Economic Analysis for the 

Proposed Revised Total 

Coliform Rule 
Office of Water (4607-M) EPA 815-R-10-001 June 2010 www.epa.gov/safewater
Economic Analysis for the Proposed RTCR i June 2010 

Table of Contents 

Table of Contents ........................................................................................................................... i 

Appendices ................................................................................................................................. v 

Exhibits ................................................................................................................................ vi 

List of Acronyms ......................................................................................................................... xii 

Health Risk Reduction and Cost Analysis ................................................................................ xv 

Executive Summary ................................................................................................................ ES-1

ES.1 Need for the Rule ......................................................................................................... ES-1

ES.2 Consideration of Regulatory Alternatives .................................................................... ES-4

ES.3 Summary of the Proposed RTCR Requirements .......................................................... ES-5

ES.4 Systems Subject to the Proposed RTCR ...................................................................... ES-9

ES.5 National Benefits and Costs of the Proposed RTCR .................................................... ES-9

ES.5.1 Derivation of Benefits ......................................................................................... ES-10

ES.5.2 Derivation of Costs .............................................................................................. ES-19

ES.6 Projected Impacts on Household Costs ...................................................................... ES-20

ES.7 Comparison of Benefits and Costs, and Regulatory Alternatives of the Proposed 

RTCR ......................................................................................................................... ES-22

ES.8 Conclusion .................................................................................................................. ES-26 

1. Introduction ............................................................................................................................ 1-1

1.1 Summary of the Proposed Revised Total Coliform Rule (RTCR) .................................... 1-1

1.2 Document Organization ..................................................................................................... 1-4

1.3 Calculations and Citations ................................................................................................. 1-5

2. Statement of Need for the Rule ............................................................................................. 2-1

2.1 Introduction ........................................................................................................................ 2-1

2.1.1 Description of the Issue ............................................................................................... 2-1

2.2 Public Health Concerns, Fecal Contamination, and Waterborne Pathogens ..................... 2-3

2.2.1 Rule Objectives and Public Health Concerns ............................................................. 2-3

2.2.2 Total Coliforms as Indicators of Treatment Effectiveness and Integrity of the 

Distribution System ............................................................................................................. 2-8

2.2.3 Sanitary Defects .......................................................................................................... 2-9

2.2.4 Occurrence of Fecal Contamination and/or Waterborne Pathogens ........................... 2-9

2.3 Statutory Authority for Promulgating the Rule ............................................................... 2-10

2.4 Economic Rationale ......................................................................................................... 2-11 

3. Consideration of Regulatory Options .................................................................................. 3-1

3.1 Introduction ........................................................................................................................ 3-1

3.2 Total Coliform Rule/Distribution System Advisory Committee ....................................... 3-1

3.3 Regulatory Options Considered ......................................................................................... 3-2

3.3.1 Comparative Summary of Regulatory Options ........................................................... 3-5

3.4 Proposed Rule Requirements ........................................................................................... 3-12

4. Baseline Conditions ................................................................................................................ 4-1

4.1 Introduction ........................................................................................................................ 4-1
Economic Analysis for the Proposed RTCR ii June 2010 

4.1.1 Background and Purpose ............................................................................................ 4-1

4.1.2 Chapter Organization .................................................................................................. 4-1

4.2 Data Sources ...................................................................................................................... 4-2

4.2.1 Background on SDWIS/FED Data ............................................................................. 4-2

4.2.2 Background on 2005 Six-Year Review 2 Data ........................................................... 4-6

4.2.3 Background on Other Data and Information Used ..................................................... 4-9

4.3 Baseline Profile ................................................................................................................ 4-11

4.3.1 Pre-GWR Baseline .................................................................................................... 4-12

4.3.2 Post-GWR Baseline .................................................................................................. 4-15

4.3.3 Baseline Population Served ...................................................................................... 4-16

4.3.4 Baseline Water Quality ............................................................................................. 4-18

4.4 Sensitive Sub-populations ................................................................................................ 4-22

4.5 Summary of Baseline Assumptions ................................................................................. 4-23 

5.Occurrence and Predictive Model ......................................................................................... 5-1

5.1 Introduction ........................................................................................................................ 5-1

5.2 Modeling of Current Total Coliform and E. coli Occurrence for Systems Serving up to 

4,100 People ............................................................................................................................. 5-3

5.2.1 Distributional Model and Notation ............................................................................. 5-3

5.2.2 Data Reduction ............................................................................................................ 5-4

5.2.3 Basic Subsets of Systems ............................................................................................ 5-4

5.2.4 Estimation Methodology ............................................................................................. 5-6

5.2.5 Results ......................................................................................................................... 5-9

5.3 Predictive Modeling of Occurrence for Systems Serving Up to 4,100 People ................ 5-13

5.3.1 Summary of GWR factors and timing affecting the TCR and Proposed RTCR ...... 5-14

5.3.2 Summary of Predictive Model .................................................................................. 5-16

