimentation basins are sized and maintained according to the estimated
settling time for the physical properties of particle sizes in the effluent and the desired final
effluent quality.
Option 1:
  This option includes baseline practices plus the establishment of a best management plan,
which may include components designed to minimize potential problems associated with the
introduction and/or discharge of aquatic animal pathogens, as well as nonnative species, and the
use of drugs and chemicals.  The details outlined for the development of the PACCP plan for this
option would be similar to the PACCP plan described for pond and flow through systems.
Option 2:
  The goal of option 2 is to further reduce solids discharged from recirculating facilities by
establishing a numeric limit for TSS from settling basins or other primary settling systems.  EPA
has identified several technologies that it believes would enable facility operators to meet a
numeric limit for TSS including microscreen filters,  polishing ponds, and chemical additions.
Option 3:
       This option would address the control of pathogen indicator organism discharges.  The
goal of disinfection is to reduce pathogens known to adversely affect human health and overall
bacterial levels that may be generated in and discharged from solids treatment systems that store
fish manure.  According to EPA, sampling data shows elevated levels of pathogen indicator
organisms and bacteria may discharge from manure storage facilities, such as sedimentation
basins, to waters of the United States.  EPA has identified several treatment technologies to
disinfect effluent discharged from solids treatment processes including chlorine, ozone, and UV.
3.4    Net Pen Systems
       The net pen system confines aquatic animals in open water through the use of nets or
other similar restraints that prevent the animals from escaping but allow the ambient water to flow
through the confinement area.  These systems usually require the addition of feed to achieve the
growth of the animals expected by the operation.  Because the animals are confined directly in
waters of the U.S. it is difficult to control discharges (whether from excess feed, fish wastes,
medications, or escapement) from these systems.
Baseline:
Feed management.
       EPA believes that the following good feed management practices are widely used in this
category:
       (1)  Use of high quality feeds   using feeds formulated for the aquatic animals being
            cultured and made with high quality ingredients.
       (2)  Not overfeeding   feeding only as much feed as the animals can consume in a
            reasonable period.
       (3)  Proper storage and handling of feed   storing feed to maintain quality and
            minimize the production of fines (small feed particles, or dust, that will not be
            eaten by most animals).
            (4)  Uniform feed applications   feeding as much of the flow-through systems surface
                 as possible to ensure that all of the animals have feed available to consume.
            (5)  Routine observation of feeding behavior   observing the feeding habits of the
                 animals to ensure that they are consuming food, e.g., watching fish feeding on the
                 surface or using portholes or other observation techniques.
Option 1:
            This option includes baseline practices plus the establishment of a best management plan,
which may include components designed to minimize potential problems associated with the
introduction and/or discharge of aquatic animal pathogens, as well as nonnative species, and the
use of drugs and chemicals.  The details outlined for the development of the PACCP plan for this
options would be similar to PACCP plan described for pond, flow through and recirculating
systems.
Option 2:
            The goal of this option is to further reduce pollutant discharges associated with feeding.
This option considers the use of an active feed monitoring system to avoid the waste (discharge)
of uneaten feed.  One such approach is to actively monitor feeding in the net pen by using a video
monitor near the bottom to observe the passage of uneaten feed through the bottom of the pen.
When feed is observed, feeding is stopped.
4.     APPLICABLE SMALL ENTITY DEFINITIONS
       EPA typically uses the Small Business Administration's (SBA) size standards that define
small businesses by number of employees or, as in this case, revenues generated from all sources
to define the facilities that may be covered.  EPA estimates that there may be approximately
4,200 AAP establishments that meet the SBA definition of "small business."   This is derived
from the  total industry population establishments that EPA believes could potentially be in the
scope of the proposed rule.  However, not all of these establishments may be directly affected by
the proposed rule.  Some establishments, either by sector or size may be excluded from the scope
of the proposed rule.  In addition, some establishments within the scope may already be using the
controls and practices used as a basis for the proposal.  EPA would use the SBA definitions of
small business in the various AAP sectors to evaluate the effect of the proposal on small entities.
The following table lists the SBA small business definitions for the AAP sectors (and activities):
         SBA Small Business Definitions for AAP Sectors
                          Sector Name
                           NAICS Code
                     SBA Size Standard ($)
                    Finfish Farming and Fish
                           Hatcheries
                             112511
                 annual revenues under $750,000
                       Shellfish Farming
                             112512
                    Other Animal Aquaculture
                             112519
                           Aquariums
                             712130
                 annual revenues under $500,000
   5.     SMALL ENTITIES THAT MAY BE SUBJECT TO THE PROPOSED
                           REGULATION
       Aquatic animal production facilities potentially affected by the rule can be subcategorized
by production method and further segmented by species, corporation type, geographic location,
wastewater characteristics,  production levels, etc.  EPA estimates that approximately 3,700 to
4,200 small commercial facilities, aquariums, and small not for profit hatcheries, for example in
Alaska are potentially included in the aquatic animal production industry.  These facilities are
located in every state within the United States, but are mainly found in the
Southern/Southeastern region.  The number of facilities (about 3,700 facilities) reflects the fact
that about 92 percent of the commercial facilities identified in the 1998 Census of Aquaculture
would be considered small entities using SBA definitions. The Census of Aquaculture did not
survey aquariums or some non-profit organizations.  As a part of EPA's efforts in identifying the
potentially regulated population (i.e., screener survey "census"), EPA continues to refine its
estimate of small businesses affected by the aquatic animal production industry.
            6.     SUMMARY OF SMALL ENTITY OUTREACH
       As part of the effluent limitations guidelines rulemaking process, EPA has actively
involved interested parties and provided many opportunities for input since the start of the
regulatory process (January 2000).  In addition, EPA has conducted numerous site visits to
aquatic animal production facilities and has personally spoken with some of the members of the
affected community.  EPA has also met with and given presentations to several stakeholder
groups during their annual or, in some cases, quarterly meetings including the Joint
Subcommittee on Aquaculture/Aquaculture Effluents Task Force, Regional Aquaculture Centers
        and State and national aquaculture associations.
               6.1    EPA's Stakeholder Outreach
       Prior to convening the Panel, EPA had several discussions, meetings, and conference
calls with small entities that will potentially be affected by this regulation.  Between August and
October 2001, EPA had discussions with members of the Aquaculture Effluents Task Force
(AETF)  to identify potential Small Entity Representatives (SERs).  EPA invited 16 aquatic
animal producers and two university professors  to serve as potential SERs for the pre-panel
outreach process.  On November 29, 2001, EPA mailed a packet of background materials about
             the rulemaking to the potential SERs.
6.2    EPA's Outreach Meeting With Potential Small Entity Representatives
       On December 12, 2001 EPA held a meeting/conference call in Washington, DC with
small entities potentially impacted by this rulemaking.  EPA presented an overview of the
SBREFA process, an explanation of effluent guidelines rulemakings, and background of the AAP
rule.  In addition, EPA explained the contents of the outreach mailing.
6.3    Panel's Outreach Meetings With Small Entity Representatives
       EPA officially convened the SBAR Panel for the aquatic animal production industry on
January 22, 2002.  The SBAR Panel met and discussed the materials to be provided to SERs
prior to the scheduled outreach meetings.  On January 25, 2002, the SBAR Panel sent some
initial information for the SERs to review and provide comment.  On February 6, 2002 the
SBAR Panel distributed additional information to the SERs for their review.  The materials were
sent in two separate mailings.  The materials in the first mailing included: a description of the
options under consideration, frequency factors indicating the technologies/practices estimated to
be in place, and questions on aquariums.  The materials in the second mailing included: a
description of the model facilities, pollutants of concern, possible exclusions for certain
subcategories, costs and loadings estimates by subsector and regulatory option, summary of
screener responses, groundwater discharges and land application of manure solids, general
questions for SERs and scope and potential impacts of the proposed rule.  The SERs were to
review the materials and provide comments during a follow-up series of meetings/conference
calls and in writing after the meetings/calls.  The meetings/conference calls were held on
                    February 12 & 13, 2002.
              7.     SMALL ENTITY REPRESENTATIVES
       EPA, in consultation with SBA, invited 22 Small Entity Representatives (SERs) to
participate in outreach meetings on the AAP proposal and the SBREFA process.  The following
lists those 22 SERs selected to advise the Small Business Advocacy Review Panel convened for
this rule.
                           ALLIGATOR
                           Scott Anderson
                        Cyprus Creek Farms
                             Starke, FL
                            AQUARIUM
                             Bob Jenkins
                         Steinhart Aquarium
                          San Francisco, CA
                            CATFISH
                           Dan Butterfield
                      Butterfield Catfish Farm
                           Tuscaloosa, AL
                          Jerry Williamson
                          Lake Village, AR
                             Tom Foshee
                          Natchitoches, LA
                            CRAWFISH
                          Norma Jean Miller
                             Eunice, LA
HYBRID STRIPED BASS
                             Tony Vaught
                              Chico, CA
                           ORNAMENTAL
                          Christopher Watts
                             Lithia, FL
                             George Hood
                           Lower Salem, OH
                         SALMON FARMING
                           Sebastian Belle
                    Maine Aquaculture Association
                            Hallowell, ME
                          Steve Reifenstuhl
                     Northern Southeast Regional
                          Aquaculture
                              Sitka, AK
                           SHELLFISH
                           Robert Rheault
                          Moonstone Oysters
                            Wakefield, RI
                             SHRIMP
                              Bill Cox
                        Island Fresh Seafood
                             Meggett, SC
                             Carolyn Orr
                          Straw Ridge Farm
                           Harrodsburg, KY
TILAPIA
     Ken G. Hale
     Ken G. Hale, Inc.
     Henderson, TX
     Rick Eager
     Swimming Rockfish and Shrimp
     Farm
     Meggett, SC
TROUT
     Bryan Plemmons
     Casta Line Trout Farms
     Goshen, VA
     Sonny Pierce
     Pierce Associates Inc.
     Hollis, ME
GENERAL
     Betsy Hart
     National Aquaculture     Association
     Charles Towne, WV
     Dr. Carole Engle
     Fisheries Center University of
     Arkansas at Pine Bluff
     Pine Bluff, AR
     Dr. Michael Rice
     Department of Fisheries, Animal &
     Veterinary Science University of
     Rhode Island
     Kingston, RI
     Jack Waggener
     URS Corporation
     National Aquaculture Association
     Franklin, TN 
8.     SUMMARY OF INPUT FROM SMALL ENTITY REPRESENTATIVES
8.1    Number and Types of Entities Affected
       Several SERs indicated that the majority of aquatic animal production facilities are small
businesses.
