<PRE>
[Federal Register: January 12, 2001 (Volume 66, Number 9)]
[Proposed Rules]               
[<strong>Page</strong> <strong>3009</strong>-<strong>3058</strong>]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr12ja01-38]                         
 
[[pp. <strong>3009</strong>-<strong>3058</strong>]] National Pollutant Discharge Elimination System Permit Regulation 
and Effluent Limitations Guidelines and Standards for Concentrated 
Animal Feeding Operations

[[Continued from <strong>page</strong> 3008]]

[[<strong>Page</strong> <strong>3009</strong>]]

the basis that they do not discharge or discharge only in the event of 
a 25-year, 24-hour storm. Second, EPA is proposing to clarify that land 
application areas are part of the CAFO and any associated discharge 
from these areas is subject to permitting.
    While these two proposed changes would help address the ``duty to 
apply'' issue, EPA does not believe they would go far enough. Even with 
eliminating the 25-year, 24-hour storm exemption from the CAFO 
definition, EPA is concerned that operations would still seek to avoid 
permitting by claiming they are ``zero dischargers.'' Specifically, EPA 
has encountered a further zero discharge conundrum: A facility claims 
that by controlling its discharge down to zero--the very level that a 
permit would require--it has effectively removed itself from CWA 
jurisdiction, because the CWA simply prohibits discharging without a 
permit, so a facility that does not discharge does not need a permit. 
EPA believes this would be an incorrect reading of the CWA and would 
not be a basis for claiming an exemption from permitting (as explained 
directly below). Therefore, it is important to clarify in the 
regulations that even CAFOs that claim to be zero dischargers must 
apply for a permit.
    To round out the basis for this proposed revision, EPA is proposing 
a regulatory presumption in the regulations that all CAFOs have a 
potential to discharge to the waters such that they should be required 
to apply for a permit. EPA believes this would be a reasonable 
presumption on two grounds. First, the Agency believes this is 
reasonable from a factual standpoint, as is fully discussed in section 
V of today's preamble.
    This factual finding would become even more compelling under 
today's proposals to eliminate the 25-year, 24-hour storm exemption 
from the CAFO definition and to clarify that discharges from on-site 
land application areas, are considered CAFO point source discharges. If 
these two proposals were put in place, EPA believes, many fewer 
operations would be claiming that they do not discharge.
    Second, a presumption that all CAFOs have a potential to discharge 
would be reasonable because of the need for clarity on the issues 
described above and the historical inability under the current 
regulations to effectuate CAFO permitting. Under today's proposal, the 
duty would be for each CAFO to apply for a permit, not necessarily to 
obtain one. A CAFO that believes it does not have a potential to 
discharge could seek to demonstrate as much to the permitting authority 
in lieu of submitting a full permit application. (To avoid submitting a 
completed permit application, a facility would need to receive a ``no 
potential to discharge'' determination from the permit authority prior 
to the deadline for applying for a permit. See section VII.F.3 below.) 
If the demonstration were successful, the permitting authority would 
not issue a permit. Therefore, the duty to apply would be based on a 
rebuttable presumption that each facility has a potential to discharge. 
Without this rebuttable presumption, EPA believes it could not 
effectuate proper permitting of CAFOs because of operations that would 
claim to be excluded from the CWA because they do not discharge.
    CWA authority for a duty to apply. In pre-proposal discussions, 
some stakeholders have questioned EPA's authority under the Clean Water 
Act to impose a duty for all CAFOs to apply for a permit. EPA believes 
that the CWA does provide such authority, for the following reasons.
    Section 301(a) of the CWA says that no person may discharge without 
an NPDES permit. The Act is silent, however, on the requirement for 
permit applications. It does not explicitly require anyone to apply for 
a permit, as some stakeholders have pointed out. But neither does the 
Act expressly prohibit EPA from requiring certain facilities to submit 
an NPDES permit application or from issuing an NPDES permit without 
one. Section 402(a) of the Act says simply that the Agency may issue an 
NPDES permit after an opportunity for public hearing.
    Indeed, finding that EPA could not require permitting of CAFOs 
would upset the legislative scheme and render certain provisions of the 
Act meaningless. Section 301(b)(2)(A), which sets BAT requirements for 
existing sources and thus is at the heart of the statutory scheme, 
states that EPA shall establish BAT standards that ``require the 
elimination of discharges of all pollutants if the Administrator finds 
* * * that such elimination is technologically and economically 
achievable.* * *'' In other words, Congress contemplated that EPA could 
set effluent standards going down to zero discharge where appropriate. 
Section 306, concerning new sources, contains similar language 
indicating that zero discharge may be an appropriate standard for some 
new sources. Section 402 puts these standards into effect by requiring 
EPA to issue NPDES permits that apply these standards and ensure 
compliance with them. Thus, the Act contemplates the issuance of NPDES 
permits that require zero discharge. These provisions are underscored 
by Section 101(a) of the Act, which sets a national goal of not just 
reducing but eliminating the discharge of pollutants to the waters.
    This statutory scheme would be negated if facilities were allowed 
to avoid permitting by claiming that they already meet a zero discharge 
standard that is established in the CAFO regulations and that a permit 
would require. Issuing a zero discharge standard would be an act of 
futility because it could not be implemented through a permit. Under a 
contrary interpretation, a CAFO could repeatedly discharge and yet 
avoid permitting by claiming that it does not intend to discharge 
further. EPA does not believe that Congress intended to tie the 
Agency's hands in this manner. To be sure, in no other area of the 
NPDES program are industrial operations allowed to avoid permitting by 
claiming that they already meet the limits that a permit would require. 
That would be a plainly wrong view of the Act; Section 301(a) states 
unequivocally that no person may discharge at all without a permit. The 
Act does not contemplate a different system for facilities that are 
subject to a zero discharge standard, and it is the unique nature of 
the zero discharge standard that makes it appropriate for EPA to 
require CAFOs to apply for permits.
    EPA also finds authority to require NPDES permit applications from 
CAFOs in Section 308 of the Act. Under Section 308, the Administrator 
may require point sources to provide information ``whenever required to 
carry out the objective of this chapter,'' for purposes, among other 
things, of determining whether any person is in violation of effluent 
limitations, or to carry out Section 402 and other provisions. Because 
EPA proposes a presumption that all CAFOs have a potential to discharge 
pollutants, it is important, and within EPA's authority, to collect 
information from CAFOs in order to determine if they are in violation 
of the Act or otherwise need a permit.
    EPA solicits comment on the proposed duty to apply.
    e. The Definitions of AFO and CAFO Would Include the Land Areas 
Under the Control of the Operator on Which Manure is Applied. In 
today's proposal, EPA defines an AFO to include both the animal 
production areas of the operation and the land areas, if any, under the 
control of the owner or operator, on which manure and associated waste 
waters are applied. See proposed Sec. 122.23(a)(1). The definition of a 
CAFO is based on the AFO definition and thus would include the

[[<strong>Page</strong> 3010]]

land application areas as well. Accordingly, a CAFO's permit would 
include requirements to control not only discharges from the production 
areas but also those discharges from the land application areas. Under 
the existing regulations, discharges from a CAFO's land application 
areas that result from improper agricultural practices are already 
considered to be discharges from the CAFO and therefore, are subject to 
the NPDES permitting program. However, EPA believes it would be helpful 
to clarify the regulations on this point.
    By the term ``production area,'' EPA means the animal confinement 
areas, the manure storage areas (e.g. lagoon, shed, pile), the feed 
storage areas (e.g., silo, silage bunker), and the waste containment 
areas (e.g., berms, diversions). The land application areas include any 
land to which a CAFO's manure and wastewater is applied (e.g., crop 
fields, fields, pasture) that is under the control of the CAFO owner or 
operator, whether through ownership or a lease or contract. The land 
application areas do not include areas that are not under the CAFO 
owner's or operator's control. For example, where a nearby farm is 
owned and operated by someone other than the CAFO owner or operator and 
the nearby farm acquires the CAFO's manure or wastewater, by contract 
or otherwise, and applies those wastes to its own crop fields, those 
crop fields are not part of the CAFO.
    The definition of an AFO under the existing regulations refers to a 
``lot or facility'' that meets certain conditions, including that 
``[c]rops, vegetation[,] forage growth, or post-harvest residues are 
not sustained in the normal growing season over any portion of the lot 
or facility.'' 40 CFR 122.23(b)(1). In addition, the regulations define 
``discharge of a pollutant'' as the addition of any pollutant to waters 
of the United States from any point source. 40 CFR 122.2. EPA 
interprets the current regulations to include discharges of CAFO-
generated manure and wastewaters from improper land application to 
areas under the control of the CAFO as discharges from the CAFO itself. 
Otherwise, a CAFO could simply move its wastes outside the area of 
confinement, and over apply or otherwise improperly apply those wastes, 
which would render the CWA prohibition on unpermitted discharges of 
pollutants from CAFOs meaningless. Moreover, the pipes and other 
manure-spreading equipment that convey CAFO manure and wastewaters to 
land application areas under the control of the CAFO are an integral 
part of the CAFO. Under the existing regulations, this equipment should 
be considered part of the CAFO, and discharges from this equipment that 
reach the waters of the United States as a result of improper land 
application should be considered discharges from the CAFO for this 
reason as well. In recent litigation brought by citizens against a 
dairy farm, a federal court reached a similar conclusion. See CARE v. 
Sid Koopman Dairy, et al., 54 F. Supp. 2d 976 (E.D. Wash., 1999).
    One of the goals of revising the existing CAFO regulations is to 
make the regulations clearer and more understandable to the regulated 
community and easier for permitting authorities to implement. EPA 
believes that amending the definition of an AFO (and, by extension, 
CAFO) to expressly include land application areas will help achieve 
this clarity and will enable permitting authorities to both more 
effectively implement the proposed effluent guidelines and to more 
effectively enforce the CWA's prohibition on discharging without a 
permit. It would be clear under this revision that the term ``CAFO'' 
means the entire facility, including land application fields and other 
areas under the CAFO's control to which it applies its manure and 
wastewater. By proposing to include land application areas in the 
definition of an AFO, and therefore, a CAFO, discharges from those 
areas would, by definition, be discharges from a point source--i.e., 
the CAFO. There would not need to be a separate showing of a 
discernible, confined, and discrete conveyance such as a ditch.
    While the CWA includes CAFOs within the definition of a point 
source, it does not elaborate on what the term CAFO means. EPA has 
broad discretion to define the term CAFO. Land application areas are 
integral parts of many or most CAFO operations. Land application is 
typically the end point in the cycle of manure management at CAFOs. 
Significant discharges to the waters in the past have been attributed 
to the land application of CAFO-generated manure and wastewater. EPA 
does not believe that Congress could have intended to exclude the 
discharges from a CAFO's land application areas from coverage as 
discharges from the CAFO point source. Moreover, defining CAFOs in this 
way is consistent with EPA's effluent limitations guidelines for other 
industries, which consider on-site waste treatment systems to be part 
of the production facilities in that the regulations restrict 
discharges from the total operation. Thus, it is reasonable for EPA to 
revise the regulations by including land application areas in the 
definition of an AFO and CAFO.
    While the proposal would include the land application areas as part 
of the AFO and CAFO, it would continue to count only those animals that 
are confined in the production area when determining whether a facility 
is a CAFO.
    EPA is also considering today whether it is reasonable to interpret 
the agricultural storm water exemption as not applicable to any 
discharges from CAFOs. See section VII.D.2. If EPA were to adopt that 
interpretation, all discharges from a CAFO's land application areas 
would be subject to NPDES requirements, regardless of the rate or 
manner in which the manure has been applied to the land.
    Please refer to section VII.D for a full discussion of land 
application, including EPA's proposal with regard to land application 
of CAFO manure by non-CAFOs.
    EPA is requesting comment on this approach.
    f. What Types of Poultry Operations are CAFOs? EPA is proposing to 
revise the CAFO regulations to include all poultry operations with the 
potential to discharge, and to establish the threshold for AFOs to be 
defined as CAFOs at 50,000 chickens and 27,500 turkeys. See proposed 
Sec. 122.23(a)(3)(i)(H) and (I). The proposed revision would remove the 
limitation on the type of manure handling or watering system employed 
at laying hen and broiler operations and would, therefore, address all 
poultry operations equally. This approach would be consistent with 
EPA's objective of better addressing the issue of water quality impacts 
associated with both storage of manure at the production area and land 
application of manure while simultaneously simplifying the regulation. 
The following discussion focuses on the revisions to the threshold for 
chickens under each of the co-proposed regulatory alternatives.
    The existing NPDES CAFO definition is written such that the 
regulations only apply to laying hen or broiler operations that have 
continuous overflow watering or liquid manure handling systems 
(i.e.,``wet'' systems). (40 CFR Part 122, Appendix B.) EPA has 
interpreted this language to include poultry operations in which dry 
litter is removed from pens and stacked in areas exposed to rainfall, 
or piles adjacent to a watercourse. These operations may be considered 
to have established a crude liquid manure system (see 1995 NPDES 
Permitting Guidance for CAFOs). The existing CAFO regulations also 
specify different thresholds for determining which AFOs

[[<strong>Page</strong> 3011]]

are CAFOs depending on which of these two types of systems the facility 
uses (e.g., 100,000 laying hens or broilers if the facility has 
continuous overflow watering; 30,000 laying hens or boilers if the 
facility has a liquid manure system). When the NPDES CAFO regulations 
were promulgated, EPA selected these thresholds because the Agency 
believed that most commercial operations used wet systems (38 FR 18001, 
1973).
    In the 25 years since the CAFO regulations were promulgated, the 
poultry industry has changed many of its production practices. Many 
changes to the layer production process have been instituted to keep 
manure as dry as possible. Consequently, the existing effluent 
guidelines do not apply to many broiler and laying hen operations, 
despite the fact that chicken production poses risks to surface water 
and ground water quality from improper storage of dry manure, and 
improper land application. It is EPA's understanding that continuous 
overflow watering has been largely discontinued in lieu of more 
efficient watering methods (i.e., on demand watering), and that liquid 
manure handling systems represent perhaps 15 percent of layer 
operations overall, although in the South approximately 40 percent of 
operations still have wet manure systems.
    Despite the CAFO regulations, nutrients from large poultry 
operations continue to contaminate surface water and ground water due 
to rainfall coming in contact with dry manure that is stacked in 
exposed areas, accidental spills, etc. In addition, land application 
remains the primary management method for significant quantities of 
poultry litter (including manure generated from facilities using 
``dry'' systems). Many poultry operations are located on smaller 
parcels of land in comparison to other livestock sectors, oftentimes 
owning no significant cropland or pasture, placing increased importance 
on the proper management of the potentially large amounts of manure 
that they generate. EPA also believes that all types of livestock 
operations should be treated equitably under the revised regulation.
    As documented in the Environmental Impact Assessment, available in 
the rulemaking Record, poultry production in concentrated areas such as 
in the Southeast, the Delmarva Peninsula in the mid-Atlantic, and in 
key Midwestern States has been shown to cause serious water quality 
impairments. For example, the Chesapeake Bay watershed's most serious 
water quality problem is caused by the overabundance of nutrients (e.g. 
nitrogen and phosphorus). EPA's Chesapeake Bay Program Office estimates 
that poultry manure is the largest source of excess nitrogen and 
phosphorous reaching the Chesapeake Bay from the lower Eastern Shore of 
Maryland and Virginia, sending more than four times as much nitrogen 
into the Bay as leaky septic tanks and runoff from developed areas, and 
more than three times as much phosphorus as sewage treatment plants. 
These discharges of nutrients result from an over-abundance of manure 
relative to land available for application, as well as the management 
practices required to deal with the excess manure. The State of 
Maryland has identified instances where piles of chicken litter have 
been stored near ditches and creeks that feed tributaries of the Bay. 
Soil data also suggest that in some Maryland counties with poultry 
production the soils already contain 90 percent or more of the 
phosphorus needed by crops. The State of Maryland has surveyed the 
Pocomoke, Transquaking, and Manokin river systems and has concluded 
that 70-87 percent of all nutrients reaching those waters came from 
farms (though not all from AFOs). Based on EPA data, phosphorus 
concentrations in the Pocomoke Sound have increased more than 25 
percent since 1985, suffocating sea grasses that serve as vital habitat 
for fish and crabs. In 1997, poultry operations were found to be a 
contributing cause of Pfiesteria outbreaks in the Pokomoke River and 
Kings Creek (both in Maryland) and in the Chesapeake Bay, in which tens 
of thousands of fish were killed. Other examples of impacts from 
poultry manure are discussed in section V of today's proposal.
    Dry manure handling is the predominant practice in the broiler and 
other meat type chicken industries. Birds are housed on dirt or 
concrete floors that have been covered with a bedding material such as 
wood shavings. Manure becomes mixed with this bedding to form a litter, 
which is removed from the house in two ways. After each flock of birds 
is removed from the house a portion of litter, referred to as cake, is 
removed. Cake is litter that has become clumped, usually below the 
watering system, although it can also be formed by a concentration of 
manure. In addition, the operator also removes all of the litter from 
the house periodically. The frequency of the ``whole house'' clean-out 
varies but commonly occurs once each year, unless a breach of 
biosecurity is suspected.
    Broiler operations generally house between five and six flocks of 
birds each year, which means there are between five or six ``cake-
outs'' each year. Roasters have fewer flocks, and small fryers have 
more flocks, but the volume of ``cake-out'' removed in a year is 
comparable. ``Cake-outs'' will sometimes occur during periods when it 
is not possible to land apply the litter (e.g. in the middle of the 
growing season or during the winter when field conditions may not be 
conducive to land application). Consequently, it is usually necessary 
to store the dry litter after removal until it can be land applied.
    Depending on the time of year it occurs, ``whole house'' clean-out 
may also require the operator to store the dry manure until it can be 
land applied. If the manure is stored in open stockpiles over long 
periods of time, usually greater than a few weeks, runoff from the 
stockpile may contribute pollutants to surface water and/or ground 
water that is hydrologically connected to surface water.
    The majority of egg laying operations use dry manure handling, 
although there are operations with liquid manure handling systems. 
Laying hens are kept in cages and manure drops below the cages in both 
dry and liquid manure handling systems. Most of the dry manure 
operations are constructed as high rise houses where the birds are kept 
on the second floor and the manure drops to the first floor, which is 
sometimes referred to as the pit. Ventilation flows through the house 
from the roof down over the birds and into the pit over the manure 
before it is forced out through the sides of the house. The ventilation 
dries the manure as it piles up into cones. Manure can usually be 
stored in high rise houses for up to a year before requiring removal.
    Problems can occur with dry manure storage in a high rise house 
when drinking water systems are not properly designed or maintained. 
For example, improper design or maintenance of the water system can 
result in excess water spilling into the pit below, which raises the 
moisture content of the manure, resulting in the potential for spills 
and releases of manure from the building.
    Concerns with inadequate storage or improper design and maintenance 
contribute to concerns over dry manure systems for laying hens. As with 
broiler operations, open stockpiles of litter stored over long periods 
of time (e.g., greater than a few weeks) may contribute to pollutant 
discharge from contaminated runoff and leachate leaving the stockpile. 
Laying hens operations may also use a liquid manure handling system. 
The system is similar to the dry manure system except that

[[<strong>Page</strong> 3012]]

the manure drops below the cages into a channel or shallow pit and 
water is used to flush this manure to a lagoon.
    The existing regulation already applies to laying hen and broiler 
operations with 100,000 birds when a continuous flow watering system is 
used, and to 30,000 birds when a liquid manure handling system is used. 
In revising the threshold for poultry operations, EPA evaluated several 
methods for equating poultry to the existing definition of an animal 
unit. EPA considered laying hens, pullets, broilers, and roasters 
separately to reflect the differences in size, age, production, feeding 
practices, housing, waste management, manure generation, and nutrient 
content of the manure. Manure generation and pollutant parameters 
considered include: nitrogen, phosphorus, BOD5, volatile solids, and 
COD. Analysis of these parameters consistently results in a threshold 
of 70,000 to 140,000 birds as being equivalent to 1,000 animal units. 
EPA also considered a liveweight basis for defining poultry. The 
liveweight definition of animal unit as used by USDA defines 455,000 
broilers and pullets and 250,000 layers as being representative of 
1,000 animal units. EPA data indicates that using a liveweight basis at 
1,000 AU would exclude virtually all broiler operations from the 
regulation.
    Consultations with industry indicated EPA should evaluate the 
different sizes (ages) and purposes (eggs versus meat) of chickens 
separately. However, when evaluating broilers, roasters, and other 
meat-type chickens, EPA concluded that a given number of birds capacity 
represented the same net annual production of litter and nutrients. For 
example, a farm producing primarily broilers would raise birds for 6-8 
weeks with a final weight of 3 to 5 pounds, a farm producing roasters 
would raise birds for 9-11 weeks with a final weight of 6 to 8 pounds, 
whereas a farm producing game hens may only keep birds for 4-6 weeks 
and at a final weight of less than 2 pounds. The housing, production 
practices, waste management, and manure nutrients and process wastes 
generated in each case is essentially the same. Layers are typically 
fed less than broilers of equivalent size, and are generally maintained 
as a smaller chicken. However, a laying hen is likely to be kept for a 
year of egg production. The layer is then sold or molted for several 
weeks, followed by a second period of egg production. Pullets are 
housed until laying age of approximately 18 to 22 weeks. In all cases 
manure nutrients and litter generated results in a threshold of 80,000 
to 130,000 birds as being the equivalent of 1,000 animal units.
    Today's proposed NPDES and effluent guidelines requirements for 
poultry eliminate the distinction between how manure is handled and the 
type of watering system that is used. EPA is proposing this change 
because it believes there is a need to control poultry operations 
regardless of the manure handling or watering system. EPA believes that 
improper storage as well as land application rates which exceed 
agricultural use have contributed to water quality problems, especially 
in areas with large concentrations of poultry production. Inclusion of 
poultry operations in the proposed NPDES regulation is intended to be 
consistent with the proposed effluent guidelines regulation, discussed 
in section VIII of today's preamble. EPA is proposing that 100,000 
laying hens or broilers be considered the equivalent of 1,000 animal 
units.
    Consequently EPA proposes to establish the threshold under the two-
tier alternative structure that defines which operations are CAFOs at 
500 animal units as equivalent to 50,000 birds. Facilities that are 
subject to designation are those with fewer than 50,000 birds. This 
threshold would address approximately 10 percent of all chicken AFOs 
nationally and more than 70 percent of all manure generated by 
chickens. On a sector specific basis, this threshold would address 
approximately 28 percent of all broiler operations (including all meat-
type chickens) while addressing more than 70 percent of manure 
generated by broiler operations. For layers (including pullets) the 
threshold would address less than 5 percent of layer operations while 
addressing nearly 80 percent of manure generated by layer operations. 
EPA believes this threshold is consistent with the threshold 
established for the other livestock sectors.
    Under this two-tier structure, today's proposed changes exclude 
poultry operations with liquid manure handling systems if they have 
between 30,000 and 49,999 birds. EPA estimates this to be few if any 
operations nationally and believes these are relatively small 
operations. EPA does not believe these few operations pose a 
significant threat to water quality even in aggregation. EPA also notes 
that the trend in laying hen operations (where liquid systems may 
occur) has been to build new operations to house large numbers of 
animals (e.g., usually in excess of 100,000 birds per house), which 
frequently employ dry manure handling systems. Given the limited number 
of existing operations with liquid manure handling systems and the 
continuing trend toward larger operations, EPA believes the proposed 
uniform threshold of 50,000 birds is appropriate.
    Under the proposed alternative three-tier structure, any operation 
with more than 100,000 chickens is automatically defined as a CAFO. 
This upper tier reflects 4 percent of all chicken operations. 
Additionally those poultry operations with 30,000 to 100,000 chickens 
are defined as CAFOs if they meet the unacceptable conditions presented 
in section VII.C. This middle tier would address an additional 10 
percent of poultry facilities. By sector this middle tier would 
potentially cover an additional 45 percent of broiler manure and 22 
percent layer manure. In aggregate this scenario would address 14 
percent of chicken operations and 86 percent of manure. See VI.A.2 for 
the additional information regarding scope of the two proposed 
regulatory alternatives.
    EPA acknowledges that this threshold pulls in a substantial number 
of chicken operations under the definition of a CAFO. Geographic 
regions with high density of poultry production have experienced water 
quality problems related to an overabundance of nutrients, to which the 
poultry industry has contributed. For example northwestern Arkansas and 
the Delmarva peninsula in the Mid-Atlantic tend to have smaller poultry 
farms as compared to other regions. The chicken and turkey sectors also 
have higher percentages of operations with insufficient or no land 
under the control of the AFO on which to apply manure. Thus EPA 
believes this threshold is appropriate to adequately control the 
potential for discharges from poultry CAFOs.
    g. How Would Immature Animals in the Swine and Dairy Sectors be 
Counted? EPA is proposing to include immature swine and heifer 
operations under the CAFO definition. See proposed 
Sec. 122.23(a)(3)(i)(C) and (E). In the proposed two-tier structure, 
EPA would establish the 500 AU threshold equivalent for defining which 
operations are CAFOs as operations with 5000 or more swine weighing 55 
pounds or less, and those with fewer than 5000 swine under 55 pounds 
are AFOs which may be designated as CAFOs. Immature dairy cows, or 
heifers, would be counted equivalent to beef cattle; that is, the 500 
AU threshold equivalent for defining CAFOs would be operations with 500 
or more heifers, and those with fewer than 500 could be designated as 
CAFOs.
    In the proposed three-tier structure, the 300 AU and 1,000 AU 
equivalents,

[[<strong>Page</strong> 3013]]

respectively for each animal type would be: 3,000 head and 10,000 head 
for immature swine; and 300 head and 1,000 head for heifers.
    Only swine over 55 pounds and mature dairy cows are specifically 
included in the current definition (although manure and wastewater 
generated by immature animals confined at the same operation with 
mature animals are subject to the existing requirements). Immature 
animals were not a concern in the past because they were generally part 
of operations that included mature animals and, therefore, their manure 
was included in the permit requirements of the CAFO. However, in recent 
years, these livestock industries have become increasingly specialized 
with the emergence of increasing numbers of large stand-alone 
nurseries. Further, manure from immature animals tends to have higher 
concentrations of pathogens and hormones and thus poses greater risks 
to the environment and human health.
    Since the 1970s, the animal feeding industry has become more 
specialized, especially at larger operations. When the CAFO regulations 
were issued, it was typical to house swine from birth to slaughter 
together at the same operation known as a farrow to finish operation. 
Although more than half of swine production continues to occur at 
farrow-to-finish operations, today it is common for swine to be raised 
in phased production systems. As described in section VI, specialized 
operations that only house sows and piglets until weaned represent the 
first phase, called farrowing. The weaned piglets are transferred to a 
nursery, either at a separate building or at a location remote from the 
farrowing operation for biosecurity concerns. The nursery houses the 
piglets until they reach about 55 to 60 pounds, at which time they are 
transferred to another site, the grow-finish facility.
    The proposed thresholds for swine are established on the basis of 
the average phosphorus excreted from immature swine in comparison to 
the average phosphorus excreted from swine over 55 pounds. A similar 
threshold would be obtained when evaluating live-weight manure 
generation, nitrogen, COD and volatile solids (VS). See the Technical 
Development Document for more details.
    Dairies often remove immature heifers to a separate location until 
they reach maturity. These off-site operations may confine the heifers 
in a manner that is very similar to a beef feedlot or the heifers may 
be placed on pasture. The existing CAFO definition does not address 
operations that only confine immature heifers. EPA acknowledges that 
dairies may keep heifers and calves and a few bulls on site. EPA data 
indicates some of these animals are in confinement, some are pastured, 
and some moved back and forth between confinement, open lots, and 
pasture. The current CAFO definition considers only the mature milking 
cows. This has raised some concerns that many dairies with significant 
numbers of immature animals could be excluded from the regulatory 
definition even though they may generate as much manure as a dairy with 
a milking herd large enough to be a CAFO. The proportion of immature 
animals maintained at dairies can vary significantly with a high being 
a one to one ratio. Industry-wide there are 0.6 immature animals for 
every milking cow.
    EPA considered options for dairies that would take into account all 
animals maintained in confinement, including calves, bulls and heifers 
when determining whether a dairy is a CAFO or not. EPA examined two 
approaches for this option, one that would count all animals equally 
and another based on the proportion of heifers, calves, and bulls 
likely to be present at the dairy. EPA is not proposing to adopt either 
of these options.
    The milking herd is usually a constant at a dairy, but the 
proportion of immature animals can vary substantially among dairies and 
even at a given dairy over time. Some operations maintain their 
immature animals on-site, but keep them on pasture most of the time. 
Some operations keep immature animals on-site, and maintain them in 
confinement all or most of the time. Some operations may also have one 
or two bulls on-site, which can also be kept either in confinement or 
on pasture, while many keep none on-site. Some operations do not keep 
their immature animals on-site at all, instead they place them offsite, 
usually in a stand-alone heifer operation. Because of the variety of 
practices at dairies, it becomes very difficult to estimate how many 
operations have immature animals on-site in confinement. EPA believes 
that basing the applicability on the numbers of immature animals and 
bulls would make implementing the regulation more difficult for the 
permit authority and the CAFO operator. However, EPA requests comment 
on this as a possible approach.
    EPA also requests comments on using only mature milking cows as the 
means for determining applicability of the size thresholds. Under the 
two-tier structure, EPA's proposed requirements for dairies would apply 
to 3 percent of the dairies nationally and will control 37 percent of 
the CAFO manure generated by all dairies nationally. This is 
proportionally lower than other livestock sectors, largely due to the 
dominance of very small farms in the dairy industry. There are similar 
trends in the dairy industry as in the other livestock sectors, 
indicating that the number of large operations is increasing while the 
number of small farms continues to decline. Under the three-tier 
structure, EPA's proposed requirements would apply to 6 percent of the 
dairies nationally, and will control 43 percent of all manure generated 
at dairy CAFOs annually. See Section VI.A.1.
    Inclusion in the proposed NPDES definition of immature swine and 
heifers is intended to be consistent with the proposed effluent 
guidelines regulation, described in section VIII of today's preamble.
    P. What Other Animal Sectors Does Today's Proposal Affect? EPA is 
proposing to lower the threshold for defining which AFOs are CAFOs to 
the equivalent of 500 AU in the horse, sheep, lamb and duck sectors 
under the two-tier structure. See proposed Sec. 122.23(a)(3)(i). This 
action is being taken to be consistent with the NPDES proposed 
revisions for beef, dairy, swine and poultry. Under the three-tier 
structure, the existing thresholds would remain as they are under the 
existing regulation.
    The animal types covered by the NPDES program are defined in the 
current regulation (Part 122 Appendix B). The beef, dairy, swine, 
poultry and veal sectors are being addressed by both today's effluent 
guidelines proposal and today's NPDES proposal. However, today's 
proposal would not revise the effluent guidelines for any animal sector 
other than beef, dairy, swine, poultry and veal. Therefore, under 
today's proposal, any facility in the horse, sheep, lamb and duck 
sectors with 500 to 1,000 AU that is defined as a CAFO, and any 
facility in any sector below 500 AU that is designated as a CAFO, will 
not be subject to the effluent guidelines, but will have NPDES permits 
developed on a best professional judgment (BPJ) basis.
    Table 7-6 identifies those meeting the proposed 500 AU threshold in 
the two-tier structure. Table 7-7 identifies the numbers of animals 
meeting the 300 AU, 300 AU to 1,000 AU, and the 1,000 AU thresholds in 
the three-tier structure.
    A facility confining any other animal type that is not explicitly 
mentioned in the NPDES and effluent guidelines regulations is still 
subject to NPDES permitting requirements if it meets the definition of 
an AFO and if the permit

[[<strong>Page</strong> 3014]]

authority designates it as a CAFO on the basis that it is a significant 
contributor of pollution to waters of the U.S. Refer to VII.C.4 in 
today's proposal for a discussion of designation for AFOs.
    The economic analysis for the NPDES rule does not cover animal 
types other than beef, dairy, swine and poultry. EPA chose to analyze 
those animal types that produce the greatest amount of manure and 
wastewater in the aggregate while in confinement. EPA believes that 
most horses, sheep, and lambs operations are not confined and therefore 
will not be subject to permitting, thus, the Agency expects the impacts 
in these sectors to be minimal. However, most duck operations probably 
are confined. EPA requests comments on the effect of this proposal on 
the horse, sheep, lamb and duck sectors.
    i. How Does EPA Propose to Control Manure at Operations that Cease 
to be CAFOs? EPA is proposing to require operators of permitted CAFOs 
that cease operations to retain NPDES permits until the facilities are 
properly closed, i.e., no longer have the potential to discharge. See 
Sec. 122.23(i)(3). Similarly, today's proposal would clarify that, if a 
facility ceases to be an active CAFO (e.g., it decreases the number of 
animals below the threshold that defined it as a CAFO, or ceases to 
operate), the CAFO must remain permitted until all wastes at the 
facility that were generated while the facility was a CAFO no longer 
have the potential to reach waters of the United States.
    These requirements mean that if a permit is about to expire and the 
manure storage facility has not yet been properly closed, the facility 
would be required to apply for a permit renewal because the facility 
has the potential to discharge to waters of the U.S. until it is 
properly closed. Proper facility closure includes removal of water from 
lagoons and stockpiles, and proper disposal of wastes, which may 
include land application of manure and wastewater in accordance with 
NPDES permit requirements, to prevent or minimize discharge of 
pollutants to receiving waters.
    The existing regulations do not explicitly address whether a permit 
should be allowed to expire when an owner or operator ceases 
operations. However, the public has expressed concerns about facilities 
that go out of business leaving behind lagoons, stockpiles and other 
contaminants unattended and unmanaged. Moreover, there are a number of 
documented instances of spills and breaches at CAFOs that have ceased 
operations, leaving behind environmental problems that became a public 
burden to resolve (see, for example, report of the North Carolina DENR, 
1999).
    EPA considered five options for NPDES permit requirements to ensure 
that CAFO operators provide assurances for proper closure of their 
facilities (especially manure management systems such as lagoons) in 
the event of financial failure or other business curtailment. EPA 
examined the costs to the industry and the complexity of administering 
such a program for all options. The analyses of these options are 
detailed in the EPA NPDES CAFO Rulemaking Support Document, September 
26, 2000.
    Closure Option 1 would require a closure plan. The CAFO operator 
would be required to have a written closure plan detailing how the 
facility plans to dispose of animal waste from manure management 
facilities. The plan would be submitted with the permit application and 
be approved with the permit application. The plan would identify the 
steps necessary to perform final closure of the facility, including at 
least:
    <bullet> A description of how each major component of the manure 
management facility (e.g., lagoons, settlement basins, storage sheds) 
will be closed;
    <bullet> An estimate of the maximum inventory of animal waste ever 
on-site, accompanied with a description of how the waste will be 
removed, transported, land applied or otherwise disposed; and
    <bullet> A closure schedule for each component of the facility 
along with a description of other activities necessary during closure 
(e.g., control run-off/run-on, ground water monitoring if necessary).
    EPA also investigated several options that would provide financial 
assurances in the event the CAFO went out of business, such as 
contribution to a sinking fund, commercial insurance, surety bond, and 
other common commercial mechanisms. Under Closure Option 2, permittees 
would have to contribute to a sinking fund to cover closure costs of 
facilities which abandon their manure management systems. The 
contribution could be on a per-head basis, and could be levied on the 
permitting cycle (every five years), or annually. The sinking fund 
would be available to cleanup any abandoned facility (including those 
which are not permitted). Data on lagoon closures in North Carolina 
(Harrison, 1999) indicate that the average cost of lagoon closure for 
which data are available is approximately $42,000. Assuming a levy of 
$0.10 per animal, the sinking fund would cover the cost of 
approximately 50 abandonments nationally per year, not accounting for 
any administrative costs associated with operating the funding program.
    Closure Option 3 would require permittees to provide financial 
assurance by one of several generally accepted mechanisms. Financial 
assurance options could include the following common mechanisms: a) 
Commercial insurance; (b) Financial test; (c) Guarantee; (d) 
Certificate of Deposit or designated savings account; (e) Letter of 
credit; or (f) Surety bond. The actual cost to the permittee would 
depend upon which financial assurance option was available and 
implemented. The financial test would likely be the least expensive for 
some operations, entailing documentation that the net worth of the CAFO 
operator is sufficient such that it is unlikely that the facility will 
be abandoned for financial reasons. The guarantee would also be 
inexpensive, consisting of a legal guarantee from a parent corporation 
or other party (integrator) that has sufficient levels of net worth. 
The surety bond would likely be the most expensive, typically requiring 
an annual premium of 0.5 to 3.0 percent of the value of the bond; this 
mechanism would likely be a last resort for facilities that could not 
meet the requirement of the other mechanisms.
    Option 4 is a combination of Options 2 and 3. Permittees would have 
to provide financial assurance by one of several generally accepted 
mechanisms, or by participating in a sinking fund. CAFO operators could 
meet closure requirements through the most economical means available 
for their operation.
    Option 5, the preferred option in today's proposal, simply requires 
CAFOs to maintain NPDES permit coverage until proper closure. Under 
this option, facilities would be required to maintain their NPDES 
permits, even upon curtailment of the animal feeding operation, for as 
long as the facility has the potential to discharge. The costs for this 
option would be those costs associated with maintaining a permit.
    Today, EPA is proposing to require NPDES permits to include a 
condition that imposes a duty to reapply for a permit unless an owner 
or operator has closed the facility such that there is no potential for 
discharges. The NPDES program offers legal and financial sanctions that 
are sufficient, in EPA's view, to ensure that operators comply with 
this requirement. EPA believes that this option would accomplish its 
objectives and would be generally easy and effective to implement. 
However, there are concerns that it would not be effective for 
abandoned facilities because, unlike some of the other