5.3.3 Predictive Model Results .......................................................................................... 5-24

5.4 Occurrence Analysis for Systems Serving More Than 4,100 People .............................. 5-48

5.4.1 Model ........................................................................................................................ 5-49

5.4.2 Model Results ........................................................................................................... 5-50

5.4.3 Model Uncertainty .................................................................................................... 5-50

5.5 Summary of Key Drivers for Benefit and Cost Analyses Output from the Predictive 

Model ............................................................................................................................ 5-54 

6. Benefits Analysis .................................................................................................................... 6-1

6.1 Introduction ........................................................................................................................ 6-1

6.2 Qualitative Benefits Analyses ............................................................................................ 6-2

6.2.1 Implementation Activities ........................................................................................... 6-2

6.2.2 Routine Monitoring ..................................................................................................... 6-2

6.2.3 Repeat Monitoring ...................................................................................................... 6-5

6.2.4 Additional Routine Monitoring ................................................................................... 6-6

6.2.5 Annual Site Inspections .............................................................................................. 6-7

6.2.6 Assessments ................................................................................................................ 6-8

6.2.7 Corrective Actions ...................................................................................................... 6-9

6.2.8 Public Notification .................................................................................................... 6-10

6.2.9 Summary of Qualitative Benefits Analyses .............................................................. 6-17

6.3 Assessment of Predictive Analysis Results ..................................................................... 6-17
Economic Analysis for the Proposed RTCR iii June 2010 

6.3.1 Assessment of Predictive Analysis Results for Small (Serving ≤4,100 People) 

and Large (Serving >4,100 People) Systems ..................................................................... 6-19

6.4 Uncertainty and Sensitivity Analyses .............................................................................. 6-28

6.5 Other Potential Benefits ................................................................................................... 6-33

6.5.1 Increased System Knowledge ................................................................................... 6-33

6.5.2 Accelerated Infrastructure Repair/Replacement ....................................................... 6-34

6.5.3 Reduction in Averting Behavior ............................................................................... 6-34

6.5.4 Reduction of Co-Occurring and Other Contaminants ............................................... 6-34

6.5.5 Reduction in Outbreak Risk and Response Costs ..................................................... 6-35 

7. Cost Analysis .......................................................................................................................... 7-1

7.1 Introduction ........................................................................................................................ 7-1

7.2 General Cost Assumptions and Methodology ................................................................... 7-1

7.2.1 Labor Rates ................................................................................................................. 7-2

7.2.2 TCR Monitoring Costs per Sample............................................................................. 7-3

7.2.3 Technology Unit Costs and Compliance Forecasts .................................................... 7-3

7.2.4 Cost Model .................................................................................................................. 7-4

7.2.5 Modeled Variability and Uncertainty in National Costs ............................................. 7-4

7.3 Projecting and Discounting National Costs ....................................................................... 7-5

7.4 Derivation of Costs for PWSs and States ........................................................................... 7-5

7.4.1 Rule Implementation and Annual Administration ...................................................... 7-6

7.4.2 Revising Sampling Plans ............................................................................................ 7-9

7.4.3 Monitoring ................................................................................................................ 7-11

7.4.4 Annual Site Visits ..................................................................................................... 7-17

7.4.5 Assessments .............................................................................................................. 7-18

7.4.6 Corrective Actions .................................................................................................... 7-26

7.4.7 Public Notification .................................................................................................... 7-31

7.4.8 Uncertainty in Unit Costs .......................................................................................... 7-36

7.5 Household Costs .............................................................................................................. 7-36

7.6 Nonquantified Costs ......................................................................................................... 7-38

7.7 Uncertainty Analysis ........................................................................................................ 7-39

7.8 Comparison of Total and Net Annualized Costs for All Regulatory Alternatives .......... 7-42 

8. Economic Impact Analysis .................................................................................................... 8-1

8.1 Introduction ........................................................................................................................ 8-1

8.2 Executive Order 12866: Regulatory Planning and Review ............................................... 8-2

8.3 Paperwork Reduction Act .................................................................................................. 8-2

8.4 The Regulatory Flexibility Act .......................................................................................... 8-5

8.5 Unfunded Mandates Reform Act ....................................................................................... 8-9

8.6 Executive Order 13132: Federalism ................................................................................ 8-10

8.7 Executive Order 13175: Consultation and Coordination with Indian Tribal 

Governments .......................................................................................................................... 8-11

8.8 Executive Order 13045: Protection of Children from Environmental Health Risks 

and Safety Risks ..................................................................................................................... 8-12

8.9 Executive Order 13211: Action Concerning Regulations That Significantly 

Affect Energy Supply, Distribution, or Use........................................................................... 8-12

8.10 National Technology Transfer and Advancement Act .................................................. 8-13
Economic Analysis for the Proposed RTCR iv June 2010 

8.11 Executive Order 12898: Federal Actions to Address Environmental Justice in 

Minority Populations and Low-Income Populations ............................................................. 8-14