       The Shrimp SER indicated that among the two highest production states for shrimp there
are 9 small businesses and one large business in SC, and 16 small businesses and 7 large
businesses in TX.
       One of the Catfish SERs indicates that most catfish production is located in areas that are
already economically depressed and many of the small facilities are owned by minorities or use
minority labor.
       One SER points out that virtually all aquatic animal producers started out at small
businesses, and if EPA imposed regulations on these small producers many would be
discouraged from entering the business and those already in the business would lose any
incentive or financial ability to expand their business.
       One SER pointed out the Aquatic Animal Producers cannot pass their costs onto the
consumer and when this is combined with increasing foreign imports, small producers are put
under a significant financial strain.  The added pressure of costs associated with this regulation
would force many producers to leave the business.  This SER also indicated that the aquatic
animal producers in Ohio are primarily small family owned businesses.  This SER also requested
that if EPA continues to consider effluent guidelines, it should exclude facilities that have
revenues that don't exceed $750,000 annually.
       One SER that represented molluscan operations indicated that the Census of Aquaculture
count of shellfish operations and revenues appeared to be low.  This SER questioned whether the
Connecticut oyster industry had been left out of the Northeast data, likewise the reported
numbers for Louisiana appear to be low.
       A trout SER indicated that trout production in the Northeast consists of small facilities
which are relatively old.  Their age contributes to their construction, primarily earthen raceways.
Most trout facilities in the Northeast would be represented by the National 1 model facility
developed by EPA from Census of Aquaculture data.  The National 1 model reflects an average
revenue of $8,027.  Another trout SER indicates that approximately 96% of US trout farms are
small businesses, based on Census of Aquaculture information.  He also points out that the trout
industry is very diverse in size, geographic location, size of fish produced, water supply quality
and temperature, and market outlets.  He expressed concern that EPA's models oversimplify
these differences.
       Every SER argued strongly against national effluent guidelines for the aquatic animal
production category.  However, two SERs indicated that if, after considering all of the SER
concerns (along with other factors EPA will consider), EPA still believes there is a strong basis
for regulation, EPA should consider regulating just those businesses which meet the NPDES
definition of a point source.
8.2    Potential Reporting, Record Keeping and Compliance
       Several SERs indicated that EPA's options do not adequately account for the time and
expense associated with the preliminary options.  EPA's option 1 is based on the implementation
of Best Management Practices (BMPs) which assume a cost for implementation including where
necessary construction of structures, but primarily rely on labor to perform the practice and keep
records.  SERs point out that many small operations are family owned and do not hire out any
labor.  Owner/operators at these facilities are already working very long days and the added
burden associated with keeping records on these practices would be unduly burdensome.  One
SER said that the added burden associated with implementing the BMPs and especially the
record keeping associate with them would require him to hire additional labor, which he could
not afford to do.
       One SER indicated in verbal comments made during the Panel Outreach meeting that the
mortality removal requirement is an example of requiring an action to be performed and records
kept just for the sake of testing.
       EPA's suggestion that manure be analyzed each time a shipment is hauled away is too
excessive. One trout SER suggested that EPA should provide some flexibility in the frequency of
monitoring.  Another SER suggested that EPA allow for the discontinuation of the testing and
reporting requirements, if the facility can establish a record of meeting or exceeding the
performance standard over a period of a couple of years.
       One trout SER suggested that EPA's estimated frequency for cleaning out quiescent
zones is excessive.  This SER referred EPA to Idaho's guidance which establishes a frequency
depending on where in the overall facility a given raceway is located but in any event the most
frequent cleaning is less frequent than EPA has assumed.
8.3    Related Federal Rules
       Many SERs indicated that State Departments of Fish and Wildlife already control escapes
of non-native species and the Federal Food and Drug Administration (FDA) is controlling the
application of drugs to aquatic species, therefore EPA should not be attempting to regulate them
under the effluent guidelines.  Pathogens are controlled by the Department of Agriculture's
(USDA), Animal, Plant Health Inspection Service (APHIS).
       Some SERs questioned EPA's attempt to develop a BMP approach modeled after the
Hazard Assessment Critical Control Points Plans or HACCP Plans, that were developed for fish
processors by FDA.  One SER pointed out that HACCP is based on scientifically determined
hazards and that the costs for training under HACCP amounted to millions.  This SER
questioned whether EPA has identified hazards that the scientific community can even agree on
and that EPA's estimate of costs are understated.
8.4    Regulatory Flexibility Alternatives
8.4.1  Regulatory Exemptions
       Most SERs addressed EPA's suggestion that some sectors be exempt in their entirety and
all supported this conclusion and some further suggested that other sectors be exempted.
       Catfish and other pond producers argued that their production practices do not have an
adverse impact on the environment and may actually improve water quality by capturing surface
runoff in watershed ponds allowing for the settling out of solids that would otherwise flow
directly into streams and rivers.  SERs maintained that ponds as a whole serve as an effective
wastewater treatment system and that they need to maintain a high water quality in order to keep
the aquatic animals alive.
8.4.2  Baseline Practices
       Several SERs pointed out that EPA has overestimated the degree to which practices are
currently in place at aquatic animal production facilities.  These are discussed by species below.
8.4.2.1     Trout
       Trout SERs questioned EPA's assumption of the frequency factors for quiescent zones
and settling basins.  One SER stated that virtually all trout facilities in the northeast are earthen
constructed and do not have quiescent zones, furthermore this SER thought it would be very
difficult to retrofit these systems with quiescent zones.  The SERs said that many of the older
facilities will have land constraints which could make it very difficult to retrofit settling basins.
These facilities will have to take raceways out of production and convert them into a settling
basins.
       The SERs also questioned EPA's assumption of the baseline feed conversion ratio
(FCR).  Smaller facilities are unable to achieve the targets cited by EPA.  SERs indicated that an
FCR of 1.6 is the best that can be expected from smaller facilities, while large producers are
already at the targets established by EPA. SERs also thought that some facilities would be unable
to rely on gravity flow and would need to pump solids and water from the quiescent zones to the
settling basins.  This would require electricity which would be an additional cost.
       SERs also disagree with EPA's loading density, they said that a more realistic loading
density is between 2 and 3 lb/cu.ft. of volume.  In addition the dimensions of the raceway are too
large.
8.4.2.2     Alaskan Salmon
       Salmon production in Alaska is conducted by small non-profit businesses for the purpose
of returning the animals to the wild to increase the wild populations.  Most of these facilities use
flow through systems to raise native species.  The Salmon SER indicated that these salmon
facilities are located in remote locations and tend to be constructed in such a way that they have
no land on which to expand.  None of the Alaska facilities have quiescent zones or settling
basins.  To put these structures into their facilities it would require taking part of their raceways
out of production.  The SER contends that they would need to reduce their production by 16%
to retrofit quiescent zones into their systems.  This SER indicated that flow through facilities do
use baffles to aid in removing solids from their raceways, although the SER said that these
baffles serve to collect the solids that are discharged.
       This SER also said that the pollutants discharged from these salmon producers is
discharged into nutrient poor waters and is useful in supporting aquatic life.  Furthermore, these
facilities contribute far fewer nutrients than the wild population of salmon returning to their
spawning grounds add to the water.
       The SER indicated that salmon producers are practicing feed management with a goal of
1:1 feed conversion.  The producers also conduct health screening of their stock before releasing
them into the wild.
       Some salmon are placed into net pens prior to release.  These operations hold salmon for
only a couple of months prior to release.  Although the SER indicated that there are some
benthic affects these disappear rapidly after the pens are emptied.
8.4.2.3     Catfish
       SERs representing the catfish production sector expressed concern about EPA's erosion
controls including rip rap as impractical.  SERs said that the cost for rip rap is excessive.
Furthermore, these SERs said that EPA's assumption that half of the  catfish ponds have
installed rip rap is not realistic.  One catfish producer that has levee ponds in the Mississippi delta
said that the rip rap would be difficult to obtain, since rocks are rare in this region.  He did not
believe that erosion on the inside berms of ponds is a serious concern for facilities in his region.
SERs also questioned EPA's assumptions of being able to divert a portion of the pond drainage
into a settling basin.  SERs said the topography of the site will often prevent all ponds from
draining in the same direction thus it would be very difficult to construct a single settling basin
for an entire facility without requiring pumping and the associated electrical requirements.
Otherwise EPA would need to assume that more than one settling basin would need to be
constructed, which could also have an impact on the land available at the facility.  Other erosion
control practices that were considered are assumed by EPA to be in place at a much higher
frequency than they actually occur.  Furthermore far fewer facilities than EPA assumes actually
have vegetated ditches.  It is common for producers to keep their drainage ditches free from
vegetation to avoid creating a habitat for snakes and other animals.
       Several SERs strongly disagreed with EPA's recommendaton that mortality be removed
from ponds.  SERs said that it would require the scheduling of a seining crew to come to the
facility which can be logistically difficult and a significant expense.  The SERs said that dead fish
decompose so quickly that by the time the seining crew arrived it would be very hard to remove
the carcasses.
8.4.2.4     Shrimp
       The Shrimp SER reported that shrimp producers do not routinely implement many of the
erosion control practices that EPA considered for ponds.  Shrimp ponds must be drained rapidly
to harvest the animals, therefore many of the practices EPA recommends to minimize the
discharge of sediment cannot be achieved.  Furthermore many shrimp farms in South Carolina do
not have the land available to construct settling basins.  The SER did say that shrimp producers
have implemented practices which reduce the discharge of sediments or pollutants.
8.4.2.5     Striped Bass
       The Striped Bass SER said that producers already spend a great deal of attention on feed
management, since it is the single largest expense producers incur and they have every incentive
to minimize the amount of feed dispensed.  This SER indicated that producers already keep
records and adjust feed rates and formulations to achieve optimum feed conversion ratios.
However, this SER says that were EPA to set a FCR as part of its regulation it would be
impossible for all facilities to achieve it.