[[<strong>Page</strong> 3015]]

options, no financial assurance mechanism would be in place. EPA is 
requesting comment on the practical means of addressing the problem of 
unmanaged waste from closed or abandoned CAFOs, and what authorities 
EPA could use under the CWA or other statutes to address this problem.
    See Section VII.E.5.c of today's proposal, which further discusses 
the requirement for permit authorities to include facility closure in 
NPDES permit special conditions.
    While EPA is today proposing to only require ongoing permit 
coverage of the former CAFO, permit authorities are encouraged to 
consider including other conditions such as those discussed above.
    j. Applicability of the Regulations to Operations That Have a 
Direct Hydrologic Connection to Ground Water. Because of its relevance 
to today's proposal, EPA is restating that the Agency interprets the 
Clean Water Act to apply to discharges of pollutants from a point 
source via ground water that has a direct hydrologic connection to 
surface water. See proposed Sec. 122.23(e). Specifically, the Agency is 
proposing that all CAFOs, including those that discharge or have the 
potential to discharge CAFO wastes to navigable waters via ground water 
with a direct hydrologic connection must apply for an NPDES permit. In 
addition, the proposed effluent guidelines will require some CAFOs to 
achieve zero discharge from their production areas including via ground 
water which has a direct hydrologic connection to surface water. 
Further, for CAFOs not subject to such an effluent guideline, permit 
writers would in some circumstances be required to establish special 
conditions to address such discharges. In all cases, a permittee would 
have the opportunity to provide a hydrologist's report to rebut the 
presumption that there is likely to be a discharge from the production 
area to surface waters via ground water with a direct hydrologic 
connection.
    For CAFOs that would be subject to an effluent guideline that 
includes requirements for zero discharge from the production area to 
surface water via ground water (all existing and new beef and dairy 
operations, and new swine and poultry operations, see proposed 
Sec. 412.33(a), 412.35(a), and 412.45(a)), the proposed regulations 
would presume that there is a direct hydrologic connection to surface 
water. The permittee would be required to either achieve zero discharge 
from the production area via ground water and perform the required 
ground water monitoring or provide a hydrologist's statement that there 
is no direct connection of ground water to surface water at the 
facility. See 40 CFR 412.33(a)(3), 412.35(a)(3), and 412.45(a)(3).
    For CAFOs that would be subject to the proposed effluent guideline 
at 412.43 (existing swine, poultry and veal facilities) which does not 
include ground water requirements, if the permit writer determines that 
the facility is in an area with topographical characteristics that 
indicate the presence of ground water that is likely to have a direct 
hydrologic connection to surface water and if the permit writer 
determines that pollutants may be discharged at a level which may cause 
or contribute to an excursion above any State water quality standard, 
the permit writer would be required to include special conditions to 
address potential discharges via ground water. EPA is proposing that 
the permittee must either comply with those conditions or provide a 
hydrologist's statement that the facility does not have a direct 
hydrologic connection to surface water. 40 CFR 122.23(j)(6) and (k)(5).
    If a CAFO is not subject to the Part 412 Subparts C or D effluent 
guideline (e.g., because it has been designated as a CAFO and is below 
the threshold for applicability of those subparts; or is a CAFO in a 
sector other than beef, dairy, swine, poultry or veal and thus is 
subject to subparts A or B), then the permit writer would be required 
to decide on a case-by-case basis whether effluent limitations 
(technology-based and water quality-based, as necessary) should be 
established to address potential discharges to surface water via 
hydrologically connected ground water. Again, the permittee could avoid 
or satisfy such requirements by providing a hydrologist's statement 
that there is no direct hydrologic connection 40 CFR 122.23(k)(5).
    Legal Basis. The Clean Water Act does not directly answer the 
question of whether a discharge to surface waters via hydrologically 
connected ground water is unlawful. However, given the broad 
construction of the terms of the CWA by the federal courts and the 
goals and purposes of the Act, the Agency believes that while Congress 
has not spoken directly to the issue, the Act is best interpreted to 
cover such discharges. The statutory terms certainly do not prohibit 
the Agency's determination that a discharge to surface waters via 
hydrologically-connected ground waters can be governed by the Act, 
while the terms do clearly indicate Congress' broad concern for the 
integrity of the Nation's waters. Section 301(a) of the CWA provides 
that ``the discharge of any pollutant [from a point source] by any 
person shall be unlawful'' without an NPDES permit. The term 
``discharge of a pollutant'' is defined as ``any addition of a 
pollutant to navigable waters from any point source.'' 33 U.S.C. 
Sec. 1362(12). In turn, ``navigable waters'' are defined as ``the 
waters of the United States, including the territorial seas.'' 33 
U.S.C. Sec. 1362(7). None of these terms specifically includes or 
excludes regulation of a discharge to surface waters via hydrologically 
connected ground waters. Thus, EPA interprets the relevant terms and 
definitions in the Clean Water Act to subject the addition of manure to 
nearby surface waters from a CAFO via hydrologically connected ground 
waters to regulation.
    Some sections of the CWA do directly apply to ground water. Section 
102 of the CWA, for example, requires the Administrator to ``develop 
comprehensive programs for preventing, reducing, or eliminating the 
pollution of the navigable waters and ground waters and improving the 
sanitary conditions of surface and underground waters.'' 33 U.S.C. 
Sec. 1252. Such references, however, are not significant to the 
analysis of whether Congress has spoken directly on the issue of 
regulating discharges via ground water which directly affect surface 
waters. Specific references to ground water in other sections of the 
Act may shed light on the question of whether Congress intended the 
NPDES program to regulate ground water quality. That question, however, 
is not the same question as whether Congress intended to protect 
surface water from discharges which occur via ground water. Thus, the 
language of the CWA is ambiguous with respect to the specific question, 
but does not bar such regulation. Moreover, the Supreme Court has 
recognized Congress' intent to protect aquatic ecosystems through the 
broad federal authority to control pollution embodied in the Federal 
Water Pollution Control Act Amendments of 1972. Section 101 of the Act 
clearly states the purpose of the Act ``to restore and maintain the 
chemical, physical, and biological integrity of the Nations' waters.'' 
33 U.S.C. Sec. 1251(a)(1). The Supreme Court found that ``[t]his 
objective incorporated a broad, systemic view of the goal of 
maintaining and improving water quality: as the House Report on the 
legislation put it, ``the word ``integrity'' * * * refers to a 
condition in which the natural structure and function of aquatic 
ecosystems [are] maintained.'' United States v. Riverside Bayview 
Homes, 474 U.S. 121, 132 (1985). An interpretation of the CWA which 
excludes regulation

[[<strong>Page</strong> 3016]]

of point source discharges to the waters of the U.S. which occur via 
ground water would, therefore, be inconsistent with the overall 
Congressional goals expressed in the statute.
    Federal courts have construed the terms of the CWA broadly (Sierra 
Club v. Colorado Refining Co., 838 F. Supp. 1428, 1431 (D.Colo. 1993) 
(citing Quivera Mining Co. v. EPA, 765 F.2d 126, 129 (10th Cir. 1985)), 
but have found the language ambiguous with regard to ground water and 
generally examine the legislative history of the Act. See e.g., Exxon 
v. Train, 554 F.2d 1310, 1326-1329 (reviewing legislative history). 
However, a review of the legislative history also is inconclusive. 
Thus, courts addressing the issue have reached conflicting conclusions.
    Since the language of the CWA itself does not directly address the 
issue of discharges to ground water which affect surface water, it is 
proper to examine the statute's legislative history. Faced with the 
problem of defining the bounds of its regulatory authority, ``an agency 
may appropriately look to the legislative history and underlying 
policies of its statutory grants of authority.'' Riverside Bayview 
Homes, 474 U.S. at 132. However, the legislative history also does not 
address this specific issue. See Colorado Refining Co., 838 F. Supp. at 
1434 n.4 (noting legislative history inconclusive).
    In the House, Representative Les Aspin proposed an amendment with 
explicit ground water protections by adding to the definition of 
``discharge of a pollutant'' the phrase ``any pollutant to ground 
waters from any point source.'' Legislative History of the Water 
Pollution Control Act Amendments of 1972, 93d Cong., 1st. Sess. at 589 
(1972) (hereinafter ``Legislative History''). While the Aspin amendment 
was defeated, that rejection does not necessarily signal an explicit 
decision by Congress to exclude even ground water per se from the scope 
of the permit program. Commentators have suggested that provisions in 
the amendment which would have deleted exemptions for oil and gas well 
injections were the more likely cause of the amendment's defeat. Mary 
Christina Wood, Regulating Discharges into Groundwater: The Crucial 
Link in Pollution Control Under the Clean Water Act, 12 Harv. Envtl. L. 
Rev. 569, 614 (1988); see also Legislative History at 590-597 (during 
debate on the amendment, members in support and members in opposition 
focused on the repeal of the exemption for oil and gas injection 
wells).
    At the least, there is no evidence that in rejecting the explicit 
extension of the NPDES program to all ground water Congress intended to 
create a ground water loophole through which the discharges of 
pollutants could flow, unregulated, to surface water. Instead, Congress 
expressed an understanding of the hydrologic cycle and an intent to 
place liability on those responsible for discharges which entered the 
``navigable waters.'' The Senate Report stated that ``[w]ater moves in 
hydrologic cycles and it is essential that discharge of pollutants be 
controlled at the source.'' Legislative History at 1495. The Agency has 
determined that discharges via hydrologically connected ground water 
impact surface waters and, therefore, should be controlled at the 
source.
    Most of the courts which have addressed the question of whether the 
CWA subjects discharges to surface waters via hydrologically connected 
ground waters to regulation have found the statute ambiguous on this 
specific question. They have then looked to the legislative history for 
guidance. McClellan Ecological Seepage Situation v. Weinberger, 707 F. 
Supp. 1182, 1194 (E.D. Cal. 1988), vacated (on other grounds), 47 F.3d 
325 (9th Cir. 1995), cert. denied, 116 S.Ct. 51 (1995); Kelley v. 
United States, 618 F.Supp. 1103, 1105-06 (D.C.Mich. 1985). Even those 
courts which have not found jurisdiction have acknowledged that it is a 
close question. Village of Oconomowoc Lake v. Dayton Hudson Corp., 24 
F.3d 962, 966 (7th Cir. 1994), cert. denied, 513 U.S. 930 (1994). As 
one court noted, ``the inclusion of groundwater with a hydrological 
connection to surface waters has troubled courts and generated a 
torrent of conflicting commentary.'' Potter v. ASARCO, Civ. No. 
S:56CV555, slip op. at 19 (D.Neb. Mar. 3, 1998). The fact that courts 
have reached differing conclusions when examining whether the CWA 
regulates such discharges is itself evidence that the statute is 
ambiguous.
    EPA does not argue that the CWA directly regulates ground water 
quality. In the Agency's view, however, the CWA does regulate 
discharges to surface water which occur via ground water because of a 
direct hydrologic connection between the contaminated ground water and 
nearby surface water. EPA repeatedly has taken the position that the 
CWA can regulate discharges to surface water via ground water that is 
hydrologically connected to surface waters.
    For example, in issuing the general NPDES permit for concentrated 
animal feeding operations (``CAFOs'') in Idaho, EPA stated:
    ``EPA agrees that groundwater contamination is a concern around 
CAFO facilities. However, the Clean Water Act does not give EPA the 
authority to regulate groundwater quality through NPDES permits.
    ``The only situation in which groundwater may be affected by the 
NPDES program is when a discharge of pollutants to surface waters can 
be proven to be via groundwater.'' 62 FR 20177, 20178 (April 25, 1997). 
In response to a comment that the CAFO general permit should not cover 
ground water, the Agency stated:
    ``EPA agrees that the Clean Water Act does not give EPA the 
authority to regulate groundwater quality through NPDES permits. 
However, the permit requirements * * * are not intended to regulate 
groundwater. Rather, they are intended to protect surface waters which 
are contaminated via a groundwater (subsurface) connection.'' Id.
    EPA has made consistent statements on at least five other 
occasions. In the Preamble to the final NPDES Permit Application 
Regulations for Storm Water Discharges, the Agency stated: ``this 
rulemaking only addresses discharges to waters of the United States, 
consequently discharges to ground waters are not covered by this 
rulemaking (unless there is a hydrological connection between the 
ground water and a nearby surface water body.'') 55 FR 47990, 47997 
(Nov. 16, 1990)(emphasis added)). See also 60 FR 44489, 44493 (August 
28, 1995) (in promulgating proposed draft CAFO permit, EPA stated: 
``[D]ischarges that enter surface waters indirectly through groundwater 
are prohibited''); EPA, ``Guide Manual On NPDES Regulations For 
Concentrated Animal Feeding Operations'' at 3 (December 1995) (``Many 
discharges of pollutants from a point source to surface water through 
groundwater (that constitutes a direct hydrologic connection) also may 
be a point source discharge to waters of the United States.'').
    In promulgating regulations authorizing the development of water 
quality standards under the CWA by Indian Tribes for their 
Reservations, EPA stated:
    Notwithstanding the strong language in the legislative history of 
the Clean Water Act to the effect that the Act does not grant EPA 
authority to regulate pollution of ground waters, EPA and most courts 
addressing the issue have recognized that * * * the Act requires NPDES 
permits for discharges to groundwater where there is a direct 
hydrological connection between groundwater and surface waters. In

[[<strong>Page</strong> 3017]]

these situations, the affected ground waters are not considered 
``waters of the United States'' but discharges to them are regulated 
because such discharges are effectively discharges to the directly 
connected surface waters. Amendments to the Water Quality Standards 
Regulations that Pertain to Standards on Indian Reservations, Final 
Rule, 56 FR 64876, 64892 (Dec. 12, 1991)(emphasis added).
    While some courts have not been persuaded that the Agency's 
pronouncements on the regulation of discharges to surface water via 
ground water represent a consistent Agency position, others have found 
EPA's position to be clear. The Hecla Mining court noted that ``The 
court in Oconomowoc Lake dismissed the EPA statements as a collateral 
reference to a problem. It appears to this court, however, that the 
preamble explains EPA's policy to require NPDES permits for discharges 
which may enter surface water via groundwater, as well as those that 
enter directly.'' Washington Wilderness Coalition v. Hecla Mining Co., 
870 F. Supp. 983, 990-91 (E.D. Wash. 1994), dismissed on other grounds, 
(lack of standing) per unpublished decision (E.D. Wash. May 7, 1997) 
(citing Preamble, NPDES Permit Regulations for Storm Water Discharges, 
55 FR 47990, 47997 (Nov. 16, 1990)).
    As a legal and factual matter, EPA has made a determination that, 
in general, collected or channeled pollutants conveyed to surface 
waters via ground water can constitute a discharge subject to the Clean 
Water Act. The determination of whether a particular discharge to 
surface waters via ground water which has a direct hydrologic 
connection is a discharge which is prohibited without an NPDES permit 
is a factual inquiry, like all point source determinations. The time 
and distance by which a point source discharge is connected to surface 
waters via hydrologically connected surface waters will be affected by 
many site specific factors, such as geology, flow, and slope. 
Therefore, EPA is not proposing to establish any specific criteria 
beyond confining the scope of the regulation to discharges to surface 
water via a ``direct'' hydrologic connection. Thus, EPA is proposing to 
make clear that a general hydrologic connection between all waters is 
not sufficient to subject the owner or operator of a point source to 
liability under the Clean Water Act. Instead, consistent with the case 
law, there must be information indicating that there is a ``direct'' 
hydrologic connection to the surface water at issue. Hecla Mining, 870 
F.Supp. at 990 (``Plaintiffs must still demonstrate that pollutants 
from a point source affect surface waters of the United States. It is 
not sufficient to allege groundwater pollution, and then to assert a 
general hydrological connection between all waters. Rather, pollutants 
must be traced from their source to surface waters, in order to come 
within the purview of the CWA.'')
    The reasonableness of the Agency's interpretation is supported by 
the fact that the majority of courts have determined that CWA 
jurisdiction may extend to surface water discharges via hydrologic 
connections.\1\ As the court in Potter v. ASARCO, Inc. declared, ``in 
light of judicial precedent, Congress'' remedial purpose, the absence 
of any specific legislative intent pertaining to hydrologically 
connected ground water and the informal pronouncements of EPA, any 
pollutants that enter navigable waters, whether directly or indirectly 
through a specific hydrological connection, are subject to regulation 
by the CWA.'' Slip op. at 26.
---------------------------------------------------------------------------

    \1\ See e.g., Williams PipeLine Co. v. Bayer Corp., 964 F.Supp. 
1300, 1319-20 (S.D.Iowa 1997) (``Because the CWA's goal is to 
protect the quality of surface waters, the NPDES permit system 
regulates any pollutants that enter such waters either directly or 
through groundwater.''); Washington Wilderness Coalition v. Hecla 
Mining Co., 870 F. Supp. 983, 989-90 (E.D. Wash. 1994), dismissed on 
other grounds, (lack of standing) per unpublished decision (E.D. 
Wash. May 7, 1997) (finding CWA jurisdiction where pollution 
discharged from manmade ponds via seeps into soil and ground water 
and, thereafter, surface waters; and holding that, although CWA does 
not regulate isolated ground water, CWA does regulate pollutants 
entering navigable waters via tributary ground waters); Friends of 
the Coast Fork v. Co. of Lane, OR, Civ. No. 95-6105-TC (D. OR. 
January 31, 1997) (reaching same conclusion as court in Washington 
Wilderness Coalition v. Hecla Mining Co., and finding 
hydrologically-connected ground waters are covered by the CWA); 
McClellan Ecological Seepage Situation, 763 F. Supp. 431, 438 (E.D. 
Cal. 1989), cacated (on other grounds), 47 F.3d 325 (9th Cir. 1995), 
cert. denied, 116 S.Ct. 51 (1995) (allowing plaintiff to attempt to 
prove at trial that pollutants discharged to ground water are 
subsequently discharged to surface water); and McClellan Ecological 
Seepage Situation v. Weinberger, 707 F. Supp. 1182, 1195-96 (E.D. 
Cal. 1988), vacated (on other grounds), 47 F.3d 325 (9th Cir. 1995), 
cert. denied, 116 S.Ct.51 (1995) (although NPDES permit not required 
for discharges to isolated ground water, Congress' intent to protect 
surface water may require NPDES permits for discharges to ground 
water with direct hydrological connection to surface waters); 
Friends of Sante Fe Co. v. LAC Minerals, Inc., 892 F. Supp. 1333, 
1357-58 (D.N.M. 1995) (although CWA does not cover discharges to 
isolated, nontributary groundwater, Quivira and decisions within 
Tenth Circuit demonstrating expansive construction of CWA's 
jurisdictional reach foreclose arguments that CWA does not regulate 
discharges to hydrologically-connected groundwater); Sierra club v. 
Colorado Refining Co., 838 F. Supp. at 1434 (``navigable waters'' 
encompasses tributary groundwater and, therefore, allegations that 
defendant violated CWA by discharging pollutants into soils and 
groundwater, and that pollutants infiltrated creek via groundwater 
and seeps in creek bank, stated cause of action); and Quivira Mining 
Co. v. United States EPA, 765 F.2d 126, 130 (10th Cir. 1985), cert. 
denied, 474 U.S. 1055 (1986) (affirming EPA's determination that CWA 
permit required for discharges of pollutants into surface arroyos 
that, during storms, channeled rainwater both directly to streams 
and into underground aquifers that connected with such streams); 
Martin v. Kansas Board of Regents, 1991 U.S.Dist. LEXIS 2779 (D.Kan. 
1991) (``Groundwater . . . that is naturally connected to surface 
waters constitute `navigable waters' under the Act.''); see also 
Inland Steel Co. v. EPA, 901 F.2d 1419, 1422-23 (7th Cir. 1990) 
(''the legal concept of navigable waters might include ground waters 
connected to surface waters--though whether it does or not is an 
unresolved question. * * * [A] well that ended in such connected 
ground waters might be within the scope of the [CWA]'').
---------------------------------------------------------------------------

    The decisions which did not find authority to regulate such 
discharges under the CWA may, for the most part, be distinguished. In 
Village of Oconomowoc Lake v. Dayton Hudson Corp., the Seventh Circuit 
held that the CWA does not regulate ground water per se. 24 F.3d 962 
(7th Cir. 1994), cert. denied, 513 U.S. 930 (1994). In Oconomowoc, 
however, the plaintiff only alluded to a ``possibility'' of a 
hydrologic connection. 24 F.3d at 965. In Kelley v. United States, the 
district court held that enforcement authority under the CWA did not 
include ground water contamination. 618 F. Supp. 1103 (W.D. Mich. 
1985). The decision is not well-reasoned, as the Kelley court merely 
states--without further elaboration--that the opinion in Exxon v. 
Train, which specifically ``expressed no opinion'' on whether the CWA 
regulated hydrologically connected ground waters, and the legislative 
history ``demonstrate that Congress did not intend the Clean Water Act 
to extend federal regulatory enforcement authority over groundwater 
contamination.'' Kelley, 618 F. Supp. at 1107 (emphasis added). In 
Umatilla, the court concluded that the NPDES program did not apply to 
even hydrologically connected ground water. 962 F.Supp. at 1318. The 
court reviewed the legislative history and existing precedent on the 
issue, but failed to distinguish between the regulation of ground water 
per se and the regulation of discharges into waters of the United 
States which happen to occur via ground water. Moreover, the court 
failed to give deference to the Agency's interpretation of the CWA. Id. 
at 1319 (finding that the Agency interpretations cited by the 
plaintiffs failed to articulate clear regulatory boundaries and were 
not sufficiently ``comprehensive, definitive or formal'' to deserve 
deference, but acknowledging that ``neither the statute nor the 
legislative history absolutely prohibits an interpretation that the 
NPDES requirement applies to discharges of

[[<strong>Page</strong> 3018]]

pollutants to hydrologically-connected groundwater''). Today's proposal 
should provide the type of formal Agency interpretation that court 
sought. Two other decisions have simply adopted the reasoning of the 
Umatilla court. United States v. ConAgra, Inc., Case No. CV 96-0134-S-
LMB (D. Idaho 1997); Allegheny Environmental Action Coalition v. 
Westinghouse, 1998 U.S. Dist. LEXIS 1838 (W.D.Pa. 1998).
    The Agency has utilized its expertise in environmental science and 
policy to determine the proper scope of the CWA. The determination of 
whether the CWA regulates discharges to ground waters connected to 
surface waters, like the determination of wetlands jurisdiction, 
``ultimately involves an ecological judgment about the relationship 
between surface waters and ground waters, it should be left in the 
first instance to the discretion of the EPA and the Corps.'' Town of 
Norfolk v. U.S. Army Corps of Engineers, 968 F.2d 1438, 1451 (1st Cir. 
1992) (citing United States v. Riverside Bayview Homes, Inc., 474 U.S. 
at 134). The Supreme Court, too, has acknowledged the difficulty of 
determining precisely where Clean Water Act jurisdiction lies and has 
held that an agency's scientific judgment can support a legal 
jurisdictional judgment. United States v. Riverside Bayview Homes, 
Inc., 474 U.S. 121, 134 (1985) (``In view of the breadth of federal 
regulatory authority contemplated by the [Clean Water] Act itself and 
the inherent difficulties of defining precise bounds to regulable 
waters, the Corps' ecological judgment about the relationship between 
waters and their adjacent wetlands provides an adequate basis for a 
legal judgment that adjacent wetlands may be defined as waters under 
the Act.'').
    The Agency has made clear the rationale for its construction: ``the 
Act requires NPDES permits for discharges to groundwater where there is 
a direct hydrological connection between groundwater and surface 
waters. In these situations, the affected ground waters are not 
considered `waters of the United States' but discharges to them are 
regulated because such discharges are effectively discharges to the 
directly connected surface waters.'' Amendments to the Water Quality 
Standards Regulations that Pertain to Standards on Indian Reservations, 
Final Rule, 56 FR 64,876, 64892 (Dec. 12, 1991) (emphasis added). The 
Agency has taken this position because ground water and surface water 
are highly interdependent components of the hydrologic cycle. The 
hydrologic cycle refers to ``the circulation of water among soil, 
ground water, surface water, and the atmosphere.'' U.S. Environmental 
Protection Agency, ``A Review of Methods for Assessing Nonpoint Source 
Contaminated Ground-Water Discharge to Surface Water'' at 3 (April 
1991). Thus, a hydrologic connection has been defined as ``the 
interflow and exchange between surface impoundments and surface water 
through an underground corridor or groundwater.'' NPDES General Permit 
and Reporting Requirements for Discharges from Concentrated Animal 
Feeding Operations, EPA Region 6 Public Notice of Final Permitting 
Decision, 58 FR 7610, 7635-36 (Feb. 8, 1993). The determination of 
whether a discharge to ground water in a specific case constitutes an 
illegal discharge to waters of the U.S. if unpermitted is a fact 
specific one. The general jurisdictional determination by EPA that such 
discharges can be subject to regulation under the CWA is a 
determination that involves an ecological judgment about the 
relationship between surface waters and ground waters.
    Finally, the Supreme Court has explicitly acknowledged that 
resolution of ambiguities in agency-administered statutes involves 
policymaking: ``As Chevron itself illustrates the resolution of 
ambiguity in a statutory text is often more a question of policy than 
of law. * * * When Congress, through express delegation or the 
introduction of an interpretive gap in the statutory structure, has 
delegated policymaking to an administrative agency, the extent of 
judicial review of the agency's policy determinations is limited.'' 
Pauly v. Bethenergy Mines, Inc., 116 S.Ct. 2524, 2534 (1991). Congress 
established a goal for the CWA ``to restore and maintain the chemical, 
physical and biological integrity of the nation's waters and to 
eliminate the discharge of pollutants into the navigable waters.'' 33 
U.S.C. Sec. 1251(a)(1). Congress also established some parameters for 
reaching that goal, but left gaps in the statutory structure. One of 
those gaps is the issue of discharges of pollutants from point sources 
which harm navigable waters but which happen to occur via ground water. 
The Agency has chosen to fill that gap by construing the statute to 
regulate such discharges as point source discharges. Given the Agency's 
knowledge of the hydrologic cycle and aquatic ecosystems, the Agency 
has determined that when it is reasonably likely that such discharges 
will reach surface waters, the goals of the CWA can only be fulfilled 
if those discharges are regulated.
    Determining Direct Hydrologic Connection. In recent rulemakings, 
EPA has used various lithologic settings to describe areas of 
vulnerability to contamination of ground water. This information can 
serve as a guide for permit writers to make the initial determination 
whether or not it is necessary to establish special conditions in a 
CAFO permit to prevent the discharge of CAFO waste to surface water via 
ground water with a direct hydrologic connection to surface water.
    During the rulemaking processes for the development of the Ground 
Water Rule and the Underground Injection Control Class V under the Safe 
Drinking Water Act, significant stakeholder and Federal Advisory 
Committee Act (FACA), input was used to define lithologic settings that 
are likely to indicate ground water areas sensitive to contamination. 
Areas likely to have such a connection are those that have ground water 
sensitive to contamination and that have a likely connection to surface 
water. The Ground Water Proposed Rule includes language that describes 
certain types of lithologic settings (karst, fractured bedrock, and 
gravel) as sensitive to contamination and, therefore, subject to 
requirements under the rule to mitigate threats to human health from 
microbial pathogens. [See National Primary Drinking Water Regulations: 
Ground Water Rule, 65 FR 30193 (2000) (to be codified at 40 CFR Parts 
141 and 142) (proposed May 10, 2000). See also Underground Injection 
Control Regulations for Class V Injection Wells, Revision; Final Rule, 
64 FR 68546 (Dec. 7, 1999) (to be codified at 40 CFR Parts 9, 144, 145, 
and 146). See also Executive Summary, NDWAC UIC/Source Water Program 
Integration Working Group Meeting (March 25-26, 1999). All are 
available in the rulemaking Record.]
    Under the Class V rule, a facility must comply with the mandates of 
the regulation if the facility has a motor vehicle waste disposal well 
(a type of Class V well) that is in an area that has been determined to 
be sensitive. (See Technical Assistance Document (TAD) for Delineating 
``Other Sensitive Ground Water Areas'', EPA #816-R-00-016--to be 
published.) States that are responsible for implementing the Class V 
Rule, or in the case of Direct Implementation Programs, the EPA 
Regional Office, are given flexibility to make determinations of ground 
water sensitivity within certain guidelines.
    40 CFR 145.23(f)(12) provides items that States are expected to 
consider in developing their other sensitive ground water area plan, 
including:
    <bullet> Geologic and hydrogeologic settings,
    <bullet> Ground water flow and occurrence,

[[<strong>Page</strong> 3019]]

    <bullet> Topographic and geographic features,
    <bullet> Depth to ground water,
    <bullet> *Significance as a drinking water source,
    <bullet> *Prevailing land use practices, and
    <bullet> *Any other existing information relating to the 
susceptibility of ground water to contamination from Class V injection 
wells.

    *The last three factors are not relevant to this rulemaking but 
are specific to mandates under the Safe Drinking Water Act to 
protect current and future sources of drinking water.

