1 March 16, 2012

 MEMORANDUM

Eastern Research Group, Inc. 

110 Hartwell Avenue

Lexington, MA 02421

Date: March 16, 2012 

To: James Covington, EPA 

From: Gina Salcedo and Cal Franz, ERG 

Re: Economic Impacts of ADF Collection and Treatment Requirements to Existing Airports 

with less than 60,000 gallons of Annual ADF Usage 

For the final rule, EPA considered the following ADF collection and treatment requirements in its 

regulatory options 

 Requirement 1: airports must collect and treat 20 percent of available ADF. 

 Requirement 2: airports must collect and treat 40 percent of available ADF. 

Summary of Economic Impact Analysis Results 

198 existing airports fall within the scope of the final rule. 143 of these airports have annual ADF usage 

below 60,000 gallons. EPA examined the potential economic impacts of applying the aircraft deicing 

fluid (ADF) collection and treatment requirements on these 143 existing airports. 

Analytic Approach 

Because most airports are publicly, or quasi-publicly, owned non-profit facilities, many traditional 

methods of determining economic achievability (such as a discounted cashflow analysis) are not 

appropriate. The economic impact analysis for the proposed effluent guideline relied on a revenue test to 

determine the economic achievability of the proposed options. Although industry comments on this 

analytic approach were unanimously negative, industry was less forthcoming about suggesting alternate 

approaches. 

 

To evaluate the impacts associated with the various collection options, we applied the same guidelines for 

revenue impacts as were used for proposal: 

 0 percent < (estimated annualized compliance costs/operating revenues) < 1 percent: 

o the option is generally considered affordable for an entity. 

 1 percent < (estimated annualized compliance costs/operating revenues) < 3 percent: 

o the option may be considered affordable if only a few entities are affected and the 

majority incurs costs less than one percent of revenues. 

 3 percent < (estimated annualized compliance costs/revenues): 

o the option is considered to be placing a heavy burden on an entity. 

As shown in the Table below, with either 20% or 40% collection, a significant number of airports are 

experiencing costs that exceed 3% of revenue: 

 Under the 20 percent collection and treatment requirement, 95 airport (67 percent) incur costs 

between 0 and 1 percent of airport revenues, and 41 airports (29 percent) incur costs exceeding 3 

percent of revenues. 
2 March 16, 2012

 Under the 40 percent collection and treatment requirement, 89 airport (62 percent) incur costs 

between 0 and 1 percent of airport revenues, but 46 airports (32 percent) incur costs exceeding 3 

percent of revenues. 

 

Annualized Compliance Costs as % of Total Airport Operating Revenues 

Number of 

Airports in 

Analysis

Compliance Costs as a Percent of Airport Revenuesa

> 0% ≥ 1% Not 

< 1% < 3% ≥3% Analyzable 

Collect and Treat 20% of ADF 

Number 143 95 2 41 5 

Percent 100% 66.5% 1.4% 28.6% 3.5%

Collect and Treat 40% of ADF 

Number 143 89 3 46 5 

Percent 100% 62.3% 2.1% 32.1% 3.5% 

a

 This analysis was performed before projected regulatory costs for the collection and treatment were 

finalized, therefore the costs used in the revenue test are somewhat smaller than if final collection and 

treatment costs were used, and each airport’s ratio of compliance costs to airport revenues is somewhat 

smaller than it would be using the finalized compliance costs.