       The SER also said that EPA's practice of installing rip rap on pond bank interiors would
be cost prohibitive and would provide a host for vermin and make harvest more difficult.  Other
solids removal practices use up valuable land that could be used for production.  The SER
argued that aquatic animal ponds actually improve water quality by capturing solids that would
otherwise runoff the land into lakes and streams.  The SER also said that the frequency factors
included in the cost model do not accurately reflect the practices in use at striped bass facilities.
8.4.2.6     Other Producers
       The Crawfish SER said that feed management does not apply to crawfish production
because this is frequently done as a crop rotation with rice and sometimes soybeans, the crawfish
forage on the remnants of the rice crop.  No additional feed is provided.   Crawfish ponds tend to
operated as constructed wetlands.  These ponds are relatively shallow and when drained for
harvest must be drained quite slowly, thus minimizing the sediment load.
       The Ornamental SER said that drug and chemical usage is minimal because the fish
density in the pond is low and thus the fish are not stressed which contributes to lower disease
rates.  The SER acknowledges that escapes may be found in waters near the facility but these are
relatively few in numbers and the likelihood that they will survive or be able to reproduce is
extremely small.  They are intolerant to the colder winter temperatures and attractive to
predators.  Further this SER says that the state has a very strict BMP program along with
inspections to control non-native species releases.
       The Alligator SER suggested that EPA establish monitoring requirements that would be
discontinued if the facility could demonstrates that they are not causing any environmental
problems.  The SER stated that alligator producers in Florida are required to pay an annual
license and wild egg permit fee to the State's Fish and Wildlife Conservation Commission.
8.4.3  Option 1
       Many of the SERs raised serious concerns regarding the PACCP plan.  They questioned
EPA's assumption of the time that would be required to develop the plan and the training
component of this plan.  Several SERs said that the objective is not well defined nor is the
expertise and training program currently available.  One SER questioned whether there is anyone
that could provide the training that might be required for the development of a PACCP.  Another
SER suggested that the plan requirements would require the help of a consultant.
       SERs also said that drug application is under the control of FDA.  The escape of non-
native species is controlled by State Departments of Fish and Wildlife.
8.4.4  Option 2
       The SERs expressed many concerns regarding the solids polishing treatment particularly
concerning costs.  One SER provided an estimate of cost for micro screens of $320,000 for
installation and $15,000 in annual operating costs. Another source estimated that micro screens
would cost about $0.36/lb of fish and pointed out that this cost would be nearly half the total
cost of trout production.
8.4..5 Option 3
       The SERs expressed deep concern over EPA's proposed requirement to disinfect
wastewater prior to discharge.  SERs pointed out that the microorganisms EPA is targeting do
not originate from cold-blooded species and the presence of these microorganisms cannot be
from fish production, they are more likely coming from the wildlife which can be around the
facility.  SERs who commented on this issue generally felt the proposed costs for disinfection
were well beyond what any facility could afford.   9.     PANEL FINDINGS AND DISCUSSIONS
9.1   Number of Small Entities to Which the Proposed Rule Will Apply
       One SER indicated that the projected counts of shellfish farms appeared too low, by
perhaps 20% in most regions and perhaps more in the Northeast and Louisiana, unless low input
"managed fisheries" were being intentionally excluded.  Another SER estimated that 96% of
aquatic animal production facilities are small businesses.  Another SER, a shrimp farmer,
reported that, based on his survey of two states, there are 10 shrimp farms in South Carolina, 9
of which are small by the SBA small business definition, and 23 shrimp farms in Texas, 16 of
which are small.   He concluded that 80% of US shrimp farmers are small and would be
vulnerable to closure as a result of significant regulatory cost increases.  Another SER indicated
that there are 26 salmon hatcheries in Alaska, three of which are inland and discharge into fresh
surface waters and 23 of which are coastal and discharge via deep saltwater pipelines. All are
either government operated or non-profit and strictly regulated by the Alaska Department of Fish
and Game.  The Panel notes that EPA used the US Department of Agriculture (USDA) Census
of Aquaculture (1998) as a basis for its initial evaluation of the number, size and distribution of
aquatic animal production facilities.  The Panel recommends that EPA incorporate the
information provided by these SERs, as appropriate, and seek additional data on the number of
potentially affected facilities.
9.2   Projected Reporting, Record Keeping and Compliance Requirements
9.2.1   Requirements applicable to all systems
9.2.1.1     Documentation of BMPs ("Pollutant Analysis at Critical Control Points")
       One SER predicted that, due to existing State regulations, most farms would have to
change very little in their day-to-day operations to comply with new Federal effluent guidelines,
but that they would have to spend a lot more time documenting and keeping records of their
practices under a PACCP type requirement, with little corresponding environmental benefit.
Another SER's comments provided support for this argument by detailing some of the
environmentally friendly practices that he currently uses, including harvest boxes set deep enough
to promote sediment settling, reduced operation of aerators during harvest draining of ponds to
avoid stirring up sediments, long discharge canals to promote settling, and minimization of water
exchange. In order to show how vulnerable the industry is to excessive paperwork requirements,
this SER also gave an example of additional State paperwork and permitting requirements in
response to an earlier disease outbreak leading to a shutdown of 2/3 of then existing shrimp
farmers in the state.
       Several SERs suggested that EPA's cost estimates for PACCP documentation and record
keeping requirements were low, and noted that many farms would have to hire outside
consultants to help them develop PACCP plans and train operators.  SERs indicated that the
estimated training costs were especially low and questioned where the appropriate expertise
would come from.
       SERs also noted that many small operators already work extremely long hours during
certain seasons and that it would be virtually impossible to find time for additional paperwork.
Several SERs discussed their experience with the HACCP program (on which the PACCP
approach is patterned) and indicated that it entails a great deal of paperwork.  One SER
questioned whether there is an adequate scientific basis to apply the HACCP principles to
pollution prevention at aquatic animal production facilities, and whether operators would have
the appropriate expertise to do so even if there were.  SERs also noted that HACCP was
generally applied to larger facilities (e.g., seafood processing plants), and received substantial
start-up funding from several Federal agencies.  They questioned whether this model was
applicable to the aquatic animal production industry.  SERs also emphasized the variability of
aquatic animal production operations and the need for operators to have the flexibility to adopt
practices (BMPs) that are appropriate to their farms.  BMPs that are appropriate on one farm
could be disastrous on another.
       The Panel notes these concerns and recommends that EPA not include extensive record
keeping and reporting requirements in the rule, especially when they mainly serve to document
existing practices.  EPA never intended to require specific BMPs, as these are unlikely to be
appropriate at all facilities, but provided examples of BMPs which have been used at specific
facilities.  While the Panel recognizes that any proposed guidelines will likely include some kind
of planning and documentation requirements, the Panel does not find HACCP a good model on
which to base these requirements.  The Panel recommends that such requirements be kept to a
minimum, and account for the level of expertise and labor constraints at the affected aquatic
animal production facilities.
9.2.1.2    Feed Management
       Several SERs noted the high variability in Feed Conversion Ratios (FCRs) across feed
types, species types, climates, seasons, and production practices, and warned EPA not to adopt
quantitative feed management requirements because it would be impossible to account for this
variability in a regulation and attempting to do so would not improve current feed management
practices.  One SER indicated that EPA's baseline and target FCRs were not realistic, and
suggested that for pond systems, the current industry average is about 2.7, with 2.2 being the
best that well managed farms could reasonably achieve.  Further, accurate calculation of FCRs
may be difficult for operators, since they can only determine yield at harvest, and some operators
do not harvest the whole crop at a single time.  SERs also noted that operators already have a
strong financial incentive to minimize feed inputs, and that there have been rapid advances in
feed technology in recent years independent of any government regulatory efforts.
       Several SERs questioned fines reduction as an appropriate or necessary practice for
aquatic animal production facilities.    According to one SER, pelletized feed is rapidly being
replaced by extruded feed, which is more digestible and does not have fines, thus reducing
wasted feed, and costs to the farmer.  For pelletized feed, fines are screened out to a large extent
by the feed mill, and those that result from transport are a relatively small in volume.  Many
farmers feed manually from bags and would find fines collection totally impractical.  It is unlikely
that feed mills would take back collected fines on this scale.  According to one SER, even
pelletized bulk feed has minimal fines, because farmers use gravity feed bins, not augers.
       The Panel is persuaded by these comments.  Feeding practices and FCRs vary so much
across facilities that it would be impossible to define any standard beyond minimization of excess
feed that would be broadly applicable.  However, minimization of feed inputs is clearly already a
primary concern of all operators, certainly of those at larger commercial facilities.  The Panel
sees minimal environmental benefit from regulatory requirements related to feed management in
pond, flow through and recirculating facilities and recommends that such requirements not be
included in the proposed guidelines.  The Panel also recommends that EPA consider providing
guidance on appropriate feed management practices for these facilities.  For net pens, the Panel
recognizes that EPA is still exploring technologies that can provide additional pollutant
reductions associated with feed (e.g., video monitoring).
9.2.1.3    Animal Health
       Several SERs questioned whether requirements related to animal health maintenance
were appropriate for effluent guidelines because they would be unlikely to affect effluent quality.
While animal health is important to operators for financial reasons, management practices to
maintain health vary widely across species and production systems.  It is not possible to identify
all potential health threats and appropriate responses in advance, so documentation of practices
would be of limited value.  Costs of specific responses (drugs, vet fees) may be high.  SERs also
indicated that fish pathogens are unlikely to pose a threat to human health or water quality, and
to the extent that they threaten wild species, they already fall under the authority of other State
and Federal agencies.
       The Panel agrees that effluent guidelines would generally not be the best way to address
animal health issues and thus recommends that the proposed guidelines not include requirements
related to animal health maintenance.  The Panel also recommends that EPA consider providing
guidance on appropriate health management practices.