8.12 Consultations with the Science Advisory Board, National Drinking Water 

Advisory Council, and the Secretary of Health and Human Services as Required by 

Section 1412 (d) and (e) of the SDWA .................................................................................. 8-14 

8.13 Impacts on Sensitive Subpopulations as Required by Section 1412(b)(3)(c)(i) 

of the 1996 Amendments to the Safe Drinking Water Act (SDWA) .................................... 8-15

8.14 Plain Language as Required by Executive Order 12866 ............................................... 8-16 

9. Comparison of Benefits and Costs ........................................................................................ 9-1

9.1 National Benefits and Costs of the AIP Option Considered in Comparison to the 

Current Total Coliform Rule and Alternative Option .............................................................. 9-1

9.1.1 National Benefits of the Regulatory Options Considered........................................... 9-3

9.1.2 National Cost Summary ............................................................................................ 9-19

9.1.3 Comparison of National Benefits and Costs of the Regulatory Options 

Considered ......................................................................................................................... 9-27

9.2 Effect of Uncertainties and Nonquantified Benefit/Cost Estimates on the Estimation 

of National Benefits and Costs .............................................................................................. 9-27

9.2.1 Summary of Major Uncertainties in EA Analyses .................................................... 9-27

9.2.2 Summary of Nonquantified Costs and Benefits ........................................................ 9-29

9.3 Comparison of the Regulatory Options Considered ........................................................ 9-30

9.3.1 Incremental Costs and Benefits ................................................................................. 9-30

9.3.2 Cost Effectiveness Measures .................................................................................... 9-32

9.3.3 Break-Even Analysis ................................................................................................. 9-34

9.3.4 Summary of Conclusions .......................................................................................... 9-39 

10. References ........................................................................................................................... 10-1
Economic Analysis for the Proposed RTCR v June 2010 

Appendices 

Appendix A: Detailed Predictive Model Results 

Appendix B: Graphs of Predicted Occurrence Over Time 

Appendix C: Detailed Cost Model Results 

Appendix D: Detailed Compliance Forecast and Unit Costs Estimates 

Appendix E: Break-Even Analysis 

Appendix F: Alternative Strategies for Combining Basic Subsets 

Appendix G: Evaluation of Representativeness of Six-Year Review 2 Data

Appendix H: Analysis of Repeat Sample Records from the Six-Year Review 2 Data 

Appendix I: Supporting Information for Regulatory Flexibility Act Screening Analysis 
Economic Analysis for the Proposed RTCR vi June 2010 

Exhibits 

Executive Summary 

Exhibit ES.1 Implementation Schedule...............................................................................ES-8 

Exhibit ES.2 GW Transient Noncommunity Water System Total Coliform 

 Occurrence ................................................................................................ES-12 

Exhibit ES.3 Potential Changes in Risk under the AIP and Alternative Options 

 Relative to the Current TCR ..........................................................................ES-13 

Exhibit ES.4 Predicted Average Annual Acute (current TCR) or E. coli MCL 

 (AIP and Alternative Options) Violations by Regulatory Option 

 and System Type ............................................................................................ES-18 

Exhibit ES.5 Comparison of Total and Net Change from Current TCR in Annualized 

 Present Value Costs ($Millions, 2007$) ........................................................ES-20 

Exhibit ES.6 Summary of Net Annual Per-Household Costs for the Proposed 

 RTCR (2007$) ...............................................................................................ES-22 

Exhibit ES.7 Estimated Annual Breakeven Threshold for Avoided Cases of 

 STEC O157 ................................................................................................ES-24 

Exhibit ES.8 Estimated Annual Breakeven Threshold for Avoided 

 Cases of Salmonella .......................................................................................ES-24 

Exhibit ES.9 Total Net Annual Cost Per Corrective Action Implemented 

 under AIP and Alternative Options, Annualized Using 3% and 

 7% Discount Rates ($2007) ...........................................................................ES-25 

Exhibit ES.10 Incremental Rule Cost Per Corrective Action Implemented under 

 AIP and Alternative Options, Annualized Using 3 and 7 Percent 

 Discount Rates ($2007) ..................................................................................ES-26 

Exhibit ES.11 Incremental Rule Cost Per Corrective Action for TNCWSs using 

 GW (Serving <100 People) Implemented under AIP and Alternative 

 options, Annualized Using 3 and 7 Percent Discount Rates ($2007) ............ES-26 

1. Introduction 

Exhibit 1.1 Proposed RTCR Monitoring Frequency Requirements (AIP Option) ...........1-3 

2. Statement of Need for the Rule 

3. Consideration of Regulatory Options 

Exhibit 3.1 Comparison of Proposed RTCR Regulatory Options ....................................3-6 

4. Baseline Conditions 

Exhibit 4.1 Pre-GWR Baseline Number of GW Systems ................................................4-13 

Exhibit 4.2 Baseline Number of SW Systems ..................................................................4-13 