    Geologic and hydrogeologic settings considered sensitive under the 
Class V Rule include areas such as karst, fractured bedrock or other 
shallow/unconsolidated aquifers. The Class V Rule lists karst, 
fractured volcanics and unconsolidated sedimentary aquifers, such as 
glacial outwash deposits and eolian sands, as examples of aquifer 
types. Under the Class V Rule, EPA urges States to consider all aquifer 
types that, based on their inherent characteristics, are likely to be 
moderately to highly sensitive. Such aquifer types are those that 
potentially have high permeability, such as: all fractured aquifers; 
all porous media aquifers with a grain size of sand or larger, 
including not only unconsolidated aquifers, but sandstone as well; and 
karst aquifers.
    For more information at the regional level, information can be 
found in the document ``Regional Assessment of Aquifer Vulnerability 
and Sensitivity in the Coterminous United States'' [EPA/600/2-91/043] 
for state maps showing aquifers and portions of aquifers whose 
transmissivity makes them sensitive/vulnerable. This document may be 
helpful in identifying areas where existing contaminants are most 
likely to spread laterally. State and federal geological surveys have 
numerous geological maps and technical reports that can be helpful in 
the identification of areas of sensitive aquifers. University geology 
and earth science departments and consulting company reports may also 
have helpful information.
    Data sources to assist permit writers in making sensitivity 
determinations can be acquired through many sources as listed above and 
include federal, state, and local data. For example, USGS maps and 
databases such as the principal aquifers map, state maps, other 
programs where such assessments may have been completed, such as State 
Source Water Assessment Programs (SWAP), state Class V, or Ground Water 
Rule sensitivity determinations.
    Another potential approach to defining areas of ground water 
sensitivity would be to define a set of characteristics which a 
facility could determine whether it met by using a set of national, 
regional and/or local maps. For instance, overburden, that is, soil 
depth and type, along with depth to water table, hydrogeologic 
characteristics of the surficial aquifer, and proximity to surface 
water could be factors used to define sensitive areas for likely ground 
water/surface water connections. For example, while there is no 
consistent definition or agreement as to what could be considered 
``shallow,'' a depth to the water table less than, say, six feet with 
sandy soils or other permeable soil type might indicate ground water 
vulnerability. Data of this nature could be obtained from USDA's 
Natural Resource Conservation Service (NRCS) national soils maps, 
available from the NRCS web site (<A HREF="http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.nhq.nrcs.usda.gov/land/index/soils.html">www.nhq.nrcs.usda.gov/land/index/
soils.html</A>) or from the EPA web site (<A HREF="http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.epa.gov/ostwater/BASINS/metadata/statsgo.htm">www.epa.gov/ostwater/BASINS/
metadata/statsgo.htm</A>).
    Once it is determined that the CAFO is in a ground water sensitive 
area, proximity to a surface water would indicate a potential for the 
CAFO to discharge to surface water via a direct hydrological connection 
with ground water. Proximity to surface water would be considered when 
there is a short distance from the boundary of the CAFO to the closest 
downstream surface water body. Again, information of this type could be 
obtained from USGS topographic maps or state maps.
    USGS Hydrologic Landscape Regions. Another approach for determining 
whether CAFOs in a region are generally located in areas where surface 
water is likely to have hydrological connections with ground water is 
by using a set of maps under development by the U.S. Geological Survey 
(USGS). USGS is developing a national map of Hydrologic Landscape 
Regions that describe watersheds based on their physical 
characteristics, such as topography and lithology. These maps will, 
among other things, help to identify physical features in the landscape 
that are important to water quality such as areas across the country 
where the geohydrology is favorable for ground water interactions with 
surface water.
    The regions in this map will be delineated based on hydrologic unit 
codes (HUCs) nationwide and do not provide information at local scales; 
however, the maps can provide supplemental information that describes 
physical features within watersheds where interactions between ground 
water and surface water are found. These areas are the most likely 
places where ground water underlying CAFO's could be discharged to 
nearby surface water bodies. While EPA has not fully assessed how this 
tool might be used to determine a CAFO's potential to discharge an 
excerpt of the pre-print report is provided here for purposes of 
discussion. The report describing this tool is anticipated to be 
published in Spring 2001 (Wolock, Winter, and McMahon, in review).
    The concept of hydrologic landscapes is based on the idea that a 
single, simple physical feature is the basic building block of all 
landscapes. This feature is termed a fundamental landscape unit and is 
defined as an upland adjacent to a lowland separated by an intervening 
steeper slope. Some examples of hydrologic landscapes are as follows:
    <bullet> A landscape consisting of narrow lowlands and uplands 
separated by high and steep valley sides, characteristic of mountainous 
terrain;
    <bullet> A landscape consisting of very wide lowlands separated 
from much narrower uplands by steep valley sides, characteristic of 
basin and range physiography and basins of interior drainage; or
    <bullet> A landscape consisting of narrow lowlands separated from 
very broad uplands by valley sides of various slopes and heights, 
characteristic of plateaus and high plains.
    The hydrologic system of a fundamental landscape unit consists of 
the movement of surface water, ground water, and atmospheric-water 
exchange. Surface water movement is controlled by land-surface slope 
and surficial permeability; ground-water flow is a function of 
gravitational gradients and the hydraulic characteristics of the 
geologic framework; and atmospheric-water exchange primarily is 
determined by climate (Winter, in review). The same physical and 
climate characteristics control the movement of water over the surface 
and through the subsurface regardless of the geographic location of the 
landscapes. For example, if a landscape has gentle slopes and low-
permeability soils, then surface runoff will be slow and recharge to 
ground water will be limited. In contrast, if the soils are permeable 
in a region of gentle slopes, then surface runoff may be limited but 
ground-water recharge will be high.
    The critical features used to describe hydrologic landscapes are 
land-surface form, geologic texture, and climate. Land-surface form can 
be used to quantify land-surface slopes and relief. Geologic texture 
provides estimates of surficial and deep subsurface permeability which 
control infiltration, the production of overland flow, and

[[<strong>Page</strong> 3020]]

ground-water flow rates. Climate characteristics can be used to 
approximate available water to surface and ground-water systems. The 
variables used to identify hydrologic settings were averaged within 
each of the 2,244 hydrologic cataloging units defined by the USGS. This 
degree of spatial averaging was coarse enough to smooth the underlying 
data but fine enough to separate regions from each other.
    For example, two Hydrological Landscape Regions (HLR) that are 
likely to have characteristics of ground water and surface water 
interactions with direct relevance to this proposed rulemaking would be 
``HLR1'' and ``HLR9''. HLR1 areas are characterized by variably wet 
plains having highly permeable surface and highly permeable subsurface. 
This landscape is 92 percent flat land, with 56 percent of the flat 
land in the lowlands and 37 percent in the uplands. Land surface and 
bedrock are highly permeable. Because of the flat sandy land surface, 
this geologic framework should result in little surface runoff, and 
recharge to both local and regional ground-water flow systems should be 
high. Therefore, ground water is likely to be the dominant component of 
the hydrologic system in this landscape. The water table is likely to 
be shallow in the lowlands, resulting in extensive wetlands in this 
part of the landscape.
    Major water issues in this hydrologic setting probably would be 
related to contamination of ground water. In the uplands, the 
contamination could affect regional ground-water flow systems. In the 
lowlands, the thin unsaturated zone and the close interaction of ground 
water and surface water could result in contamination of surface water. 
Flooding probably would not be a problem in the uplands, but it could 
be a serious problem in the lowlands because of the flat landscape and 
shallow water table.
    HLR9 areas are characterized by wet plateaus having poorly 
permeable surface and highly permeable subsurface. This landscape is 42 
percent flat land, with 24 percent in lowlands and 17 percent in 
uplands. Land surface is poorly permeable and bedrock is highly 
permeable. Because of the flat poorly permeable land surface, this 
geologic framework should result in considerable surface runoff and 
limited recharge to ground water. However, the bedrock is largely 
karstic carbonate rock, which probably would result in a considerable 
amount of surface runoff entering the deep aquifer through sinkholes. 
This water could readily move through regional ground-water flow 
systems. Surface runoff and recharge through sinkholes are likely to be 
the dominant component of the hydrologic system in this landscape. The 
water table is likely to be shallow in the lowlands, resulting in 
extensive wetlands in this part of the landscape. Major water issues in 
this hydrologic setting probably would be related to contamination of 
surface water from direct surface runoff, and extensive contamination 
of ground water (and ultimately surface water) because of the ease of 
movement through the bedrock. The capacity of these carbonate rocks to 
mediate contaminants is limited. Flooding could be a problem in the 
lowlands.
    EPA is requesting comment on how a permit writer might identify 
CAFOs at risk of discharging to surface water via ground water. EPA is 
also requesting comment on its cost estimates for the permittee to have 
a hydrologist make such a determination. EPA estimates that for a 
typical CAFO, the full cost of determining whether ground water beneath 
the facility has a direct hydrologic connection to surface water would 
be approximately $3,000. See Section X for more information on cost 
estimates.
    Permit requirements for facilities with groundwater that has a 
direct hydrologic connection with surface water are discussed in 
Section VII.E.5.d below.
    k. What Regulatory Relief is Provided by Today's Proposed 
Rulemaking? Two-tier vs. Three-tier Structure. Each of EPA's proposals 
effect small livestock and poultry businesses in different ways, posing 
important trade-offs when selecting ways to mitigate economic impacts. 
First, by proposing to establish a two-tier structure with a 500 AU 
threshold, EPA is proposing not to automatically impose the effluent 
guidelines requirements on operations with 300 to 500 AU. By 
eliminating this size category, EPA estimates that about 10,000 smaller 
AFOs are relieved from being defined as CAFOs, and instead would only 
be subject to permitting if designated by the permit authority due to 
being a significant contributor of pollutants.
    A three-tier structure, by contrast, only automatically defines all 
operations over 1,000 AU as CAFOs, instead of 500 AU. However, while 
all of the 26,000 AFOs between 300 and 1,000 AU wouldn't be required to 
apply for an NPDES permit, all those operations would be required to 
either apply for a permit or to certify to the permit authority that 
they do not meet any of the conditions for being a CAFO. EPA estimates 
that approximately 19,000 of these operations would have to change some 
aspect of their operation in order to avoid being permitted, and all 
26,000 would be required to develop and implement a PNP. Thus, while in 
theory fewer operations could be permitted, in fact more small 
enterprises would incur costs under a three-tier scenario. Section 
X.J.4 provides a summary of the difference in costs associated with 
these two options; more detailed information is provided in Section 9 
of the Economic Analysis.
    The three-tier structure allows States more flexibility to develop 
more effective non-NPDES programs to assist middle tier operations. The 
two-tier structure with a 500 AU threshold might limit access to 
federal funds, such as Section 319 nonpoint source program funds, for 
operations in the 500 to 1,000 AU range. The detailed conditions in the 
three-tier structure, however, do not meet the goal of today's proposal 
to simplify the NPDES regulation for CAFOs because it leaves in place 
the need for the regulated community and enforcement authorities to 
interpret a complicated set of conditions.
    Chicken Threshold. During deliberations to select a threshold for 
dry chicken operations, EPA considered various options for relieving 
small business impacts. Under the two-tier structure, EPA examined a 
100,000 bird threshold as well as a 50,000 bird threshold. Although the 
50,000 bird threshold effects many more small chicken operations, 
analysis showed that setting the threshold at 100,000 birds would not 
be sufficiently environmentally protective in parts of the country that 
have experienced water quality degradation from the chicken industry. 
Section VII.C.2.f describes the relative benefits of each of these 
options. Nonetheless, because wet layer operations are currently 
regulated at 30,000 birds, raising the threshold to 50,000 birds will 
relieve some small businesses in this sector.
    Elimination of the mixed animal calculation. EPA's is further 
proposing to mitigate the effects of today's proposal on small 
businesses by eliminating the mixed animal calculation for determining 
which AFOs are CAFOs. Thus, operations with mixed animal types that do 
not meet the size threshold for any single livestock category would not 
be defined as a CAFO. EPA expects that there are few AFOs with more 
than a single animal type that would be defined as CAFOs, since most 
mixed operations tend to be smaller in size. The Agency determined that 
the inclusion of mixed operations would disproportionately burden small 
businesses while resulting in little additional environmental benefit. 
Since

[[<strong>Page</strong> 3021]]

most mixed operations tend to be smaller in size, this exclusion 
represents important accommodations for small business. EPA's decision 
not to include smaller mixed operations is consistent with its 
objective to focus on the largest operations since these pose the 
greatest potential risk to water quality and public health given the 
sheer volume of manure generated at these operations.
    Operations that handle larger herds or flocks take on the 
characteristics of being more industrial in nature, rather than having 
the characteristics typically associated with farming. These facilities 
typically specialize in a particular animal sector rather than having 
mixed animal types, and often do not have an adequate land base for 
agricultural use of manure. As a result, large facilities need to 
dispose of significant volumes of manure and wastewater which have the 
potential, if not properly handled, to cause significant water quality 
impacts. By comparison, smaller farms manage fewer animals and tend to 
concentrate less manure nutrients at a single farming location. Smaller 
farms tend to be less specialized and are more diversified, engaging in 
both animal and crop production. These farms often have sufficient 
cropland and fertilizer needs to land apply manure nutrients generated 
at a farm's livestock or poultry business for agricultural purposes.
    For operations not defined as a CAFO, the Permit Authority would 
designate any facility determined to be a significant contributor of 
pollution to waters of the U.S. as a CAFO, and would consequently 
develop a permit based on best professional judgement (BPJ).
    The estimated cost savings from eliminating the mixed animal 
calculation is indeterminate due to limited information about 
operations of this size and also varying cost requirements. EPA's 
decision is also expected to simplify compliance and be more 
administratively efficient, since the mixed operation multiplier was 
confusing to the regulated community and to enforcement personnel, and 
did not cover all animal types (because poultry did not have an AU 
equivalent).
    Site-specific PNPs Rather than Mandated BMPs. In addition, while 
facilities that are defined or designated as CAFOs would be subject to 
specific performance standards contained with the permit conditions, 
EPA's proposed revisions also provide flexibility to small businesses. 
In particular, the revised effluent guidelines and NPDES standards and 
conditions are not specific requirements for design, equipment, or work 
practices, but rather allow the CAFO operator to write site-specific 
Permit Nutrient Plans that implement the permit requirements in a 
manner appropriate and manageable for that business. This will reduce 
impacts to all facilities, regardless of size, by allowing operators to 
choose the least costly mix of process changes and new control 
equipment that would meet the limitations.
    Demonstration of No Potential to Discharge. Finally, in both 
proposals, operations that must apply for a permit would have the 
additional opportunity to demonstrate to the permit authority that 
pollutants have not been discharged and have no potential to discharge 
into waters of the U.S. These operations would not be issued a permit 
if they can successfully demonstrate no potential to discharge. See 
section VII.D.3 for a discussion of demonstrating ``no potential to 
discharge.''
    Measures Not Being Proposed. During the development of the CAFO 
rulemaking, EPA considered regulatory relief measures under the NPDES 
permit program that are not being proposed, including: (1) A ``Good 
Faith Incentive,'' and (2) an ``Early Exit'' provision. These options 
are summarized below. More detail is provided in the SBREFA Panel 
Report (2000).
    Under the ``Good Faith Incentive,'' EPA considered incorporating an 
incentive for small CAFO businesses (i.e., AFOs with a number of 
animals below the regulatory threshold) to take early voluntary actions 
in good faith to manage manure and wastewater in accordance with the 
requirements of a nutrient management plan. In the event that such 
smaller AFOs have a discharge that would otherwise cause them to be 
designated as CAFOs, the CAFO regulations would provide an opportunity 
for these smaller AFOs to address the cause of the one-time discharge 
and avoid being designated as CAFOs.
    Under the ``Early Exit'' provision, EPA considered a regulatory 
provision that would explicitly allow CAFOs with fewer animals than the 
regulatory threshold for large CAFOs to exit the regulatory program 
after five years of good performance. The regulations could allow such 
a smaller CAFO to exit the regulatory program if it demonstrates that 
it had successfully addressed the conditions that caused it to either 
be defined or designated as a CAFO.
    EPA decided not to include either of these provisions in the 
proposed regulations following the SBAR Panel consultation process. 
Neither small businesses, SBA, OMB, nor EPA enforcement personnel 
expressed support for either of these provisions. Also, the Early Exit 
provision was not deemed to provide additional regulatory relief over 
the current program, since an operation that has been defined or 
designated as a CAFO can already make changes at the operation whereby, 
after complying with the permit for the permit's five year term, the 
operation would no longer meet the definition of a CAFO and therefore 
would no longer be required to be permitted.
    Both the regulatory relief measures selected and those considered 
but not selected are discussed in detail in Chapter 9 of the Economic 
Analysis, included in the Record for today's proposed rulemaking. EPA 
requests comment on the regulatory relief measures considered but not 
included in today's proposal.
3. How Does the Proposed Rule Change the Existing Designation Criteria 
and Procedure?
    In the existing regulation, an operation in the middle tier, those 
with 300 AU to 1,000 AU, may either be defined as a CAFO or designated 
by the permit authority; those in the smallest category, with fewer 
than 300 AU, may only be designated a CAFO if the facility discharges: 
(1) into waters of the United States through a man-made ditch, flushing 
system, or other similar man-made device; or (2) directly into waters 
of the United States that originate outside of the facility and pass 
over, across, or through the facility or otherwise come into direct 
contact with the confined animals. The permit authority must conduct an 
on-site inspection to determine whether the AFO is a significant 
contributor of pollutants. The two discharge criteria have proved 
difficult to interpret and enforce, making it difficult to take 
enforcement action against dischargers. Very few facilities have been 
designated in the past 25 years despite environmental concerns.
    EPA's proposals on how, and whether, to amend these criteria vary 
with the alternative structure. Under a two-tier structure, EPA is 
proposing to eliminate these two criteria; under a three-tier 
structure, EPA is proposing to retain these two criteria.
    Under the proposed two-tier structure with a 500 AU threshold, or 
under any other alternative two-tier structure such as with a 750 AU 
threshold, EPA is proposing to eliminate the two discharge criteria. 
Raising the NPDES threshold to 500 AU, 750 AU or 1,000 AU raises a 
policy question for facilities below the selected threshold but with 
more than 300 AU. Facilities with 300 to 1,000 AU are currently subject 
to

[[<strong>Page</strong> 3022]]

NPDES regulation (if certain criteria are met). To rely entirely on 
designation for these operations could be viewed by some as 
deregulatory, because the designation process is a time consuming and 
resource intensive process that makes it difficult to redress 
violations. It could also result in the inability of permit authorities 
to take enforcement actions against initial discharges unless they are 
from an independent point source at the facility. Otherwise, the 
initial discharge can only result in initiation of the designation 
process itself; enforcement could only take place upon a subsequent 
discharge. Unless the designation process can be streamlined in some 
way to enable permit authorities to more efficiently address those who 
are significant contributors of pollutants, raising the threshold too 
high may also not be sufficiently protective of the environment. While 
EPA could have proposed to retain the two criteria for those with fewer 
than 300 AU, and eliminate it only for those with greater than 300 AU 
but below the regulatory threshold, EPA believes that this would 
introduce unnecessary complexity into this regulation.
    While eliminating the two discharge criteria, this proposal would 
retain the provision in the existing regulation that any AFO may be 
designated as a CAFO on a case-by-case basis if the NPDES permit 
authority determines that the facility is a significant contributor of 
pollutants to waters of the U.S. Today's proposal would not change the 
factors that the regulation lists as relevant to whether a facility is 
a significant contributor--see proposed Sec. 122.23(b)(1) (listing 
factors such as: the size of the operation; the amount of wastewater 
discharged; the location of any potential receiving waters; means of 
conveyance of animal manure and process wastewater into waters of the 
U.S.; slope, vegetation, rainfall and other factors affecting the 
likelihood or frequency of discharge to receiving waters).
    This proposal also retains the existing requirement that the permit 
authority conduct an on-site inspection before making a designation. No 
inspection would be required, however, to designate a facility that was 
previously defined or designated as a CAFO, although the permit 
authority may chose to do one.
    Under a three-tier structure, EPA is proposing to retain the two 
discharge criteria used to designate an AFO with fewer than 300 AU as a 
CAFO. In this approach, facilities in the 300 AU to 1,000 AU size range 
must meet certain conditions for being considered a CAFO, and EPA 
considers this to be sufficiently protective of the environment.
    EPA is requesting comment on these two proposals, and also requests 
comment on three other alternatives. EPA could: (1) retain the two 
criteria even under a two-tier structure for all operations below the 
regulatory threshold; (2) retain the two criteria under a two-tier 
structure for only for those with fewer than 300 AU and eliminate the 
two criteria for those below the regulatory threshold but with greater 
than 300 AU; or (3) eliminate the criteria in the three-tier structure 
for those with fewer than 300 AU.
    Significant concern was raised over the issue of designation during 
the SBREFA Panel process. At the time of the Panel, EPA was not 
considering eliminating these two criteria, and SERs and Panel members 
strongly endorsed this position. At that time, EPA's was focusing on a 
three-tier structure with revised conditions as the preferred option, 
and retaining the criteria was consistent with the revisions being 
considered. Since then, however, EPA's analysis has resulted in a 
strong option for a two-tier approach that would be simpler to 
implement and would focus on the largest operations. Once this scenario 
became a strong candidate, reconsideration of the two designation 
criteria was introduced. EPA realizes that this proposal has raised 
some concern in the small business community. However, EPA does not 
believe that eliminating these criteria will result in significantly 
more small operations being designated. Rather, it will enable the 
permit authority to ensure that the most egregious discharges of 
significant quantities of pollutants are addressed.
    It is likely that few AFOs with less than 300 AU are significant 
contributors of pollutants, and permit authorities may be appropriately 
focusing scarce resources on larger facilities. Further, some also 
believe that it may be appropriate under a two-tier structure to retain 
the two criteria as well as the on-site inspection criterion to AFOs 
under the regulatory threshold, e.g. with fewer than 500 AU or 750 AU. 
SERs during the SBREFA process indicated that family farmers operating 
AFOs with fewer than 1,000 AU tend to have a direct interest in 
environmental stewardship, since their livelihood (e.g., soil quality 
and drinking water) often depends on it. They also argued that EPA 
should not divert resources away from AFOs with the greatest potential 
to discharge--those with 1,000 AU or more. EPA is soliciting comment on 
whether to retain the designation criteria for all AFOs below the 
regulatory threshold in a two-tier structure, and whether this option 
will be protective of the environment.
    While permit authorities have indicated that the requirement for an 
on-site inspection makes the designation process resource intensive, 
recommendations resulting from the SBREFA small business consultation 
process encouraged EPA not to remove the on-site inspection 
requirement. Some were concerned that EPA might do widespread blanket 
designations of large numbers of operations, especially in watersheds 
that have been listed under the CWA 303(d), Total Maximum Daily Load 
(TMDL) process. Thus, EPA is soliciting comment on whether to eliminate 
the requirement that the inspection be ``on-site,'' perhaps by 
allowing, in lieu of on-site inspections, other forms of site-specific 
information gathering, such as use of monitoring data, fly-overs, 
satellite imagery, etc. Other parts of the NPDES program allow such 
information gathering and do not require inspections to be ``on-site.''
    If the on-site requirement were eliminated, the permit authority 
would still need to make a determination that the facility is a 
significant contributor of pollution, which might necessitate an on-
site inspection in many cases. On the other hand, in watersheds that 
are not meeting water quality standards for nutrients, the permit 
authority could designate all AFOs as CAFOs without conducting 
individual on-site inspections. Even in 303(d) listed watersheds, 
however, an operator of an individual facility might be able to 
demonstrate in the NPDES permit application that it has no potential to 
discharge, and request that it be exempted from NPDES requirements.
    Due to the significant concerns of the small business community, 
EPA is not proposing at this time to eliminate the on-site inspection 
requirements, but, rather, EPA is soliciting comment on whether or not 
to eliminate this provision or to revise it to allow other forms of 
site-specific data gathering.
    Finally, EPA is proposing a technical correction to the designation 
regulatory language. The existing CAFO NPDES regulations provide for 
designation of an AFO as a CAFO upon determining that it is a 
significant contributor of ``pollution'' to the waters of the U.S. 40 
CFR 122.23(c). EPA is today proposing to change the term to 
``pollutants.'' Elsewhere in the NPDES regulations, EPA uses the phrase 
``significant contributor of pollutants'' for designation purposes. 40 
CFR 122.26(a)(1)(v). EPA is not aware of any reason the Agency would 
have used different terms for similar designation

[[<strong>Page</strong> 3023]]

standards, and is seeking consistency in this proposal. The Agency 
believes the term ``pollutant'' is the correct term. The Clean Water 
Act provides definitions for both ``pollutant and ``pollution'' in 
Section 502, but the NPDES program of Section 402 focuses specifically 
on permits ``for the discharge of any pollutant, or combination of 
pollutants.'' Therefore, EPA believes it is appropriate to establish a 
designation standard for purposes of permitting CAFOs based on whether 
a facility is a significant contributor of ``pollutants.''
4. Designation of CAFOs by EPA in Approved States
    Today's proposal would explicitly allow the EPA Regional 
Administrator to designate an AFO as a CAFO if it meets the designation 
criteria in the regulations, even in States with approved NPDES 
programs. See proposed Sec. 122.23(b). As described in the preceding 
section, VII.C.4, AFOs that have not been defined as CAFOs may be 
designated as CAFOs on a case-by-case basis upon determination that 
such sources are significant contributors of pollution to waters of the 
United States. EPA's authority to designate AFOs as CAFOs would be 
subject to the same criteria and limitations to which State designation 
authority is subject.
    The existing regulatory language is not explicit as to whether EPA 
has the authority to designate AFOs as CAFOs in States with approved 
NPDES programs. The current regulations state that ``the Director'' may 
designate AFOs as CAFOs. 40 CFR 122.23(c)(1). The existing definition 
of ``Director'' states: ``When there is an approved State program, 
`Director' normally means the State Director. In some circumstances, 
however, EPA retains the authority to take certain actions even where 
there is an approved State program.'' 40 CFR 122.2. Today's proposal 
would give EPA the explicit authority to designate an AFO as a CAFO in 
States with approved programs.
    EPA does not propose to assume authority or jurisdiction to issue 
permits to the CAFOs that the Agency designates in approved NPDES 
States. That authority would remain with the approved State.
    EPA believes that CWA Section 501(a) provides the Agency with the 
authority to designate point sources subject to regulation under the 
NPDES program, even in States approved to administer the NPDES permit 
program. This interpretive authority to define point sources and 
nonpoint sources was recognized by the D.C. Circuit in NRDC v. Costle, 
568 F.2d 1369, 1377 (D.C. Cir. 1977). The interpretive authority arises 
from CWA Section 501(a) when EPA interprets the term ``point source'' 
at CWA Section 502(14). EPA's proposal would ensure that EPA has the 
same authority to designate AFOs as CAFOs that need a permit as the 
Agency has to designate other storm water point sources as needing a 
permit. See 40 CFR 122.26(a)(2)(v).
    EPA recognizes that many State agencies have limited resources to 
implement their NPDES programs. States may be hesitant to designate 
CAFOs because of concerns that regulating the CAFOs will require 
additional resources that could be used for competing priorities. In 
light of the increased reliance and success in control of point sources 
under general permits, however, the Agency believes that there will be 
only an incremental increase in regulatory burden due to the designated 
sources.
    On August 23, 1999, the Agency proposed to provide explicit 
authority for EPA to designate CAFOs in approved States, but would have 
limited such authority to the designation of AFOs where pollutants are 
discharged into waters for which EPA establishes a total maximum daily 
load or ``TMDL'' and designation is necessary to ensure that the TMDL 
is achieved. 64 FR 46058, 46088 (August 23, 1999). EPA received 
comments both supporting and opposing the proposal. In promulgating the 
final TMDL rule, however, the Agency did not take final action on the 
proposed changes applicable to CAFOs, 65 FR 43586, 43648 (July 13, 
2000), deciding instead to take action in this proposed rulemaking.
    Today's proposal is intended to help ensure nationally consistent 
application of the provisions for designating CAFOs and is not focusing 
specifically at AFOs in impaired watersheds. Implementation of the 
current rule in States with NPDES authorized programs has varied 
greatly from State to State, with several States choosing to implement 
non-NPDES State programs rather than a federally enforceable NPDES 
program. Public concerns have also been raised about lack of access to 
State non-NPDES CAFO programs. While several of today's proposed 
revisions would help to correct these disparities, EPA is concerned 
that there may be instances of significant discharges from AFOs that 
may not be addressed by State programs, and that are not being required 
to comply with the same standards and requirements expected of all 
AFOs. As part of their approved programs, States should designate AFOs 
that are significant sources of pollutants. EPA would have the 
authority to designate AFOs as CAFOs, should that be necessary.
    The Agency invites comment on this proposal.
5. Co-permitting Entities That Exert Substantial Operational Control 
Over a CAFO
    EPA is proposing that permit authorities co-permit entities that 
exercise substantial operational control over CAFOs along with the 
owner/operator of the facility. See proposed Sec. 122.23(a)(5) and 
(i)(4). While the permit authority currently may deem such entities to 
be ``operators'' under the Clean Water Act and require them to be 
permitted under existing legal requirements, today's proposal includes 
changes to the regulations to identify the circumstances under which 
co-permitting is required and how permit authorities are expected to 
implement the requirements. Because the existing definition of 
``operator'' in 122.2 generally already encompasses operators who 
exercise substantial operational control, the Agency is seeking comment 
on whether this additional definition [or provision] is necessary.
    For other categories of discharges, EPA's regulations states that 
contributors to a discharge ``may'' be co-permittees. See 40 CFR 
Sec. 122.44(m). Sec. 122.44(m) addresses the situation in which the co-
permittees operate distinct sources and a privately owned treatment 
works is the owner of the ultimate point source discharge. In that 
context, EPA deemed it appropriate to give the permit writer the 
discretion to permit only the privately owned treatment works or the 
distinct sources, or both, depending on the level of control each 
exercises over the pollutants. In the context of CAFOs, however, the 
co-permittees both control some aspects of operations at the point 
source. Therefore, EPA is proposing that they must either be co-
permittees or each must hold a separate permit.
    Processor/Producer Relationship. As discussed below, proposed 
Sec. 122.23(a)(5) is intended, at a minimum, to require permit 
authorities to hold certain entities that exercise substantial 
operational control over other entities jointly responsible for the 
proper disposition of manure generated at the CAFO. While under today's 
proposal a permit authority could require an entity that has 
substantial operational control over a CAFO to be jointly responsible 
for all of the CAFO's NPDES permit requirements, the proposal would 
allow the permit authority to allocate individual responsibility for 
various activities to any of the co-permittees. The proposed

[[<strong>Page</strong> 3024]]

rule would specify, however, that the proper disposition of manure must 
remain the joint responsibility of all the entities covered by the 
permit.
    As discussed in more detail in section IV.C. of this preamble, 
among the major trends in livestock and poultry production are closer 
linkages between animal feeding operations and processing firms. 
Increasingly, businesses such as slaughtering facilities and meat 
packing plants and some integrated food manufacturing facilities are 
contracting out the raising or finishing production phase to a CAFO. 
Oftentimes, production contracts are used in which a contractor (such 
as a processing firm, feed mill, or other animal feeding operation) 
retains ownership of the animals and/or exercises substantial 
operational control over the type of production practices used at the 
CAFO. More information on the trends in animal agriculture and the 
evolving contractual relationships between producer and processors is 
presented in section IV.C of this preamble.
    Use of production contracts varies by sector. Production 
contracting dominates U.S. broiler and turkey production, accounting 
for 98 percent of annual broiler production and 70 percent of turkey 
production. About 40 percent of all eggs produced annually are under a 
production contract arrangement. Production contracting in the hog 
sector still accounts for a relatively small share of production (about 
30 percent of hog production in 1997), but use is rising, especially in 
some regions. Production contracts are uncommon at beef and dairy 
operations, although they are used by some operations to raise 
replacement herd or to finish animals prior to slaughter. Additional 
detail on the use of production contracts in these sectors is provided 
in section VI.
    Although farmers and ranchers have long used contracts to market 
agricultural commodities, increased use of production contracts is 
changing the organizational structure of agriculture and is raising 
policy concerns regarding who is responsible for ensuring that manure 
and wastewater is contained on-site and who should pay for 
environmental improvements at a production facility. As a practical 
matter, however, regulatory authorities have limited ability to 
influence who pays for environmental compliance, since the division of 
costs and operational responsibilities is determined by private 
contracts, not regulation.
    In addition, there is also evidence that the role of the producer-
processor relationship may influence where animal production facilities 
become concentrated, since animal feeding operations tend to locate in 
close proximity to feed and meat packing plants. This trend may be 
increasing the potential that excess manure nutrients beyond the need 
for crop fertilizer are becoming concentrated in particular geographic 
areas, thus raising the potential for increased environmental pressure 
in those areas. To further examine this possibility, EPA conducted an 
analysis of the correlation between areas of the country where there is 
a concentration of excess manure generated by animal production 
operations and a concentration of meat packing and poultry slaughtering 
facilities. This analysis concludes that in some areas of the country 
there is a strong correlation between areas of excess manure 
concentrations and areas where there is a large number of processing 
plants. More information on this analysis is provided in section IV.C.4 
of this preamble.
    Substantial Operational Control as Basis for Co-Permitting. Today's 
proposal would clarify that all entities that exercise substantial 
operational control over a CAFO are subject to NPDES permitting 
requirements as an ``operator'' of the facility. EPA's regulations 
define an owner or operator as ``the owner or operator of any `facility 
or activity' subject to regulation under the NPDES program.'' 40 CFR 
Sec. 122.2. This definition does not provide further detail to 
interpret the term, and the Agency looks for guidance in the 
definitions of the term in other sections of the statute: ``The term 
`owner or operator' means any person who owns, leases, operates, 
controls, or supervises a source.'' CWA Sec. 306(a)(4) (emphasis 
added).
    Case law defining the term ``operator'' is sparse, but courts 
generally have concluded that through the inclusion of the terms owner 
and operator: ``Liability under the CWA is predicated on either (1) 
performance of the work, or (2) responsibility for or control over the 
work.'' U.S. v. Sargent County Water Resources Dist., 876 F.Supp 1081, 
1088 (N.D. 1992). See also, U.S. v. Lambert, 915 F.Supp. 797, 802 
(S.D.WVa. 1996) (``The Clean Water Act imposes liability both on the 
party who actually performed the work and on the party with 
responsibility for or control over performance of the work.''); U.S. v. 
Board of Trustees of Fla. Keys Community College, 531 F.Supp. 267, 274 
(S.D.Fla. 1981). Thus, under the existing regulation and existing case 
law, integrators which are responsible for or control the performance 
of the work at individual CAFOs may be subject to the CWA as an 
operator of the CAFO. With today's proposal, EPA is identifying some 
factors which the Agency believes indicate that the integrator has 
sufficient operational control over the CAFO to be considered an 
``operator'' for purposes of the CWA.
    Whether an entity exercises substantial operational control over 
the facility would depend on the circumstances in each case. The 
proposed regulation lists factors relevant to ``substantial operational 
control,'' which would include (but not be limited to) whether the 
entity: (1) Directs the activity of persons working at the CAFO either 
through a contract or direct supervision of, or on-site participation 
in, activities at the facility; (2) owns the animals; or (3) specifies 
how the animals are grown, fed, or medicated. EPA is aware that many 
integrator contracts may not provide for direct integrator 
responsibility for manure management and disposal. EPA believes, 
however, that the proposed factors will identify integrators who 
exercise such pervasive control over a facility that they are, for CWA 
purposes, co-operators of the CAFO.
    This is a representative list of factors that should be considered 
in determining whether a co-permit is appropriate, but States should 
develop additional factors as needed to address their specific needs 
and circumstances. The greater the degree to which one or more of these 
or other factors is present, the more likely that the entity is 
exercising substantial operational control and, thus, the more 
important it becomes to co-permit the entity. For example, the fact 
that a processor required its contract grower to purchase and feed its 
animals feed from a specific source could be relevant for evaluating 
operational control. EPA will be available to assist NPDES permit 
authorities in making case-specific determinations of whether an entity 
is exerting control such that it should be co-permitted. EPA is also 
taking comment on whether there are additional factors which should be 
included in the regulation. EPA also requests comment on whether degree 
of participation in decisions affecting manure management and disposal 
is one of the factors which should be considered.
    EPA is soliciting comment on whether, alternatively, the fact that 
an entity owns the animals that are being raised in a CAFO should be 
sufficient to require the entity to be a joint permittee as a owner. 
EPA believes that ownership of the animals establishes an ownership 
interest in the pollutant generating

[[<strong>Page</strong> 3025]]

activity at the CAFO that is sufficient to hold the owner of the 
animals responsible for the discharge of pollutants from the CAFO.
    In non-CAFO parts of the NPDES regulations, the operator rather 
than the owner is generally the NPDES permit holder. One reason an 
owner is not required to get a permit is illustrated by an owner who 
has leased a factory. When an owner leases a factory to the lessee-
operator, the owner gives up its control over the pollution-producing 
activities. The owner of animals at a feedlot, on the other hand, 
maintains all current interests in the animal and is merely paying the 
contract grower to raise the animals for the owner. It is the owner's 
animals that generate most of the manure and wastewater that is created 
at a CAFO. Therefore, EPA believes that ownership of the animals may be 
sufficient to create responsibility for ensuring that their wastes are 
properly disposed of. This may be particularly true where manure must 
be sent off-site from the CAFO in order to be properly disposed of.
    EPA has previously identified situations where the owner should be 
the NPDES permittee rather than, or in addition to, the contract 
operator. In the context of municipal wastewater treatment plants, EPA 
has recognized that the municipal owner rather than the contract 
operator may be the proper NPDES permittee where the owner maintains 
some control over the plant.
    If EPA selects this option, it might also clarify that ownership 
could be determined by factors other than outright title to the 
animals. This would prevent integrators from modifying their contracts 
so that they do not own the animals outright. EPA could develop factors 
for determining ownership such as the existence of an agreement to 
purchase the animals at a fixed price together with the integrator 
accepting the risk of loss of the animals prior to sale. EPA solicits 
comments on whether such criteria are necessary and, if so, what 
appropriate criteria would be.
    Implementation of Co-Permitting. All permittees would be held 
jointly responsible for ensuring that manure production in excess of 
what can be properly managed on-site is handled in an environmentally 
appropriate manner. The effluent guidelines proposes to require a 
number of land application practices that will limit the amount of CAFO 
manure that can be applied to a CAFO's land application areas. If the 
CAFO has generated manure in excess of the amount which can be applied 
consistent with its NPDES permit, the proposed NPDES regulations impose 
a number of requirements on co-permittees, described in VII.D.4. See 
proposed Sec. 122.23(j)(4). The co-permittees could also transfer their 
excess manure to a facility to package it is as commercial fertilizer, 
to an incinerator or other centralized treatment, to be transformed 
into a value-added product, or to any other operation that would not 
land apply the manure. EPA is proposing that manure that must leave the 
CAFO in order to be properly managed not be considered within the 
unique control of any of the entities with substantial operational 
control over the CAFO. In fact, an integrator that owns the animals at 
a number of CAFOs in an area which are producing manure in such volumes 
that it cannot be properly land applied may be in a unique position to 
be able to develop innovative means of compliance with the permit 
limits. Today's proposal would specify that the disposition of excess 
manure would remain the joint responsibility of all permit holders. See 
proposed Sec. 122.23(i)(9). Integrators would thereby be encouraged to 
ensure compliance with NPDES permits in a number of ways, including: 
(a) establishing a corporate environmental program that ensures that 
contracts have sound environmental requirements for the CAFOs; (b) 
ensuring that contractors have the necessary infrastructure in place to 
properly manage manure; and (c) developing and implementing a program 
that ensures proper management and/or disposal of excess manure. The 
proposed requirement will give integrators a strong incentive to ensure 
that their contract producers comply with permit requirements and 
subject them to potential liability if they do not. Integrators could 
also establish facilities to which CAFOs in the area could transfer 
their excess manure. EPA is further proposing to require co-permitted 
entities to assume responsibility for manure generated at their 
contract operations when the manure is transferred off-site.
    EPA believes that integrators will want to make good faith efforts 
to take appropriate steps to address the adverse environmental impacts 
associated with their business. EPA is soliciting comments on how to 
structure the co-permitting provisions of this rulemaking to achieve 
the intended environmental outcome without causing negative impacts on 
growers.
    EPA also believes the proposal contains sufficient flexibility for 
permit authorities to develop creative, and streamlined, approaches to 
co-permitting. For example, a State might want to develop an NPDES 
general permit in collaboration with a single integrator or, 
alternatively, with all integrators in a geographic region (e.g., 
statewide, watershed, etc.). Such a general permit might require 
integrators to assume responsibility for ensuring that their 
contractors engage in proper management practices for excess manure. As 
a condition of the NPDES general permit, the integrator could be 
obligated to fulfill its commitment or to assume responsibility for 
violations by its growers.
    The proposed regulations would provide that a person is an 
``operator'' when ``the Director determines'' that the person exercises 
substantial operational control over the CAFO. EPA also considered 
whether to delete the reference to a determination by the Director, so 
that any person who exercised such control over a CAFO would be an 
operator without the need for a determination by the Director. If EPA 
were to eliminate the need for a determination before such a person may 
be an ``operator,'' persons who may meet this definition would be less 
certain in some cases as to whether they do in fact meet it. On the 
other hand, if EPA retains the need for a determination by the 
Director, then because of resource shortages or for other reasons, EPA 
or the State might not be able to make these determinations in a timely 
way, or might not make them at all in some cases. These persons would 
therefore inappropriately be able to avoid liability even though they 
are exercising substantial operational control of a CAFO. Accordingly, 
EPA requests comments on whether the final rule should retain the need 
for a determination by the Director of substantial operational control. 
Finally, EPA solicits comment on whether to provide that, in authorized 
States, either the Director or EPA may make the determination of 
substantial operational control.
    Additional Issues Associated With Co-Permitting. The option of co-
permitting integrators was discussed extensively by small entity 
representatives (SERs) and by the Small Business Advocacy Review Panel 
during the SBREFA outreach process. The SERs included both independent 
and contract producers. A majority of SERs expressed opposition to such 
an approach. They were concerned that co-permitting could decrease the 
operator's leverage in contract negotiations with the corporate entity, 
increase corporate pressure on operators to indemnify corporate 
entities against potential liability for non-compliance on the part of 
the operator, encourage corporate entities to interfere in the 
operational management