9.2.1.4    Mortality Removal
       One SER indicated that mortality removal at pond systems was not only impractical, but
also less environmentally friendly than allowing natural processes to work.  He gave an example
from his own experience of a 6,000 lb fish kill that was eliminated in just five days by a
combination of feeding by buzzards, ants and flies, and decay followed by a brief algal bloom that
crashed and settled out, resulting in no excess discharge whatsoever from his pond system.  He
contrasted this with the environmental nightmare of trying to haul off and landfill 3 tons of dead
fish.  Another SER noted that the only practical method of mortality removal for ponds would be
to hire a seining crew, which would be cost prohibitive and likely not effective as it would be
difficult to get a crew on site before most fish had decayed.   The Panel recognizes that EPA is
concerned about the possibility of catastrophic mortality events releasing pathogens that may
threaten wild species, but also recognizes that the evidence on this issue is mixed and research is
ongoing.  At the same time, the Panel finds the SER comments compelling for pond systems that
are infrequently drained, and thus recommends that mortality removal requirements for pond
systems not be included in the proposed guidelines.  For other production systems, mortality
removal is generally considered part of good operating practice and it is thus not clear that
additional regulatory requirements would enhance environmental protection.  A general
requirement to address mortality removal in the facility's BMP plan may not change existing
practice, while a specific requirement (e.g., daily mortality removal) might not be appropriate for
all facilities.  The Panel therefore recommends that before proposing specific regulatory
requirements related to mortality removal EPA consider whether such requirements would
significantly enhance environmental protection.
9.2.2   Requirements applicable to ponds, flow-through, and recirculation systems
9.2.2.1    Settling Basins
       One SER noted that most States have regulations governing construction activities near
(e.g., within 300 feet of) waters of the US.  Since aquatic animal production facilities tend to be
located near water, this may make it difficult to site a new settling basin.  Several SERs noted
that many facilities are located in low-lying areas with little gradient and would thus require
substantial pumping to bring water to settling basins. One SER estimated that the necessary 2000
g.p.m. pump and associated piping would cost $38,500, and his facility would need two of these.
This would be in addition to $30,000 to $40,000 per year in lost revenue from converting two
production ponds into settling basins.  This would more than eat up his entire profit margin over
a ten year period.  SERs also raised serious concerns about the availability of land for settling
basins.  Several were worried that the only practical means of adding a settling basin would be to
convert one or more production ponds for this purpose, which could significantly erode
revenues.  SERs also noted that depending on the configuration of the facility, it might not be
possible to route all discharges through a single settling basin.  If several basins were needed,
costs and land requirements would be even more prohibitive.  One SER noted that many facilities
would not have heavy machinery (tractors, loaders, backhoes) for cleaning out the basin and
would find it cost prohibitive or simply not possible to rent such machinery, especially in remote
areas.   This SER also stated that EPA's engineering design cost estimates were significantly
understated based on his experience.   Another SER  noted that settling basins may be
superfluous for some facilities, for example if drainage water is reused for irrigation.
       The Panel is persuaded that settling basins would not generally be necessary for pond-
based facilities where the pond itself can provide adequate solids settling.  Where drainage is
slow and controlled, solids transport into the discharge is minimized and further settling basins
would not provide significant environmental benefits.  The Panel thus recommends that
limitations based on the use of settling basins not be included in the proposed guidelines at pond-
based systems that utilize slow, controlled drainage techniques.  For some ponds, where drainage
occurs rapidly, resuspension and discharge may be a concern. For such facilities, as well as for
flow-through and recirculating systems.  Site-specific factors, such as availability of land and
configuration of an existing facility, can greatly influence the cost of settling basins. The Panel
recommends that any requirements related to solids removal thus be flexible enough to
accommodate facilities where settling basins are not a viable option.
9.2.2.2    Numeric Sediment Limits
       Several SERs questioned the achievability of a 30 mg/L TSS limit.  SERs also questioned
the environmental value of such a requirement, and suggested that the total solids contribution
from aquatic animal production facilities is likely to be insignificant on a watershed scale.  One
SER stated that the specific proportions of pond discharge suggested for treatment were
excessive (first 5% for bottom drains, last 20% for all ponds) and suggested that if treatment
were required at all, the appropriate volume would depend on hydrology and production
practices at the particular facility.  The Panel recommends that EPA not include numeric
sediment limits for pond-based systems in the proposed guidelines.  For other systems, the Panel
is concerned about the difficulty of consistently achieving numeric limits, due to site-specific
variability, and that numeric limits may thus be economically unachievable at many small
facilities.  The panel recommends that if EPA includes numeric limits in the proposed guidelines,
that it also include alternative approaches, such as BMPs, that facilities can implement to
demonstrate compliance in lieu of numeric limitations.
9.2.2.3    Water Quality Monitoring
       One SER indicated that monitoring needs would vary substantially across facilities and
questioned the basis for EPA's suggested parameters and frequencies.  This SER also stated that
monitoring and lab analysis costs are significantly higher than EPA estimates.  The Panel agrees
with this concern and recommends that any monitoring requirements in the proposed guidelines
be kept to the minimum necessary to demonstrate compliance with applicable regulatory
requirements.  Where monitoring will not provide information that is useful to the operator in
managing his farm (including regulatory compliance) it should not be required.
9.2.3   Requirements applicable to flow-through and recirculation systems
9.2.3.1    Microfiltration (Solids Polishing)
       SERs indicated that filtration is not a common practice (EPA data show 17 % of flow
through and recirculating facilities above NPDES production thresholds with such treatment
currently in place) and would only be economically feasible for public facilities that do not have
to cover costs with sales revenues.  Several SERs indicated that mechanical filtration would be
physically impossible and/or cost prohibitive for most facilities.  One SER provided detailed cost
estimates for microscreens based on actual vendor quotes and published literature.  For example,
one estimate was $0.36 per pound of fish.  Another estimate was $320,000 installation plus
$15,000 annual operating costs to treat a 350 g.p.m. flow.  The SER also noted practical
limitations with such screens, for example the need to protect them from freezing weather.  Costs
for chemical precipitation were even higher.  Based on preliminary cost information, the Panel
believes it unlikely that limitations based on microfiltration or chemical precipitation would be
economically achievable for any sector of the aquatic animal production industry that must cover
cost with revenues.  The Panel recommends that EPA consider the economic achievability of
these technologies before proposing limitations based on them and that any requirements related
to solids removal be flexible enough to accommodate facilities where microfiltration is not
economically achievable.
9.2.3.2    Groundwater Protection from manure storage
       Based on SER comments, it appears that few facilities use fish waste storage ponds.
Production ponds would not have pollutants in concentrations high enough to pose a threat to
groundwater.  One SER suggested that settling basin and waste storage pond bottoms would
likely become impervious even if not originally constructed from impervious material because of
thick, sticky properties of fish manure.  The Panel is not aware of any evidence to suggest that
groundwater contamination is a problem at aquatic animal production facilities and thus
recommends that EPA not include requirements related to groundwater protection in the
proposed guidelines.  Any site-specific concerns about groundwater contamination from manure
storage could be dealt with on a site-specific basis by the permitting authority.
9.2.3.3    Disinfection of manure storage supernatant
       Many SERs noted that, according to EPA's preliminary cost estimates, disinfection
would be cost prohibitive.  They also questioned whether aquatic animal production facilities are
significant sources of human pathogens, and whether UV technology would remove or inactivate
any such pathogens even if they were present, given the variety of environmental conditions
(e.g., temperature) at aquatic animal production facilities and the fact that the technology is
largely untested on wastewater from aquatic animal production facilities except as part of the
treatment for water internal to recirculating systems and as a treatment of oysters prior to
consumption (depurating).  The Panel shares these concerns and recommends that EPA not
include disinfection requirements in the proposed guidelines.
9.2.3.4    Land Application of Manure
       One SER indicated that only small facilities are likely to include significant row crop
agriculture, as these are often traditional farmers that have diversified into aquatic animal
production as a subsidiary operation.  These facilities produce very small quantities of manure
(much smaller than CAFOs) which he does not believe warrant regulation.  Another SER stated
that testing nutrient content for each shipment of manure would be burdensome and unnecessary,
as nutrient content would be unlikely to change much over time.  He suggested using published
estimates instead.  The Panel notes that in the proposed CAFO guidelines, EPA limited record
keeping and testing requirements for off-site land application to facilities producing 12 tons of
manure or more per year.  Based on available evidence, the Panel believes that few aquatic
animal production facilities produce manure in such quantities and those that do would pose less
of a threat (if any), because fish manure is generally less concentrated than CAFO manure.  The
Panel thus questions whether the volume of manure that might be land applied from even the
largest facilities would warrant the cost of limitations and/or other requirements related to land
application, and recommends that such requirements not be included in the proposed guidelines.
9.2.4   Requirements applicable to flow-through systems only
9.2.4.1    Quiescent Zones
       SERs noted that retrofitting raceways with quiescent zones, especially for older, dirt
bottom facilities, would be impractical, and even where possible would significantly reduce
production area, thus reducing revenues.  Labor requirements to vacuum raceways (2 man days
per week for the large facilities) would not be affordable for small operations.  Operators do not
have this much available time, and hired labor would be too expensive.  The Panel recommends
that EPA re-evaluate the need for and practicability of quiescent zones in existing earthen
raceways.  The Panel also recommends that any requirements related to solids removal be
flexible enough to accommodate facilities where quiescent zones are not a viable option.
9.2.5  Requirements applicable to ponds only
9.2.5.1    Constructed Wetlands
       EPA had been considering constructed wetlands among the technologies for pond
systems.  One SER indicated that the land requirements and costs associated with this option
would be burdensome for most producers.  Another SER indicated that unlined wetlands cost
about $5,000 per acre and lined wetlands as much as 100 times more (not including land costs).
Based on currently available information, the Panel believes it unlikely that limitations based on
construction and maintenance of constructed wetlands would be necessary for pond systems.
The Panel thus recommends that EPA not include any requirements based on constructed
wetlands for ponds.  However, this technology may be appropriate in circumstances where ponds
must be drained rapidly for harvest.  The Panel further notes  that facilities in other discharging
sectors may choose to comply with limitations through the use of constructed wetlands.
9.2.5.2    Vegetated Ditches
       Most SERs did not disagree that vegetated ditches are generally an appropriate way to
reduce sediment discharge.  However, one SER warned against inflexible requirements that may
stifle innovation.  He used the example of a 700 foot ditch, as discussed under Option 2 for
ponds, and noted that while such a requirement might be appropriate for pelletized feed, it might
be unnecessary for higher quality, less polluting feed.  However, if the better feed is also more
expensive, the farmer's only incentive for using it may be the potential cost savings associated
with a shorter drainage ditch.  It would thus be counterproductive, and could discourage the use
of less polluting feed,  to specify a minimum ditch length by regulation.  Another SER stated that
700 feet was excessive, as most settling occurs within the first 150 feet.  Other SERs also noted
that appropriate practices are highly site specific. For example, facilities may have limited land on
which to construct ditches.  Inflexible requirements for vegetated ditches of a particular length
could force facilities to take land out of production and reduce revenues.  The Panel finds these
comments compelling and thus recommends that any requirements related to solids removal be
flexible enough to accommodate existing facilities where vegetated ditches are not a viable
option. The Panel also notes that a vegetative ditch is an effective technology to control solids
and that facilities may choose this technology to comply with limitations.