Exhibit 4.3 Pre-GWR Baseline Population Served by GW Systems ...............................4-14 

Exhibit 4.4 Percent Distribution of Ground Water PWS Monitoring 

 Frequencies by PWS Size and Type for Current TCR ..................................4-14 

Exhibit 4.5 Post-GWR Baseline Number of GW Systems ...............................................4-16 

Exhibit 4.6 Post-GWR Baseline Population Served by GW Systems ..............................4-17 

Exhibit 4.7 Baseline Population Served by SW Systems .................................................4-17 
Economic Analysis for the Proposed RTCR vii June 2010 

Exhibit 4.8 Household Baseline .......................................................................................4-18 

Exhibit 4.9 Total Coliform and E. coli Percent Positive by System Size and Type .........4-19 

Exhibit 4.10 Baseline Number of TCR Violations by System Size and Type (2005) ........4-21 

Exhibit 4.11 Number of PWSs with Violations by System Type (2001 – 2007) ...............4-22 

Exhibit 4.12 Estimates of Sensitive Subpopulations in the United States ..........................4-23 

Exhibit 4.13 Summary of Baseline Assumptions Influencing RTCR Estimates ................4-24 

5. Occurrence and Predictive Model 

Exhibit 5.1 Basic Classifications of PWSs Used for Occurrence Modeling ....................5-5 

Exhibit 5.2 Directed Graph of Model Used for RTTC Occurrence .................................5-7 

Exhibit 5.3 Maximum Likelihood a and b Parameter Estimates for RTTC and RPTC ...5-10 

Exhibit 5.4 Maximum Likelihood a and b Parameter Estimates for RTEC and RPEC ...5-11 

Exhibit 5.5 α and β Parameter Estimates for RTTC and RPTC ......................................5-12 

Exhibit 5.6 α and β Parameter Estimates for RTEC and RPEC ......................................5-13 

Exhibit 5.7 Simulated Impacts of the AIP and Alternative Options on Systems 

 Serving ≤4,100 People – Surface Water Systems ..........................................5-20 

Exhibit 5.8 Simulated Impacts of the AIP and Alternative Options on Systems 

 Serving ≤4,100 People – Ground Water Systems ..........................................5-21 

Exhibit 5.9a Percent of GW Systems Assumed to be on Monthly, Quarterly, and 

 Annual (M/Q/A) Monitoring by System Category under Current 

 TCR (Baseline) – Initial Estimates (Post GWR Implementation) .................5-22 

Exhibit 5.9b Percent of GW Systems Predicted to be on M/Q/A Monitoring by 

 System Category under AIP Option – Adjusted Estimates 

 (Post RTCR Implementation) ........................................................................5-23 

Exhibit 5.9c Percent of GW Systems on M/Q/A Monitoring by System 

 Category under Alternative option – Adjusted Estimates 

 (Post RTCR Implementation) ........................................................................5-24 

Exhibit 5.10 Ground Water Community Water System Model Output Cumulative 

 Endpoints ................................................................................................5-28 

Exhibit 5.11 Ground Water Nontransient Noncommunity Water System Model Output 

Cumulative Endpoints ....................................................................................5-28 

Exhibit 5.12 Ground Water Transient Noncommunity Water System Model Output 

 Cumulative Endpoints ....................................................................................5-29 

Exhibit 5.13 Surface Water Community Water System Model Output Cumulative 

 Endpoints ................................................................................................5-29 

Exhibit 5.14 Surface Water Nontransient Noncommunity Water System Model Output 

Cumulative Endpoints ....................................................................................5-30 

Exhibit 5.15 Surface Water Transient Noncommunity Water System Model Output 

 Cumulative Endpoints ....................................................................................5-30 

Exhibit 5.16 Ground Water Community Water System TC Occurrence ...........................5-31 

Exhibit 5.17 Ground Water Nontransient Noncommunity Water System TC 

 Occurrence ................................................................................................5-32 

Exhibit 5.18 Ground Water Transient Noncommunity Water System TC 

 Occurrence ................................................................................................5-33 

Exhibit 5.19 Surface Water Community Water System TC Occurrence ...........................5-34 
Economic Analysis for the Proposed RTCR viii June 2010 

Exhibit 5.20 Surface Water Nontransient Noncommunity Water System TC 

 Occurrence ................................................................................................5-35 

Exhibit 5.21 Surface Water Transient Noncommunity Water System TC 

 Occurrence ................................................................................................5-36 

Exhibit 5.22a Summary of Model Parameters Influencing RTCR Baseline and 

 Options ................................................................................................5-38 

Exhibit 5.22b Summary of Model Parameters Influencing Proposed RTCR 

 Options Only ................................................................................................5-39 

Exhibit 5.23 Sensitivity Analysis Assumptions for Frequency and Effectiveness of 

 Corrective Actions following Level 1 or 2 Assessments ...............................5-42 