[[<strong>Page</strong> 3026]]

of the feedlot in order to protect against such liability, provide an 
additional pretext for corporate entities to terminate a contract when 
it was to their financial advantage to do so, restrict the freedom of 
operators to change integrators, and generally decrease the profits of 
the operator. These SERs were not convinced that co-permitting would 
result in any benefit to the environment, given that the operator 
generally controls those aspects of a feedlot's operations related to 
discharge, nor were they convinced that such an approach would result 
in additional corporate resources being directed toward environmental 
compliance, given the integrator's ability to pass on any additional 
costs it might incur as a result of co-permitting to the operator. A 
few SERs, who were not themselves involved in a contractual 
relationship with a larger corporate entity, favored co-permitting as a 
way of either leveling the playing field between contact and 
independent operators, or extracting additional compliance resources 
from corporate entities. Despite general concern over co-permitting due 
to the economic implications for the contractor, several SERs voiced 
their support for placing shared responsibility for the manure on the 
integrators, especially in the swine sector.
    The Panel did not reach consensus on the issue of co-permitting. On 
the one hand, the Panel shared the SER's concern that co-permitting not 
serve as a vehicle through which the bargaining power and profits of 
small contract growers are further constrained with little 
environmental benefit. On the other, the Panel believed that there is a 
potential for environmental benefits from co-permitting. For example, 
the Panel noted (as discussed above), that co-permitted integrators may 
be able to coordinate manure management for growers in a given 
geographic area by providing centralized treatment, storage, and 
distribution facilities, though the Panel also pointed out that this 
could happen anyway through market mechanisms without co-permitting if 
it resulted in overall cost savings. In fact, the Agency is aware of 
situations where integrators do currently provide such services through 
their production contracts. The Panel also noted that co-permitting 
could motivate corporate entities to oversee environmental compliance 
of their contract growers, in order to protect themselves from 
potential liability, thus providing an additional layer of 
environmental oversight.
    The Panel also expressed concern that any co-permitting 
requirements may entail additional costs, and that co-permitting can 
not prevent these costs from being passed on to small operators, to the 
extent that corporate entities enjoy a bargaining advantage during 
contract negotiations. The Panel thus recommended that EPA carefully 
consider whether the potential benefits from co-permitting warrant the 
costs, particularly in light of the potential shifting of these costs 
from corporate entities to contract growers. The Panel further 
recommended that if EPA does propose any form of co-permitting, it 
address in the preamble both the environmental benefits and any 
economic impacts on small entities that may result and request comment 
on its approach.
    As discussed in Section VI, EPA estimates that 94 meat packing 
plants that slaughter hogs and 270 poultry processing facilities may be 
subject to the proposed co-permitting requirements. EPA expects that no 
meat packing or processing facilities in the cattle and dairy sectors 
will be subject to the proposed co-permitting requirements. Reasons for 
this assumption are summarized in Section VI of this preamble. 
Additional information is provided in Section 2 of the Economic 
Analysis. EPA is seeking comment on this assumption as part of today's 
notice.
    EPA did not precisely estimate the costs and impacts that would 
accrue to individual co-permittees. Information on contractual 
relationships between contract growers and processing firms is 
proprietary and EPA does not have the necessary market information and 
data to conduct such an analysis. Market information is not available 
on the number and location of firms that contract out the raising of 
animals to CAFOs and the number and location of contract growers, and 
the share of production, that raise animals under a production 
contract. EPA also does not have data on the exact terms of the 
contractual agreements between processors and CAFOs to assess when a 
processor would be subject to the proposed co-permitting requirements, 
nor does EPA have financial data for processing firms or contract 
growers that utilize production contracts.
    EPA, however, believes that the framework used to estimate costs to 
CAFO does provide a means to evaluate the possible upper bound of costs 
that could accrue to processing facilities in those industries where 
production contracts are more widely utilized and where EPA believes 
the proposed co-permitting requirements may affect processors. The 
details of this analysis are provided in Section X..F.2. Based on the 
results of this analysis, EPA estimates that the range of potential 
annual costs to hog processors is $135 million to $306 million ($1999, 
pre-tax). EPA estimates that the range of potential annual costs to 
broiler processors as $34 million to $117 million. EPA is soliciting 
comment on this approach.
    This approach does not assume any addition to the total costs of 
the rule as a result of co-permitting, yet it does not assume that 
there will be a cost savings to contract growers as result of a 
contractual arrangement with a processing firm. This approach merely 
attempts to quantify the potential magnitude of costs that could accrue 
to processors that may be affected by the co-permitting requirements. 
Due to lack of information and data, EPA has not analyzed the effect of 
relative market power between the contract grower and the integrator on 
the distribution of costs, nor the potential for additional costs to be 
imposed by the integrator's need to take steps to protect itself 
against liability and perhaps to indemnify itself against such 
liability through its production contracts. EPA has also not 
specifically analyzed the environmental effects of co-permitting.
    EPA recognizes that some industry representatives do not support 
assumptions of cost passthrough from contract producers to integrators, 
as also noted by many small entity representatives during the SBREFA 
outreach process as well as by members of the SBAR Panel. These 
commenters have noted that integrators have a bargaining advantage in 
negotiating contracts, which may ultimately allow them to force 
producers to incur all compliance costs as well as allow them to pass 
any additional costs down to growers that may be incurred by the 
processing firm. EPA has conducted an extensive review of the 
agricultural literature on market power in each of the livestock and 
poultry sectors and concluded that there is little evidence to suggest 
that increased production costs would be prevented from being passed on 
through the market levels. This information is provided in the docket.
    EPA requests comments on its cost passthrough assumptions in 
general and as they relate to the analysis of processor level impacts 
under the proposed co-permitting requirements. EPA will give full 
consideration to all comments as it decides whether to include the 
proposed requirement for co-permitting of integrators in the final 
rule, or alternately whether to continue to allow this decision to be 
made on a case-by-case basis by local permit writers. Several other 
alternatives to co-permitting are discussed below. EPA

[[<strong>Page</strong> 3027]]

also requests comment on how to structure the co-permitting provisions 
of the rule making to achieve the intended environmental outcome 
without causing negative impacts on growers, should it decide to 
finalize them.
    Alternatives to Co-Permitting. EPA also considered alternative 
approaches under which EPA would waive the co-permitting requirement 
for States and processors that implement effective programs for 
managing excess manure and nutrients. One such approach would require 
the disposition of manure that is transported off-site to remain the 
joint responsibility of the processor and other permit holders, unless 
an enforceable state program controls the off-site land application of 
manure. For example, if the State program addressed the off-site land 
application of manure with PNP development and implementation 
requirements that are equivalent to the requirements in 40 CFR 
412.13(b)(b) and 122.23(j)(2), it would not be necessary to permit the 
processor in order to ensure the implementation of those requirements.
    Another approach would be based on whether the processor has 
developed an approved Environmental Management System (EMS) that is 
implemented by all of its contract producers and regularly audited by 
an independent third party. EPA anticipates that the alternative 
program would be designed to achieve superior environmental and public 
health outcomes by addressing factors beyond those required in this 
proposed regulation, such as odor, pests, etc. The following section 
describes the principles of such a system.
    Environmental Management System as Alternative to Co-Permitting. An 
increasing number of organizations, in both the private and public 
sector, are using environmental management systems (EMS) as a tool to 
help them not only comply with environmental legal requirements, but 
also address a full range of significant environmental impacts, many of 
which are not regulated. Environmental management systems include a 
series of formal procedures, practices, and policies that allow an 
organization to continually assess its impacts on the environment and 
take steps to reduce these impacts over time, providing an opportunity 
and mechanism for continuous improvement. EMSs do not replace the need 
for regulatory requirements, but can complement them and help 
organizations improve their overall environmental performance. EPA 
supports the adoption of EMSs that can help organizations improve their 
compliance and overall performance and is working with a number of 
industries to help them adopt industry-wide EMS programs.
    Under this alternative, EPA would not require a processor to be co-
permitted with their producers if the processor has developed, in 
conjunction with its contract producers, an EMS program that is 
approved by the permit authority and EPA, including opportunities for 
review and comment by EPA and the public. The EMS would identify the 
environmental planning and oversight systems, and critical management 
practices expected to be implemented by all of the processors' contract 
growers. Independent third-party auditors annually would verify 
effective implementation of the EMS to the permit authority and 
integrator. If a processor agreed to implement such a program, and then 
one or more of its contract producers failed to meet these 
requirements, the processor would remove animals from the contract 
producers farm, in a time and manner as defined in the approved EMS, 
and not supply additional animals until the contract producer is 
certified as being in compliance with the EMS by the third party 
auditor. Once the animals have been removed, processors would not 
continue contractual relationships with producers not capable or 
willing to meet the minimum requirements of the EMS. Processors who 
fail the independent audit would be required to apply for an NPDES 
permit or be included as a co-permittee on contract producers' permits.
    Each permitted facility's EMS would also require that programs be 
in place to ensure that it remained in compliance with its NPDES permit 
(if a permitted facility). For all contractors, the EMS would address 
all activities that could have a significant impact on the environment, 
including activities not subject to this proposed regulations. These 
best management practices could be adapted to meet the particular needs 
of individual States, as appropriate.
    To ensure consistency, contract growers and the processor would be 
required to be annually audited by an independent third party. The 
permit authority would be expected to develop criteria for the audit, 
including what constitutes acceptable implementation of the EMS by both 
contract producers and the processor. Such an EMS would require 
contract producers to comply with their NPDES permit (if a permitted 
facility) and to implement the terms of the EMS that address manure 
management as well as other unregulated impacts like odor, pests, etc. 
Contract producers would need to employ specific Best Management 
Practices (BMPs) when addressing unregulated impacts and maintain 
specific records on their use. BMPs could be adapted to meet the needs 
of a particular state or region.
    The EMS would be required to be consistent with guidance developed 
by the processor and approved by the permit authority and EPA. 
Processors would assume responsibility for developing, in conjunction 
with contract producers, the proposed EMS as well as the proposed third 
party auditing guidance, which would be subject to approval by the 
permit authority and EPA. Further, the processors would facilitate 
implementation by their producers through training and technical 
assistance.
    Each facility's EMS would be required to successfully complete an 
audit conducted by an independent third party organization approved by 
the permit authority. Facilities would also be subject to annual follow 
up audits designed to determine if the EMS was in place and being 
adequately implemented. Contractors would not continue contractual 
relationships with producers that did not remain in compliance and did 
not continue to adequately implement their EMSs, as determined by 
annual third party follow-up audits.
    Each processor would be required to seek input from local 
stakeholders as it developed and implemented its EMS. Further, 
information about EMS implementation, including audit results, would be 
publicly available.
    Because geographic areas tend to be dominated by few processors, 
contract growers tend to have limited choice in selecting with whom to 
have a production contract. Thus, EPA expects that processors would 
provide economic and technical assistance to help contract producers 
implement the EMS.
    EPA sees potential benefits to this type of approach. Besides 
giving processors an incentive to develop regional approaches to 
managing excess manure nutrients from CAFO generated manure, it would 
involve the processors in ensuring that permittees meet their permit 
requirements, thus relieving burden on the resources of permit 
authorities and EPA. Further, an EMS goes beyond what NPDES requires, 
in that it addresses issues beyond the scope of this rulemaking, such 
as odor, pests, etc., and, most important, it will address manure 
generated by all CAFOs as well as all AFOs under contract with the 
processors. Finally, this approach will provide local stakeholders with 
important information about the operations of producers and give these

[[<strong>Page</strong> 3028]]

stakeholders meaningful opportunities to provide input to the facility 
on its operations throughout the permitting and EMS development 
process.
    On the other hand, an EMS approach could be more difficult to 
administer and enforce. Some also question whether it would be 
appropriate to impose the requirements of an EMS on independent growers 
or AFO operators who trade with the processors, but who are not subject 
to this regulation. Further, it could be a concern that a producer 
might, seemingly arbitrarily, refuse resources to assist with 
implementing the EMS, and then subsequently withholding animals from 
the grower and effectively terminating the contract.
    EPA solicits comment on whether EPA should provide an option for 
States to develop an alternative program for addressing excess manure 
in lieu of requiring co-permitting. EPA also requests comment on the 
EMS concept described in detail in this proposal.
6. How Does EPA Propose To Regulate Point Source Discharges at AFOs 
That Are Not CAFOs?
    EPA is proposing to clarify in today's proposed rulemaking that all 
point source discharges from AFOs are covered by the NPDES regulations 
even if the facility is not a CAFO (except for certain discharges 
composed entirely of storm water, as discussed below). See proposed 
Sec. 122.23(g).
    The definition of point source in the CWA and regulations lists 
both discrete conveyances (such as pipes and ditches) and CAFOs. CWA 
Sec. 502(14); 40 CFR 122.2. EPA wants to confirm as explicitly as 
possible that the NPDES regulatory program applies to both types of 
discharges. Thus, where an AFO is not a CAFO (either because it has not 
met the definition criteria or has not been designated) discharges from 
the AFO are still regulated as point source discharges under the NPDES 
program if the discharge is through a discrete conveyance that would 
qualify itself as a point source. An AFO is not excluded from the NPDES 
regulatory program altogether simply because it is not a CAFO. That is, 
if an AFO has a point source discharge through a pipe, ditch, or any 
other type of discernible, confined and discrete conveyance, it is 
subject to NPDES requirements just the same as any other facility that 
has a similar point source discharge and that is not an AFO.
    Today's proposal would clarify that, even though an AFO is not a 
CAFO, an AFO may nevertheless require an NPDES permit due to discharges 
from a point source at the facility. See proposed Sec. 122.23(g). More 
specifically, under existing regulation and today's proposal, an AFO 
may be subject to regulation under the Clean Water Act in any of the 
following ways:
    (1) Non-storm water discharges. A non-storm water discharge of 
pollutants from a point source, such as a ditch, at the production area 
or land application area of an AFO, into waters of the U.S. is a 
violation of the CWA unless the owner or operator of the facility has 
an NPDES permit for the discharge from that point source (as discussed 
further below); or
    (2) Storm water discharges. A discharge from a point source, such 
as a ditch, at the land application area of an AFO that does not 
qualify for the agricultural storm water discharge exemption may be 
designated as a regulated storm water point source under 
Sec. 122.26(a)(1)(v), and, therefore, require an NPDES permit. The 
agricultural storm water exemption is discussed further in the 
following section D; or
    (3) Discharge as a CAFO. An AFO may be designated as a CAFO and, 
therefore, require an NPDES permit on that basis (as discussed in the 
section on designation).
    In addition to listing ``physical'' conveyances (such as pipes and 
ditches), the definition of point source in the CWA and EPA's 
regulations identifies CAFOs as a point source. CWA Sec. 502(14); 40 
CFR 122.2. Because all CAFOs are point sources, even surface run off 
from a CAFO that is not channelized in a discrete conveyance is 
considered a point source discharge that is subject to NPDES permit 
requirements. AFOs, on the other hand, are not defined as point 
sources. Because of that, under today's proposal, AFOs will be subject 
to NPDES permitting requirements if they have a point source discharge 
including under the circumstances described above.
    First, today's proposal states clearly that an AFO which has a 
discharge of pollutants through a point source, such as a pipe or 
ditch, at either the production area or the land application area, to 
the waters of the United States which is not the direct result of 
precipitation is in violation of the Clean Water Act. See proposed 
Sec. 122.23(g). The existing regulations are silent and some AFO 
operators have argued that none of their discharges can be considered 
point source discharges unless their AFO is defined or designated as a 
CAFO under 40 CFR 122.23. Today's proposal would make it clear that 
certain discharges at AFOs are subject to NPDES requirements and no 
designation by the permitting authority is required. For example, if 
the operator of an AFO with less than 500 animal units (in the two-tier 
structure) or less than 300 animal units (in the three-tier structure) 
empties its lagoon via a pipe directly into a stream without an NPDES 
permit, that would be a violation of the Clean Water Act.
    Second, today's proposal clarifies that a storm water discharge 
composed entirely of storm water from a point source at the land 
application area of an AFO into waters of the U.S. requires an NPDES 
permit if: (1) the discharge does not quality for the agricultural 
storm water discharge exemption, discussed below; and (2) it is 
designated as a regulated storm water point source. Generally, all 
point source discharges are prohibited unless authorized by an NPDES 
permit. Section 402(p) of the Clean Water Act exempts certain storm 
water discharges from that general prohibition. Section 402(p)(2)(E) 
and the EPA regulations that implement Section 402(p)(6) provide for 
regulation of unregulated point sources on a case by case basis upon 
designation by EPA or the State permitting authority (40 CFR 
122.26(a)(1)(v)).
    EPA considered proposing that only 40 CFR 122.23 may be used to 
designate an AFO based on discharges from its land application area. 
Designation as a CAFO, however, could unnecessarily subject the AFO's 
production area to NPDES permit requirements. Also, because the land 
application area of third party applicators of manure may be designated 
using 122.26(a)(1)(v), EPA is proposing that AFO controlled land 
application areas could also be designated under that section, even if 
the AFO has not been designated as a CAFO. AFOs may be required to get 
a permit based on storm water discharges from their production areas 
only if they have been designated as a CAFO under Sec. 122.23.
    An AFO operator is not required to obtain a permit for a point 
source discharge at the land application area which consists entirely 
of storm water, and which does not qualify for the agricultural storm 
water discharge exemption, unless the point source has been designated 
under 40 CFR 122.26(a)(1)(v). A discharge consists entirely of storm 
water if it is due entirely to precipitation. It may include incidental 
pollutants that the storm water picks up while crossing the facility. 
The discharge would not consist entirely of storm water if, for 
example, a non-storm water (e.g., process waste water) discharge occurs 
during the storm and is mixed with the storm water. Once a permit 
authority has determined that a point source

[[<strong>Page</strong> 3029]]

discharge from the land application area of an AFO is not composed 
entirely of storm water and does not qualify for the agricultural storm 
water discharge exemption, the permit authority may designate that 
point source as a regulated storm water point source if the permit 
authority further determines under 40 CFR 122.26(a)(1)(v) that the 
discharge contributes to a violation of a water quality standard or is 
a significant contributor of pollutants to waters of the U.S.
    Designation under Sec. 122.26 is separate from the designation of 
an operation as a CAFO. The criteria for designation as a CAFO based on 
discharges from either the land application or the production area are 
discussed above in C.4.

D. Land Application of CAFO-generated Manure

1. Why Is EPA Regulating Land Application of CAFO-generated Manure?
    As discussed in Section IV.B of this preamble, agricultural 
operations, including animal production facilities, are considered a 
significant source of water pollution in the United States. The 
recently released National Water Quality Inventory indicates that 
agriculture is the leading contributor of identified water quality 
impairments in the nation's rivers and streams, as well as in lakes, 
ponds, and reservoirs. Agriculture is also identified as a major 
contributor to identified water quality impairments in the nation's 
estuaries.
    Pollutant discharges from CAFOs arise from two principal routes. 
The first route of discharges from CAFOs is from manure storage or 
treatment structures, especially catastrophic failures, which cause 
significant volumes of often untreated manure and wastewater to enter 
waters of the U.S. resulting in fish kills. The second route of 
pollutant discharges is from the application of manure to land, usually 
for its fertilizer value or as a means of disposal. Additional 
information on how pollutants from CAFOs reach surface waters is 
provided in Section V.B of this document and in the rulemaking record.
    The proposed regulation seeks to improve control of discharges that 
occur from land applied manure and wastewater. Analysis conducted by 
USDA indicates that, in some regions, the amount of nutrients present 
in land applied manure has the potential to exceed the nutrient needs 
of the crops grown in those regions. Actual soil sample information 
compiled by researchers at various land grant universities provides an 
indication of areas where there is widespread phosphorus saturation. 
Other research by USDA documents the runoff potential of land applied 
manure under normal and peak precipitation. Furthermore, research from 
a variety of sources indicates that there is a high correlation between 
areas with impaired lakes, streams and rivers due to nutrient 
enrichment and areas where there is dense livestock and poultry 
production. This information is documented in the Technical Development 
Document. Additional information is available in the Environmental 
Assessment of the Proposed Effluent Limitations Guidelines for 
Concentrated Animal Feeding Operations and other documents that support 
today's rulemaking.
2. How Is EPA Interpreting the Agricultural Storm Water Exemption With 
Respect to Land Application of CAFO-generated Manure?
    Today, EPA is proposing to define the term ``agricultural 
stormwater discharge'' with respect to land application of manure and 
wastewater from animal feeding operations. Section 502(14) of the Clean 
Water Act excludes ``agricultural stormwater discharges'' from the 
definition of the term point source. The Clean Water Act does not 
further define the term, and the Agency has not formally interpreted 
it. Under today's proposal, an ``agricultural stormwater discharge'' 
would be defined as ``a discharge composed entirely of storm water, as 
defined in 40 CFR 122.26(a)(13), from a land area upon which manure 
and/or wastewater from an animal feeding operation or concentrated 
animal feeding operation has been applied in accordance with proper 
agricultural practices, including land application of manure or 
wastewater in accordance with either a nitrogen-based or, as required, 
a phosphorus-based manure application rate.'' Sec. 122.23(a)(1).
    The CWA defines a point source as: ``any discernible, confined and 
discrete conveyance, including but not limited to any pipe, ditch, 
channel, tunnel, conduit, well, discrete fissure, container, rolling 
stock, concentrated animal feeding operation, or vessel or other 
floating craft, from which pollutants are or may be discharged. The 
term does not include agricultural stormwater discharges and return 
flows from irrigated agriculture.'' 33 U.S.C. Sec. 1362(14).
    Congress added the exemption from the definition of point source 
for ``agricultural stormwater discharges'' in the Water Quality Act of 
1987. There is limited legislative history for this provision; Congress 
simply stated that the ``provision expands the existing exemption for 
return flows from irrigated agriculture to include agricultural 
stormwater discharges.'' Legislative History of the Water Quality Act 
of 1987, 100th Cong., 2d. Sess. at 538 (1988).
    The courts have found that the EPA Administrator has the discretion 
to define point and nonpoint sources. NRDC v. Costle, 568 F.2d 1369, 
1382 (D.C. Cir. 1977). EPA is proposing to exercise that discretion by 
defining the exemption for ``agricultural stormwater discharges'' to 
include only those discharges that (1) are composed entirely of storm 
water; and, (2) occur only after the implementation of proper 
agricultural practices.
    EPA believes the first component is clear on the face of the 
statute. Only discharges that result from precipitation can qualify for 
an agricultural storm water discharge exemption. Therefore, the 
addition of pollutants as a result of a discharge from a point source 
to waters of the United States that is not due to precipitation is a 
violation of the Clean Water Act (except in compliance with an NPDES 
permit). For example, the application of CAFO manure onto a field in 
quantities that are so great that gravity conveys the manure through a 
ditch even in dry weather into a nearby river would not be eligible for 
the exemption for agricultural storm water discharges. Furthermore, it 
is possible for a discharge to occur during a precipitation event yet 
not be considered to be ``composed entirely of stormwater.'' As the 
Second Circuit found, a discharge during a storm could be ``primarily 
caused by the over-saturation of the fields rather than the rain and * 
* * sufficient quantities of manure were present so that the run-off 
could not be classified as ``stormwater'.'' CARE v. Southview Farms, 34 
f. 3d 114,121 (Sept. 2, 1994).
    Second, EPA is proposing that to be eligible for the exemption for 
agricultural storm water, any addition of manure and/or wastewater to 
navigable waters must occur despite the use of proper agricultural 
practices. EPA interprets the statute to reflect Congress' intent not 
to regulate additions of manure or wastewater that are truly 
agricultural because they occur despite the use of proper agricultural 
practices. Application of manure or wastewater that is not consistent 
with proper rates and practices such that there are adverse impacts on 
water quality would be considered waste disposal rather than 
agricultural usage. In today's action, EPA is proposing to interpret 
the term ``proper agricultural practices'' to incorporate the concept 
of protecting

[[<strong>Page</strong> 3030]]

water quality. This is consistent with USDA's Technical Guidance for 
Developing Comprehensive Nutrient Management Plans, which states that: 
``[t]he objective of a CNMP is to provide AFO owners/operators with a 
plan to manage generated nutrients and by-products by combining 
conservation practices and management activities into a system that, 
when implemented, will protect or improve water quality.'' EPA believes 
that proper agricultural practices do encompass the need to protect 
water quality. While EPA recognizes that there may be legitimate 
agricultural needs that conflict with protecting water quality in some 
instances, EPA believes that its proposed definition of proper 
agricultural practices strikes the proper balance between these 
objectives. Since one focus of agricultural management practices, 
whether through guidance or regulation, at the state or federal level, 
is the minimization of water quality impacts, and since this is of 
particular concern to EPA, the Agency is proposing a definition of 
``agriculture'' for Clean Water Act purposes which would be flexible 
enough so that an assessment of the actual impacts of a discharge of 
animal waste on a specific waterbody could be factored in. Today's 
proposal identifies the proper agricultural practices which land 
appliers seeking to qualify for the agricultural storm water discharge 
exemption would need to implement. In addition, if a permit authority 
determined that despite the implementation of the practices identified 
in today's proposal, discharges from the land application area of a 
CAFO were having an impact on water quality, the permit writer would 
need to impose additional agricultural practice requirements to 
mitigate such impacts. Only discharges that occur despite the 
implementation of all these proper agricultural practices would be 
considered ``agricultural stormwater discharges'' and be eligible for 
the exemption. EPA requests comment on this interpretation of the 
agricultural storm water exemption and on the proposal to define proper 
agricultural practice.
    For CAFOs which land apply their manure, the Agency is proposing to 
require that owners or operators implement specific agricultural 
practices, including land application of manure and wastewater at a 
specified rate, development and implementation of a Permit Nutrient 
Plan, a prohibition on the application of CAFO manure or wastewater 
within 100 feet of surface water, and, as determined to be necessary by 
the permit authority, restrictions on application of manure to frozen, 
snow covered or saturated ground. See proposed Secs. 412.31(b) and 
412.37; Sec. 122.21(j). The Agency is proposing to require these 
specific agricultural practices under its CWA authority both to define 
the scope of the agricultural storm water discharge exemption and to 
establish the best available technology for specific industrial 
sectors. Given the history of improper disposal of CAFO waste and 
Congress' identification of CAFO's as point sources, the Agency 
believes it should clearly define the agricultural practices which must 
be implemented at CAFOs.
    EPA considered limiting the scope of the proper agricultural 
practices necessary to qualify for the agricultural storm water 
discharge exemption to those specified in the effluent guideline and 
NPDES regulations with no flexibility for the permit authority to 
consider additional measures necessary to mitigate water quality 
impacts. EPA chose not to propose this option because EPA was concerned 
that permit authorities would then be unable to include any additional 
permit conditions necessary to implement Total Maximum Daily Loads in 
impaired watersheds. EPA seeks comment on this option and other ways to 
address this concern.
    The Agency is proposing to allow AFO owners or operators who land 
apply manure (either from their own operations or obtained from CAFOs) 
and more traditional, row crop farmers who land apply manure obtained 
from CAFOs to qualify for the agricultural storm water exemption as 
long as they are applying manure and wastewater at proper rates. As 
discussed in VII.B, under one of today's co-proposed options, CAFOs 
that transfer manure to such recipients would be required to obtain a 
letter of certification from the recipient land applier that the 
recipient intends to determine the nutrient needs of its crops based on 
realistic crop yields for its area, sample its soil at least once every 
three years to determine existing nutrient content, and not apply the 
manure in quantities that exceed the land application rates calculated 
using either the Phosphorus Index, Phosphorus Threshold, or Soil Test 
Phosphorus method as specified in 40 CFR 412.13(b)(1)(iv). For purposes 
of the CAFO's permit, recipient land appliers need not implement all of 
the proper agricultural practices identified above which CAFOs would be 
required to implement at their own land application areas. EPA believes 
that this proposal enables the Agency to implement Congress' intent to 
both exclude truly agricultural discharges due to storm water and 
regulate the disposition of the vast quantities of manure and 
wastewater generated by CAFOs.
    EPA considered defining the agricultural storm water discharge 
exemption for non-CAFO land appliers to apply only to those discharges 
which occurred despite the implementation of all the practices required 
by today's proposal at CAFO land application areas. EPA could require a 
more comprehensive set of practices for land appliers of CAFO manure 
and wastewater to qualify for the agricultural storm water discharge 
exemption. Under any definition of proper agricultural practices, a 
recipient who failed to implement the required practices and had a 
discharge through a point source into waters of the U.S. could be 
designated as a regulated storm water point source. However, that 
recipient would not be vulnerable to enforcement under the Clean Water 
Act for discharges prior to designation, and could only be designated 
as a point source if the permitting authority (or EPA in authorized 
States) found that the conditions of 40 CFR 122.26(a)(1)(v) were met. 
See discussion below. EPA is requesting comment on this option.
    Whether a discharger (who would otherwise be ineligible for the 
agricultural storm water discharge exemption) is subject to the Clean 
Water Act permitting requirements varies, because of the complex 
interaction among the agricultural storm water discharge exemption, the 
definition of ``point source,'' and other storm water discharge 
provisions. The next sections clarify EPA's intentions with regard to 
such regulation.
3. How is EPA Proposing To Regulate Discharges From Land Application of 
CAFO-generated Manure by CAFOs?
    In today's action, EPA is proposing that the entire CAFO operation 
(e.g. the feedlot/production area and the land application areas under 
the operational control of a CAFO owner or operator) is subject to the 
revised effluent limitations guideline and the revised NPDES permitting 
regulation. See proposed Sec. 122.23(a)(2). Also, as discussed above, 
EPA is proposing to interpret the CWA to allow CAFO land application 
areas to be eligible for the agricultural storm water discharge 
exemption. However, unless the CAFO could demonstrate that it has 
absolutely no potential to discharge from the production area and the 
land application area, the facility would be required to apply for an 
NPDES permit.