9.2.5.3    Bank Stabilization
       A number of SERs mentioned that use of riprap on internal pond banks is not common
and would be both economically and technically impractical.  In addition to the high cost (EPA
estimates $1,000 per acre), SERs indicated that riprap placement could interfere with feeding
and harvesting machinery, and that riprap could serve as habitat for snakes and other nuisance
species.  One SER indicated that EPA's cost estimate was low.  In his area, the necessary stone
costs $9 per square foot, which he estimated would mean a total cost of $26,775 per pond to
cover two banks.  This would be cost prohibitive, especially for farmers with multiple ponds.
Some SERs did not oppose use of vegetation for bank stabilization but indicated that this was
common practice anyway, where feasible.  However, in marine environments, grass may not
grow on pond banks because of salt water.  One SER also expressed concern with the cost of
adding vegetation to slopes and stated that his operation could not afford it.   Another SER
noted that constructed ponds may actually serve as a barrier to erosion by catching sediment
laden runoff before it reaches waters of the US.  The Panel recommends that EPA not promote
or require the use of riprap in the proposed guidelines.  While a requirement to consider
vegetation as a means of bank stabilization for rapidly draining ponds may be appropriate, the
Panel notes that where drainage is slow and controlled, solids transport into the discharge is
minimized and additional requirements for erosion controls are thus unnecessary.  The panel
recommends that any requirements related to solids discharge from pond facilities be flexible
enough to accommodate facilities where bank stabilization is not a viable option.
9.2.5.4    Frequency and Rate of Pond Draining
       One SER commented that infrequent draining of ponds is not possible for shrimp farmers,
who must drain their ponds at least once or twice per year for harvest, as well on an emergency
basis to prepare for a hurricane.  The SER also stated that seining is not a viable alternative for
shrimp farms, in that the shrimp can bury in the pond bottom.  Another SER noted that fingerling
ponds may also need to be drained completely for harvest.  Most food finfish ponds are drained
infrequently anyway.  The Panel believes that operators already have a financial incentive to
minimize the frequency of pond drainage and that current practice is dictated largely by
production requirements.  The Panel thus believes that there is little opportunity to reduce
drainage frequency without significant impacts on production and recommends that such
requirements not be included in the proposed guidelines.
       The rate of pond draining can also have an impact on the pollutant loads discharged when
ponds are drained.  Some SERs indicated that their ponds are drained slowly minimizing the
disturbance of solids on the bottom.  The Panel recognizes that drainage rate is to some degree
determined by the harvesting practices and species produced at the facility, however, since rate
can influence effluent quality, additional measures may be necessary to reduce pollutant loads
from rapidly draining ponds.
9.2.5.5     Water Exchange
       One SER said that it would not be feasible to prohibit water exchange altogether as a
practice.  (Water exchange refers to the practice of adding fresh water to a pond system with the
goal being to improve the overall water quality in the pond.  Water exchange results in water
being discharged from the pond for the period during which water exchange takes place.)
Although this SER acknowledged that water exchange is being used to a lesser extent than
previously it is still sometimes necessary to avoid losing an entire crop when water quality gets
bad enough.  This SER indicated that shrimp farms already have an incentive to minimize water
exchange, to avoid bringing into the pond wild shrimp diseases with the freshwater.
       The Panel recognizes that water exchange may be necessary at some facilities and would
be determined by production goals, the species produced, and site specific factors (e.g., water
availability).  The Panel thus recommends that EPA not ban the practice of water exchange
entirely.  However, since water exchange has the potential to discharge additional pollutants
from ponds, particularly those that drain rapidly, additional measures may be necessary for such
ponds to reduce pollutant loads from these systems.  It is not clear that national effluent
guidelines are the best way to address this concern however.  Operators already have a strong
financial incentive to minimize water exchange, so a general requirement to do so would be
unlikely to change existing practice.  More specific requirements (e.g., an absolute limit on the
amount of exchange allowed in a given year) would not be appropriate for all facilities.  The
Panel recommends that EPA consider whether specific regulatory requirements imposed through
effluent guidelines would significantly enhance environmental protection for rapidly discharging
ponds and avoid requirements which would not.
9.2.5.6    Elimination of Deep Water Overflows
       One SER commented that EPA's cost estimate for this option, at least in a marine
environment, was low.  He estimated the cost of aluminum risers at $2600 and piping at $1000,
per pond.  He indicated that such an expenditure would put him out of business.  Another SER
noted that appropriate drain configurations are also highly site and species specific and warned
against inflexible requirements. Another SER stated that in shallow, levee type ponds, there is
not a significant difference in water quality between the pond bottom and pond surface, so
reconfiguration of drains would likely have little effect on effluent quality.  The Panel agrees that
appropriate drain configurations are site specific and recommends against including any specific
requirement in the proposed effluent guidelines.
9.2.6  Other requirements
9.2.6.1    Polyculture
       Several SERs noted that polyculture is a promising new area with significant potential to
reduce pollutant discharges.  For example, filter feeders such as tilapia and mollusks may
consume nutrient rich residuals from other species.  This SER warned against a regulatory
structure that would discourage such innovative approaches by layering on additional
requirements for each additional species raised.  The Panel shares this concern and recommends
that EPA evaluate the proposed guidelines to ensure that they not provide a disincentive for
environmentally beneficial polyculture.
9.3   Other Regulations that May Duplicate, Overlap, or Conflict with the Proposed Rule
       Many SERs stated that existing State regulations are adequate to deal with any water
quality concerns stemming from aquatic animal production.  They urged EPA not to subject
them to another layer of Federal regulation that would add little environmental benefit.  Several
SERs questions whether EPA had done an adequate job of identifying and evaluating potentially
duplicative State regulations.  These SERs indicated that based on their experience, they believed
such an effort would reveal that most State programs are already more than adequate.
       The Panel notes this concern and recommends that EPA explore options to provide
regulatory flexibility to reduce conflicting requirements in states with strong existing programs.
One such option would be to establish performance criteria for States to demonstrate that their
existing program provides equivalent protection to any proposed effluent guidelines and to
consider promulgating requirements that are part of a demonstrated equivalent program as an
alternative standard for those States.  The Panel recognizes that such an option would have to be
structured in a way that is consistent with Clean Water Act requirements.
       Under this approach, where a State can demonstrate that its existing program provides
equivalent protection, EPA would promulgate the State standards as the effluent guideline
applicable in that State.  Thereby, operators would have to comply only with the promulgated
components of the State program that was shown to be equivalent.  However, the Panel could
envision a situation where a State may have an equivalent program for only part of the effluent
guidelines (e.g., non-native species or pathogens).  In such instances, the Panel recommends that
EPA provide alternate provisions based on the State program for requirements where the State
already has equivalent programs in place.  For example, if EPA decided to require BMP plans for
non-native species and pathogens but the State had an equivalent program only for non-native
species, affected operators would have to comply with state requirements for non-native species
and the national requirements for pathogens.
Several SERs noted that pathogens in fish are already regulated by the US Department of
Agriculture's (USDA)  Animal Plant Health Inspection Service (APHIS),  US Fish and Wildlife
Service (USFWS) the Food and Drug Administration (FDA) as well as by many State and
interstate agencies (ie, the New England Salmonid Fish Health compact).  The Panel
recommends that EPA investigate the extent to which these agencies already regulate fish
pathogens and defer to such regulations where appropriate.
Several SERs questioned the authority of EPA to regulate non-native species under the Clean
Water Act and indicated that both USDA's Animal and Plant Health Inspection Service (APHIS)
and the USFWS have regulations that address this issue.  The Panel recommends that EPA
investigate the extent to which these (and other) agencies already have regulations that would
address concerns regarding non-native species introductions by aquatic animal production
facilities, and defer to such regulations where appropriate.
9.4   Significant Alternatives to the Proposed Rule
9.4.1    Small Facility Exclusion
SERs generally favored retaining, or raising, existing NPDES threshold levels.  Under existing
regulations, facilities that discharge less than 30 days per year or produce less than specific
thresholds (warm water species: 100,000 pounds annually; or cold water species: 20,000 pounds
annually or feed less than 5000 pounds of food during the calendar month of maximum feeding)
are not considered point sources unless designated.  Based on the data provided, the Panel does
not believe that facilities below these thresholds, many of which are family farms, are discharging
significant quantities of pollutants or could likely afford technology-based discharge limitations.
The Panel strongly recommends that EPA not lower the existing thresholds or otherwise change
the definition of a point source for this industry.
In addition, most smaller facilities that exceed existing thresholds and are currently regulated
through general permits on a BPJ basis would find any of the regulatory options that EPA has so
far considered economically unachievable.  Based on EPA's current cost analysis, compliance
costs for such facilities in most subcategories would generally exceed 20% of revenues, whereas
in the past EPA has generally considered impacts in the range 5 to 10 percent of revenues as
raising potential economic achievability concerns.  Unless EPA significantly scales back the
regulatory options from those currently under consideration, it is clear that only the largest
facilities could plausibly find any of these options economically achievable.  While the Panel does
not have enough data to identify specific threshold levels, which may well differ across sectors,
the Panel recommends that EPA establish small facility exclusion thresholds for the proposed
guidelines based on economic achievability.  Facilities that fall below these thresholds but above
the current NPDES thresholds would continue to be regulated on a BPJ basis.
The Panel further recommends that in order to minimize paperwork burden on small entities,
EPA not send the detailed industry survey to entities, such as those falling below the NPDES
production and feeding thresholds, that are unlikely to be covered by the proposed guidelines.
To the extent that EPA can identify likely thresholds for a small facility exclusion prior to
sending out the survey, EPA should not send the survey to facilities that fall below these
thresholds.