Exhibit 5.24a Cumulative Effect of Alternative Assumptions for Corrective Action 

Effectiveness and Duration on AIP Option Model Results 

 (Nondisinfecting TNCWS Serving ≤500 People over 25 Years) ..................5-42 

Exhibit 5.24b Cumulative Effect of 50% Assumption for Corrective Action 

 Implementation Rate on AIP Option Model Results (Nondisinfecting 

 TNCWS Serving ≤500 People over 25 Years) .............................................5-44 

Exhibit 5.25 Effect of Seasonality on Occurrence Analysis Endpoints .............................5-45 

Exhibit 5.25 Comparison of TC+ Occurrence Predicted as a 25-Year Annual 

 Average under the Current TCR with 2005 Six-Year Review Data ..............5-47 

Exhibit 5.26 Comparison of SDWIS Data for Nonacute and Acute Violations with 

 Predictive Model Annual Results for the Current TCR .................................5-48 

Exhibit 5.27 Results for Systems Serving more than 4,100 People – Current TCR ..........5-51 

Exhibit 5.28 Results for Systems Serving more than 4,100 People – AIP option ..............5-52 

Exhibit 5.29 Results for Systems Serving more than 4,100 People – 

 Alternative option ..........................................................................................5-53 

6. Benefits Analysis 

Exhibit 6.1 Potential Changes in Risk under the AIP and Alternative Option 

 Relative to the Current TCR ..........................................................................6-13 

Exhibit 6.2 Predicted Outcomes (25-Year Period of Analysis) under Current TCR ........6-23 

Exhibit 6.3 Predicted Outcomes (25-Year Period of Analysis) for AIP ...........................6-24 

Exhibit 6.4 Predicted Outcomes (25-Year Analysis Period) for Alternative Option .......6-25 

Exhibit 6.5 Predicted Average Annual Acute Violations by Reg. Option and 

 System Type ................................................................................................6-26 

Exhibit 6.6 Predicted Change in Average Annual Acute Violations1 by 

 Regulatory Option and System Type .............................................................6-27 

Exhibit 6.7 Relative Impacts Analysis for TNCWS Serving <101 People 

 for the Range of Corrective Action and Sampling Regimens Predicted .......6-31 

7. Cost Analysis 

Exhibit 7.1 Labor Rates by PWS Size (2007$) ................................................................7-2 

Exhibit 7.2 Monitoring Costs per Sample (2007$) ...........................................................7-3 

Exhibit 7.3 Net Change in PWS Unit Burden and Cost Estimates for Rule 

 Implementation (2007$).................................................................................7-7 

Exhibit 7.4 Net Change in State Unit Burden and Cost Estimates for Rule 

 Implementation (2007$).................................................................................7-8 
Economic Analysis for the Proposed RTCR ix June 2010 

Exhibit 7.5 Annualized Cost Estimates for Rule Implementation 

 ($Millions, 2007$) .........................................................................................7-9 

Exhibit 7.6 Net Change in PWS and State Burden and Cost Estimates for 

 Revising Sampling Plans (2007$) ..................................................................7-10 

Exhibit 7.7 Annualized Cost Estimates to Revise (PWSs) and Review (States) 

 Sampling Plans ($Millions, 2007$) ...............................................................7-11 

Exhibit 7.8 Summary of Monitoring Requirements Under the TCR, AIP, and 

 Alternative Options ........................................................................................7-12 

Exhibit 7.9 Cumulative Number of Samples over 25-Year Period of Analysis ...............7-16 

Exhibit 7.10 Annualized PWS and State Cost Estimates for Monitoring Costs 

 ($Millions, 2007$) .........................................................................................7-17 

Exhibit 7.11 PWS Unit Costs Estimates for Assessment Activities under 

 Current TCR (2007$) .....................................................................................7-20 

Exhibit 7.12 PWS Unit Costs Estimates for Level 1 and Level 2 Assessments 

 (AIP and Alternative Option) (2007$) ...........................................................7-21 

Exhibit 7.13 Number of Level 1 and Level 2 Assessments over the 25-Year 

 Compliance Period .........................................................................................7-22 

Exhibit 7.14 State Unit Cost Estimates for Review of Level 1 and Level 2 

 Assessments under TCR, AIP, and Alternative Options (2007$) ..................7-25 

Exhibit 7.15 Annualized PWS and State Cost Estimates for Level 1 and Level 2 

 Assessments ($Millions, 2007$) ....................................................................7-26 

Exhibit 7.16a Compliance Forecast for Corrective Actions based on Level 1 and 

 Level 2 Assessments ......................................................................................7-28 

Exhibit 7.16b Detailed PWS Compliance Forecast for Corrective Actions based on 

 Level 1 and Level 2 Assessments ..................................................................7-29 

Exhibit 7.17 Net Change in PWS and State Unit Costs Estimates for Reporting and 

Recordkeeping for Corrective Actions (2007$) .............................................7-30 

Exhibit 7.18 Annualized PWS and State Cost Estimates for Corrective Actions 

 based on Level 1 and Level 2 Assessments ($Millions, 2007$) ....................7-31 