[[<strong>Page</strong> 3031]]

See proposed Sec. 122.23(e). While EPA is proposing to interpret the 
terms of the statute such that CAFOs may qualify for the agricultural 
storm water exemption, EPA is also proposing that such CAFOs must apply 
for a permit even if the CAFO's only discharges may potentially qualify 
for the agricultural storm water discharge exemption. EPA is proposing 
such a requirement because it has the authority to regulate point 
source discharges and any discharge from the land application area of a 
CAFO which is not agricultural storm water is subject to the Clean 
Water Act. EPA believes that the only way to ensure that all 
nonagricultural, and therefore point source, discharges from CAFOs are 
permitted is to require that CAFOs apply for NPDES permits which will 
establish effluent limitations based on proper agricultural practices.
    As noted above, the CWA explicitly defines the term ``point 
source'' to include CAFOs, and explicitly excludes agricultural storm 
water discharges. In today's action, EPA is attempting to interpret 
both provisions in a way that establishes meaningful controls over a 
significant source of pollution in our Nation's waters. EPA is 
proposing to interpret the definition of ``point source'' such that the 
exclusion of ``agricultural stormwater discharges'' may be an exclusion 
from any and all of the conveyances listed in the definition of ``point 
source,'' including ``concentrated animal feeding operations.'' The 
production area of the CAFO would continue to be ineligible for the 
agricultural storm water discharge exemption because it involves the 
type of industrial activity that originally led Congress to single out 
concentrated animal feeding operations as point sources. However, the 
land application areas under the operational control of the CAFO, where 
CAFO manure or wastewater is appropriately used as a fertilizer for 
crop production, appear to have the kind of agricultural activity that 
Congress intended to exempt. Consequently, EPA proposes to interpret 
the CWA so that its authority to regulate discharges of CAFO manure due 
to precipitation from land application areas is used in a way that 
ensures that any discharge is the result of agricultural practices. Any 
such discharges would be from the CAFO and, therefore, no separate, 
confined and discrete conveyance need be present.
    Under today's proposal, permit writers would establish effluent 
limits for land application areas in the form of rates and practices 
that constitute proper agricultural practices to the extent necessary 
to fulfill the requirements of the effluent guidelines or based on BPJ, 
as well as to the extent necessary to ensure that a CAFO's practices 
are agricultural in that they minimize the operation's impact on water 
quality.
    As noted above, EPA believes the statute does not directly address 
the interaction between the specific listing of ``concentrated animal 
feeding operations'' and the specific exemption of ``agricultural 
stormwater discharges'' in the definition of ``point source.'' While 
EPA is proposing to interpret the Act to allow the land application 
areas of CAFOs to be eligible for the agricultural storm water 
discharge exemption, EPA is considering an interpretation of the Act 
under which all additions of pollutants associated with CAFOs could be 
regulated as ``point source'' discharges, and, thus, the agricultural 
storm water exemption would never apply to discharges from a CAFO. By 
singling out ``concentrated animal feeding operations,'' a far more 
specific conveyance reference compared to the other, more general, 
terms in the definition of ``point source'' (such as ``ditch,'' 
``channel,'' and ``conduit''), Congress may have intended the addition 
of pollutants to waters of the United States from these facilities to 
be considered ``industrial'' and not ``agricultural'' discharges. As 
such, the tremendous amount of manure and wastewater generated by CAFOs 
could be considered industrial waste. Thus, any discharge, even if 
caused by storm water after land application of the manure could be 
considered a discharge ``associated with industrial activity'' under 
the statute's storm water discharge provisions.
    EPA is soliciting comments on four additional approaches under 
which the agricultural storm water exemption would not apply to CAFOs. 
Each of these approaches would require that all CAFO permits restrict 
discharges from land application sites to the extent necessary to 
prevent them from causing or contributing to a water quality 
impairment.
    First, EPA is soliciting comment on an alternate approach that 
would regulate CAFO waste as ``process waste'' that is not eligible for 
the agricultural storm water exemption, when it is applied on land that 
is owned or controlled by the CAFO owner or operator, because it is 
industrial process waste and therefore not agricultural. Any storm 
water associated discharges would be regulated under the existing storm 
water statutory provisions and EPA's implementing regulations. Under 
that approach, in addition to the requirements in the proposed effluent 
limitation guideline, the NPDES permit issued to the CAFO operator 
would include any additional limitations necessary to protect water 
quality.
    Second, EPA solicits comment on classifying discharges from land 
application sites as discharges regulated under ``Phase I'' of the 
NPDES storm water program (CWA Section 402(p)(2)(B)). EPA's existing 
storm water regulations already identify discharges from land 
application sites that receive industrial wastes as a ``storm water 
discharge associated with industrial activity.'' 40 CFR 
122.26(b)(14)(v). Under the storm water regulation, EPA does not 
currently interpret that category (i.e., storm water discharge 
associated with industrial activity) to include land application of 
CAFO manure because the Agency did not assess the cost of such 
regulation when it promulgated the rule. With today's proposal, 
however, EPA has calculated the cost of proper land application of 
CAFO-generated manure and wastewater and could clarify that 
precipitation-induced discharges from land application areas are 
subject to the storm water discharge regulations. If EPA finalizes a 
definition of CAFO which includes the land application area, then EPA 
could also regulate any storm water discharges from CAFOs under its 
existing regulations as a storm water discharge associated with 
industrial activity because facilities subject to storm water effluent 
guidelines are considered to be engaging in ``industrial activity.'' 40 
CFR 122.26 (b)(14)(i). EPA would have to conclude that no discharges 
from CAFO land application areas qualify for the agricultural storm 
water discharge exemption, even discharges which occur despite 
implementation of proper agricultural practices.
    Third, EPA could consider discharges from the CAFO's land 
application area to be discharges of ``process wastewater,'' and, 
therefore, not ``composed entirely of stormwater,'' rendering the 
statutory storm water provisions entirely inapplicable. Under this 
alternate interpretation of the statutory terms, NPDES permit 
provisions for the CAFO, including both the production area and the 
land application area, could include both technology-based limits and 
any necessary water quality-based effluent limits.
    Fourth, EPA could clarify that once a facility is required to be 
permitted because it is a CAFO, the agricultural storm water discharge 
exemption no longer applies to the land application area subject to the 
permit. Thus, all permit conditions, including a water

[[<strong>Page</strong> 3032]]

quality-based effluent limitation, could be required on both the 
production area and the land application area.
    EPA is also requesting comment on whether the land application 
practices established under the effluent guidelines will be sufficient 
to ensure that there will be little or no discharge due to 
precipitation from CAFO land application areas. If there were no such 
discharges, then EPA wouldn't need to adopt any of the four alternative 
approaches described above, because the effluent guidelines 
requirements would protect water quality. If there would be significant 
run-off even when manure is applied in accordance with agricultural 
practices, EPA is requesting comment on the extent and the potential 
adverse water quality impacts from that increment.
4. How is EPA Proposing to Regulate Land Application of Manure and 
Wastewater by non-CAFOs?
    In some instances, CAFO owners or operators transport their manure 
and/or wastewater off-site. If off-site recipients land apply the CAFO-
generated manure, they may be subject to regulation under the Clean 
Water Act. In addition, AFOs may land apply their own manure and 
wastewater, and they too may be subject to regulation under the Clean 
Water Act. A land applier could be subject to regulation if: (1) its 
field has a point source, as defined under the Act, through which (2) a 
discharge occurs that is not eligible for the agricultural storm water 
exemption, and (3) the land applier is designated on a case-by-case 
basis as a regulated point source of storm water. 40 CFR 
Sec. 122.26(a)(1)(v). EPA notes that under the three-tier structure, an 
AFO with between 300 AU and 1,000 AU which has submitted a 
certification that it does not meet any of the conditions for being 
CAFO, and therefore does not receive an NPDES permit, would be 
immediately subject to enforcement and regulation under the Clean Water 
Act if it has a discharge which is not subject to the agricultural 
storm water discharge exemption; EPA and the State do not need to 
designate such a facility as either a CAFO or as a regulated storm 
water point source.
    With this proposal, EPA intends to give effect to both the 
agricultural storm water discharge exemption and the other storm water 
provisions of the Clean Water Act by subjecting to regulation a non-
CAFO land applier of AFO and/or CAFO-generated manure and wastewater 
only if: (1) the discharge is not eligible for the agricultural storm 
water discharge exemption (which, as discussed above, for AFOs and 
other non-CAFO land appliers primarily consists of applying the manure 
in accordance with proper agricultural practice, including soil test, P 
threshold, or Phosphorus Index methods); and (2) a conveyance at the 
land applier's operation has been designated as a regulated storm water 
point source. EPA emphasizes again that this regulatory approach is 
relevant only to discharges which are composed entirely of storm water. 
If it is not due to precipitation, a discharge of manure or wastewater 
through a point source, such as a ditch, into the waters of the U.S. 
need not be designated to be subject to enforcement and regulation 
under the Clean Water Act, as discussed in Section VII.C.6 of today's 
proposal.
    In addition, the Director (or Regional Administrator) could 
exercise his or her authority to designate such dischargers within a 
geographic area as significant contributors of pollution to waters of 
the United States. 40 CFR 122.26(a)(9)(i)(D). The geographic area of 
concern could be a watershed which is impaired for the pollutants of 
concern in CAFO waste. To do so, the Director (or Regional 
Administrator) would need to identify the point source at each land 
application area or provide a record for presuming that the land 
application areas in that watershed have point sources, and the 
designation would only apply to those that do.
    As noted above, case-by-case designation of point sources at land 
application areas which are not under the control of a CAFO owner or 
operator can already occur under existing regulations. Under section 
122.26(a)(1)(v), either the permitting authority or EPA may designate a 
discharge which he or she determines contributes to a violation of a 
water quality standard or is a significant contributor of pollutants to 
waters of the U.S. EPA is soliciting comment on whether to clarify the 
term ``significant contributor of pollutants'' for the purposes of 
designating a discharge of manure and/or wastewater. If a land applier 
is applying manure and/or wastewater such that he or she is not 
eligible for the agricultural storm water discharge exemption and if 
the receiving waterbody (into which there are storm water discharges 
associated with manure and/or wastewater) is not meeting water quality 
standards for a pollutant in the waste (such as phosphorus, nitrogen, 
dissolved oxygen or fecal coliform), then EPA could propose that, by 
regulation, such a discharge constitutes a ``significant contributor of 
pollutants.'' For example, if a land applier is applying manure and/or 
wastewater at a rate above the rate which qualifies the recipient for 
the agricultural storm water discharge exemption, and if, due to 
precipitation, waste runs off the land application area through a ditch 
into a navigable water that is impaired due to nutrients, then the 
permit authority may designate that point source as a regulated storm 
water point source. The designee would then need to apply for an NPDES 
permit or risk being subject to enforcement for unpermitted discharges.
    EPA solicits comment on the proposed means of ensuring that manure 
and wastewater from AFOs and CAFOs is used in an environmentally 
appropriate manner, whether on-site at the CAFO or AFO or off-site 
outside of the control of the CAFO operator.

E. What are the Terms of an NPDES Permit?

    EPA is proposing to include several new requirements in the NPDES 
permit for CAFOs. See proposed Sec. 122.23(i). As discussed in section 
VIII on the proposed effluent guidelines, EPA is proposing to require 
all CAFO operators to develop and implement a Permit Nutrient Plan, 
which is a site-specific plan for complying with the effluent 
limitations requirements contained in the NPDES permit. EPA is 
proposing to require permit authorities to develop special conditions 
for each individual or general NPDES permit that address: (1) 
development of the allowable manure application rate; and (2) timing 
and method for land applying manure. Permits would also include a 
special condition that clarifies the duty to maintain permit coverage 
until the facility is properly closed.
    NPDES permits are comprised of seven sections: cover <strong>page</strong>; effluent 
limitations; monitoring and reporting requirements; record keeping 
requirements; special conditions; and standard conditions, discussed 
below.
1. What is a Permit Nutrient Plan (PNP) and What is the difference 
between USDA's CNMP and EPA's PNP?
    EPA is proposing to require all CAFO operators to develop and 
implement a Permit Nutrient Plan, or PNP. See proposed 
Sec. 412.31(b)(1)(i)(iv) and Sec. 122.23(k)(4). The PNP is a site-
specific plan that describes how the operator intends to meet the 
effluent discharge limitations and other requirements of the NPDES 
permit. Because it is the primary planning document for determining 
appropriate practices at the CAFO, EPA is also proposing to require 
that it be developed, or reviewed and modified, by a certified planner. 
The PNP must be developed within three months of submitting either a 
notice of intent for coverage under an NPDES

[[<strong>Page</strong> 3033]]

general permit, or an application for an NPDES individual permit.
    EPA is proposing to include a permit requirement for the CAFO to 
develop and implement a PNP and modify it when necessary. EPA believes 
this approach will maintain flexibility for modifications as the 
agricultural practices of the CAFO change. PNPs are intended to be 
living documents that are updated as circumstances change. Formal 
permit modification procedures would not have to be followed every time 
the PNP was modified.
    As described in section VIII of today's proposed revisions to the 
effluent guidelines, CAFO operators would be required to prepare a PNP 
that establishes the allowable manure application rate for land 
applying manure and wastewater, and that documents how the rate was 
derived. The plan would also address other site-specific conditions 
that could affect manure and wastewater application. It would also 
describe sampling techniques to be used in sampling manure and soils, 
as well as the calibration of manure application equipment, and would 
describe operational procedures for equipment at the production area.
    EPA is proposing to use the term ``Permit Nutrient Plan'' in 
today's proposed regulation in order to have a separate and distinct 
term that applies solely to the subset of activities in a CNMP that are 
directly connected with the effluent guideline and NPDES permit 
requirements, which are related to the best available technology 
currently available. EPA expects that many CAFOs will satisfy the 
requirement to develop a PNP by developing a Comprehensive Nutrient 
Management Plan (CNMP). EPA recognizes that creating a new term has the 
potential to create some initial confusion, and cause concern about 
overlapping or duplicative requirements. However, EPA believes the term 
PNP more clearly articulates to the regulated community the important 
distinctions between the broad requirements of a CNMP and the more 
specific effluent guideline requirements for a PNP.
    EPA invites comment on today's proposal to define PNPs as the 
subset of elements in the CNMP that are written to meet the effluent 
guideline requirements. EPA is especially interested in knowing whether 
PNP is the best term to use to refer to the regulatory components of 
the CNMP, and whether EPA's explanation of both the differences and 
relationship between these two terms (PNP and CNMP) is clear and 
unambiguous.
    In the Unified National Strategy for Animal Feeding Operations, EPA 
and USDA agreed that the development and implementation of CNMPs was 
the best way to minimize water quality impairment from confinement 
facilities and land application of manure and wastewater. The Strategy 
also articulated the expectation that all AFOs would develop and 
implement CNMPs, although certain facilities (CAFOs) would be required 
to do so while others (AFOs) would do so on a voluntary basis.
    In December 2000, USDA published its Comprehensive Nutrient 
Management Planning Technical Guidance (referred to here as the ``CNMP 
Guidance''). Federal Register: December 8, 2000 (Volume 65, Number 237) 
<strong>Page</strong> 76984-76985. The CNMP Guidance is intended for use by NRCS, 
consultants, landowners/operators, and others that will either be 
developing or assisting in the development of CNMPs. USDA published the 
CNMP Guidance to serve only as a technical guidance document, and it 
does not establish regulatory requirements for local, tribal, State, or 
Federal programs. Rather, it is intended as a tool to support the 
conservation planning process, as contained in the NRCS National 
Planning Procedures Handbook. The objective of the CNMP technical 
guidance is to identify management activities and conservation 
practices that will minimize the adverse impacts of animal feeding 
operations on water quality. The CNMP Guidance provides a list of 
elements that USDA believes should be considered when developing a 
CNMP. The strength of the CNMP Guidance is the breadth of conservation 
practices and management activities that it recommends AFO operators 
should consider.
    Initially, it was EPA's expectation to simply adopt USDA's 
voluntary program into its NPDES permitting program. However, by 
intentionally avoiding establishing regulatory requirements and 
limiting its role to that of technical guidance only, USDA's CNMP 
Guidance lacks many of the details EPA believes are necessary to ensure 
discharges of manure and other process wastewater are adequately 
controlled and nutrients applied to agricultural land in an acceptable 
manner. In addition, the CNMP Guidance addresses certain elements that 
address aspects of CAFO operations that EPA will not include as a part 
of the effluent guidelines and standards.
    Nonetheless, it is important to ensure that the regulatory program 
that would be established by the effluent guidelines and standards and 
NPDES permit regulations proposed today is complementary to and 
leverages the technical expertise of USDA with its CNMP Guidance, 
rather than present CAFO operators with programs that they might 
perceive as contradictory. EPA believes this goal will be accomplished 
by the requirements being proposed today. EPA is proposing that CAFOs, 
covered by the effluent guideline, develop and implement a PNP that is 
narrower in scope than USDA's CNMP Guidance, but that establishes 
specific actions and regulatory requirements.
    One of the key differences between the effluent guideline PNP and 
USDA's CNMP is the scope of elements included in each plan. USDA's CNMP 
includes certain aspects that EPA does not require CAFO operators to 
address within the regulatory program. For example, element 4.2.2.1 of 
USDA's CNMP Guidance (``Animal Outputs--Manure and Wastewater 
Collection, Handling, Storage, Treatment, and Transfer'') tells 
operators that the CNMP should include insect control activities, 
disposal of animal medical wastes, and visual improvement 
considerations. Additionally, Element 4.2.2.1 of the CNMP Guidance 
(``Evaluation and Treatment of Sites Proposed for Land Application'') 
states the CNMP should identify conservation practices and management 
activities needed for erosion control and water management. The 
regulations (and PNP) being proposed today include no such requirement. 
EPA is not including conservation practices which control erosion as 
part of a PNP because erosion control is not needed on all CAFO 
operations and because the costs associated with controlling erosion 
would add $150 million dollars to the cost of this proposal. These 
elements of a CNMP are, however, key components to protect water 
quality from excessive nutrients and sediments. EPA solicits comment 
and data on the costs and benefits of controlling erosion and whether 
erosion control should be a required component of PNPs.
    There are a number of elements that are addressed by both the CNMP 
and PNP. Examples of common elements include soil and manure analyses 
to determine nutrient content; calibration of application equipment; 
developing nutrient budgets; and records of Plan implementation. 
However, USDA's CNMP Guidance is indeed presented only as technical 
guidance. The CNMP Guidance identifies a number of elements that AFOs 
should consider, but there is no avenue for ensuring that AFOs 
implement any management practices or achieve a particular performance 
standard. In contrast,

[[<strong>Page</strong> 3034]]

EPA's proposed PNP would establish requirements for CAFOs that are 
consistent with the technical guidance published by USDA experts, but 
that go beyond that guidance by identifying specific management 
practices that must be implemented.
    For example, EPA is proposing the effluent guidelines to require 
CAFOs to analyze soil samples at least once every three years, and 
manure and lagoon samples at least annually. 40 CFR 412.37(a)(4)(ii). 
The CNMP Guidance addresses such analyses, but imposes no mandatory 
duty to perform such analyses, nor to conform to a particular 
monitoring frequency. Given the degree to which overflows and 
catastrophic failures of lagoons have been due to poor operation or 
maintenance of manure storage structures, EPA is proposing to establish 
specific requirements under Sections 308 and 402 that would: (1) More 
precisely monitor lagoon levels to prevent overflows that could be 
reasonably avoided; (2) require operators to periodically inspect the 
structural integrity of manure handling and storage structures, and 
expeditiously take corrective action when warranted; and (3) maintain 
records to ensure the proper operation and maintenance of manure 
handling and storage structures. USDA's CNMP Guidance establishes no 
such requirements.
    The regulations proposed today would also require permit 
authorities to establish more specific requirements for application of 
manure and wastewater to land, where appropriate, including: how the 
CAFO operator is to calculate the allowable manure application rate; 
when it is appropriate to apply manure to frozen, snow covered or 
saturated land; and facility closure.
    a. How are PNPs Developed and What is the Role of Certified 
Specialists? Under today's proposed rule, CAFO owners and operators 
would be required to seek qualified technical assistance for developing 
PNPs to meet their effluent guidelines and NPDES permit requirements. 
EPA is proposing that PNPs be developed, or reviewed and modified, by 
certified planners. See proposed Sec. 412.31(b)(1)(ii).
    Since PNPs are a defined subset of activities covered in CNMPs, as 
described above, owners and operators are expected to take advantage of 
the same technical assistance that is available for CNMP development, 
including appropriate Federal agencies, such as the NRCS, State and 
Tribal agricultural and conservation agency staff, Cooperative 
Extension Service agents and specialists, Soil and Water Conservation 
Districts, and Land Grant Universities. In addition, there are a 
growing number of non-governmental sources of qualified technical 
assistance, including integrators, industry associations, and private 
consultants who are certified to develop CNMPs, as well as the defined 
subset of activities covered in PNPs. In addition to the help of these 
experts, a growing number of computer-based tools are either available 
or under development to facilitate development and implementation of 
CNMPs, and should be equally useful for PNPs.
    Although CAFO owners and operators are ultimately responsible for 
developing and implementing effective PNPs, EPA is today proposing that 
PNPs be developed and/or reviewed and approved by a certified 
specialist. A certified PNP specialist is a person who has a 
demonstrated capability to develop CNMPs in accordance with applicable 
USDA and State standards, as well as PNPs that meet the EPA effluent 
guideline, and is certified by USDA or a USDA-sanctioned organization. 
Certified specialists include qualified persons who have received 
certifications through a State or local agency, personnel from NRCS, 
certification programs recognized as third party vendors of technical 
assistance, or other programs recognized by States. In addition, USDA 
is now developing agreements with third-party vendors similar to the 
1998 agreement with the Certified Crop Advisors (CCAs) and consistent 
with NRCS standards and specifications (or State standards if more 
restrictive). CCAs are expected to be available to provide technical 
assistance to producers in nutrient management, pest management, and 
residue management.
    The purpose of using certified specialists is to ensure that 
effective PNPs are developed and/or reviewed and modified by persons 
who have the requisite knowledge and expertise to ensure that plans 
fully and effectively address the need for PNPs that meet the minimum 
effluent guideline requirements in the NPDES permit, and that plans are 
appropriately tailored to the site-specific needs and conditions at 
each CAFO.
    EPA recognizes that some States already have certification programs 
in place for nutrient management planning, and expects that the USDA 
and EPA guidance for AFOs and CAFOs will provide additional impetus for 
new and improved State certification programs. These programs provide 
an excellent foundation for producing qualified certified specialists 
for CNMPs, and can be modified relatively easily to include a special 
module on how to develop an effective PNP as a defined subset of 
activities in the CNMP. EPA expects that, as a result of experience 
gained in the initial round of CAFO permitting under the existing 
regulations (2000--2005), certification programs will be well equipped 
to deal with both CNMPs and PNPs by the time today's regulations go 
into effect and States begin issuing the next round of CAFO permits 
that reflect these regulations. Thus, PNPs won't be expected to be 
developed before 2005.
    The issue of CNMP preparer requirements was also discussed by the 
SERs and SBAR Panel during the SBREFA outreach process. (Note that at 
that time, EPA was still using the term CNMP to apply to regulatory as 
well as voluntary nutrient management plans.) Several SERs were 
concerned that requiring the use of a certified planner could 
significantly increase the cost of plan development, as well as limit 
the operator's influence over the final product. These SERs felt that, 
with adequate financial and technical assistance, they could write 
their own plans and suggested that EPA work to facilitate such an 
option through expanded training and certification of farmers and 
provision of a user-friendly computer program to aid in plan 
development.
    The Panel recognized the need for plan preparers to have adequate 
training to write environmentally sound plans, particularly for large 
operations. However, the Panel also recognized the potential burden on 
small entities of having to use certified planners, especially 
considering the large number of AFOs and the limited number of 
certified planners currently available. The Panel recommended that EPA 
work with USDA to explore ways for small entities to minimize costs 
when developing CNMPs, and indicated that EPA should continue to 
coordinate with other Federal, State and local agencies in the 
provision of low-cost CNMP development services and should facilitate 
operator preparation of plans by providing training, guidance and tools 
(e.g., computer programs). EPA indicated in the Panel Report that it 
expected that many operations could become certified through USDA or 
land grant universities to prepare their own CNMPs.
    EPA is requesting comment on the proposal to require that PNPs be 
developed, or reviewed and modified, by certified planners, and on ways 
to structure this requirement in order to minimize costs to small 
operators.
    b. Submittal of Permit Nutrient Plan to the Permit Authority.--EPA 
is proposing to require that applicants for

[[<strong>Page</strong> 3035]]

individual permits and operators of new facilities submitting notices 
of intent for coverage under a general permit submit a copy of the 
cover sheed and executive summary of their draft PNP to the permit 
authority at the time of application or NOI submittal. 
Sec. 122.21(i)(1)(iv) and 122.28(b)(2)(ii). Operators of existing 
facilities seeking coverage under a general permit must submit a notice 
of final PNP development within 90 days of seeking coverage, but are 
not required to provide a copy of the PNP to the Permit Authority 
unless requested. The reporting requirements, including the notice of 
PNP development and notice of PNP amendment, are discussed in more 
detail in section VII.E.3 below.
    Initial installation of manure control technologies are 
significantly less costly compared to retrofitting existing facilities, 
and early development of a PNP will help to ensure that, when a new 
facility is being designed, the operator is considering optimal control 
technologies. In addition, in situations where individual permits are 
warranted, the public interest demands early review of the PNP, rather 
than waiting for its availability after the permit has been in effect 
for some time.
    EPA is requesting comment on the proposal to require new facilities 
seeking coverage under a general permit, as well as applicants for 
individual permits, to submit a copy of the cover sheet and executive 
summary of their PNP to the permit authority along with the NOI or 
permit application. EPA is further requesting comment on whether the 
entire draft PNP should be submitted along with the NOI or permit 
application.
    EPA is further requesting comment on whether, for individual 
permits, the PNP, in part or in its entirety, should be part of the 
public notice and comment process along with the permit.
    c. Availability of the Permit Nutrient Plan Information to the 
Public.--EPA is proposing to require the operator of a permitted CAFO 
to make a copy of the PNP cover sheet and executive summary available 
to the public for review. The CAFO operator could choose to make this 
information directly available to the public in any of several ways, 
such as: (1) maintaining a copy of these documents at the facility and 
making them available to the permit authority as publicly viewable 
documents upon request; (2) maintaining a copy of these documents at 
the facility and making them available directly to the requestor; (3) 
placing a copy of them at a publicly accessible site, such as at a 
public library; or (4) submitting a copy of them to the permit 
authority. EPA is proposing that, if the operator has not made the 
information available by other means, the permit authority would be 
required, upon request from the public, to obtain a copy of the PNP 
cover sheet and executive summary and make them available. It is 
important to ensure that the public has access to this information, 
which is needed to determine whether a CAFO is complying with its 
permit, including the land application provisions.
    EPA is also considering adding a provision in the final rule that 
would state that all information in the PNP, not just the cover sheet 
and executive summary, must be publicly available and cannot be claimed 
as confidential business information. Some stakeholders have claimed 
that all or a portion of the PNPs should be entitled to protection as 
confidential business information (CBI). EPA does not believe that the 
PNP cover sheet or executive summary would ever contain confidential 
business information. The information in these two sections of the plan 
is simply too general ever to be considered as CBI. However, EPA is 
sensitive to the concerns of CAFOs that there may be information in the 
remaining, more detailed portions of the PNP that is legitimately 
proprietary to the CAFOs' businesses and that the permit authorities 
should therefore protect. We therefore request comments on whether the 
final rule should require the entire PNP to be publicly available, or 
alternatively, whether the CAFO should be able to make a 
confidentiality claim as to the remaining information in the PNP. Any 
such claim of confidentiality would be governed by EPA's regulations at 
40 CFR, Part 2 and relevant statutes.
    There would be two bases on which EPA could base a determination 
that no portion of the Permit Nutrient Plans would be entitled to CBI 
status. First, CWA Section 402(j) states that ``[a] copy of each permit 
application and each permit issued under this section shall be 
available to the public.'' It may be that the PNPs that would be 
required by today's proposal are properly viewed as a part of the 
CAFO's NPDES permit. The permits would require each CAFO to develop and 
carry out a PNP, as specified in the proposed Part 122 regulations. In 
addition, today's proposed effluent limitations guidelines would 
specify detailed requirements that PNPs must meet. Failure to develop 
and properly carry out a PNP would be enforceable under each permit as 
a permit violation. Therefore, for purposes of Section 402(j), EPA may 
conclude that PNPs are properly viewed as a part of the permit or 
permit application and, accordingly, must be available to the public.
    EPA issued a ``Class Determination'' in 1978 that addresses this 
issue. See ``Class Determination 1-78'' (March 22, 1978) (a copy of 
which is in the public record for today's proposal). This Class 
Determination addressed how to reconcile Section 402(j) of the Clean 
Water Act with Section 308 of the Act. Section 308, which authorizes 
EPA to collect information, states that information obtained under that 
section shall be available to the public, except upon a showing 
satisfactory to the Administrator that the information, if made public, 
would divulge methods or processes entitled to protection as trade 
secrets. Upon such a showing, the Administrator shall protect that 
information as confidential. Section 308 makes an exception for 
``effluent data,'' which is not entitled to such protection.
    This Class Determination concludes that information contained in 
NPDES permits and permit applications is not entitled to confidential 
treatment because Section 402(j) mandates disclosure of this 
information to the public, notwithstanding the fact that it might be 
trade secrets or commercial or financial information. Referring to the 
legislative history of the CWA, the Class Determination notes that 
Congress sought to treat the information in permits and permit 
applications differently from information obtained under Section 308. 
It concludes that Congress intended Section 402(j) to be a disclosure 
mandate in contrast to the basic approach of Section 308, which 
provides protection for trade secret information. (Class Determination 
at pp. 2-4.) Therefore, consistent with the Class Determination, if EPA 
were to conclude that the PNPs are a part of the permit, the entire PNP 
would be a public document that would not be entitled to 
confidentiality protection.
    A second basis for finding that PNPs must be available to the 
public would be that, even apart from Section 402(j), the information 
in PNPs may be ``effluent data'' and if so, also would not be entitled 
to protection under Section 308. EPA's regulations define the term 
``effluent data,'' among other things, as ``[i]nformation necessary to 
determine the identity, amount, frequency, concentration, temperature, 
or other characteristics (to the extent related to water quality) of 
any pollutant which has been discharged by the source (or of any 
pollutant resulting from any discharge from the source), or any 
combination of the foregoing.'' 40 CFR 2.302(a)(2)(i). There is a 
limited exception for information that is related to research and 
development activities.

[[<strong>Page</strong> 3036]]

EPA believes that the information in PNPs may fit this definition of 
``effluent data.'' The information in PNPs has direct bearing on the 
amount of pollutants that may be discharged by a CAFO and on 
characteristics of the pollutants that may be discharged (such as the 
identity and presence of nutrients) that would be related to water 
quality.
    On the other hand, the Agency could conclude that the information 
in the PNP is not part of the CAFO's permit. Each permit would indeed 
require the CAFO to develop and carry out a PNP that is approved by a 
certified specialist. Nevertheless, the CAFO will be developing the 
terms of the final PNP, as well as periodic modifications to the PNP, 
outside of the permitting process. It may be appropriate not to 
consider the PNP to be part of the permit for purposes of section 
402(j). If 402(j)--which states that all information in the permit must 
be publicly available--is therefore not a relevant provision, then 
whether PNPs could be protected as confidential would be determined 
under section 308.
    Section 308, as noted above, allows information to be protected as 
CBI where the submitter can demonstrate the trade secret nature of the 
information to the satisfaction of the Administrator, except that 
``effluent data'' is never confidential. EPA could find that the 
information in PNPs is not ``effluent data.'' That is, EPA could 
conclude that the information in PNPs primarily concerns operational 
practices at the facility and does not have enough of a bearing on the 
characteristics of pollutants in the effluent to be considered 
``effluent data.'' Because it would not be ``effluent data,'' the PNP 
information would not be categorically excluded from being treated as 
confidential. EPA's regulations at 40 CFR Part 2 specify the procedures 
for parties to make case-specific claims that information they submit 
to EPA is confidential and for EPA to evaluate those claims. Consistent 
with these regulations, each CAFO could claim that the information in 
its PNP is confidential (except for the cover sheet and executive 
summary). EPA would evaluate these claims and determine in each case 
whether the CAFO's CBI claim should be approved or denied. In sum, EPA 
could adopt final regulations that would require a CAFO's CBI claims 
for the more detailed information in the remaining parts of the PNP to 
be decided in each case.
    The Agency notes that EPA itself would, of course, always be able 
to request and review the CAFO's full PNP. The issues raised in this 
discussion concern only the availability of these plans to outside 
parties.
    EPA requests comments on all aspects of this proposal, including 
whether it would be proper to determine that the full PNP must be 
publicly available under CWA Section 402(j) and under CWA Section 308 
as ``effluent data.'' EPA also requests comments on whether the cover 
sheet and executive summary should always be made available to the 
public, as proposed, or whether there are elements of the cover sheet 
or executive summary that might appropriately be claimed as CBI, and 
not considered to be either part of the permit or ``effluent data.''
    The PNP would be narrower than the CNMP and would contain only 
requirements that are necessary for purposes of the effluent guideline. 
A CNMP may contain other elements that go beyond the effluent 
guideline. EPA is not proposing any separate requirements for CNMPs 
themselves to be made publicly available and is not proposing any 
findings as to whether information in a CNMP may be confidential.
2. What are the Effluent Limitations in the Permit?
    The effluent limitations section in the permit serves as the 
primary mechanism for controlling discharges of pollutants to receiving 
waters. This section describes the specific narrative or numeric 
limitations that apply to the facility and to land application. It can 
contain either technology-based effluent limits or water quality-based 
effluent limits, or both, and can contain additional best management 
practices, as needed.
    a. What Technology Based Effluent Limitations Would be in the 
Permit? Under the two-tier structure, for CAFOs with 500 AU or more, 
the effluent guidelines and standards regulations [40 CFR 412] would 
establish the technology-based effluent limitations to be applied in 
NPDES permits. Under the three-tier structure, any operation defined as 
a CAFO would be subject to the revised effluent guidelines. The 
proposal to revise the effluent guidelines and standards regulation is 
described in section VIII of today's proposed rule.
    Operations with fewer than 500 AU under the two-tier structure, or 
fewer than 300 AU under the three-tier structure, which have been 
designated as CAFOs by the permit authority would not be subject to the 
effluent guidelines and standards. For these CAFOs, the permit writer 
would use ``Best Professional Judgement,'' or BPJ, to establish, on a 
case-by-case basis, the appropriate technology-based requirements. 
Often, permit writers adopt requirements similar to, or the same as the 
effluent guidelines requirements.
    b. What Water Quality-based Effluent Limitations Would be in the 
Permit? Section 301(b)(1)(C) of the Clean Water Act requires there to 
be achieved ``any more stringent limitation, including those necessary 
to meet water quality standards.'' Therefore, where technology-based 
effluent limitations are not sufficient to meet water quality 
standards, the permit writer must develop more stringent water quality-
based effluent limits. Under today's proposal, the permit writer must 
include any more stringent effluent limitations for the waste stream 
from the production area as necessary to meet water quality standards. 
If necessary to meet water quality standards, permit writers may 
consider requiring more stringent BMPs (e.g., liners for lagoons to 
address a direct hydrologic connection to surface waters; covers for 
lagoons to prevent rainwater from causing overflows; allowing 
discharges only from catastrophic storms and not from chronic storms; 
pollutant limits in the overflow; particular treatments, such as 
grassed waterways for the overflows discharged; etc.).
    If EPA chose to promulgate one of the options discussed in section 
VII.D.2 above under which the agricultural storm water discharge 
exemption did not apply to land application areas under the operational 
control of a permitted CAFO, then the permit writer would be required 
to establish water quality-based effluent limits where necessary to 
meet water quality standards. If EPA chose to promulgate the option 
described in section VII.D.2 above, under which the appropriate rates 
and practices identified in the effluent guidelines and the NPDES 
regulations established the scope of the term ``agriculture'' without 
additional consideration of water quality impacts or water quality 
standards, only the limitations and practices required by the effluent 
guidelines and the NPDES regulations could be required by the permit 
authority for land application discharges.
    c. What Additional Best Management Practices Would be in the 
Permit? Under Sec. 122.44(k)(4) of the existing NPDES regulations, 
permit writers may include in permits best management practices ``that 
are reasonably necessary to achieve effluent limitations and standards 
or to carry out the purposes and intent of the CWA.'' Under today's 
proposal, the permit writer may include BMPs for land application areas 
in

[[<strong>Page</strong> 3037]]

addition to those required by the effluent guidelines, as necessary to 
prevent adverse impacts on water quality. As discussed in section 
VII.D.2 above, EPA is today defining proper agricultural practices 
required to qualify for the agricultural storm water discharge 
exemption to include practices necessary to minimize adverse water 
quality impacts. Therefore, if a permit writer determines that despite 
the implementation of the BMPs required by the effluent guidelines 
discharges from a CAFO will have adverse water quality impacts, the 
permit writer should impose additional BMPS designed to minimize such 
impacts.
    3. What Monitoring and Reporting Requirements are Included in the 
Permit?
    The section of the NPDES permit on monitoring and reporting 
requirements identifies the specific conditions related to the types of 
monitoring to be performed, the frequencies for collecting samples or 
data, and how to record, maintain, and transmit the data and 
information to the permit authority. This information allows the NPDES 
permit authority to determine compliance with the permit requirements.
    As described in section VIII, today's proposed revisions to the 
effluent guidelines would require the operator to conduct periodic 
visual inspection and to maintain all manure storage and handling 
equipment and structures as well as all runoff management devices. See 
proposed Sec. 412.33(c). The NPDES permit would also require the 
permittee to: (1) test and calibrate all manure application equipment 
annually to ensure that manure is land applied in accordance with the 
proper application rates established in the NPDES permit; (2) sample 
manure for nutrient content at least once annually, and up to twice 
annually if manure is applied more than once or removed to be sent off-
site more than once per year; and (3) sample soils for phosphorus once 
every three years. Today's proposed effluent guidelines would also 
require the operator to review the PNP annually and amend it if 
practices change either at the production area or at the land 
application area, and submit notification to the permit authority. 
Examples of changes in practice necessitating a PNP amendment include: 
a substantial increase in animal numbers ( e.g., more than 20 percent) 
which would significantly increase the volume of manure and nutrients 
produced on the CAFO; a change in the cropping program which would 
significantly alter land application of animal manure and wastewater; 
elimination or addition of fields receiving animal waste application; 
or changes in animal waste collection, storage facilities, treatment, 
or land application method.
    As discussed in section VII.E.1.c above, CAFO operators would be 
required to submit their PNPs, as well as any information necessary to 
determine compliance with their PNPs and other permit requirements, to 
the permit authority upon request. The CAFO operator could make a copy 
of the cover sheet and executive summary of the PNP available to the 
public in any of several ways. Operators of new facilities seeking 
coverage under a general permit and applicants for individual permits 
would be required to submit a copy of their draft PNP to the permit 
authority at the time of NOI submittal or application.
    EPA is also proposing to require operators to submit a written 
notification to the permit authority, signed by the certified planner, 
that the PNP has been developed or amended, and is being implemented, 
accompanied by a fact sheet summarizing certain elements of the PNP. 
See Sec. 412.31(b)(1)(ii). This written notice of PNP availability 
would serve an important role in verifying that the permittee is 
complying with one of the requirements of the NPDES permit. EPA is 
proposing that the PNP notification and fact sheet contain the 
following information:
<bullet> The number and type of animals covered by the plan
<bullet> The number of acres to which manure and wastewaters will be 
applied
<bullet> The phosphorus conditions for those fields receiving the 
manure
<bullet> Nutrient content of the manure
<bullet> Application schedule and rate
<bullet> The quantity to be transferred off-site
<bullet> Date PNP completed or amended
<bullet> Key implementation milestones
4. What are the Record Keeping Requirements?
    The record keeping requirements section of the permit specifies the 
types of records to be kept on-site at the permitted facility.
    Operation and Maintenance of the CAFO. As described in section VIII 
of today's proposal, EPA is proposing to require operators to maintain 
records at the facility that document: (1) the visual inspections, 
findings, and preventive maintenance; (2) the date, rate, location and 
methods used to apply manure and wastewater to land under the control 
of the CAFO operators; (3) the transfer of the CAFO-generated manure 
off-site; (4) the results of annual manure and wastewater sampling and 
analyses to determine the nutrient content; and (5) the results of 
representative soil sampling and analyses conducted at least every 
three years to determine nutrient content.
    Transfer to Off-site Recipients of CAFO Manure. As described in 
Chapter IV.B and V.B, inappropriate land application of CAFO-generated 
manure poses a significant risk to water quality. Further, EPA 
estimates that the majority of CAFO-generated manure is in excess of 
CAFO's crop needs, and will very likely be transferred off-site. The 
ultimate success of the CAFO program depends on whether recipients 
handle manure appropriately, and in a manner that prevents discharge to 
waters. As discussed fully in section VII.D.4, EPA is not proposing to 
regulate off-site recipients through CAFO permit requirements, however, 
EPA believes that the certification and record-keeping requirements 
described here will help to ensure responsible handling of manure. 
Thus, EPA is co-proposing additional record keeping requirements under 
the NPDES program.
    Under one co-proposed option, EPA would require that owners or 
operators of CAFOs obtain from off-site land appliers a certification 
that, if land applying CAFO-generated manure, they are doing so at 
proper agricultural rates. In addition, the CAFO owner or operator 
would be required to maintain records of transfer, including the name 
of the recipient and quantity transferred, and would be required to 
provide the recipient with an analysis of the contents of the manure 
and a brochure describing the recipient's responsibilities for proper 
management of the manure.. Under another co-proposed option, EPA would 
not require the certification, but would require the CAFO owner or 
operator to keep records and provide information.
    Certification Option. Under one option, EPA is proposing that CAFOs 
obtain a certification and that recipients of CAFO-generated manure so 
certify, pursuant to Sec. 308 of the CWA. Under Sec. 308, EPA has the 
authority to require the owner or operator of a point source to 
establish and maintain records and provide any information the Agency 
reasonably requires. The Agency has documented historic problems 
associated with over application of CAFO manure and wastewater by both 
CAFO operators and recipients of CAFO manure and wastewater. Today's 
proposal would establish effluent limitations designed to prevent 
discharges due to over application. In order to determine whether or 
not CAFOs are meeting the effluent