9.4.2   Production System/Sector Specific Comments
       It has become clear to the Panel that the "aquatic animal production industry" is actually
a collection of highly dissimilar sub-sectors that differ fundamentally in production practices,
species raised, and potential environmental concerns.  The Panel thus feels it is appropriate to
discuss each sector separately before addressing common issues that may be relevant to more
than one sector.
9.4.2.1    Ponds
Catfish, Tilapia, Shrimp and Hybrid Striped Bass
       Based on available information, the Panel believes that most ponds are not currently point
sources because they discharge less than 30 days per year.  The Panel has elsewhere
recommended that EPA not revise the point source definition for aquatic animal production
facilities, in which case most pond facilities would not be covered by the proposed guidelines.
However, some larger facilities with many ponds, particularly shrimp ponds which must be
drained for harvest, might still be covered.  Also, under current NPDES regulations, individual
facilities can be designated as point sources by the permitting authority.  SERs noted that ponds
generally act as natural biological treatment systems.  For example, the State of Louisiana, in its
BMP guide for aquaculture, estimates that under typical production conditions catfish ponds
remove 92% of nitrogen, 97% of phosphorus, and 87% of organic matter prior to discharge.
Several SERs indicated that EPA's current loadings estimates for pond discharges are
substantially overstated because they do not adequately account for this in-pond treatment.  See
Section 9.5 (below) for additional explanation.  The Panel understands that EPA has had
discussions with experts concerning pond dynamics and agrees that ponds which are
intermittently drained can serve as an effective water treatment system.  EPA is currently revising
its analysis of loadings from ponds.
       The Panel has carefully considered the various technologies and BMPs that EPA has so
far identified for reducing pollutant discharges from ponds.   In general, based on EPA's analysis
to date, the Panel believes that most of these measures are either impractical, not economically
achievable, or would result in minimal pollutant reductions.  In particular, the Panel recommends
that EPA not adopt requirements related to sediment discharge, erosion, nutrients, or feed
management for pond facilities, except that as noted previously, there may be some concerns
related to ponds that are drained rapidly for harvest that may warrant consideration of sediment
discharges.  The Panel's findings with respect to individual technologies are discussed in Section
9.2.
       However, the Panel understands that EPA is still concerned about the potential discharge
of drugs, chemicals, and aquatic pathogens from large pond facilities, and about the potential for
introduction of exotic species.  The Panel agrees that these are important concerns, but questions
whether they can be adequately addressed through national effluent guidelines given that they are
all highly site-specific.  The limitations and challenges of addressing these concerns through
national effluent guidelines are discussed in detail in Section 9.4.3 below.  One technology option
that EPA is considering is mortality removal.  However, the Panel believes that there are many
situations where it is not only impractical but may result in environmental harm, as predation and
natural decay within a pond system may well be environmental superior to collection and off-site
disposal.  (See Section 9.2.1.4)
       The Panel understands that EPA is still exploring options for control of drugs, chemicals,
aquatic pathogens and exotic species at large pond facilities.  However, based on information
developed to date, the Panel believes it unlikely that the measures which have so far been
identified would be effective in addressing these concerns through national effluent guidelines.
The Panel thus recommends that EPA continue its research, but that it carefully evaluate any
potential measures to ensure that they are both effective and economically achievable before
including them in the proposed guidelines.  Unless EPA identifies such measures, the Panel
recommends that EPA exclude all ponds from coverage under the proposed guidelines
Sportfish
       One SER supported EPA's intention to exclude ponds used for recreational sport fishing
purposes from the scope of this regulation, because these ponds are stocked for the enjoyment of
the public and these activities bring income to many economically depressed rural areas, where
the tourist industry is the only source of consistent income to the area.  Further, the Panel
believes that the fish in these ponds are stocked and fed at such a low rate as not to warrant
further consideration, nor is the Panel aware of any environmental or public health concerns
associated with these ponds.  Therefore, the Panel recommends that EPA exclude from the scope
of regulation at least those facilities that have only sport fishing ponds.  There may be facilities
that have sport fish ponds in addition to other fish production systems, and the Panel does not
believe that sport fish ponds at these facilities would pose any greater risk to public health or the
environment than those at facilities with only sport fish ponds.  If regulation is warranted for any
such facilities, EPA should consider excluding the sport fish ponds from regulation.
Walleye
       No SER comments were received on this topic, however, EPA's preliminary analysis
suggests that these fish are primarily raised as sport fish, and are stocked and fed at such a low
rate as not to warrant regulation.  Unless subsequent analysis indicates a strong basis for
regulation, the Panel recommends that EPA exclude these ponds from the scope of the proposed
regulation.
Mollusks
       One SER, an oyster farmer, noted that mollusk farmers add no feeds, drugs or chemicals
(except EPA-permitted use of Sevin to control ghost crabs in Washington State) and that
shellfish cultivation serves to improve several water quality parameters, including TSS, water
clarity, and nutrients, and fosters biodiversity by providing improved habitat for other organisms.
This SER also stated that, with a few exceptions, States with significant aquatic animal
production industries already have appropriate regulations to deal with them.  The Panel agrees
and recommends that mollusk farms be excluded  from the scope of the proposed guidelines.
Lobsters
       One SER stated that lobster pounds are not animal production facilities, but simply
storage facilities in which lobsters do not multiply or grow.  He noted that such storage facilities
are used for other species of crabs and shellfish as well.  Another SER indicated that some
northeastern States are attempting to culture lobsters for fishery enhancement/restoration but
that feed and water flows for such operations are minimal.  However, the Panel is also aware of
concerns about the use of drugs, such as antibiotics, at such facilities.  Therefore, the Panel
recommends that EPA not include any requirements for lobster pounds, or other live storage
only operations, within the scope of the proposed guidelines other than to address potential
discharge of drugs if these are found to be significant and EPA identifies an effective,
economically achievable technology to control them.
Crawfish
       One SER indicated that crawfish are generally raised in a symbiotic relationship with rice
crops, and do not require any inputs, nor do they produce any adverse environmental impacts.
Therefore, the Panel recommends that EPA not include crawfish farms within the scope of the
proposed guidelines.
9.4.2.2    Flow Through and Recirculating Systems
       The Panel considered whether and to what extent flow through systems should be
regulated under national effluent guidelines.  The Panel learned that concerns are site specific and
there is a great deal of dissimilarity among flow through systems, even within same-species
production.  The Panel also notes that EPA's analysis of its least aggressive option showed that
the preliminary cost estimates as a percent of revenue would generally exceed 30% at even the
largest facilities.  While recirculating systems may be less varied, the preliminary cost estimates
of the least stringent option currently under consideration for these systems would exceed 50%
of revenues.  The Panel understands that EPA is continuing to explore options.  The Panel
recommends that EPA carefully consider economic achievability and technical feasibility before
proposing any regulation for these types of systems.  If no feasible and economically achievable
technologies are identified, EPA should exclude them from the scope of the proposed national
effluent guidelines.  Specific issues related to particular species follow.
Alaska Salmon
       One SER recommended that Alaska salmon hatcheries be exempt from coverage under
the proposed guidelines because they are all either government owned or non-profit and are
operated in the public interest to enhance natural salmon populations under strict regulation by
the Alaska Department of Fish and Game. Most are primarily flow through facilities, with a few
net pens to keep juvenile fish for brief periods (two months) prior to release.  All but three are
coastal facilities that discharge via deep salt water discharge pipes.  Discharges are primarily
sediment and nutrients which are quickly dispersed by tidal action.  In addition, receiving waters
are generally nutrient limited so that discharge of nutrients may actually enhance water quality
for aquatic life.  Further, these anthropogenic discharges of salmon derived biomass are small
relative to natural sources.  Only native species are permitted, and fish health is strictly
monitored.  FCRs are already very low by industry standards (often below 1.0 in net pens) and
feeding is done manually from bags; no bulk feed is used and fines are minimized.  Feed
consumption is carefully monitored and only high quality feeds are used to minimize feed input.
For all of these reasons, this SER believes that Alaska salmon hatcheries are not causing
environmental damage.
       In addition, most of the substantive requirements that EPA is considering would not be
economically achievable for Alaska salmon hatcheries.  Most are in isolated locations with very
high transport costs for all material inputs.  Many are severely limited in the availability of flat
land.  Sedimentation basins would be impractical and quiescent zones would significantly impact
production; the SER estimated a 16% reduction.  Because water is abundant, most facilities have
very high flows, in order to maintain suitable water quality for the fish, so any type of treatment
would be prohibitively expensive.  Video monitoring of net pens would not be cost effective for
the brief periods during which they are used.  The SER indicated that preparation of a PACCP
type BMP plan would be economically feasible for most facilities, but questioned whether there
would be any environmental benefits from this burdensome additional paperwork.  He suggested
that if such a requirement were adopted it should include an option to reduce or eliminate
compliance monitoring once satisfactory performance had been demonstrated.
       Based on the SER's comments, it appears that there is limited, if any, opportunity for
additional requirements imposed through national effluent guidelines to provide significant
additional environmental protection.  The Panel thus recommends that EPA strongly consider
excluding Alaska Salmon hatcheries from the scope of the proposed guidelines.
Trout
       Trout SERs noted that small trout farms tend to have earthen raceways for which
quiescent zones do not exist and would be very difficult to construct.  Furthermore, few small
facilities can attain feed conversion rations (FCRs) of 1.4, the best small facilities can expect to
achieve is about 1.6.  However, large facilities are already achieving an FCR of 1.2, thus for
large trout facilities, EPA's estimates of pollutant reduction benefits are overstated.  Trout SERs
also pointed out that the loading density and size of the raceway are incorrect and result in
overstated pollutant loading estimates.  The panel recommends that EPA re-evaluate the
environmental pollutant reductions using loading densities provided by the SERs and consider
the effect that smaller sized raceways may have on the assumptions of costs and pollutant loading
reductions for small trout facilities.
       Trout SERs indicated that many smaller, older facilities have limitations on available land
and would be forced to take raceways out of production to construct either quiescent zones or
settling basins.  This would have the added negative effect of reducing revenues and would not
be feasible for smaller facilities.  The panel recommends that EPA carefully consider economic
achievability and technical feasibility before proposing limitations based on the use of quiescent
zones or settling basins.