Exhibit 7.19 PWS Unit Cost Estimates for Public Notification (2007$) ...........................7-33 

Exhibit 7.20 State Unit Costs Estimates for Public Notification (TCR, AIP, 

 Alternative Options).......................................................................................7-34 

Exhibit 7.21 Number of Tier 1 and Tier 2 Public Notifications over the 25-Year 

 Compliance Period .........................................................................................7-35 

Exhibit 7.22 Annualized PWS and State Cost Estimates for Public Notification 

 ($Millions, 2007$) .........................................................................................7-36 

Exhibit 7.23 Summary of Net Annual Per-Household Costs for the Proposed 

 RTCR (2007$) ...............................................................................................7-38 

Exhibit 7.24 Sensitivity Analysis – Annualized Net Change in Costs based on 

 Changes in Compliance Forecast ($Millions, 2007$) ....................................7-41 

Exhibit 7.25 Cost Uncertainty Summary ............................................................................7-42 

Exhibit 7.26 Comparison of Total and Net Change from Current TCR in 

 Annualized Present Value Costs ($Millions, 2007$) .....................................7-43 

Exhibit 7.27 Comparison of Total and Net Change in Annualized Present 

 Value Costs by Rule Component ($Millions, 2007$) ....................................7-44 

Exhibit 7.28 Total and Net Change in Annualized Costs to PWSs by 

 PWS Size and Type ($Millions, 2007$) ........................................................7-45 
Economic Analysis for the Proposed RTCR x June 2010 

Exhibit 7.29 Total and Net Change in Annualized Per PWS Costs by 

 PWS Size and Type (2007$) .........................................................................7-46 

8. Economic Impact Analysis 

Exhibit 8.1 Average Annual Net Change Burden and Costs for the Proposed RTCR 

Information Collection Request .....................................................................8-4 

Exhibit 8.2 Average Annualized Revenue by System Size and Percent of 

 Systems with Costs Exceeding One Percent and Three Percent of 

 Revenue (Three Percent Discount Rate) ........................................................8-6 

Exhibit 8.3 Average Costs per System and as Percentage of Revenue 

 (2007$) ................................................................................................8-7 

Exhibit 8.4 Annualized Net Rule Costs Predicted for Small Entities 

 (PWSs serving ≤10,000) by Rule Component Using Three 

 Percent and Seven Percent Discount Rates (2007$) ......................................8-8 

9. Comparison of Benefits and Costs 

Exhibit 9.1a Ground Water (GW) Transient Noncommunity Water System 

 TC Occurrence ...............................................................................................9-5 

Exhibit 9.1b Potential Changes in Risk under the AIP and Alternative Options 

 Relative to the Current TCR ..........................................................................9-6 

Exhibit 9.2 Estimates of Non-Acute Violations (TCR) and Level 1 Assessment 

 Triggers (AIP and Alternative Options) ........................................................9-13 

Exhibit 9.3 Estimates of Acute Violations (TCR) and E. coli MCL Violations 

 (AIP and Alternative Options) .......................................................................9-14 

Exhibit 9.4 Estimates of Corrective Actions ....................................................................9-15 

Exhibit 9.5 Discounted Estimates of Non-Acute Violations (TCR) and Level 1 

 Assessment Triggers (AIP and Alternative Options) (3% Discount Rate) ....9-16 

Exhibit 9.6 Discounted Estimates of Acute Violations (TCR) and E. coli 

 MCL Violations (AIP and Alternative Options) (3% Discount Rate) ...........9-17 

Exhibit 9.7 Discounted Estimates of Corrective Actions (3% Discount Rate) ................9-18 

Exhibit 9.8 Net Costs to PWSs (2007$) ...........................................................................9-21 

Exhibit 9.9 Discounted Net Costs to PWSs Over Time (3% Discount Rate) (2007$) .....9-22 

Exhibit 9.10 Discounted Net Costs to PWSs (7% Discount Rate) (2007$) .......................9-23 

Exhibit 9.11 Comparison of Total and Net Change in Annualized Present 

 Value Costs ($Millions, 2007$) .....................................................................9-24 

Exhibit 9.12 Comparison of Total and Net Change in Annualized Present Value 

 Costs by Rule Component ($Millions, 2007$) ..............................................9-25 

Exhibit 9.13 Total and Net Change in Annualized Costs to PWSs by PWS Size 

 and Type ($Millions, 2007$) .........................................................................9-26 

Exhibit 9.14 Incremental Net Change in Annualized Present Value Costs 

 ($Millions, 2007$) and Benefits (Number of Corrective Actions) ................9-31 

Exhibit 9.15 Total Net Annual Cost Per Corrective Action Implemented under 

 AIP option and Alternative Options, Annualized Using 3% and 7% 

 Discount Rates ($2007) ..................................................................................9-32 