[[<strong>Page</strong> 3038]]

limitations which would be established under today's proposals, EPA 
believes it is necessary for the Agency to have access to information 
concerning where a CAFO's excess manure is sent. Furthermore, in order 
to determine whether or not the recipients of CAFO manure should be 
permitted (which may be required if they do not land apply the CAFO 
manure in accordance with proper agricultural practices and they 
discharge from a point source, see section VII.D.2), EPA has determined 
that it will be necessary for such recipients to provide information 
about their land application methods. Recipients who certify that they 
are applying manure in accordance with proper agricultural practices as 
detailed in section VII.D.2 are responding to a request under Section 
308 of the CWA. Therefore, a recipient who falsely certifies is subject 
to all applicable civil and criminal penalties under Section 309 of the 
CWA.
    In some cases, CAFOs give or sell manure to many different 
recipients, including those taking small quantities, and this 
requirement could result in an unreasonable burden. EPA is primarily 
concerned with recipients who receive and dispose of large quantities, 
presuming that recipients of small quantities pose less risk of 
inappropriate disposal or over-application. To relieve the paperwork 
burden, EPA is proposing that CAFOs not be required to obtain 
certifications from recipients that receive less than twelve tons of 
manure per year from the CAFO. The CAFO would, however, be required to 
keep records of transfers to such recipients, as described below.
    The Agency believes that it would be reasonable to exempt from the 
PNP certification requirements recipients who receive small amounts of 
manure from CAFOs. EPA considered exempting amounts such as a single a 
truckload per day or a single truckload per year. EPA decided that an 
appropriate exemption would be based on an amount that would be 
typically used for personal, rather than commercial, use. The exemption 
in today's proposal regulation is based on the amount of manure that 
would be appropriately applied to five acres of land, since five acres 
is at the low end of the amount of land that can be profitably farmed. 
See, e.g., ``The New Organic Grower,'' Eliott Coleman (1995).
    To determine the maximum amount of manure that could be 
appropriately applied to five acres of land, an average nutrient 
requirement per acre of cropland and pasture land was computed. Based 
on typical crops and national average yields, 160 pounds of nitrogen 
and 14.8 pounds of phosphorous are required annually per acre. See 
``Manure Nutrient Relative to the Capacity of Cropland and Pastureland 
to Assimilate Nutrients,'' Kellogg et al (USDA, July, 25, 2000). The 
nutrient content of manure was based on USDA's online software, Manure 
Master, available on the world wide web at <A HREF="http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www2.ftw.nrcs.usda.gov/ManureMaster/MM21.html">http://
www2.ftw.nrcs.usda.gov/ManureMaster/MM21.html</A>.
    The nitrogen content of manure at the time of land application 
ranges from 1.82 pounds per ton for heifers and dairy calves to 18.46 
pounds per ton for hens and pullets. Using the low end rate of 1.82 
pounds of nitrogen per ton, 87.4 tons of manure would be needed for a 
typical acre or 439 tons of manure for five acres in order to achieve 
the 160 pounds per acre rate. Using the high end rate of 18.46 pounds 
of nitrogen per ton, 8.66 tons of manure would be needed for a typical 
acre or 43.3 tons of manure for five acres in order to achieve the 160 
pounds per acre rate. Thus, the quantity of manure needed to meet the 
nitrogen requirements of a five acre plot would range from 43.3 tons to 
439 tons, depending on the animal type.
    The phosphate content of manure at the time of land application 
ranges from 1.10 pounds per ton for heifers and dairy calves to 11.23 
pounds per ton for turkeys for breeding. Using the high end 11.23 pound 
per ton rate for phosphorous, only about 1.3 tons would be needed for 
an average acre, or 6.5 tons for five acres in order to meet the 14.8 
pounds of phosphorous required annually for a typical acre of crops. 
Using the low end 1.1 pound per ton rate for phosphorous, about 13.2 
tons would be needed for an average acre, or 66 tons for five acres. 
Using the phosphate content for broilers of 6.61 pounds per ton is more 
typical of the phosphate content of manure and would result in 2.23 
tons per acre being needed for an average acre, or 11.2 tons for five 
acres.
    Clearly, exempting the high end amount of manure based on nitrogen 
content could lead to excess application of phosphorous. Regulating 
based on the most restrictive phosphate requirement could lead to 
manure not being available for personal use.
    The exemption is only an exemption from the requirement that the 
CAFO obtain a certification. The recipient would remain subject to any 
requirements of State or federal law to prevent discharge of pollution 
to waters of the U.S.
    EPA is proposing to set the threshold at 12 tons per recipient per 
year. This is rounding the amount based on typical phosphate content. 
It also allows one one-ton pick up load per month, which is consistent 
with one of the alternative approaches EPA considered. Recipients that 
receive more than 12 tons would have to certify that it will be 
properly managed. EPA is interested in comments on alternative 
thresholds for exempting small quantity transfers by the CAFO from the 
requirement that CAFOs receive certifications from the recipients.
    For CAFO owners or operators who transfer CAFO-generated manure and 
wastewater to manure haulers who do not land apply the waste, EPA is 
proposing that the CAFO owner or operator must: (1) obtain the name and 
address of the recipients, if known; (2) provide the manure hauler with 
an analysis of the nutrient content of the manure, to be provided to 
the recipients; and (3) provide the manure hauler with a brochure to be 
given to the recipients describing the recipient's responsibility to 
properly manage the land application of the manure to prevent discharge 
of pollutants to waters of the U.S. The certification form would 
include the statement,

``I understand that the information is being collected on behalf of 
the U.S. Environmental Protection Agency or State and that there are 
penalties for falsely certifying. The permittee is not liable if the 
recipient violates its certification.''

    Concern has been expressed that many potential recipients of CAFO 
manure will choose to forego CAFO manure, and buy commercial 
fertilizers instead, in order to avoid signing such a certification and 
being brought under EPA regulation. The result could be that CAFO 
owners and operators might be unable to find a market for proper 
disposal, thereby turning the manure into a waste rather than a 
valuable commodity. EPA requests comment on this concern.
    This alternative is potentially protective of the environment 
because non-CAFO land appliers would be liable for being designated as 
a point source in the event that there is a discharge from improper 
land application. EPA's proposed requirements for what constitutes 
proper agricultural practices, described in VII.D.2 above, would ensure 
that CAFO-generated manure is properly managed.
    No Certification Option. In the second alternative proposal for 
ensuring proper management of manure that is transferred off-site, EPA 
is not proposing to require CAFO owners or operators to obtain the 
certification described above. Rather, CAFO owners or operators would 
be required to maintain records of transfer, described in the following 
section.

[[<strong>Page</strong> 3039]]

    Concern has been expressed that many potential recipients of CAFO 
manure will choose to forego CAFO manure, and buy commercial 
fertilizers instead, in order to avoid signing such a certification and 
being brought under EPA regulation. The result could be that CAFO 
owners and operators might be unable to find a market for proper 
disposal, thereby turning the manure into a waste rather than a 
valuable commodity.
    This alternative is potentially protective of the environment 
because non-CAFO land appliers would be liable for being designated as 
a point source in the event that there is a discharge from improper 
land application. EPA's proposed requirements for what constitutes 
proper agricultural practices, described in VII.D.2 above, would ensure 
that CAFO-generated manure is properly managed.
    Records of Transfer of Manure Off-site. In both alternative 
proposals for whether or not to require CAFO owners or operators to 
obtain certifications from off-site recipients, EPA is proposing to 
require CAFO operators to maintain records of the off-site transfer of 
the CAFO-generated manure and wastewater, e.g., when manure is sold or 
given away for land application on land not under their operational 
control, to ensure the environmentally acceptable use of the CAFO-
generated manure. See Sec. 122.23(i)(5). When CAFO-generated manure is 
sold or given away to be used for land application, the specific manner 
of land application does not need to be addressed in the CAFO's PNP. 
However, to help ensure the environmentally acceptable use of the CAFO-
generated manure, the CAFO operator would be required to do the 
following: See Sec. 122.23(j)(4) and (5).
    <bullet> Maintain records showing the amount of manure and/or 
wastewater that leaves the operation;
    <bullet> Record the name and address of the recipient(s), including 
the intended recipient(s) of manure and/or wastewater transferred to 
contract haulers, if known;
    <bullet> Provide the recipient(s) with representative information 
on the nutrient content of the manure to be used in determining the 
appropriate land application rates; and
    <bullet> Provide the recipient with information provided by the 
permit authority of his/her responsibility to properly manage the land 
application of the manure to prevent discharge of pollutants to waters 
of the U.S.
    <bullet> [Under one co-proposed option, obtain and retain on-site a 
certification from each recipient of the CAFO-generated manure and 
wastewater that they will do one of the following: (a) land apply in 
accordance proper agricultural practices as defined in today's 
proposal; (b) obtain an NPDES permit for discharges resulting from non-
agricultural spreading; (c) or utilize it for other than land 
application purposes.]
    EPA proposes to require these records to be retained on-site at the 
CAFO, and to be submitted to the permit authority upon request.
5. What are the Special Conditions and Standard Conditions in an NPDES 
Permit?
    Standard conditions in an NPDES permit list pre-established 
conditions that apply to all NPDES permits, as specified in 40 CFR 
122.41.
    The special conditions in an NPDES permit are used primarily to 
supplement effluent limitations and ensure compliance with the CWA. EPA 
is proposing at 40 CFR 122.23(i) to (k) to require permit authorities 
to develop special conditions that: (a) specify how the permittee is to 
calculate the allowable manure application rate; (b) specify timing 
restrictions, if necessary, on land application of manure and 
wastewater to frozen, snow covered or saturated ground; (c) establish 
requirements for facility closure; (d) specifying conditions for 
groundwater with a direct hydrological connection to surface water; (e) 
require certification for off-site transfer of manure and wastewater 
(co-proposed with omitting this requirement). Finally, EPA is 
soliciting comment on whether a special condition should be included 
regarding erosion control.
    a. Determining Allowable Manure Application Rate. EPA is proposing 
that the permit authority be required to include a term in the NPDES 
permit that establishes the method to be used for determining the 
allowable manure application rate for applying manure to land under the 
control of the CAFO operator. See proposed Sec. 122.23(j)(1).
    As described in detail in section VIII, three methods are available 
which may be used to determine the allowable manure application rate 
for a CAFO. These three methods are: (1) the Phosphorus Index; (2) the 
Soil Phosphorus Threshold Level; and (3) the Soil Test Phosphorus 
Level.
    EPA is proposing to adopt these three methods from USDA Natural 
Resource Conservation Service's (NRCS) nutrient management standard 
(Standard 590). State Departments of Agriculture are developing State 
nutrient standards which incorporate one of these three methods. EPA is 
proposing to require that each authorized permit authority adopt one or 
more of these three methods as part of the State NPDES program, in 
consultation with the State Conservationist. The permit would require 
the permittee to develop the appropriate land application rates in the 
site-specific PNP based upon the State's adopted method. EPA solicits 
comment on whether the special conditions in an NPDES permit should 
require permit authorities to adopt the USDA Natural Resource 
Conservation Service's (NRCS) Nutrient Management Standard (Standard 
590) in its entirety rather than just the portion that applies to 
determining the allowable manure application rate.
    b. Would Timing Restrictions on Land Application of CAFO-generated 
Manure be Required? EPA is proposing to require that the permit writer 
include in the CAFO's NPDES permit regionally appropriate prohibitions 
or restrictions on the timing and methods of land application of manure 
where necessary. See proposed Sec. 122.23(i)(3). The permit writer 
would develop the restrictions based on a consideration of local crop 
needs, climate, soil types, slope and other factors.
    The permit would prohibit practices that would not serve an 
agricultural purpose and would have the potential to result in 
pollutant discharges to waters of the United States. A practice would 
be considered not to be agricultural if significant quantities of the 
nutrients in the manure would be unavailable to crops because they 
would leach, run off or be lost due to erosion before they can be taken 
up by plants.
    EPA considered establishing a national prohibition on applying 
CAFO-generated manure to frozen, snow covered or saturated ground in 
today's proposed effluent guidelines. Disposal of manure or wastewater 
to frozen, snow covered or saturated ground is generally not a 
beneficial use for agricultural purposes. While such conditions can 
occur anywhere in the United States, pollutant runoff associated with 
such practice is a site specific consideration and is dependent on a 
number of variables, including climate and topographic variability, 
distance to surface water, and slope of the land. Such variability 
makes it difficult to develop a national technology-based standard that 
is consistently reasonable, and does not impose unnecessary cost on 
CAFO operators.
    While EPA believes that many permit writers will find a prohibition 
on applying CAFO-generated manure to frozen, snow covered or saturated 
ground to be reasonably necessary to achieve the effluent limitations 
and to carry out the purposes and intent of the

[[<strong>Page</strong> 3040]]

CWA, EPA is aware that there are areas where these practices might be 
allowed provided they are restricted. Application on frozen ground, for 
example, may be appropriate in some areas provided there are 
restrictions on the slope of the ground and proximity to surface water. 
Many States have already developed such restrictions.
    While the proposed regulations would not establish a national 
technology-based limitation or BMP, EPA is proposing at 
Sec. 122.23(j)(2) that permit writers consider the need for these 
limits. Permit authorities would be expected to develop restrictions on 
timing and method of application that reflect regional considerations, 
which restrict applications that are not an appropriate agricultural 
practice and have the potential to result in pollutant discharges to 
waters of the United States. It is likely that the operators would need 
to consider means of ensuring adequate storage to hold manure and 
wastewater for the period which manure may not be applied. EPA 
estimates that storage periods might range from 45 to 270 days, 
depending on the region and the proximity to surface water, and to 
ground water with a direct hydrological connection to surface water. 
Permit authorities are expected to work with State agricultural 
departments, USDA's Natural Resource Conservation Service, the EPA 
Regional office, and other local interests to determine the appropriate 
standard, and include the standard consistently in all NPDES permits 
for CAFOs.
    EPA's estimate that storage periods would range from 45 days to 270 
days is derived using published freeze/frost data from the National 
Oceanic and Atmospheric Administration, National Center for Disease 
Control. For the purpose of estimating storage requirements to prevent 
application to frozen ground, EPA assumed CAFOs could only apply manure 
between the last spring frost and the first fall frost, called the 
``freeze free period''. With a 90 percent probability, EPA could also 
use a 28 degree temperature threshold to determine the storage time 
required, rounded to the nearest 45 day increment. This calculation 
results in 45 days of storage in the South; 225 days in parts of the 
Midwest and the Mid-Atlantic; and as high as 270 days storage in the 
Central region.
    EPA is soliciting comment on alternate approaches of prohibiting 
land application at certain times or using certain methods. For 
example, EPA might develop a nationally applicable prohibition against 
applying manure on frozen land that is greater than a certain slope 
such as 15 percent. EPA is also interested in whether to prohibit 
application to saturated soils.
    c. Closure. EPA is proposing to require permit authorities to 
require the CAFO operator to maintain permit coverage (e.g., after the 
facility ceases operation as a CAFO or drops below the size for being 
defined as a CAFO) until all CAFO-generated manure and wastewater is 
properly disposed and, therefore, the facility no longer has the 
potential to discharge. See proposed Sec. 122.23(i)(3). Specifically, 
the permit writer would need to impose a permit condition requiring the 
owner or operator to reapply for a permit unless and until the owner or 
operator can demonstrate that the facility has no potential to 
discharge wastes generated by the CAFO. This requirement would be 
included as a special condition in the NPDES permits.
    EPA considered several options for ensuring that manure and 
wastewater from CAFOs is properly disposed after the operation 
terminates or ceases being a CAFO. Section VII.C.2.g above discusses 
the options in detail. In this proposal, EPA is also proposing to 
ensure that permits explicitly address closure requirements. While EPA 
is today proposing to only require ongoing permit coverage of the 
former CAFO, permit authorities are encouraged to consider including 
other conditions such as those discussed in Section VII.C.2.g above.
    EPA is soliciting comment on these proposed provisions.
    d. Discharge to Surface Water via a Direct Hydrological Connection 
with Ground Water. EPA is proposing requirements to address the serious 
environmental harms caused by discharges from CAFOs to surface waters 
via direct hydrologic connection with ground water. As described in 
section V.B.2.a, studies in Iowa, the Carolinas, and the Delmarva 
Peninsula have shown that CAFO lagoons do leak, and that leaks from 
lagoons contaminate ground water and the surface water to which that 
ground water is hydrologically connected, often severely. EPA believes 
that it is reasonable to include a requirement to ensure that 
discharges to surface water via a direct hydrologic connection with 
ground water do not occur from CAFOs, either by requiring the permit 
applicant to implement appropriate controls or to provide evidence that 
no such connection exists at the facility.
    Section VII.C.2.J of today's preamble discusses the legal and 
technical basis for the proposed ground water controls, and provides 
information on tools and resources available to permit writers to make 
determinations as to whether the production area of a CAFO may 
potentially discharge to surface waters via direct hydrologic 
connection with ground water.
    EPA requests comment on the following proposals.
    CAFOs Subject to Effluent Guideline Requirements for Ground water. 
EPA is proposing that, for all CAFOs that are subject to an effluent 
guideline that includes requirements for zero discharge from the 
production area to surface water via direct hydrologic connection to 
ground water (all beef and dairy operations, as well as new swine, 
poultry and veal operations), the permit would require the appropriate 
controls and monitoring. See proposed 40 CFR 412.33(a)(3), 412.35(a)(3) 
and 412.45(a)(3). The permittee would be able to avoid the requirements 
by submitting a hydrologist's report demonstrating, to the satisfaction 
of the permit authority, that the ground water beneath the production 
area is not connected to surface water through a direct hydrologic 
connection.
    EPA is also requesting comment on other options for determining 
which CAFOs must implement appropriate monitoring and controls to 
prevent discharges from the production area to hydrologically connected 
groundwater. One option would be for EPA to narrow the rebuttable 
presumption to areas with topographical characteristics that indicate 
the presence of ground water that is likely to have a direct hydrologic 
connection to surface water. For example, the final rule could specify 
that only CAFOs located in certain areas, such as an area with certain 
types of lithologic settings (e.g., karst, fractured bedrock, or 
gravel); or an area defined by the USGS as a HLR1 or HLR9; or an area 
with a shallow water table; would need to either comply with the 
groundwater monitoring requirements and appropriate controls in the 
effluent guideline or provide a hydrologist's statement demonstrating 
that there is no direct hydrologic connection to surface waters. 
Another option would be to require States, through a public process, to 
identify the areas of the State in which there is the potential for 
such discharges. In those areas, CAFOs subject to an effluent guideline 
that includes requirements to prevent discharges to surface water via 
hydrologically connected ground water would again need to either comply 
with the monitoring requirements and appropriate controls in the 
guideline or provide a hydrologist's statement demonstrating that there 
is no hydrologic connection to surface waters.
    Requirements for CAFOs Not Subject to Effluent Guidelines Ground 
Water

[[<strong>Page</strong> 3041]]

Provisions. Certain facilities are not subject to today's revised 
effluent guideline (412 Subpart C and D) that includes requirements to 
prevent discharges to surface water via hydrologically connected ground 
water. Such CAFOs include: (1) Facilities below the effluent guideline 
applicability threshold that are designated as CAFOs; (2) existing 
swine, poultry and veal operations; and (3) CAFOs in sectors other than 
beef, dairy, poultry, swine and veal. For such CAFOs not subject to an 
effluent guideline that includes ground water requirements, EPA is 
proposing that the permit writer must assess whether the facility is in 
an area with topographical characteristics that indicate the presence 
of ground water that is likely to have a direct hydrologic connection 
to surface water. For instance, if the facility is in an area with 
topographical characteristics that indicate the presence of ground 
water that is likely to have a hydrologic connection to surface water, 
as discussed above, the permit writer is likely to determine that there 
is the potential for a discharge to surface water via ground water with 
a direct hydrologic connection.
    For existing swine, poultry, and veal operations, if the permit 
writer determines that pollutants may be discharged at a level which 
may cause or contribute to an excursion above any State water quality 
standard, the permit writer would be required to decide on a case-by-
case basis whether effluent limitations (technology-based and water 
quality-based, as necessary) should be established to address potential 
discharges to surface water via hydrologically connected ground water. 
EPA is proposing that a permittee for whom the permit authority has 
made the above determinations would be required to comply with those 
conditions, or could avoid having those conditions imposed by providing 
a hydrologist's statement that the facility does not have a direct 
hydrologic connection to surface water. 40 CFR 122.23(j)(6) and (k)(5).
    For CAFOs not subject to today's revised effluent guidelines, if 
the permit writer determines that there is likely to be a discharge 
from the CAFO to surface waters via a direct hydrologic connection, the 
permit writer must impose technology-based or water quality-based, or 
both, effluent limitations, as necessary. Again, EPA is proposing that 
a permittee for whom the permit authority has made the above 
determinations would be required to comply with those conditions, or 
could avoid having those conditions imposed by providing a 
hydrologist's statement that the facility does not have a direct 
hydrologic connection to surface water. 40 CFR 122.23(j)(6) and (k)(5).
    EPA is soliciting comments on the alternative provisions discussed 
here. EPA is also requesting comment on the proposal to place the 
burden on the permittee to establish to the satisfaction of the 
permitting authority that the ground water beneath the production area 
is not connected to surface waters through a direct hydrologic 
connection.
    e. Certification for Off-site Recipients of CAFO Manure. EPA is co-
proposing either to include the following requirement or to omit it. In 
the inclusionary proposal, EPA would require permit writers to include 
a special condition in each permit that requires CAFO owners or 
operators to transfer manure off-site only to recipients who can 
certify that they will either: (1) Land apply manure according to 
proper agricultural practices, as defined for off-site land appliers in 
today's proposed rule; (2) obtain an NPDES permit for potential 
discharges; or (3) use the manure for purposes other than land 
application. EPA proposes to define the term ``proper agriculture 
practice'' to mean that the recipient shall determine the nutrient 
needs of its crops based on realistic crop yields for its area, sample 
its soil at least once every three years to determine existing nutrient 
content, and not apply the manure in quantities that exceed the land 
application rates calculated using either the Phosphorus Index, 
Phosphorus Threshold, or Soil Test Phosphorus method as specified in 40 
CFR 412.13(b)(1)(iv).
    EPA is also proposing to allow States to waive this requirement if 
the recipient is complying with the requirements of a State program 
that are equivalent to proposed 40 CFR 412.13(b).
    f. Erosion Control. EPA is not proposing to specify erosion 
controls as a necessary element of the PNP, but permit writers should 
consider whether to add special conditions on a case-by-case basis as 
appropriate.
    As described in previous sections, EPA recognizes that sediment 
eroding from cropland can have a significant negative impact on surface 
waters. While EPA realizes that it is not possible to completely 
prevent all erosion, erosion can be reduced to tolerable rates. In 
general terms, tolerable soil loss is the maximum rate of soil erosion 
that will permit indefinite maintenance of soil productivity, i.e., 
erosion less than or equal to the rate of soil development. The USDA-
NRCS uses five levels of erosion tolerance (``T'') based on factors 
such as soil depth and texture, parent material, productivity, and 
previous erosion rates. These T levels are equivalent to annual losses 
of about 1-5 tons/acre/year (2-11 mt/ha/year), with minimum rates for 
shallow soils with unfavorable subsoils and maximum rates for deep, 
well-drained productive soils (from Ag Management Measures).
    Options for controlling erosion are: (1) Implementation of one of 
the three NRCS Conservation Practices Standards for Residue Management: 
No-Till and Strip Till (329A), Mulch Till (329B), or Ridge Till (329C) 
in the state Field Office Technical Guide; (2) requiring a minimum 30 
percent residue cover; (3) achieving soil loss tolerance or ``T''; or 
(4) following the Erosion and Sediment Control Management Measure as 
found in EPA's draft National Management Measures to Control Nonpoint 
Source Pollution from Agriculture which is substantially the same as 
EPA's 1993 Guidance Specifying Management Measure for Sources of 
Nonpoint Pollution in Coastal Waters.
    EPA is requesting public comment on the suitability of requiring 
erosion control as a special condition of an NPDES permit to protect 
water quality from sediment eroding from fields where CAFO manure is 
applied to crops. If erosion control is desirable, EPA is soliciting 
comment as to which method would be the most cost-efficient.
    g. Design Standards for Chronic Rainfall. In this section, EPA is 
soliciting comments on whether additional regulatory language is needed 
to clarify when a discharge is considered to be caused by ``chronic 
rainfall.'' EPA also solicits comment on whether design standards to 
prevent discharges due to chronic rainfall should be specified in the 
effluent limitations or as a special condition in the NPDES permit.
    CAFOs in the beef and dairy sub-category [412-subpart C] are 
prohibited from discharging except during a ``25-year, 24-hour rainfall 
event or chronic rainfall'' and then only if they meet the criteria in 
Sec. 412.13(a)(2). Section 412.13(a)(2)(i) allows a discharge caused by 
such rainfall events only if ``(i) The production area is designed and 
constructed to contain all process wastewaters including the runoff 
from a 25-year, 24-hour rainfall event; and (ii) the production area is 
operated in accordance with the requirements of Sec. 412.37(a).''
    The term ``25-year, 24-hour rainfall event'' is clearly defined in 
40 CFR 412.01(b). In addition, proposed Sec. 412.37(c)(1)(iv) would 
require all surface impoundments to have a depth

[[<strong>Page</strong> 3042]]

marker which indicates the design volume and clearly indicates the 
minimum freeboard necessary to allow for the 25-year, 24-hour rainfall 
event. A discharge may be caused by a 25-year, 24-hour storm when it 
occurs despite the fact that the CAFO operator maintained adequate 
freeboard.
    The term ``chronic rainfall'' has not been specifically defined. 
Generally, a chronic rainfall event is one that lasts longer than 24 
hours and causes a discharge from a system that has been designed, 
constructed, maintained and operated to contain all process wastewaters 
plus the runoff from a 25-year, 24-hour rainfall event. Persistent 
rainfall over a period longer than 24 hours may overwhelm a system 
designed for the 25-year, 24-hour rainfall event even though such 
persistent rainfalls may be expected to occur more frequently than 
every 25 years.
    In order for a discharge to be ``caused'' by chronic rainfall, it 
would need to be contemporaneous with the rainfall. The discharge could 
not continue after the event any longer than is necessary. For example, 
once a flooded lagoon has been drawn down to the level necessary to 
protect the integrity of the lagoon (which in no case should be below 
the level of the freeboard necessary for a 25/24-hour storm), the 
discharge should cease. If the lagoon could not then accept additional 
waste from the CAFO, no animals that would contribute waste to the 
lagoon should be brought to the facility until additional capacity can 
be generated by properly land applying the waste or shipping the waste 
off-site.
    A discharge also would not be considered to be ``caused'' by the 
chronic storm if the operator should have foreseen the event in time to 
properly land apply the waste and thereby have avoided an overflow or 
the need to apply wastes to saturated grounds. Similarly, a discharge 
is not considered to be caused by the chronic storm if the operator 
should have foreseen the event and maintained adequate facilities for 
managing the waste. Although (in the absence of more specific 
regulatory requirements) operators would be responsible for foreseeing 
and planning for chronic rainfall events, they would be liable for 
discharges during chronic events only where they were not reasonable in 
their decision regarding what would be adequate capacity.
    An approach that would provide more certainty to the operator but 
place a greater burden on permitting authorities would be for EPA to 
require permit authorities to specify regionally-specific minimum free 
board requirements necessary to contain runoff from foreseeable chronic 
events. For example, it may be known that, in a given area, the free 
board necessary to contain the runoff from a 25-year, 24-hour storm 
will not be sufficient to contain the run off that typically 
accumulates during the region's rainy season, especially when it would 
not be appropriate to draw down the lagoon by land applying wastes 
during that time. In that case, it may be necessary for the permit 
writer to specify a greater freeboard requirement that would apply to 
the CAFO at the beginning of that season. For example, Nebraska 
requires CAFOs to be able to capture the average rainfall for the three 
summer months. EPA notes that such additional permit conditions are 
already required where they are necessary to eliminate potential 
discharges that would cause or contribute to violations of state water 
quality standards.
    Another approach would be to require the operator to notify the 
permitting authority as soon as it knows that a discharge will occur or 
is occurring and to come to an agreement on how long the discharge will 
occur. This approach has several disadvantages. Because many facilities 
located in the same area may be experiencing the same problem, 
permitting authorities may not have the resources to address several 
simultaneous requests. It is not clear how a disagreement between the 
operator and permit authority would be resolved. Perhaps most 
importantly, this approach also does not address the need to foresee 
and prepare for such events in advance of the event.
    EPA solicits comment on all of these approaches for clarifying when 
a discharge is considered to be caused by ``chronic rainfall,'' and 
whether technology guidelines are necessary in either section 412 or 
122 to address discharges due to chronic rainfall.

F. What Type of NPDES Permit is Appropriate for CAFOs?

    NPDES permit authorities can exercise one of two NPDES permitting 
options for CAFOs: general permits or individual permits. A general 
NPDES permit is written to cover a category of point sources with 
similar characteristics for a defined geographic area.
1. What Changes Are Being Made to the General Permit and NOI 
Provisions?
    The majority of CAFOs may appropriately be covered under an NPDES 
general permit because CAFOs generally involve similar types of 
operations, require the same kinds of effluent limitations and permit 
conditions, and discharge the same types of pollutants. In the past, 
about 70 percent of permitted CAFOs have been permitted under an NPDES 
general permit, and EPA expects this trend to continue. General permits 
offer a cost-effective approach for NPDES permit authorities because 
they can cover a large number of facilities under a single permit. The 
geographic scope of a general permit is flexible and can correspond to 
political or other boundaries, such as watersheds. At the same time, 
the general permit can also provide the flexibility for the permittee 
to develop and implement pollution control measures that are tailored 
to the site-specific circumstances of the permittee. The public has an 
opportunity for input during key steps in the permit development and 
implementation process.
    EPA is proposing to clarify that CAFOs may obtain permit coverage 
under a general permit. See proposed Sec. 122.28(a)(2)(iii). Although 
section 122.28 currently authorizes CAFOs to be regulated using a 
general permit, some stakeholders have questioned whether CAFOs fall 
within the current language of that section. Today's proposal would 
clarify that permit writers may use a general permit to regulate a 
category of CAFOs that are appropriately regulated under the terms of 
the general permit.
    A complete and timely NOI indicates the operator's intent to abide 
by all the conditions of the permit, and the NOI fulfills the 
requirements for an NPDES permit application. The contents of the NOI 
are specified in the general permit.
    The current regulation requires NOIs to include legal name and 
address of the owner and operator; facility name and address; type of 
facility or discharges; and the receiving stream(s). EPA is proposing 
to amend Sec. 122.28(b)(2)(ii) to require, in addition:
    <bullet> Type and number of animals at the CAFO
    <bullet> Physical location, including latitude and longitude of the 
production area
    <bullet> Acreage available for agricultural use of manure and 
wastewater;
    <bullet> Estimated amount of manure and wastewater to be 
transferred off-site
    <bullet> Name and address of any other entity with substantial 
operational control of facility
    <bullet> If a new facility, provide a copy of the draft PNP
    <bullet> If an existing facility, the status of the development of 
the PNP
    <bullet> If an area is determined to have vulnerable ground water 
(karst, sandy soil, shallow water table, or in a hydrological landscape 
region 1 (HLR1), submit a hydrologist's statement that the

[[<strong>Page</strong> 3043]]

ground water under the production area of the facility is not 
hydrologically connected to surface water, if the applicant asserts as 
such
    <bullet> Provide a topographic map as described in 40 CFR 
122.21(f)(7), showing any ground water aquifers and depth to ground 
water that may be hydrologically connected to surface water

    Sec. 122.21(f) requires the applicant to submit a topographic map 
extending one mile beyond the facility's boundary that shows potential 
discharge points and surface water bodies in the area. EPA is proposing 
to include a requirement that the operator also identify on the 
topographic map any ground water aquifers that may be hydrologically 
connected to surface water, as well as the depth to ground water.
    EPA is proposing to require permit authorities to make the NOI and 
the notification of PNP development or amendment available to the 
public and other interested parties in a timely manner, updated on a 
quarterly basis. See proposed Sec. 122.23(j)(2). EPA encourages States 
to develop and use Internet-based sites as a supplemental means to 
provide ready public access to CAFO NPDES general permits, facility 
NOIs, and other information.
    EPA will explore ways to adapt the Permit Compliance System, EPA's 
national wastewater database, so that permit authorities may use it to 
track CAFO compliance information. This information might include: 
NPDES permit number; facility name; facility location; latitude and 
longitude of the production of area; animal type(s); number of animals; 
the name and address of the contract holder (for contract operations); 
PNP date of adoption or, where a PNP has not yet been developed, the 
schedule for developing and implementing the PNP, including interim 
milestones.
    EPA is proposing to clarify that CAFOs may obtain permit coverage 
under a general permit. See proposed Sec. 122.28(a)(2)(iii), which 
would expressly add ``concentrated animal feeding operations'' to the 
list of sources that are eligible for general permits. In fact, CAFOs 
are already eligible for general permits under the existing regulations 
at Sec. 122.28(a)(2), both because they are storm water point sources 
(see subsection (a)(2)(i)) and because they are a category of point 
sources that involve the same or substantially similar types of 
operations, may be more appropriately controlled under a general permit 
than under individual permits, and otherwise meet the criteria of 
subsection (a)(2)(ii). Some stakeholders, however, have questioned 
whether CAFOs meet these existing criteria for general permit 
eligibility. Therefore, to remove any such questions among 
stakeholders, EPA is proposing to expressly add CAFOs to the list of 
sources that are eligible for general permits. In sum, this proposed 
change would be for purposes of clarity only; it would effect no 
substantive change to the regulations.
2. Which CAFOs May Be Subject to Individual Permits?
    Although EPA is not proposing to require NPDES individual permits 
in particular circumstances, the Agency is proposing additional 
criteria for when general permits may be inappropriate for CAFOs. See 
proposed Sec. 122.28(b)(3)(i)(G). Under the existing regulation, the 
public may petition the permit authority when it believes that, based 
on the criteria in section 122.28(b)(3)(i), that coverage under a 
general permit is inappropriate. Finally, EPA is proposing to require 
the permit authority to conduct a public process for determining which 
criteria, if any, would require a CAFO owner or operator to apply for 
an individual permit. See proposed Sec. 122.28(b)(3)(i)(G). Permit 
authorities would be required to conduct this public process and set 
forth its policy prior to issuing any general permit for CAFOs. Permit 
authorities would have flexibility as to how to conduct this public 
process.
    Besides requiring a public process to develop criteria for 
requiring individual permits, the proposed regulation would also add 
the following CAFO-specific criteria for when the Director may require 
an individual permit: (1) CAFOs located in an environmentally or 
ecologically sensitive area; (2) CAFOs with a history of operational or 
compliance problems; (3) CAFOs that are exceptionally large operations 
as determined by the permit authority; and (4) significantly expanding 
CAFOs. See proposed Sec. 122.28(b)(3)(i)(G)(i)-(iv). Any interested 
member of the public may petition the Director to require an individual 
permit for a facility covered by a general permit. Section 
122.28(b)(3).
    EPA believes these criteria on the availability of general permits 
for CAFOs are desirable because of keen public interest in 
participating in the process of issuing permits to CAFOs. The public 
may participate in notice and comment during the development of general 
permits, but once issued, public participation regarding facilities 
submitting notices of intent is limited. On the other hand, the public 
does have access to notice and comment participation with regard to 
individual permits.
    EPA considered requiring all CAFOs, or all new CAFOs, to obtain an 
individual permit, but considered this potentially burdensome to permit 
authorities. Using general permits to cover classes of facilities by 
type of operation, by jurisdiction, or by geographic boundary such as a 
watershed, offers positive environmental as well as administrative 
benefits.
    EPA also considered identifying a threshold to establish when 
exceptionally large facilities would be required to apply for an 
individual permit, such as 5,000 AU or 10,000 AU, or by defining such a 
threshold as the largest ten percent or 25 percent of CAFOs within each 
sector. EPA did not propose this approach because, as shown in table 7-
9, it was difficult to establish a consistent basis across sectors for 
making this determination. While EPA's cost models assume that 30% of 
operations might obtain individual permits, and thus such thresholds 
are taken into account in the cost analyses for this proposed 
regulation, EPA did not believe particular thresholds would be 
appropriate across all sectors or all states. EPA is interested in 
comments on whether it should establish a size threshold above which 
individual permits would be required, recommendations of what the 
threshold should be, and data to support such recommendations.