9.4.2.3    Net Pens
       The Panel recognizes that feed can be a significant component of pollutant loads at net
pen facilities.  Under Option 2, EPA is considering requiring video feed monitoring below pens
linked to automated control equipment that would stop feeding when excess particles were
detected.  One SER indicated that this would not be practical at near shore/estuarine sites due to
low transparencies (less than 3 meters under the best of conditions and less than 1 meter during
storms).  As noted above under feed management, the Panel believes that operators already have
a strong financial incentive to minimize feed inputs and are likely already using video monitoring
where it can make a significant difference.  This is especially likely to be true at larger
commercial facilities.  The Panel recommends that EPA consider practical limitations such as
turbidity as well as costs when evaluating video monitoring requirements in the proposed
guidelines.
9.4.2.4    Alligators
       One SER noted that Florida alligator farmers pay annual licensing fees to the Florida Fish
and Wildlife Conservation Commissions (averaging $180,000 annually in aggregate) that support
the Commission's alligator management and biological research programs.  (The Panel notes this
works out to about $9,000 per farm on average.)  Farmers have adopted sustainable use
practices advocated by the Crocodile Specialist Group of CITES and contribute significantly to
the viability and health of the species and its habitat.  Any regulations that adversely affected the
industry would thus also adversely affect the species.  The Panel recommends that in developing
the proposed guidelines, EPA analyze the impacts of any requirements on wild species and
consider such effects in its selection of options.
9.4.1.4    Ornamentals
       One SER noted that farm production of ornamentals reduces pressure on wild
populations, and may thus provide an environmental benefit.  The Panel is not aware of
significant environmental problems associated with production of ornamentals however
recognizes that there may be a potential for the release of non-native exotic species and increased
use of drugs and chemicals to maintain healthy stocks at some facilities (since drug residues do
not need to be considered in fish that are not being raised to be consumed).  However, one SER
stated that drug and chemical use in this sector is especially small, since ornamentals are stocked
at lower rates which translates into lower stress rates and hence fewer disease outbreaks.
Similarly, he indicated that the release of non-native species is not a problem, because the
escapees won't survive for long in the waters of the U.S. because the waters are too cold and
they make easy targets for predators. The Panel understands that EPA is continuing to evaluate
these potential concerns, but also notes the difficulties in addressing these concerns through
national effluent guidelines (see Section 9.4.3).  Unless EPA finds that these are significant
environmental concerns and identifies effective economically achievable technologies to address
them,  the Panel recommends that such facilities should be excluded from the scope of the
proposed guidelines.
9.4.1.5    Baitfish and Sportfish Fingerlings
       One SER stated that the low poundage produced, small volume of feed input, and low
impact collection methods all justify exemption of baitfish and sportfish fingerlings from any
national effluent guidelines.  The Panel agrees and recommends that such operations be excluded
from the scope of the proposed guidelines.
9.4.1.6    Aquaria
       One SER indicated that aquaria are generally indirect dischargers, and that they discharge
low volumes of water and waste relative to commercial aquatic animal production facilities.
Also, their use of inputs (feed, chemicals, drugs, etc) is highly site specific and is likely to be
directed by qualified professionals (vets, scientists, etc).  The Panel notes that EPA has little data
on which to base effluent guidelines for this industry sector.  Based on this SERs comments, the
Panel recommends that aquaria be excluded from the scope of the proposed guidelines.
However, the Panel understands that EPA plans to send the detailed survey to aquaria and the
results may lead to a reconsideration of this recommendation.
9.4.3   Pollutants of Concern
       A number of the issues raise by SERs related to possible requirements aimed at
addressing specific pollutants of concern that would potentially affect more than one sector.
These issues and the Panel's recommendations are discussed below.
9.4.3.1   Non-Native Species
       Many SERs questioned whether it was appropriate (or even legal) to include BMPs
related to introduction of non-native species in national effluent guidelines under the Clean Water
Act.  An operator who raises ornamentals noted that Florida has a strong State program to
prevent escapements and that when ornamental species do escape, they are unlikely to survive in
the wild both because the climate is generally colder than what they can tolerate and because
their bright coloration makes them easy targets for predators.
       It is not clear that exotic species can be effectively controlled through effluent guidelines.
The US FWS and many States already have lists of prohibited species; no facility, large or small,
point source or not, may raise species on these lists.  The Panel believes that such a prohibition is
likely the only effective way of preventing escapement of exotic species.  While there are barrier
technologies (e.g., double or triple netting) that can significantly reduce escapements from a
particular facility, it is unlikely that even these technologies would reduce escapements to zero.
More importantly, since most pond facilities are not considered point sources, and even among
those that are, it is likely that effluent guidelines would only be economically achievable for the
largest facilities (see Section 9.4.1), any technology based measures to reduce escapements
would likely not apply to the majority of facilities.  Exotic species are not like other pollutants;
their potential for harm is not proportional to the volume discharged.  Once a species escapes in
sufficient quantities to establish itself in the wild, additional escapements in the same area have
little environmental impact.  Based on investigation and discussions with the other Federal or
State Agencies that have authority to prohibit or control the importation of exotic species the
Panel believes that EPA should defer to these agencies where they have taken such actions.  For
those species not prohibited that still have a potential to either become a nuisance or invasive
species or that may carry diseases that pose a threat to native aquatic species, the Panel
recommends that EPA work with these agencies to develop and implement appropriate
protection and controls and provide guidance to States.  In general, the Panel believes that for
the Aquatic Animal Production Industry national effluent guidelines are not the best way to deal
with non-native species.
9.4.3.2        Drugs and Chemicals
       Several SERs indicated that drugs and chemicals were not widely used in most aquatic
animal production sectors.  They suggested that what drugs were used were generally already
regulated (by FDA or other agencies) and generally were not used in quantities that would pose
any environmental concern.  Most producers do not add drugs or chemicals to their systems on a
routine basis, but may do so in response to an unforseen event, such as a disease outbreak or
pest infestation.  The particular drug or chemical used, however, would depend on the species,
disease, climate, hydrology, etc at the particular facility.  Aquatic animal production facilities
mainly use drugs or chemicals that have been specifically approved for a particular use by some
other Federal or State agency (e.g., FDA, EPA/OPPT), and that operators would generally rely
on labels, instructions, or the advice of qualified professionals (e.g., vets) in determining
quantities and conditions of use.
       Drugs can be divided into four categories: approved drugs, investigational drugs, extra-
label use drugs, and unapproved drugs.  Approved drugs have already been screened by the Food
and Drug Administration (FDA) to ensure that they do not cause significant adverse public
health or environmental impacts when used in accordance with label instructions.  Investigational
drugs are authorized on a case by case basis by the FDA to allow a way of gathering data for the
approval process.  Quantities and conditions of use are strictly regulated, however, FDA
sometimes relies on the NPDES permitting process to establish limitations on discharges to
prevent environmental harm.  Extralabel drug use in animals is restricted to use of approved
animal and human drugs by or on the order of a licensed veterinarian and must be within the
context of a valid veterinarian-client-patient relationship.  Use of unapproved new animal drugs
would not be legal except in those discrete cases where regulatory discretion has been granted by
FDA.
       Given the existing regulatory structure, the Panel believes that drug and chemical use by
aquatic animal production facilities is already adequately regulated in most cases.  Further,
the Panel is unaware of any particular technology or BMP that would be broadly applicable in
addressing concerns related to discharge of drugs or chemicals.  EPA could require a
management plan for drugs and chemicals, but given the unforeseen nature of most uses, the
Panel believes it would be hard for operators to develop a substantive plan in advance that would
result in any better management of drugs and chemicals than is likely already occurring.  Unless
subsequent analysis identifies control strategies that can be effectively implemented through
national effluent guidelines and that would be economically achievable for affected facilities, the
Panel recommends that EPA address concerns regarding the discharge of drugs and chemicals
through guidance rather than through effluent guidelines requirements.
9.4.3.3   Pathogens
       Many SERs expressed concern with the possibility of regulating pathogens in aquatic
animal production effluent, for several reasons.  First of all, aquatic animal production is not a
source of human pathogens, though coliforms and other indicators may be present in source
water or may be introduced by birds and other wildlife into farm ponds, particularly off-line
settling ponds, which are found at some recirculating and larger flow-through facilities.  One
SER noted that coliform counts in warm water may be dominated by Klebsiella, which is not a
human pathogen indicator.   Second, there are not good monitoring technologies to identify or
quantify pathogens in effluent discharges.  Finally, disinfection, which the outreach materials
provided to SERs discuss as a possible requirement for addressing pathogens, would be both
technically impractical and prohibitively expensive.
       Control of animal pathogens through effluent guidelines presents similar challenges.
Prevention is the most effective (and cost effective) approach; once an outbreak occurs, there is
often little that can be done.  In general, operators already have strong incentives to maintain the
health of their crop, and are likely to rely on the advice of qualified professionals in determining
appropriate responses to potential outbreaks.  The Panel thus questions whether requirements to
adopt specific control strategies and/or an additional layer of planning and testing, mandated
through effluent guidelines, would provide any additional environmental protection relative to
existing practice.  Unless subsequent analysis identifies control strategies that can be effectively
implemented through national effluent guidelines and that would be economically achievable for
affected facilities, the Panel recommends that EPA address concerns regarding human and animal
pathogens through guidance rather than through effluent guidelines requirements.
9.4.3.2    Metals
       Many SERs also expressed concern about possible requirements, including numeric
limitations, related to metals.  These SERs questioned whether aquatic animal production
facilities were sources of metals and suggested that metals detections in effluent samples may
reflect concentrations in the source water rather than incremental discharges from the facilities.
One SER noted that small quantities of zinc (from galvanized machinery) and copper (from EPA
approved algae control formulations) may be present in discharges, but questioned whether these
would ever be found in high enough concentrations to be of concern.  Another SER provided an
analysis which indicated that EPA could remove at most only 2 PEs (pounds of detected metals
and ammonia, each adjusted for toxicity) from an average catfish farm per year and even less per
year from the typical trout farm.  The Panel did not provide data on the costs and loadings
reductions that might be associated with any limitations on metals discharges but is not surprised
by this SER's findings.  It is hard to imagine that traditional methods of metals removal, such as
chemical precipitation, would be cost-effective for aquatic animal production facilities, given
their very low baseline metals concentrations.  For these reasons, the Panel recommends that
EPA not include limitations on metals in the proposed effluent guidelines.