Exhibit 9.16 Incremental Rule Cost Per Corrective Action (CA) Implemented for 

 All PWSs under AIP and Alternative Options, Annualized Using 

 3% and 7% Discount Rates ($2007) ..............................................................9-33 
Economic Analysis for the Proposed RTCR xi June 2010 

Exhibit 9.17 Incremental Rule Cost Per CA Implemented for GW TNCWSs 

 under AIP and Alternative Options, Annualized Using 3% and 

 7% Discount Rates ($2007) ...........................................................................9-33 

Exhibit 9.18 Average Estimated Value Per STEC O157 Case Avoided (2007$) ..............9-36 

Exhibit 9.19 Average Estimated Value Per Salmonella Case Avoided (2007$) ................9-37 

Exhibit 9.20 Estimated Annual Break-Even Threshold for Avoided Cases 

 of STEC O157................................................................................................9-37 

Exhibit 9.21 Estimated Annual Break-Even Threshold for Avoided Cases 

 of Salmonella ................................................................................................9-38 

10. References 
Economic Analysis for the Proposed RTCR xii June 2010 

List of Acronyms 

A/CA Assessment and corrective action if necessary 

AGI Acute Gastrointestinal Illness 

AIDS Acquired Immune Deficiency Syndrome 

AIP Agreement in Principle 

ASDWA Association of State Drinking Water Administrators 

BMPs Best Management Practices 

CAs Corrective Actions 

CCR Consumer Confidence Report 

CDC Centers for Disease Control and Prevention 

COI Cost of Illness 

CWS Community Water System 

DBP Disinfection Byproduct 

DBPR Disinfection Byproducts Rule 

DisGW disinfected ground water 

DisinfSW disinfected surface water 

DV Data Verification 

EA Economic Analysis 

EC E. coli bacteria 

EC+ E. coli-positive 

ECI Employee Cost Index 

EO Executive Order 

EPA United States Environmental Protection Agency 

ERS Economic Research Service 

FAC Federal Advisory Committee 

FACA Federal Advisory Committee Act 

FC Fecal coliform bacteria 

FC+ Fecal Coliform-positive 

FDA U.S. Food and Drug Administration 

FR Federal Register

GW Ground Water 

GWR Ground Water Rule 

GWSs Ground Water Systems 

GWUDI Ground Water Under the Direct Influence of Surface Water 

HAA5 Five Haloacetic Acids 

HAV Hepatitis A Virus 

HEV Hepatitis E Virus 

HUS Hemolytic Uremic Syndrome 

ICR Information Collection Rule 

ICR Information Collection Request 

IDSEs Initial Distribution System Evaluations 

IESWTR Interim Enhanced Surface Water Treatment Rule 

KRPEC Number of repeat TC positive samples assayed that tested positive 

 for EC 

KRPTC Number positive repeat samples during year 
Economic Analysis for the Proposed RTCR xiii June 2010 