                      Table 7-9. Potential Definition of ``Exceptionally Large'' Facilities
----------------------------------------------------------------------------------------------------------------
                                         5,000 AU    10,000 AU      Top 10% (Est.)           Top 25% (Est.)
                                       -------------------------------------------------------------------------
             Animal sector                 Head        Head
                                        equivalent  equivalent     Head         AU         Head          AU
----------------------------------------------------------------------------------------------------------------
Beef/Heifer...........................       5,000      10,000      11,000      11,000       3,500         3,500

[[<strong>Page</strong> 3044]]

Dairy.................................       3,500       7,000       3,800       5,440       2,170         3,100
Veal..................................       5,000      10,000       1,500       1,500         950           950
Swine.................................      12,500      25,000       9,000       3,600       5,000         2,000
Broiler...............................     500,000   1,000,000     150,000       1,500     110,000         1,100
Layer.................................     500,000   1,000,000     500,000       5,000     180,000         1,800
Turkey................................     275,000     550,000     100,000       1,820      55,000        1,000
----------------------------------------------------------------------------------------------------------------
Note: Except for beef, these values are interpolations based on best professional judgement.

    EPA also considered whether operations that significantly expand 
should be required to reapply for a permit. Public concern has been 
expressed as to whether operations that significantly expand should be 
required to undergo a public process to determine whether new limits 
are necessitated by the expansion. EPA believes, however, that if the 
general permit covers operations similar to the newly expanded 
operation, there would be no basis for requiring an individual permit. 
In section VIII above, EPA also has explained why it would not be 
appropriate to classify facilities that expand their production 
capacities as new sources. If a member of the public believes that the 
requirements of a proposed general permit are not adequate for CAFOs 
above a certain size, it should raise that issue when the permit 
authority proposes the general permit and request that it be limited to 
certain size operations. As is discussed above, the public could also 
petition the permit authority if it believes that a specific facility 
should be covered by an individual permit.
    Under existing regulations the permit authority may modify a permit 
if there are material and substantial alterations to the permitted 
facility or activity that occur after the permit is issued and justify 
different permit conditions. 40 CFR 122.62(a)(1). The public would be 
able to participate in the permit modification process to incorporate 
the new standards. 40 CFR 123.5(c).
    EPA is interested in comment on whether the above procedures are 
adequate to ensure public participation or whether individual permits 
should be required for any of the categories of facilities discussed 
above. Specifically, EPA is interested in comments on whether 
individual permits should be required for (a) facilities over a certain 
size threshold, (b) new facilities; (c) facilities that are 
significantly expanding; (d) facilities that have historical compliance 
problems; or (e) operations that are located in areas with significant 
environmental concerns.
3. Demonstrating No Potential to Discharge
    As described in section VII.C.2.d above, today's proposal would 
require all CAFO owners or operators to apply for an NPDES permit, 
based on a presumption that all CAFOs have a potential to discharge 
pollutants to waters of the U.S. There would, however, be one exception 
to this requirement: A CAFO owner or operator would not need to apply 
for a permit if it received a determination by the permit authority 
that the CAFO does not have a potential to discharge. It would be the 
CAFO owner's or operator's burden to ask for a ``no potential to 
discharge'' determination and to support the request with appropriate 
data and information. See proposed Sec. 122.23(c) and (e).
    The term ``no potential to discharge'' means that there is no 
potential for any CAFO manure or wastewaters to be added to waters of 
the United States from the operation's production or land application 
areas, without qualification. For example, if a CAFO land applies its 
manure according to a permit nutrient plan, it may not claim ``no 
potential to discharge'' status on the basis that it would have runoff, 
but any runoff would be exempt as agricultural storm water. CAFOs 
owners or operators should not be able to avoid permitting by claiming 
that they already meet the land application requirements that would be 
in a permit--in this case, the requirement of zero discharge from land 
application areas except for runoff from properly applied manure and 
wastewater (see today's proposed effluent limitation guidelines). 
Moreover, today's proposed effluent limitation guidelines would include 
not only restrictions on the rate of land application but also a set of 
best management practices to further protect against inadvertent 
discharges from land applied manure and wastewater (for example, the 
requirement for 100 foot setbacks, consideration of timing of 
application, etc.). EPA's intention would be to require a permit that 
imposes both types of requirements unless an operation has clearly 
established the absence of a potential to discharge. A CAFO's claim 
that it already meets the restrictions on the rate of land application 
would not ensure, as a permit would, that the CAFO has employed and is 
continuing to employ these additional management practices.
    Instead, EPA proposes to allow ``no potential to discharge'' status 
in order to provide relief where there truly is no potential for a 
CAFO's wastes to reach the waters. This would include, for example, 
CAFOs that are far from any water body, or those that have closed cycle 
systems for managing their wastes and that do not land apply their 
wastes. In particular, EPA believes that the act of land applying its 
manure and wastewater would, in many cases, be enough by itself to 
indicate that a CAFO does have a potential to discharge. It would be 
very difficult, in general, for CAFOs that land apply their wastes to 
demonstrate that they have no potential to discharge (although 
conceivably such a showing could be made if the physical features of 
the site, including lack of proximity to the waters, slope, etc. 
warrant it).
    It is only where there is no potential for a CAFO's wastes to reach 
the waters that EPA believes it is appropriate not to require a permit. 
Indeed, where a CAFO has demonstrated that it has no potential to 
discharge, it no longer qualifies as a point source under the Act (see 
Section 502(14), which defines ``point source'' to include conveyances 
such as CAFOs from which pollutants ``are or may be'' discharged).
    Under today's proposal, the burden of proof to show that there is 
no potential to discharge would be with the CAFO owner or operator, not 
the permitting authority. There would be a presumption that the CAFO 
does have the potential to discharge unless the CAFO owner or operator 
has rebutted this presumption by showing, to the satisfaction of the 
permit authority, that it does not.

[[<strong>Page</strong> 3045]]

    It is not EPA's intention to allow a broad interpretation of this 
provision but, rather, to establish that ``no potential to discharge'' 
is to be narrowly interpreted and applied by permit authorities. This 
provision is intended to be a high bar that provides an exemption only 
to those facilities that can demonstrate to a degree of certainty that 
they have no potential to discharge to the waters of the U.S.
    Today's proposal would specify that an operation that has had a 
discharge within the past five years cannot receive a determination 
that it has no potential to discharge. The Agency is not proposing to 
specify further the exact conditions that would indicate that a 
facility has no potential to discharge. However, any such demonstration 
would need to account for all manure generated at the facility, 
specifying how the design of the animal confinement areas, storage 
areas, manure and wastewater containment areas, and land application 
areas eliminates any possibility of discharge to surface waters or to 
groundwater with a direct hydrological connection to surface water. 
Further, the CAFO operator must be able to provide assurance that all 
CAFO-generated manure and wastewater that is transported off-site are 
transferred to a recipient that provides for environmentally 
appropriate handling, such as by: (1) land applying according to proper 
agricultural practices as defined in this regulation; (2) obtaining an 
NPDES permit for discharges resulting from land application; or (3) 
having other non-land application uses.
    If an owner or operator is able to demonstrate no potential to 
discharge at the production area, but cannot demonstrate an assurance 
that manure transported off-site is being appropriately disposed of, 
the facility would be required to apply for a zero discharge permit 
that includes the record keeping requirements described in section 
VII.E. of today's proposal.
    EPA requests comment on whether it should include additional 
specific criteria for determining whether a CAFO has ``no potential to 
discharge,'' and what those criteria should be. The Agency is concerned 
that without more specific criteria, this provision could be subject to 
abuse. Therefore, EPA is seeking comment on whether safeguards are 
necessary to ensure that only those CAFOs which truly pose no risk to 
the environment are able to avoid permitting requirements.
    The fact that a CAFO owner or operator submits a request for a 
determination that the facility has no potential to discharge would not 
change the deadline to apply for a permit. The CAFO owner or operator 
would need to apply for a permit according to the date specified in 
Sec. 122.23(f) unless it receives a no potential to discharge 
determination before that date. It would be inappropriate, in EPA's 
view, to allow otherwise--i.e., to postpone the deadline to apply for a 
permit if the CAFO has not yet received a determination on its ``no 
potential to discharge'' request. Under that approach, even CAFOs 
owners or operators who could not make a serious claim of ``no 
potential to discharge'' could apply for such a determination simply as 
a way of delaying the permitting process, and the process could in fact 
be delayed if permitting authorities are faced with large numbers of 
such requests. We recognize that under the approach we are proposing, 
some CAFOs who really do have no potential to discharge will be forced 
to file a complete permit application if their permitting authority has 
not ruled on their request prior to the deadline for the permit 
application. However, EPA expects there to be few such cases, since we 
expect relatively few CAFOs to be able to demonstrate no potential to 
discharge; and in light of the problems of the alternative approach, 
EPA's proposed approach seems preferable.
    It is important to recognize that if a CAFO receives a ``no 
potential to discharge'' determination but subsequently does have a 
discharge, that operation would be in violation of the Clean Water Act 
for discharging without a permit. The ``no potential to discharge'' 
determination would not identify an operation as forever a non-point 
source. To the contrary, there would be no basis for excluding an 
operation from the requirements for point sources if it meets the 
criteria for being a CAFO and has an actual discharge of pollutants to 
the waters. The operation, upon discharging, would immediately revert 
to status as a point source.
    EPA is requesting comment on whether the Director's ``no potential 
to discharge'' determination should be subject to the same types of 
administrative procedures that are required for the Director's decision 
to issue or deny a permit. That is, EPA is considering a requirement 
that, before EPA or the State could issue a final determination that 
there is no potential to discharge, the public would have the formal 
right to comment on, and EPA would have the opportunity to object to 
(in authorized States), the Director's draft determination. These 
procedures may be appropriate, for example, in light of anticipated 
public interest in the Director's determination. Alternatively, EPA 
requests comment on not requiring the Director to follow these 
procedures for public and EPA input into the Director's decision. EPA 
could conclude that the types of procedures that apply to permitting 
decisions are not appropriate here (since the ``no potential to 
discharge'' determination is neither the issuance nor denial of a 
permit), but that the environment is sufficiently protected by the fact 
that any actual discharge from either the production or land 
application areas would be a violation of the Clean Water Act. Under 
this latter interpretation, EPA would not itself follow the types of 
procedures that apply to permit decisions (such as providing the public 
with the formal opportunity to submit public comments on the Director's 
draft decision) and would not require States to follow those 
procedures; however, States could make those procedures available if 
they chose, since they would be more stringent than the procedures 
required by EPA. EPA requests comment on which of these two alternative 
approaches to adopt in the final rule.
    It should be noted that under the three-tier proposal, in some 
cases owners of operations in the middle tier (300 AU to 1,000 AU) 
would not need to demonstrate ``no potential to discharge'' to avoid a 
permit because they would not be defined as CAFOs in the first 
instance. That is, if they do not meet any of the conditions under that 
regulatory option for being defined as a CAFO (insufficient storage and 
containment to prevent discharge, production area located within 100 
feet of waters, evidence of discharge in the last five years, land 
applying without a PNP, or transporting manure to an off-site recipient 
without appropriate certification) then they would not be subject to 
permitting as CAFOs. (They could, however, still be subject to NPDES 
permitting as other, non-CAFO types of point sources, as discussed 
elsewhere in this preamble.)
4. NPDES Permit Application Form 2B
    EPA is proposing to amend the NPDES permit application form 2B for 
CAFOs and Aquatic Animal Production Facilities in order to reflect the 
revisions included in today's proposed rulemaking, and in order to 
facilitate consideration of the permit application. EPA is proposing to 
require applicants for individual CAFO permits to submit the following 
information:
    <bullet> acreage available for agricultural use of manure and 
wastewater;
    <bullet> estimated amount of manure and wastewater to be 
transferred off-site.

[[<strong>Page</strong> 3046]]

    <bullet> name and address of any person or entity that owns animals 
to be raised at the facility, directs the activity of persons working 
at the CAFO, specifies how the animals are grown, fed, or medicated; or 
otherwise exercises control over the operations of the facility, in 
other words, that may exercise substantial operational control.
    <bullet> provide a copy of the draft PNP.
    <bullet> whether buffers, setbacks or conservation tillage are 
implemented to protect water quality.
    <bullet> On the topographic map required by Form 1, identify 
latitude and longitude of the production area, and identify depth to 
ground water that may be hydrologically connected to surface water, if 
any.
    See proposed Sec. 122.21(i)(1).
    The existing Form 2B currently only requires: whether the 
application is for a proposed or existing facility; type and number of 
animals in confinement (open confinement or housed under roof); number 
of acres for confinement feeding; if there is open confinement, whether 
a runoff diversion and control system has been constructed and, if so, 
indicate whether the design basis is for a 10-year, 24-hour storm, a 
25-year, 24-hour storm, or other, including inches; number of acres 
contributing to drainage; design safety factor; name and official 
title, phone number, and signature. In addition, Sec. 122.21(f) of the 
current NPDES regulation requires applicants to submit a topographic 
map extending one mile beyond the facility's boundary that shows 
discharge points and surface water bodies in the area.
    EPA is proposing to update form 2B and requests comment on what 
information should be required of applicants for individual permits.

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BILLING CODE 6560-50-C
    It is anticipated that as a result of the requirement that all 
CAFOs have a duty to apply, there will be a large number of CAFOs 
applying for NPDES permits. Some of these operations represent a 
greater risk to water quality than others. In order for the permit 
writer to prioritize NPDES permit writing activities based on the risk 
to water quality, Section G is being proposed to add to Form 2B as a 
screening mechanism. Those facilities without

[[<strong>Page</strong> 3050]]

buffers, setbacks, or conservation tillage potentially pose a greater 
risk to water quality; therefore the permit writer could use this 
information to develop and issue NPDES permits to these facilities on 
an expedited basis.

VIII. What Changes to the Feedlot Effluent Limitations Guidelines 
Are Being Proposed?

A. Expedited Guidelines Approach

    EPA has developed today's proposed regulation using an expedited 
rulemaking process which relies on communication between EPA, the 
regulated community, and other stakeholders, rather than formal data 
and information gathering mechanisms. At various stages of information 
gathering, USDA personnel, representatives of industry and the national 
trade associations, university researchers, Agricultural Extension 
agencies, States, and various EPA offices and other stakeholders have 
presented their ideas, identified advantages and disadvantages to 
various approaches, and discussed their preferred options.
    EPA encourages full public participation in commenting on these 
proposals.

B. Changes to Effluent Guidelines Applicability

1. Who is Regulated by the Effluent Guidelines?
    The existing effluent guidelines regulations for feedlots apply to 
operations with 1,000 AU and greater. EPA is proposing to establish 
effluent guidelines requirements for the beef, dairy, swine, chicken 
and turkey subcategories that would apply to any operations in these 
subcategories that are defined as a CAFO under either the two-tier or 
three-tier structure. Also as discussed in detail in Section VII.B.3, 
EPA is also requesting comment on an option under which the effluent 
guidelines proposed today would not be applicable to facilities under 
1,000 AU. Under this approach, AFOs below this threshold would be 
permitted based on an alternate set of effluent guidelines, or the best 
professional judgment of the permit writer. After evaluating public 
comments EPA may decide to consider this option. At that time EPA would 
develop and make available for comment an analysis of why it is 
appropriate to promulgate different effluent guidelines requirements or 
no effluent guidelines for CAFOs that have between 300 and 1,000 AU as 
compared to the effluent guidelines for operations with greater than 
1,000 AU.
    EPA also proposes to establish a new subcategory that applies to 
the production of veal cattle. Veal production is included in the beef 
subcategory in the existing regulation. However, veal production 
practices and wastewater and manure handling are very different from 
the practices used at beef feedlots; therefore, EPA proposes to 
establish a separate subcategory for veal.
    Under the three-tier structure the proposed effluent guidelines 
requirements for the beef, dairy, swine, veal and poultry subcategories 
will apply to all operations defined as CAFOs by today's proposal 
having at least as many animals as listed below.

200 mature dairy cattle (whether milked or dry);
300 veal;
300 cattle other than mature dairy cattle or veal;
750 swine weighing over 55 pounds;
3,000 swine weighing 55 pounds or less;
16,500 turkeys; or
30,000 chickens.

    Under the two-tier structure, the proposed requirements for the 
beef, dairy, swine, veal and poultry subcategories will apply to all 
operations defined as CAFOs by today's proposal having at least as many 
animals as listed below.

350 mature dairy cattle (whether milked or dry);
500 veal;
500 cattle other than mature dairy cattle or veal;
1,250 swine weighing over 55 pounds;
5,000 swine weighing 55 pounds or less;
27,500 turkeys; or
50,000 chickens.

    EPA is proposing to apply the Effluent guidelines requirements for 
the beef, dairy, veal, swine, chicken and turkey subcategories, to all 
operations in these subcategories that are defined as CAFOs under 
either of today's proposed permitting scenarios. Operations designated 
as CAFOs are not subject to the proposed effluent guidelines.
    EPA is proposing to rename the Effluent Guidelines Regulations, 
which is entitled Feedlots Point Source Category. Today's proposal 
changes the name to the Effluent Guidelines Regulation for the CAFOs 
Point Source Category. EPA is proposing this change for consistency and 
to avoid confusion between who is defined as a CAFO under Part 122 and 
whether the Effluent guidelines apply to the operation.
    EPA is not proposing to revise the Effluent guidelines requirements 
or the applicability for the horses, sheep and lambs and ducks 
subcategories even though the definition of CAFO for these 
subcategories is changing as described previously in Section VII. These 
sectors have not undergone the same level of growth and consolidation 
that the other livestock sectors have experienced in the past 25 years. 
In 1992, an estimated 260 farms in these sectors were potentially CAFOs 
based on size, and relatively few of these operations were expected to 
maintain horses or sheep in confinement. Finally, the CAFOs in these 
sectors have not been identified as significant contributors of 
wastewater pollutants that result in water quality impairment.
    EPA has evaluated the technology options described in this section 
and evaluated the economic achievability for these technologies for all 
operations with at least as many animals listed above for both the two-
tier and three-tier NPDES structures. The technology requirements for 
operations defined as CAFOs under the two-tier structure are the same 
requirements for operations defined as CAFOs under the three-tier 
structure. Therefore for the purpose of simplifying this discussion and 
emphasizing the differences in technology requirements for the various 
technology options, the following discussion will not distinguish 
between the two CAFO definition scenarios. For more discussion of the 
costs and differences in costs between the different CAFO definition 
scenarios, refer to Section X of this preamble or the EA. For 
discussion of the benefits achieved for the different technology 
options and scenarios, refer to Section XI of this preamble.
    EPA proposes to make the Effluent guidelines and standards 
applicable to those operations that are defined as CAFOs as described 
previously under Section VII. EPA is not proposing to apply the 
Effluent guidelines to those operations that fall below the proposed 
thresholds but are still designated as CAFOs. As described in Section 
VII, EPA anticipates that few AFOs will be designated as CAFOs and that 
these operations will generally be designated due to site-specific 
conditions. Examples of these conditions could include, not capturing 
barnyard runoff which runs directly into the stream, or siting open 
stockpiles of manure inappropriately. EPA believes that establishing 
national technology based requirements for designated CAFOs is not 
efficient or appropriate because historically a small number of 
facilities has been designated and facilities which are designated in 
the future will be designated for a wide variety of reasons. EPA 
believes that a permit will best control pollutant discharges from 
those operations if it is based on the permit writer's best 
professional judgment and is tailored to address the specific

[[<strong>Page</strong> 3051]]

problems which caused the facility to be designated.
    EPA is proposing to make substantial changes to the applicability 
for chickens, mixed animal operations and immature animals as described 
below.
    Chickens. The current regulations apply to chicken operations with 
liquid manure handling systems or continuous flow watering systems. 
Unlimited continuous flow watering systems have been replaced by more 
efficient systems for providing drinking water to the birds. 
Consequently, many state permitting authorities and members of the 
regulated community contend that the existing effluent guidelines do 
not apply to most broiler and laying hen operations, despite the fact 
that chicken production poses risks to surface water and groundwater 
quality from improper storage of dry manure, and improper land 
application. EPA is proposing to clarify the effluent guidelines to 
ensure coverage of broiler and laying hen operations with dry manure 
handling. The proposed applicability is identical to the definition of 
chicken CAFOs described in Section VII.C.2.f. EPA is thus proposing to 
establish effluent guidelines for chicken operations that use dry 
manure handling systems regardless of the type of watering system or 
manure handling system used. EPA is using the term chicken in the 
regulation to include laying hens, pullets, broilers and other meat 
type chickens. See Section VII for more details on the proposed 
applicability threshold for chickens.
    Mixed Animal Types. Consistent with the proposed changes to the 
definition of CAFO as described in Section VII.C.2.b, EPA is proposing 
to eliminate the calculation in the existing regulation that apply to 
mixed animals operations.
    Immature Animals. EPA is proposing to apply technology based 
standards to swine nurseries and to operations that confine immature 
dairy cows or heifers apart from the dairy. EPA currently applies 
technology based standards to operations based on numbers of swine each 
weighing over 55 pounds. Modern swine production has a phase of 
production called a nursery that only confines swine weighing under 55 
pounds. These types of operations are currently excluded from the 
technology based standards, but are increasing in both number and size. 
Therefore, EPA proposes to establish technology based standards to 
operations confining immature pigs. Under the two-tier structure EPA 
proposes to establish a threshold of 5,000 immature pigs or pigs 
weighing 55 pounds or less. Under the proposed three-tier structure 
operations that confine between 3,000 and 10,000 immature pigs could be 
defined as CAFOs and all operations with more than 10,000 immature pigs 
would be CAFOs. EPA also proposes to establish requirements for 
immature heifers when they are confined apart from the dairy, at either 
stand alone heifer operations similar in management to beef feedlots, 
or at cattle feedlots. Therefore EPA proposes to include heifer 
confinement off-site from the dairy under the beef feedlot subcategory, 
and today's proposed technology standards for beef feedlots would apply 
to those stand alone heifer operations defined as CAFOs. Also any 
feedlot that confines heifers along with cattle for slaughter is 
subject to the beef feedlot requirements.
    EPA is proposing to establish a new subcategory for the effluent 
guidelines regulations which applies to veal operations. The existing 
regulation includes veal production in the beef cattle subcategory. EPA 
is proposing to create a distinct subcategory for veal operations 
because these operations use different production practices than other 
operations in the beef subcategory however, we are proposing to retain 
the sized threshold that pertained to veal while included in the beef 
subcategory. Veal operations maintain their animals in confinement 
housing as opposed to open outdoor lots as most beef feedlots operate. 
They also manage their manure very differently than typical operations 
in the beef cattle subcategory. Due in large part to the diet the 
animals are fed, the manure has a lower solids content and is handled 
through liquid manure handling systems, such as lagoons, whereas beef 
feedlots use dry manure handling systems and only collect stormwater 
runoff in retention ponds. EPA is proposing to define a veal CAFO as 
any veal operation which confines 300 veal calves or greater under the 
three-tier structure, or 500 veal calves or greater under two-tier 
structure.

C. Changes to Effluent Limitations and Standards

    EPA is today proposing to revise BAT and new source performance 
standards for the beef, dairy, veal, swine and poultry subcategories. 
EPA is proposing to establish technology-based limitations on land 
application of manure to lands owned or operated by the CAFO, maintain 
the zero discharge standard and establish management practices at the 
production area.
1. Current Requirements
    The existing regulations, which apply to operations with 1,000 AU 
or greater, require zero discharge of wastewater pollutants from the 
production area except when rainfall events, either chronic or 
catastrophic cause an overflow of process wastewater from a facility 
designed, constructed and operated to contain all process generated 
wastewaters plus runoff from a 10-year, 24-hour event under the BPT 
requirements and a 25-year, 24-hour event under the BAT and NSPS 
requirements. In other words, wastewater and wastewater pollutants are 
allowed to be discharged as the result of a chronic or catastrophic 
rainfall event so long as the operation has designed, constructed and 
operated a manure storage and/or runoff collection system to contain 
all process generated wastewater, including the runoff from a specific 
rainfall event. The effluent guidelines do not set discharge 
limitations on the pollutants in the overflow.
2. Authority to Establish Requirements Based on Best Management 
Practices
    The regulations proposed today establish a zero discharge 
limitation and include provisions requiring CAFOs to implement best 
management practices (BMPs) to prevent or otherwise contain CAFO waste 
to meet that limitation at the production area. The regulations also 
establish non-numeric effluent limitations in the form of other BMPs 
when CAFO waste is applied to land under the control of the CAFO owner 
or operator. For toxic pollutants of concern in CAFO waste, 
specifically cadmium, copper, lead, nickel, zinc and arsenic, EPA is 
authorized to establish BMPs for those pollutants under CWA section 
304(e). EPA also expects reductions in conventional and nonconventional 
water pollutants as a result of BMPs. To the extent these pollutants 
are in the waste streams subject to 304(e), EPA has authority under 
that section to regulate them. EPA also has independent authority under 
CWA sections 402(a) and 501(a) and 40 CFR 122.44(k) to require CAFOs to 
implement BMPs for pollutants not subject to section 304(e). In 
addition, EPA has authority to establish non-numeric effluent 
limitations guidelines, such as the BMPs proposed today, when it is 
infeasible to establish numeric effluent limits. Finally, EPA is 
authorized to impose the BMP monitoring requirements under section 
308(a).
    Production Area. EPA has determined that the BMPs for the 
production area are necessary because the requirement of zero discharge 
has historically not been attained. As described in Section V, of this 
preamble, there are numerous reports of discharges from CAFOs that are 
unrelated to storm events which would be less likely to occur if the

[[<strong>Page</strong> 3052]]

proposed BMPs described below were required.
    Section 304(e) provides that ``[t]he Administrator, after 
consultation with appropriate Federal and State agencies and other 
interested persons, may publish regulations, supplemental to any 
effluent limitations specified under (b) and (c) of this section for a 
class or category of point sources, for any specific pollutant which 
the Administrator is charged with a duty to regulate as a toxic or 
hazardous pollutant under section 1317(a)(1) or 1321 of this title, to 
control plant site runoff, spillage or leaks, sludge or waste disposal, 
and drainage from raw material storage which the Administrator 
determines are associated with or ancillary to industrial manufacturing 
or treatment process within such class or category of point sources and 
may contribute significant amounts of such pollutants to navigable 
waters.'' Sec. 304(e). There are studies showing the presence of a 
number of listed metals in animal manure. Numerous sources such as the 
American Society of Agricultural Engineers, and Universities such as 
North Carolina State University have acknowledged the presence of 
metals in manure. Metals are present in the manure because they are 
added or present in the animal feed. EPA has estimated metal loadings 
being applied to land before and after this regulation would take 
effect. Although the concentration of metals present in untreated 
manure are less than the limits for metals established in EPA's 
biosolids regulations (40 CFR Part 503), EPA still anticipates that 
there would be a substantial reduction in pollutant loadings reaching 
the edge of the field through use of the land application practices 
included in today's proposal. See the Development Document for more 
discussion.
    EPA's authority to require these BMPs does not require a 
determination that the toxics present in CAFO waste are significant. 
The federal courts have held that EPA has extensive authority to carry 
out its duties under the Clean Water Act:
    EPA is not limited by statute to the task of establishing effluent 
standards and issuing permits, but is empowered by section 501(a) of 
the Act to prescribe regulations necessary to carry out its functions 
under the Act. 33 U.S.C. Sec. 1361(a). It is also clear that 
permissible conditions set forth in NPDES permits are not limited to 
establishing limits on effluent discharge. To the contrary, Congress 
has seen fit to empower EPA to prescribe as wide a range of permit 
conditions as the agency deems appropriate in order to assure 
compliance with applicable effluent limits. 33 U.S.C. Sec. 1342(a)(2); 
see also id. Sec. 1314(e). NRDC v. EPA, 822 F.2d 104, 122 (D.C. Cir. 
1987).
    This authority operates independent of section 304(e). EPA's 
authority under section 402(a)(2) to establish NPDES permit conditions, 
including BMPs, for any pollutant when such conditions are necessary to 
carry out the provisions of the statute has been further implemented 
through regulations at 40 CFR 122.44(k). Although a requirement to 
establish and implement BMPs of the type proposed in this regulation 
could be imposed on a case-by-case basis, EPA has decided to promulgate 
this requirement on a categorical basis for those facilities which are 
CAFOs by definition. In light of the more than twenty years of 
experience with the regulation of CAFOs and their failure to achieve 
the zero discharge limit originally promulgated, EPA has determined 
that certain management practices are necessary to ensure that the zero 
discharge limit is actually met. The stated goal of the Clean Water Act 
is to eliminate the discharge of pollutants into the Nation's waters. 
CWA section 101(a)(1). EPA has determined that these BMPs, by 
preventing or controlling overflows, leaks or intentional diversions, 
are an important step toward that goal.
    Finally, EPA has authority to impose monitoring and recordkeeping 
requirements under section 308 of the Act. As described below EPA is 
proposing to require that CAFOs periodically sample their manure and 
soils to analyze for nutrient content. This is necessary to both 
determine what is the appropriate rate to land apply manure and to 
ensure that the application rate is appropriate. The proposed rule 
would also require CAFOs to conduct routine inspections around the 
production area to ensure that automated watering lines are functioning 
properly, and to ensure that the manure level for liquid systems is not 
threatening a potential discharge. The CAFO would also maintain records 
that document manure application, including equipment calibration, 
volume or amount of manure applied, acreage receiving manure, 
application rate, weather conditions and timing of manure application, 
application method, crops grown and crop yields. These records will 
provide documentation that the manure was applied in accordance with 
the PNP and has not resulted in a discharge of pollutants in excess of 
the agricultural use. EPA has determined that these practices are 
necessary in order to determine whether an owner or operator of a CAFO 
is complying with the effluent limitation. Establishment and 
maintenance of records, reporting, and the installation, use and 
maintenance of monitoring equipment are all requirements EPA has the 
authority to impose. 33 U.S.C. Sec. 1318(a).
    Land Application Areas. For the land application areas of a CAFO, 
EPA is proposing a nonnumeric effluent limitation consisting of best 
management practices. The D.C. Circuit has concluded that ``[w]hen 
numerical effluent limitations are infeasible, EPA may issue permits 
with conditions designed to reduce the level of effluent discharges to 
acceptable levels.'' NRDC v. Costle, 568 F.2d 1369, 1380 (D.C. Cir. 
1977); 40 CFR 122.44(k)(3). EPA has determined that it is infeasible to 
establish a numeric effluent limitation for discharges of land applied 
CAFO waste and has also determined that the proposed BMPs are the 
appropriate ones to reduce the level of discharge from land application 
areas.
    The proposed BMPs constitute the effluent limitation for one 
wastestream from CAFOs. The statutory and regulatory definition of 
``effluent limitation'' is very broad--``any restriction'' imposed by 
the permitting authority on quantities, discharge rates and 
concentrations of a pollutant discharged into a water of the United 
States. Clean Water Act Sec. 502(11), 40 CFR 122.2. Neither definition 
requires an effluent limitation to be expressed as a numeric limit. 
Moreover, nowhere in the CWA does the term ``numeric effluent 
limitation'' even appear and the courts have upheld non-numeric 
restrictions promulgated by EPA as effluent limitations. See NRDC v. 
EPA, 656 F.2d 768, 776 (D.C. Cir. 1981) (holding that a regulation 
which allows municipalities to apply for a variance from the normal 
requirements of secondary sewage treatment is an ``effluent 
limitation'' for purposes of review under Sec. 509(b): ``[W]hile the 
regulations do not contain specific number limitations in all cases, 
their purpose is to prescribe in technical terms what the Agency will 
require of section 1311(h) permit applicants.''). Thus, the statutory 
definition of ``effluent limitation'' is not limited to a single type 
of restriction, but rather contemplates a range of restrictions that 
may be used as appropriate. Likewise, the legislative history does not 
indicate that Congress envisioned a single specific type of effluent 
limitation to be applied in all circumstances. Therefore, EPA has a 
large degree of discretion in interpreting the term ``effluent 
limitation,'' and determining whether an effluent limitation must be 
expressed