9.4.4    Monitoring
       One SER recommended that NPDES monitoring requirements be reduced or eliminated
for facilities that have demonstrated little or no environmental impact after two years.  States
would retain the right to conduct site visits and reinstate monitoring where necessary.  This SER
suggested that monitoring is a burdensome requirement and that the possibility of such relief
would provide a significant incentive for sound environmental management.  The Panel
recommends that EPA keep monitoring requirements in the proposed guidelines to the minimum
necessary to demonstrate compliance with regulatory requirements and include provisions for
reduced monitoring for facilities that demonstrate superior environmental performance.
9.4.5    New Facilities
       One SER noted that aquatic animal production has provided an important alternative in
recent years for failing crop farms in distressed rural areas and expressed concern that the
guidelines not establish stringent standards for new farms that prevent small crop farms from
diversifying into aquatic animal production.  The Panel shares this concern.  In addition, the after
considering the various technologies that EPA has identified as candidates for BAT in this
industry, the Panel believes that in most cases it is unlikely that compliance costs would be
significantly lower for new facilities than for existing facilities.  The Panel recommends that EPA
propose New Source Performance Standards equivalent to existing source requirements.
9.5    Costs and Loadings Estimation Methodology
       The Panel received numerous comments on EPA's cost and loadings model.  These are
summarized below.
Cost Estimates
       Several SERs indicated that EPA's current models are not sufficient to capture the
variability in the industry and that they generally overestimate pollutant reduction benefits and
underestimate costs.  One SER noted in particular EPA's assumption of constant loading of
BOD, total nitrogen, total phosphorus and TSS per unit of feed, and suggested that this was
completely unrealistic.  This SER also questioned the assumption of a loading density of 5 lbs/cf
for virtually all species, which will significantly overestimate pollutant loadings for facilities with
lower densities, such as those that raise recreational species.  This SER also believes that EPA
has inadequately accounted for treatment in place, for example, at recirculating facilities.
       Another SER indicated that the model facility data are not representative of northeastern
trout farmers.  Specifically, feed conversion ratios are generally higher than 1.4, while loadings
densities are lower than 5 lbs/cf.  Facilities are generally small, with dirt bottoms, limited flows,
and cold water.  Feeding during the winter is intermittent and most farmers use bag feed, for
which fines have already been dramatically reduced, not bulk feed.
       Several SERs suggested that EPA's cost estimates were low.  One stated that they were
especially low for small farms, which could not benefit from economies of scale.  One important
factor not considered in EPA cost estimates is lost production time.  Practices such as slower
draining of ponds or closing drains when ponds are empty may entail significant time costs.
SERs generally felt that labor estimates were low for most of the practices discussed.  Examples
include time for observation of feeding, record keeping, mortality removal, and cleaning of
quiescent zones and settling basins.  SERs also noted that operators often work long hours and
would not be able to provide any extra labor themselves.  Hiring part-time or intermittent labor
to supplement the labor of the operator is often not feasible in remote rural areas where many
fish farms are located.
       One SER noted that costs for rock riprap were likely to be much higher in the Mississippi
Delta than EPA estimates (by a factor of 3-4) because rock would have to be trucked in from
long distances away.  This SER also noted that the cost of installing drains was underestimated.
This SER also stated that the costs of installing settling basins for a pond-based system would be
at least $11,000 per acre, if a single basin could be used.  For farms that drain in multiple
directions, however, or farms with several distinct production areas, more than one basin would
be required and costs would be much higher.  This SER estimated costs for unlined constructed
wetlands at $5,000 per acre, and for lined wetlands several orders of magnitude greater.
       One SER suggested that EPA's cost estimates for construction and maintenance of
settling basins and quiescent zones were low.  In particular, costs estimates for engineering
design were significantly less than his experience suggested.  Labor and equipment requirements
for cleaning of basins were also underestimated, and disposal costs for hauling and tipping fees
would likely be very high in remote areas where many facilities are located.  Land costs (where
land was available at all) would likely be higher for aquatic animal production facilities than for
average crop land because they tend to be in choice locations with direct access to surface
waters.
       One SER indicated that EPA's cost estimates did not adequately account for the land
required for wetlands based effluent treatment.  He also indicated that projected costs for
aeration equipment and consultant time were low, and noted that many facilities are located in
rural areas where significant travel time costs for consultants would also be incurred.  He
provided detailed cost estimates for a 1,000 per year alligator farm.
       Many SERs questioned the accuracy of EPA's frequency factors for current practices,
suggesting that in general they were too high.  SERs suggested that this reflected not a lack of
appropriate environmental stewardship, but rather that many of the practices identified are only
appropriate in limited situations.  SERs believed that many respondents to the screener survey
may have misunderstood the practices being described.  Specific practices mentioned in this
context included riprap on pond banks, quiescent zones and settling basins.  One SER suggested
the following alternate frequency factors for catfish ponds, based on extensive experience with
many such facilities: for riprap on interior pond banks, 0.05; for riprap around drains, 0.25; for
vegetated stoppers; 0.75; for mortality removal, 0; for sedimentation basins, < 0.01; for in-pond
settling, < 0.1; for constructed wetlands, < 0.1.  This SER also noted that the practice "feed
management" was ambiguous in that all farmers must manage feed to maximize profits, since
feed is the most expensive input, but very few if any manage it specifically with the goal of
protecting water quality.  Similarly, most farmers measure those water quality parameters that
are important to their operation, but few if any measure all of the parameters EPA is interested in
with the goal of protecting receiving water quality.
       Several SERs highlighted the distinction between gross price and net price received by
the farmer.  Net prices include deductions for transportation and other factors.  EPA should base
its revenue estimates on net prices, if this data can be obtained.
Loadings Estimates
       Several SERs stated that EPA's estimates of solids loadings in pond discharges were
seriously flawed because they are based on oversimplified assumptions.  First of all, there is no
documented relationship between the amount of feed that is introduced into a pond and the
amount of pollution that leaves the pond when drained.  Most of the solids in ponds are
phytoplankton (not fecal solids from feeding) and phytoplankton growth is not proportional to
feed additions, except at very low and very high feeding rates not used at most commercial
facilities.  But even if there were a relationship, most organic matter added to and produced
within ponds is ultimately decomposed through microbial oxidation.  One SER provided a
sample calculation which showed that EPA's input based model overestimated solids discharges
for a 70 acre facility by a factor of 20, when compared with a model based on empirical
parameters.  This SER suggested that a model based on empirical discharge concentrations and
draining frequencies while less than perfect, would be more appropriate than one based on
modeled inputs.  This SER also noted that pollutant concentrations and drainage volume can
vary substantially even within a single pond, and even more so across ponds and facilities.  An
accurate estimate of loadings must account for this variability.
       Another SER stated that loadings estimates for flow-through facilities were also
significantly overstated.  He indicated that they did not account for modern feed formulations,
and did not account for the variability in feed, temperature, fish size, etc that would substantially
affect effluent loadings.  He stated that for large facilities, FCRs were close to 1.2 (lower than
EPA estimated) so that feed input was also overestimated.  He also suggested that raceway
velocities may be lower than estimated with the result that more solids settle out before
discharge.  Finally, he questioned the data on which the estimates of pollutant loadings per unit
of feed were based and suggested that EPA may be relying on outdated sources.  He cited a
number of recent references.
       A trout farmer provided the following comments on EPA's model facility parameters.
Fish loadings for trout flow-through facilities are generally between 2 and 3 lbs/cf.  Most
raceways are smaller than EPA estimated (500-600 cf) but the number of raceways per farm is
greater.
       The Panel understands that EPA intends to revise its loading model for ponds and
supports this intention.  The Panel recommends that whatever methodology EPA adopts, the
results be ground-truthed against real world empirical data to the extent that such data can be
identified.   The Panel recommends that EPA carefully evaluate all of the SER comments and
adjust its cost and loadings models appropriately.
9.6    Economic Achievability
       The Panel notes that based on EPA's preliminary cost estimates, most of the regulatory
options evaluated to date would not be economically achievable for any but the largest facilities
in any given industry sector.  See section 9.4.1 for further discussion.
       One SER noted that even in the absence of national effluent guidelines, financing for
capital improvements is often difficult to obtain for aquatic animal production facilities because it
is perceived by financial institutions as a fairly risky industry, especially in light of intense foreign
competition.  This SER speculated that financing for compliance related improvements would be
particularly difficult to obtain because it would not lead to any increase in revenues, and that lack
of financing might thus force many farms out of business.  Other SERs noted that due to intense
foreign competition in some sectors (e.g. catfish and shrimp), there is little opportunity for
producers to pass regulatory costs onto processors or consumers through price increases.  The
Panel recommends that EPA consider constraints on financing and cost pass-through in its
analysis of economic achievability.
9.7   Community Level Impacts
       Several SERs noted that forcing a significant number of facilities out of business would
have serious spillover effects, especially in small rural communities, on feed mills, processing
plants, equipment suppliers, and others, including many minority-owned businesses.  A
significant share of the industry is located in economically depressed areas, such as the
Mississippi delta.  The Panel recommends that EPA fully consider such impacts in its economic
achievability analysis.
9.8    Environmental Benefits of Aquatic Animal Production
       A number of SERs indicated that aquatic animal production provides environmental
benefits that must also be factored into any environmental impacts analysis.  If facilities are
forced to close as a result of new regulatory costs, such benefits would be lost.  Examples of
such benefits include: restocking of threatened fisheries, fisheries management research, reuse of
effluent for agricultural irrigation and fertilization, reduction in runoff from land that would
otherwise be used for row crop agriculture, reductions in nutrients and solids loadings in other
waters (e.g., by filter feeders), and reduced pressure on stressed wild populations.  The Panel
recommends that EPA fully consider all of these benefits, at least qualitatively and quantify them
to the extent possible given time and resources available, in its analysis of the proposed
guidelines.
9.9    Uncertainty
       One SER noted that it is important to account for uncertainty in EPA's estimates of costs
and loadings reductions.  The Panel agrees with this and recommends that EPA present both
point estimates and confidence intervals, to the extent feasible,  in its economic analyses.  Where
there is insufficient data to calculate meaningful confidence intervals, uncertainty should be
addressed through sensitivity analyses, qualitative discussions, or other appropriate methods.