[[<strong>Page</strong> 3053]]

as a numeric standard. EPA has defined BMPs as ``schedules of 
activities, prohibitions of practices, maintenance procedures, and 
other management practices to prevent or reduce the pollution of waters 
of the United States.'' 40 CFR 122.2. A BMP may take any number of 
forms, depending upon the problem to be addressed. Because a BMP must, 
by definition, ``prevent or reduce the pollution of waters of the 
United States,'' the practices and prohibitions a BMP embodies 
represent restrictions consistent with the definition of an effluent 
limitation set out in CWA Sec. 502(11).
    Effluent limitations in the form of BMPs are particularly suited to 
the regulation of CAFOs. The regulation of CAFOs often consists of the 
regulation of discharges associated with storm water. Storm water 
discharges can be highly intermittent, are usually characterized by 
very high flows occurring over relatively short time intervals, and 
carry a variety of pollutants whose nature and extent varies according 
to geography and local land use. Water quality impacts, in turn, also 
depend on a wide range of factors, including the magnitude and duration 
of rainfall events, the time period between events, soil conditions, 
the fraction of land that is impervious to rainfall, other land use 
activities, and the ratio of storm water discharge to receiving water 
flow. CAFOs would be required to apply their manure and wastewater to 
land in a manner and rate that represents agricultural use. The manure 
provides nutrients, organic matter and micronutrients which are very 
beneficial to crop production when applied appropriately. The amount or 
rate at which manure can be applied to provide the nutrient benefits 
without causing excessive pollutant discharge will vary based on site 
specific factors at the CAFO. These factors include the crop being 
grown, the expected crop yield, the soil types, and soil concentration 
of nutrients (especially phosphorus), and the amount of other nutrient 
sources to be applied. For these reasons, EPA has determined that 
establishing a numeric effluent limitation guideline is infeasible.
    EPA has determined that the various BMPs specified in today's 
proposed regulation represent the minimum elements of an effective BMP 
program. By codifying them into a regulation of general applicability, 
EPA intends to promote expeditious implementation of a BMP program and 
to ensure uniform and fair application of the baseline requirements. 
EPA is proposing only those BMPs which are appropriate on a nationwide 
basis, while giving both States and permittees the flexibility to 
determine the appropriate practices at a local level to achieve the 
effluent limitations. The BMP's (described below) that are included in 
the proposed technology options are necessary to ensure that manure and 
wastewater are utilized for their nutrient content in accordance with 
agricultural requirements for producing crops or pastures. EPA also 
believes that the proposed regulations represent an appropriate and 
efficient use of its technical expertise and resources that, when 
exercised at the national level, relieves state permit writers of the 
burden of implementing this aspect of the Clean Water Act on a case-by-
case basis.
3. Best Practicable Control Technology Limitations Currently Available 
(BPT)
    EPA is proposing to establish BPT limitations for the beef, dairy, 
swine, veal chicken and turkey subcategories. There are BPT limitations 
in the existing regulations which apply to CAFOs with 1,000 AU or more 
in the beef, dairy swine and turkey subcategories. BPT requires that 
these operations achieve zero discharge of process wastewater from the 
production area except in the event of a 10-year, 24-hour storm event. 
EPA is proposing to revise this BPT requirement and to expand the 
applicability of BPT to all operations defined as CAFOs in these 
subcategories including CAFOs with fewer than 1,000 AU.
    The Clean Water Act requires that BPT limitations reflect the 
consideration of the total cost of application of technology in 
relation to the effluent reduction benefits to be achieved from such 
applications. EPA considered two options as the basis for BPT 
limitations.
    Option 1. This option would require zero discharge from a facility 
designed, maintained and operated to hold the waste and wastewater, 
including storm water, from runoff plus the 25-year 24-hour storm 
event. Both this option and Option 2 would add record keeping 
requirements and practices that ensure this zero discharge standard is 
met. As described in Section V there are numerous reports of operations 
discharging pollutants from the production area during dry weather. The 
reason for these discharges varies from intentional discharge to poor 
maintenance of the manure storage area or confinement area. EPA's cost 
models reflect the different precipitation and climatic factors that 
affect an operations ability to meet this requirement; see Section X 
and the Development Document for further details.
    Option 1 would require weekly inspection to ensure that any storm 
water diversions at the animal confinement and manure storage areas are 
free from debris, and daily inspections of the automated systems 
providing water to the animals to ensure they are not leaking or 
spilling. The manure storage or treatment facility would have to be 
inspected weekly to ensure structural integrity. For liquid 
impoundments, the berms would need to be inspected for leaking, 
seepage, erosion and other signs of structural weakness. The proposal 
requires that records of these inspections would be maintained on-site, 
as well as records documenting any problems noted and corrective 
actions taken. EPA believes these inspections are necessary to ensure 
proper maintenance of the production area and prevent discharges apart 
from those associated with a storm event from a catastrophic or chronic 
storm.
    Liquid impoundments (e.g., lagoons, ponds and tanks) that are open 
and capture precipitation would be required to have depth markers 
installed. The depth marker indicates the maximum volume that should be 
maintained under normal operating conditions allowing for the volume 
necessary to contain the 25-year, 24-hour storm event. The depth of the 
impoundment would have to be noted during each week's inspection and 
when the depth of manure and wastewater in the impoundment exceeds this 
maximum depth, the operation would be required to notify the Permit 
Authority and inform him or her of the action will be taken to address 
this exceedance. Closed or covered liquid impoundments must also have 
depth markers installed, with the depth of the impoundment noted during 
each week's inspection. In all cases, this liquid may be land applied 
only if done in accordance with the permit nutrient plan (PNP) 
described below. Without such a depth marker, a CAFO operator may fill 
the lagoons such that even a storm less than a 25-year, 24-hour storm 
causes the lagoon to overflow, contrary to the discharge limit proposed 
by the BPT requirements.
    An alternative technology for monitoring lagoon and impound meat 
levels is remote sensors which monitor liquid levels in lagoons or 
impoundments. This sensor technology can be used to monitor changes in 
liquid levels, either rising or dropping levels, when the level is 
changing rapidly can trigger an alarm. These sensors can also trigger 
an alarm when the liquid level has reached a critical level. The alarm 
can transmit to a wireless receiver to alert the CAFO

[[<strong>Page</strong> 3054]]

owner or operator and can also alert the permit authority. The 
advantages of this type of system is the real time warning it can 
provide the CAFO owner or operator that his lagoon or impoundment is in 
danger of overflowing. It can provide the CAFO operator an opportunity 
to better manage their operations and prevent catastrophic failures. 
These sensors are more expensive than depth markers; however, the added 
assurance they provide in preventing catastrophic failures may make 
them attractive to some operations.
    Option 1 would require operations to handle dead animals in ways 
that prevent contributing pollutants to waters of the U.S. EPA proposes 
to prohibit any disposal of dead animals in any liquid impoundments or 
lagoons. The majority of operations have mortality handling practices 
that prevent contamination of surface water. These practices include 
transferring mortality to a rendering facility, burial in properly 
sited lined pits, and composting.
    Option 1 also would establish requirements to ensure the proper 
land application of manure and other process wastes and wastewaters. 
Under Option 1 land application of manure and wastewater to land owned 
or operated by the CAFO would have to be performed in accordance with a 
PNP that establishes application rates for manure and wastewater based 
on the nitrogen requirements for the crop. EPA believes that 
application of manure and wastewater in excess of the crop's nitrogen 
requirements would increase the pollutant runoff from fields, because 
the crop would not need this nitrogen, increasing the likelihood of it 
being released to the environment.
    In addition, Option 1 includes a requirement that manure be sampled 
at least once per year and analyzed for its nutrient content including 
nitrogen, phosphorus and potassium. EPA believes that annual sampling 
of manure is the minimum frequency to provide the necessary nutrient 
content on which to establish the appropriate rate. If the CAFO applies 
its manure more frequently than once per year, it may choose to sample 
the manure more frequently. Sampling the manure as close to the time of 
application as practical provides the CAFO with a better measure of the 
nitrogen content of the manure. Generally, nitrogen content decreases 
through volatilization during manure storage when the manure is exposed 
to air.
    The manure application rate established in the PNP would have to be 
based on the following factors: (1) the nitrogen requirement of the 
crop to be grown based on the agricultural extension or land grant 
university recommendation for the operation's soil type and crop; and 
(2) realistic crop yields that reflect the yields obtained for the 
given field in prior years or, if not available, from yields obtained 
for same crop at nearby farms or county records. Once the nitrogen 
requirement for the crop is established the manure application rate 
would be determined by subtracting any other sources of nitrogen 
available to the crop from the crop's nitrogen requirement. These other 
sources of nitrogen can include residual nitrogen in the soil from 
previous applications of organic nitrogen, nitrogen credits from 
previous crops of legumes, and crop residues, or applications of 
commercial fertilizer, irrigation water and biosolids. Application 
rates would be based on the nitrogen content in the manure and should 
also account for application methods, such as incorporation, and other 
site specific practices.
    The CAFO would have to maintain the PNP on-site, along with records 
of the application of manure and wastewater including: (1) the amount 
of manure applied to each field; (2) the nutrient content of manure; 
(3) the amount and type of commercial fertilizer and other nutrient 
sources applied; and (4) crop yields obtained. Records must also 
indicate when manure was applied, application method and weather 
conditions at the time of application.
    While Option 1 would require manure to be sampled annually, it 
would not require soil sampling and analysis for the nitrogen content 
in the soil. Nitrogen is present in the soil in different forms and 
depending on the form the nitrogen will have different potential to 
move from the field. Nitrogen is present in an organic form from to the 
decay of proteins and urea, or from other organic compounds that result 
from decaying plant material or organic fertilizers such as manure or 
biosolids. These organic compounds are broken down by soil bacteria to 
inorganic forms of nitrogen such as nitrate and ammonia. Inorganic 
nitrogen or urea may be applied to crop or pasture land as commercial 
fertilizer. Inorganic nitrogen is the form taken up by the plant. It is 
also more soluble and readily volatile, and can leave the field through 
runoff or emissions. Nitrogen can also be added to the soil primarily 
through cultivation of legumes which will ``fix'' nitrogen in the soil. 
At all times nitrogen is cycling through the soil, water, and air, and 
does not become adsorbed or built up in the soil in the way that 
phosphorus does, as discussed under Option 2. Thus, EPA is not 
proposing to require soil sampling for nitrogen. EPA would, however, 
require that, in developing the appropriate application rate for 
nitrogen, any soil residue of nitrogen resulting from previous 
contributions by organic fertilizers, crop residue or legume crops 
should be taken into account when determining the appropriate nitrogen 
application rate. State Agricultural Departments and Land Grant 
Universities have developed methods for accounting for residual 
nitrogen contributed from legume crops, crop residue and organic 
fertilizers.
    Option 1 would also prohibit application of manure and wastewater 
within 100 feet of surface waters, tile drain inlets, sinkholes and 
agricultural drainage wells. EPA strongly encourages CAFOs to construct 
vegetated buffers, however, Option 1 only prohibits applying manure 
within 100 feet of surface water and would not require CAFOs to take 
crop land out of production to construct vegetated buffers. CAFOs may 
continue to use land within 100 feet of surface water to grow crops. 
Under Option 1, EPA included costs for facilities to construct minimal 
storage, typically three to six months, to comply with the manure 
application rates developed in the PNP. EPA included these costs 
because data indicate pathogen concentrations in surface waters 
adjacent to land receiving manure are often not significantly different 
from pathogen levels in surface waters near lands not receiving manure 
when the manure has been stored and aged prior to land application. EPA 
believes the 100 foot setback, in conjunction with proper manure 
application, will minimize the potential runoff of pathogens, hormones 
such as estrogen, and metals and reduce the nutrient and sediment 
runoff.
    EPA is aware of concerns that the presence of tile drain inlets, 
sinkholes and agricultural drainage wells may be widespread in some 
parts of the country. This could effectively preclude manure based 
fertilization of large areas of crop land. EPA requests comment on the 
presence of such features in crop land and the extent to which a 100 
foot setback around such features would interfere with land application 
of manure. EPA also requests comment on how it might revise the setback 
requirement to address such concerns and still adequately protect water 
quality.
    EPA analysis shows application rates are the single most effective 
means of reducing runoff. Nevertheless, no combination of best 
management

[[<strong>Page</strong> 3055]]

practices can prevent pollutants from land application from reaching 
surface waters in all instances; vegetated buffers provide an extra 
level of protection. Buffers are not designed to reduce pollutants on 
their own; proper land application and buffers work in tandem to reduce 
pollutants from reaching surface waters. Data on the effectiveness of 
vegetated buffers indicate that a 35 to 66 foot vegetated buffer 
(depending primarily on slope) achieves the most cost-effective removal 
of sediment and pollutants from surface runoff. However, EPA chose not 
to propose requiring operations to take land out of production and 
construct a vegetated buffer because a buffer may not be the most cost-
effective application to control erosion in all cases. There are a 
variety of field practices that should be considered for the control of 
erosion. EPA encourages CAFOs to obtain and implement a conservation 
management plan to minimize soil losses, and also to reduce losses of 
pollutant bound to the soils.
    Today's proposal requires a greater setback distance than the 
optimum vegetated buffer distance. Since EPA is not requiring the 
construction of a vegetated buffer, the additional setback distance 
will compensate for the loss of pollutant reductions in the surface 
runoff leaving the field that would have been achieved with a vegetated 
buffer without requiring CAFOs to remove this land from production.
    EPA solicits comment on additional options to control erosion which 
would, in turn, reduce the amount of pollutants reaching waters of the 
U.S. The options for controlling erosion include: (1) implementing one 
of the three NRCS Conservation Practice Standards for Residue 
Management: No-Till and Strip Till (329A), Mulch Till (329B), or Ridge 
Till (329C) in the state Field Office Technical Guide; (2) requiring a 
minimum 30% residue cover; (3) achieving soil loss tolerance or ``T'; 
or (4) implementing of the Erosion and Sediment Control Management 
Measure as found in EPA's draft National Management Measures to Control 
Nonpoint Source Pollution from Agriculture. This measure is 
substantially the same as EPA's 1993 Guidance Specifying Management 
Measure for Sources of Nonpoint Pollution in Coastal Waters which says 
to:

    ``* * * Apply the erosion control component of a Resource 
Management System (RMS) as defined in the 1993 Field Office 
Technical Guide of the U.S. Department of AgricultureBNational 
Resources Conservation Service to minimize delivery of sediment from 
agricultural lands to surface waters, or design and install a 
combination of management and physical practices to settle the 
settleable solids and associated pollutants in runoff delivered from 
the contributing area for storms of up to and including a 10-year, 
24-hour frequency.''

    Farmers entering stream buffers in the Conservation Reserve 
Program's (CRP) Continuous Sign-Up receive bonus payments, as an added 
incentive to enroll, include a 20 percent rental bonus, a $100 per acre 
payment up-front (at the time they sign up), and another bonus at the 
time they plant a cover. These bonus payments more than cover costs 
associated with enrolling stream buffers, (i.e., rents forgone for the 
duration of their 10 or 15 year CRP contracts, and costs such as seed, 
fuel, machinery and labor for planting a cover crop). The bonuses 
provide a considerable incentive to enroll stream buffers because the 
farmers receive payments from USDA well in excess of what they could 
earn by renting the land for crop production. Farmers can enter buffers 
into the CRP program at any time.
    EPA may also consider providing CAFOs the option of prohibiting 
manure application within 100 feet or constructing a 35 foot vegetated 
buffer. EPA solicits comment on any and all of these options.
    Option 2. Option 2 retains all the same requirements for the 
feedlot and manure storage areas described under Option 1 with one 
exception: Option 2 would impose a BMP that requires manure application 
rates be phosphorus based where necessary, depending on the specific 
soil conditions at the CAFO.
    Manure is phosphorus rich, so application of manure based on a 
nitrogen rate may result in application of phosphorus in excess of crop 
uptake requirements. Traditionally, this has not been a cause for 
concern, because the excess phosphorus does not usually cause harm to 
the plant and can be adsorbed by the soil where it was thought to be 
strongly bound and thus environmentally benign. However, the capacity 
for soil to adsorb phosphorus will vary according to soil type, and 
recent observations have shown that soils can and do become saturated 
with phosphorus. When saturation occurs, continued application of 
phosphorus in excess of what can be used by the crop and adsorbed by 
the soil results in the phosphorus leaving the field with storm water 
via leaching or runoff. Phosphorus bound to soil may also be lost from 
the field through erosion.
    Repeated manure application at a nitrogen rate has now resulted in 
high to excessive soil phosphorus concentrations in some geographic 
locations across the country. Option 2 would require manure application 
be based on the crop removal rate for phosphorus in locations where 
soil concentrations or soil concentrations in combination with other 
factors indicate that there is an increased likelihood that phosphorus 
will leave the field and contribute pollutants to nearby surface water 
and groundwater. Further, when soil concentrations alone or in 
combination with other factors exceed a given threshold for phosphorus, 
the proposed rule would prohibit manure application. EPA included this 
restriction because the addition of more phosphorus under these 
conditions is unnecessary for ensuring optimum crop production.
    Nutrient management under Option 2 includes all the steps described 
under Option 1, plus the requirement that all CAFOs collect and analyze 
soil samples at least once every 3 years from all fields that receive 
manure. EPA would require soil sampling at 3 year intervals because 
this reflects a minimal but common interval used in crop rotations. 
This frequency is also commonly adopted in nutrient management plans 
prepared voluntarily or under state programs. When soil conditions 
allow for manure application on a nitrogen basis, then the PNP and 
record keeping requirements are identical to Option 1. Permit nutrient 
plans would have to be reviewed and updated each year to reflect any 
changes in crops, animal production, or soil measurements and would be 
rewritten and certified at a minimum of once every five years or 
concurrent with each permit renewal. EPA solicits comment on 
conditions, such as no changes to the crops, or herd or flock size, 
under which rewriting the plan would not be necessary and would not 
require the involvement of a certified planner.
    The CAFO's PNP would have to reflect conditions that require manure 
application on a phosphorus crop removal rate. The manure application 
rate based on phosphorus requirements takes into account the amount of 
phosphorus that will be removed from the field when the crop is 
harvested. This defines the amount of phosphorus and the amount of 
manure that may be applied to the field. The PNP must also account for 
the nitrogen requirements of the crop. Application of manure on a 
phosphorus basis will require the addition of commercial fertilizer to 
meet the crop requirements for nitrogen. Under Option 2, EPA believes 
there is an economic incentive to maximize proper handling of manure by 
conserving nitrogen and minimizing the

[[<strong>Page</strong> 3056]]

expense associated with commercial fertilizer. EPA expects manure 
handling and management practices will change in an effort to conserve 
the nitrogen content of the manure, and encourages such practices since 
they are likely to have the additional benefit of reducing the nitrogen 
losses to the atmosphere.
    EPA believes management practices that promote nitrogen losses 
during storage will result in higher applications of phosphorus because 
in order to meet the crops requirements for nitrogen a larger amount of 
manure must be applied. Nitrogen volatilization exacerbates the 
imbalance in the ratio of nitrogen to phosphorus in the manure as 
compared to the crop's requirement. Thus application of manure to meet 
the nitrogen requirements of the crop will result in over application 
of phosphorus and the ability of the crops and soil to assimilate 
phosphorus will reach a point at which the facility must revise the PNP 
to reflect phosphorus based application rates. EPA solicits comment on 
additional incentives that can be used to discourage those manure 
storage, treatment, and handling practices that result in nitrogen 
volatilization.
    Under both Option 1 (N) and Option 2 (P), the application of 
nitrogen from all sources may not exceed the crop nutrient 
requirements. Since a limited amount of nutrients can be applied to the 
field in a given year, EPA expects facilities will select the site-
specific practices necessary to optimize use of those nutrients. 
Facilities that apply manure at inappropriate times run the risk of 
losing the value of nutrients and will not be permitted to reapply 
nutrients to compensate for this loss. Consequently crop yields may 
suffer, and in subsequent years, the allowable application rates will 
be lower. For these reasons, facilities with no storage are assumed to 
need a minimal storage capacity to allow improved use of nutrients.
    Option 2 provides three methods for determining the manure 
application rate for a CAFO. These three methods are:

<bullet> Phosphorus Index
<bullet> Soil Phosphorus Threshold Level
<bullet> Soil Test Phosphorus Level

    These three methods are adapted from NRCS' nutrient management 
standard (Standard 590), which is being used by States' Departments of 
Agriculture to develop State nutrient standards that incorporate one or 
a combination of these three methods. EPA is proposing to require that 
each authorized state Permit Authority adopt one of these three methods 
in consultation with the State Conservationist. CAFOs would then be 
required to develop their PNP based on the State's method for 
establishing the application rate. In those states where EPA is the 
permitting authority, the EPA Director would adopt one of these three 
methods in consultation with that State's Conservationist.
    Phosphorus Index--This index assesses the risk that phosphorus will 
be transported off the field to surface water and establishes a 
relative value of low, medium, high or very high, as specified in 
Sec. 412.33. Alternatively, it may establish a numeric ranking. At the 
present time there are several versions of the P-Index under 
development. Many states are working on a P-Index for their state in 
response to the NRCS 590 Standard, and NRCS itself developed a P-Index 
template in 1994 and is in the process of updating that template at the 
present time. There are efforts underway in the scientific community to 
standardize a phosphorus index and assign a numeric ranking.
    At a minimum the phosphorus index must consider the following 
factors:

<bullet> Soil erosion
<bullet> Irrigation erosion
<bullet> Runoff class
<bullet> Soil P test
<bullet> P fertilizer application rate
<bullet> P fertilizer application method
<bullet> Organic P source application rate
<bullet> Organic P source application method

    Other factors could also be included, such as:

<bullet> Subsurface drainage
<bullet> Leaching potential
<bullet> Distance from edge of field to surface water
<bullet> Priority of receiving water

    Each of these factors is listed in a matrix with a score assigned 
to each factor. For example, the distance from edge of field to surface 
water assigns a score to different ranges of distance. The greater the 
measured distance, the lower the score. Other factors may not be as 
straightforward. For example, the surface runoff class relates field 
slope and soil permeability in a matrix, and determines a score for 
this element based on the combination of these factors. The same kind 
of approach could also be used for the subsurface drainage class, 
relating soil drainage class with the depth to the seasonal high water 
table. The values for all variables that go into determining a P-Index 
can either be directly measured, such as distance to surface water, or 
can be determined by data available from the state, such as soil 
drainage class that is based on soil types found in the state and 
assigned to all soil types. Finally, each factor is assigned a weight 
depending on its relative importance in the transport of phosphorus.
    When a P-Index is used to determine the potential for phosphorus 
transport in a field and the overall score is high, the operations 
would apply manure on a phosphorus basis (e.g., apply to meet the crop 
removal rate for phosphorus). When a P-Index determines that the 
transport risk is very high, application of manure would be prohibited. 
If the P-Index results in a rating of low or medium, then manure may be 
applied to meet the nitrogen requirements of the crop as described 
under Option 1. However, the CAFO must continue to collect soil samples 
at least every three years. If the phosphorus concentration in the soil 
is sharply increasing, the CAFO may want to consider managing its 
manure differently. This may include changing the feed formulations to 
reduce the amount of phosphorus being fed to the animals, precision 
feeding to account for nutrient needs of different breeds and ages of 
animals. It may also include changing manure storage practices to 
reduce nitrogen losses. There is a great deal of research on feed 
management, including potential effects on milk production when 
phosphorus in rations fed to dairy cows is reduced, and the cost 
savings of split sex and multistage diets and the addition of or adding 
the enzyme phytase to make the phosphorus more digestible by poultry 
and swine. Phytase additions in the feed of monogastrics have proven 
effective at increasing the ability of the animal to assimilate 
phosphorus and can reduce the amount of phosphorus excreted. Phytase 
use is also reported to increase bioavailability of proteins and 
essential minerals, reducing the need for costly supplemental 
phosphorus, and reducing necessary calcium supplements for layers. The 
CAFO may also consider limiting the application of manure. For example, 
the CAFO may apply manure to one field to meet the nitrogen 
requirements for that crop but not return to that field until the crops 
have assimilated the phosphorus that was applied from the manure 
application.
    Phosphorus Threshold--This threshold which would be developed for 
different soil types is a measure of phosphorus in the soil that 
reflects the level of phosphorus at which phosphorus movement in the 
field is acceptable. Scientists are currently using a soluble 
phosphorus concentration of 1 part per million (ppm) as a measure of 
acceptable phosphorus movement. When the soil concentration of 
phosphorus reaches this threshold the concentration of phosphorus in 
the runoff would be expected to be 1 ppm. The 1 ppm value

[[<strong>Page</strong> 3057]]

has been used as an indicator of acceptable phosphorus concentration 
because it is a concentration that has been applied to POTWs in their 
NPDES permits. An alternative phosphorus discharge value could be the 
water quality concentration for phosphorus in a given receiving stream.
    States which adopt this method in their state nutrient management 
standard would need to establish a phosphorus threshold for all types 
of soils found in their state.
    Use of the phosphorus threshold in developing an application rate 
allows for soils with a phosphorus concentration less than three 
quarters the phosphorus threshold to apply manure on a nitrogen basis. 
When soils have a phosphorus concentration between 3/4 and twice the 
phosphorus threshold then manure must be applied to meet the crop 
removal requirements for phosphorus. For soils which have phosphorus 
concentrations greater than twice the phosphorus threshold, no manure 
may be applied.
    Soil Test Phosphorus--The soil test phosphorus is an agronomic soil 
test that measures for phosphorus. This method is intended to identify 
the point at which the phosphorus concentration in the soil is high 
enough to ensure optimum crop production. Once that concentration range 
(often reported as a ``high'' value from soil testing laboratories) is 
reached, phosphorus is applied at the crop removal rate. If the soil 
test phosphorus level reaches a very high concentration, then no manure 
may be applied. Most soils need to be nearly saturated with phosphorus 
to achieve optimum crop yields. The soil phosphorus concentration 
should take into account the crop response and phosphorus application 
should be restricted when crop yield begins to level off.
    The soil test phosphorus method establishes requirements based on 
low, medium, high and very high soil condition, and applies the same 
restrictions to these measures as are used in the P-Index. States that 
adopt this method must establish the soil concentration ranges for each 
of these risk factors for each soil type and crop in their state.
    EPA anticipates that in most states, the permit authority will 
incorporate the State's nutrient standard (590 Standard) into CAFO 
permits. For example, if the permit authority, in consultation with the 
State Conservationist, adopts a Phosphorus Index, then CAFO permits 
would include the entire P-Index as the permit condition dictating how 
the application rate must be developed. If a permit authority selects 
the Phosphorus Threshold, then the CAFO permits must contain soil 
concentration limitations that reflect phosphorus-based application, as 
well as the level at which manure application is prohibited.
    Each State Conservationist, in consultation with land grant 
university scientists and the state, must develop a Phosphorus Index 
for that state by May 2001. EPA may consider eliminating the use of the 
soil phosphorus threshold level and the soil test phosphorus level as 
methods for determining the manure application rate for a CAFO and 
requiring the use of the state Phosphorus Index. Scientists studying 
phosphorus losses from agricultural lands are supporting the 
development and use of the Phosphorus Index since it combines the 
factors critical in determining risk of phosphorus rate and transport 
to surface waters, including the soil phosphorus threshold level, when 
developed. EPA is soliciting comment on this option.
    Finally, under Option 2 EPA is proposing to require CAFOs that 
transfer manure off-site to provide the recipient of the manure with 
information as to the nutrient content of the manure and provide the 
recipient with information on the correct use of the manure. See 
Section VII.E.4, for a complete discussion of the requirements for off-
site transfer of manure.
    As discussed in Section VI, compliance costs for manure transfer 
assessed to the CAFO include hauling costs and record keeping. If the 
recipient is land applying the manure, the recipient is most likely a 
crop farmer, and the recipient is assumed to already have a nutrient 
management plan that considers typical yields and crop requirements. 
The recipient is also assumed to apply manure and wastes on a nitrogen 
basis, so the application costs are offset by the costs for commercial 
fertilizer purchase and application. EPA assumes the recipient may need 
to sample soils for phosphorus, and costs for sampling identically to 
the CAFO, i.e. every three years. EPA has not accounted for costs that 
would result from limiting the amount or way recipients are currently 
using manure. EPA solicits comment on the impact to recipients who 
currently use manure and may have to change their practices as a result 
of this requirement. In cases where manure is received for alternative 
uses, the recipient is deemed to already maintain the appropriate 
records.
    EPA solicits comments on whether there should be required training 
for persons that will apply manure. There are some states which have 
these requirements. Proper application is critical to controlling 
pollutant discharges from crop fields. Some states have establish 
mandatory training for persons that apply manure. EPA will consult with 
USDA on the possibility of establishing a national training program for 
manure applicators.
    Rotational Grazing. At the request of the environmental community, 
EPA has investigated rotational grazing as an alternative to 
confinement-based livestock production. Any pasture or grazing 
operation is by definition not a form of confinement, therefore use of 
these practices are outside of the scope of these regulations.
    Intensive rotational grazing is known by many terms, including 
intensive grazing management, short duration grazing, savory grazing, 
controlled grazing management, and voisin grazing management. This 
practice involves rotating livestock and poultry among several pasture 
subunits or paddocks, often on a daily basis, to obtain maximum 
efficiency of the pasture land.
    Due to the labor, fencing, water, and land requirements for 
intensive rotational grazing, typically only small dairy operations 
with less than 100 head use this practice. Few beef feedlots practice 
intensive rotational grazing. Poultry on pasture is usually housed in a 
portable building or pen holding up to 100 birds that is moved daily; 
rarely are more than 1,000 birds in total raised in this manner. Swine 
have also been successfully raised on pasture, most frequently as a 
seasonal farrowing operation in combination with seasonal sheep or cow 
grazing. Climate and associated growing seasons make it very difficult 
for operations to use an intensive rotational grazing system throughout 
the entire year. Most dairy operations and beef feedlots that use 
rotational grazing typically operate between 3 and 9 months of the 
year, with 12 months most likely only in the southern states. Poultry 
on pasture are produced for about 6 months, and pigs are typically 
farrowed once per year.
    Grazing systems are not directly comparable to confined feeding 
operations, as one system can not readily switch to the other. 
Intensive rotational grazing systems are reported to have advantages 
over confined feeding operations: reduced housing and feed costs, 
improved animal health, less manure handling, and more economic 
flexibility. Intensive rotational grazing also encourages grass growth 
and development of healthy sod, which in turn reduces erosion. In a 
good rotational system, manure is more evenly distributed and will 
break up and disappear from the surface faster.
    Despite these advantages, studies do not indicate significant 
reductions of

[[<strong>Page</strong> <strong>3058</strong>]]

pathogens or nutrients in runoff to nearby streams as compared to 
manured fields. Rotational grazing systems may still require manure 
maintenance near watering areas and paths to and from the paddock 
areas. There are also limits to the implementation of intensive 
rotational grazing systems, which are highly dependent upon: available 
acreage, herd size, land resources, labor, water availability, 
proximity of pasture area to milking center for dairy operations, and 
feed storage capabilities. Grazing systems usually produce lower animal 
weight gain and milk production levels, provide limited manure handling 
options, and do not provide the level of biosecurity that confinement 
farms can obtain.
    Proposed Basis for BPT Limitations. EPA is not proposing to 
establish BPT requirements for the beef, dairy, swine, veal and poultry 
subcategories on the basis of Option 1, because it does not represent 
the best practicable control technology. In areas that have high to 
very high phosphorus build up in the soils, Option 1 would not require 
that manure application be restricted or eliminated. Thus, the 
potential for phosphorus to be discharged from land owned or controlled 
by the CAFOs would not be controlled by Option 1. Consequently Option 1 
would not adequately control discharges of phosphorus from these areas. 
Option 2 would reduce the discharge of phosphorus in field runoff by 
restricting the amount of phosphorus that may be applied to the amount 
that is appropriate for agricultural purposes or prohibiting the 
application of manure when phosphorus concentrations in the soil are 
very high and additional phosphorus is not needed to meet crop 
requirements.
    EPA is proposing to establish BPT limitations for the beef, dairy, 
swine, veal and poultry subcategories on the basis of Option 2 with the 
exception that it is co-proposing options with and without the 
certification regulations for off-site land application of manure. 
EPA's decision to base BPT limitations on Option 2 treatment reflects 
consideration of the total cost of application of technology in 
relation to the effluent reduction benefits to be achieved from such 
application. Option 2 is expected to cost $549 million under the two-
tier structure and achieve 107 million pounds of pollutant reductions 
for a total cost to pound ratio of $0.57. The three-tier structure is 
estimated to cost $551 for a total cost to pound ratio of $0.51.
    The Option 2 technology is one that is readily applicable to all 
CAFOs. The production area requirements represent the level of control 
achieved by the majority of CAFOs in the beef, dairy, swine, poultry 
and veal subcategories. USDA and the American Society of Agricultural 
Engineers cite the 25-year, 24-hour storm as the standard to which 
storage structures should comply. This has been the standard for many 
years, and most existing lagoons and other open liquid containment 
structures are built to this standard. As described above, the land 
application requirements associated with Option 2 are believed to 
represent proper agricultural practice and to ensure that CAFO manure 
is applied to meet the requirements of the crops grown and not exceed 
the ability of the soil and crop to absorb nutrients.
    EPA believes any of the three methods for determining when manure 
should be applied on a phosphorus basis would represent BPT. Each 
method has distinct advantages which, depending on the circumstances, 
could make one method preferred over another. There has been 
considerable work done in this area within the past few years and this 
work is continuing. EPA believes that this proposed BPT approach 
provides adequate flexibility to allow states to develop an approach 
that works best for the soils and crops being grown within their state. 
Nonetheless, EPA will continue to work with soil scientists and may 
consider standardizing the factors included in the phosphorus index to 
develop a standard rating scale, for the purpose of CAFO requirements. 
EPA also solicits comment on whether there should be some EPA oversight 
or approval of the phosphorus method developed by the states. 
Specifically EPA solicits comment whether of EPA should establish 
standards that must be included in a phosphorus index. These standards 
may include specifying additional criteria which should be considered 
in the index, such as distance to surface water. EPA also seeks comment 
on whether it should establish minimum standards on how these criteria 
must be factored into a Phosphorus Index, such as specifying the weight 
to be assigned to the various criteria included in the Index and 
assigning the values for specific ranges for each criteria. EPA may 
consider establishing a minimum standard for the phosphorus threshold 
method for example requiring that at a minimum the phosphorus threshold 
be based on the soil phosphorus concentration that would result in a 
soluble phosphorus concentration in the runoff of 1 ppm. EPA may also 
consider establishing specific sampling protocols for collecting manure 
and soil samples and analyzing for nutrients.
    CAFOs must also develop and implement a PNP that establishes the 
appropriate manure application rate. EPA believes the land application 
rates established in accordance with one of the three methods described 
in today's proposed regulation, along with the prohibition of manure 
application within 100 feet of surface water, will ensure manure and 
wastewater are applied in a manner consistent with proper agricultural 
use. EPA has included a discussion of how to develop a PNP in section 
VIII.C.6.
    EPA believes that state sampling and analytical protocols are 
effective; however, soil phosphorus levels can vary depending on how 
the soil samples are collected. For example, a CAFO that surface-
applies manure will deposit phosphorus in the surface layer of the soil 
and should collect soil samples from the top layer of soil. If this 
CAFO collects soil samples to a depth of several inches the analysis 
may understate the phosphorus concentrations in the soil. EPA solicits 
comments on the need to establish sampling protocols for soil sampling.
4. Best Control Technology for Conventional Pollutants (BCT)
    In evaluating possible BCT standards, EPA first considered whether 
there are any candidate technologies (i.e., technology options); that 
are technologically feasible and achieve greater conventional pollutant 
reductions than the proposed BPT technologies. (Conventional pollutants 
are defined in the Clean Water Act as including: Total Suspended Solids 
(TSS), Biochemical Oxygen Demand (BOD), pH, oil and grease and fecal 
coliform.) EPA considered the same BAT technology options described 
below and their effectiveness at reducing conventional pollutants. 
EPA's analysis of pollutant reductions has focused primarily on the 
control of nutrients, nitrogen and phosphorus. However, the Agency has 
also analyzed what the technology options can achieve with respect to 
sediments (or TSS), metals, and pathogens. Although livestock waste 
also contains BOD, EPA did not analyze the loadings or loadings 
reductions associated with the technology options for BOD. Thus, the 
only conventional pollutant considered in the BCT analysis is TSS. EPA 
identified no technology option that achieves greater TSS removals than 
the proposed BPT technologies (see the Technical Development Document). 
EPA does not believe that these technology options would substantially

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