KRTEC Number of routine TCpositive samples assayed that tested positive 

 for EC 

KRTTC Number positive routine samples during year 

LRAAs Locational Running Annual Averages 

LT1ESWTR Long Term 1 Enhanced Surface Water Treatment Rule 

LT2ESWTR Long Term 2 Enhanced Surface Water Treatment Rule 

M/DBP Microbial/Disinfection By-Product 

M/Q/A Monthly, Quarterly, and Annual 

MAC Mycobacterium avium Complex 

MCL Maximum Contaminant Level 

MCLG Maximum Contaminant Level Goal 

MCMC Bayesian Markov Chain Monte Carlo 

MLEs Maximum Likelihood Estimates 

MRDLGs Maximum Residual Disinfectant Level Goals 

MRDLs Maximum Residual Disinfectant Levels 

NAICS North American Industry Classification System 

NCWS Non-Community Water System 

NDPWR National Primary Drinking Water Regulation 

NondisGW Nondisinfected ground water 

NPDWRs National Primary Drinking Water Regulations 

NRPEC Number of repeat TCpositive samples that were assayed for EC 

NRPTC Total number repeat samples assayed 

NRTEC Number of routine TCpositive samples that were assayed for EC 

NRTTC Number routine samples assayed 

NTNC Nontransient Noncommunity 

NTNCWS Nontransient Noncommunity Water Systems 

NTTAA National Technology Transfer and Advancement Act 

NTUs Nephelometric Turbidity Units 

O&M Operations and Maintenance 

OMB Office of Management and Budget 

PAM Primary Amoebic Meningioencephalitis 

PN Public Notification 

POU Point of Use 

pRPEC Repeat probability that a TCpositive repeat sample will also test 

 ECpositive 

pRPTC Probability that a repeat sample will test positive 

pRTEC Probability that a TCpositive routine sample will also test 

 ECpositive 

pRTTC Probability that a routine sample will test positive 

PWSs Public Water Systems 

RAA Running Annual Average 

RFA Regulatory Flexibility Act 

RPEC Repeat E. coli 

RPTC Repeat TC 

RTCR Revised Total Coliform Rule 

RTEC Routine E. coli

RTTC Routine TC 
Economic Analysis for the Proposed RTCR xiv June 2010 

SAB Science Advisory Board 

SBA Small Business Administration 

SBREFA Small Business Regulatory Enforcement Fairness Act 

SDWA Safe Drinking Water Act 

SDWIS Safe Drinking Water Information System 

SDWIS/FED Safe Drinking Water Information System Federal Version 

Six Year Review Six Year Review of National Primary Drinking Water Regulations 

SS Sanitary survey 

STEC Shiga toxin-producing E. coli

SW Surface Water 

SWTR Surface Water Treatment Rule 

TC Total Coliform bacteria 

TC+ Total Coliform-positive 

TCR Total Coliform Rule 

TCRDSAC Total Coliform Rule/Distribution System Advisory Committee 

TMF Technical, Managerial, and Financial 

TNC Transient Noncommunity 

TNCWS Transient Noncommunity Water Systems 

TT Treatment Technique 

TTHM Total Trihalomethane 

TWG Technical Work Group 

UMRA Unfunded Mandates Reform Act 

UV Ultraviolet light 

VSL Value of a Statistical Life 
Economic Analysis for the Proposed RTCR xv June 2010 

Health Risk Reduction and Cost Analysis 

Under the Safe Drinking Water Act (SDWA) Amendments of 1996, when proposing a 

national primary drinking water regulation that includes a maximum contaminant level (MCL), 

the U.S. Environmental Protection Agency (EPA) must conduct a health risk reduction and cost 

analysis (HRRCA). A HRRCA addresses seven requirements, all of which are addressed in this 

Economic Analysis (EA) for the proposed Revised Total Coliform Rule (RTCR). 

HRRCA Crosswalk Summary 

HRRCA Requirement Addressed in Economic Analysis 

Quantifiable and nonquantifiable health risk 

reduction benefits 

Chapter 6 (all sections) 

Chapter 8 (sections 8.8 and 8.12) 

Chapter 9 (sections 9.1.2, 9.2.2, and 9.3) 

Quantifiable and nonquantifiable health risk 

reduction benefits from co-occurring 

contaminants 

Chapter 6 (section 6.5.1, 6.5.4) 

Chapter 9 (section 9.2.2) 

Quantifiable and nonquantifiable costs 

Chapter 7 (all sections) 

Chapter 8 (sections 8.3 - 8.6, 8.9, and 8.13 - 

8.15) 

Chapter 9 (sections 9.1.3, 9.2.2, and 9.3) 

Incremental costs and benefits associated with 

regulatory alternatives

Chapter 6 (sections 6.2 and 6.3) 

Chapter 7 (sections 7.4, 7.5, and 7.8) 

Chapter 9 (sections 9.1, 9.3.1, and 9.3.2) 

Effects of the contaminants on the general 

population and sensitive subpopulations 

Chapter 2 (section 2.2) 

Chapter 6 (all sections) 

Chapter 8 (section 8.12) 

Chapter 9 (sections 9.1.2, 9.2.2, and 9.3) 

Increased health risk that may occur as a 

result of compliance 

Chapter 6 (section 6.2) 

Chapter 9 (section 9.1.2) 

Other relevant factors (quality and uncertainty 

of information) 

Chapter 4 (sections 4.2 and 4.3) 

Chapter 5 (section 5.3.3.1) 

Chapter 6 (section 6.4) 

Chapter 7 (section 7.7) 

Chapter 9 (section 9.2.1) 
Economic Analysis for the Proposed RTCR ES-1 June 2010

Executive Summary 

This Economic Analysis (EA) presents the evaluation of the benefits and costs of the 

proposed Revised Total Coliform Rule (RTCR). The analysis is performed in compliance with 

Executive Order 12866, Regulatory Planning and Review (58 Federal Register (FR) 51735, 

September 1993), which requires the United States Environmental Protection Agency (EPA or 

Agency) to estimate the economic impact of rules that have an annual effect on the economy of 

over $100 million. The Order further requires agencies to make the analysis for an 

“economically significant” rule available to the public in conjunction with publication of the 

final rule. Although EPA's analysis of the proposed RTCR has determined that its annual costs 

are below this threshold, EPA has chosen to publish a complete EA for this rule. 

In the Six-Year Review determination published in July 2003, EPA gave notice of its 

intent to review the current Total Coliform Rule (current TCR). EPA has since developed the 

proposed RTCR in collaboration with states, other interested stakeholders, and the Total 

Coliform Rule/Distribution System Advisory Committee (TCRDSAC). The Agency’s primary 

reasons for revising the 1989 Total Coliform Rule are implementation-related issues. The 

proposed revisions offer a meaningful opportunity for greater public health protection against 

fecal contamination and waterborne pathogens in the distribution systems of public water 

systems (PWSs) beyond the current Total Coliform Rule. These proposed revisions are in 

accordance with the Safe Drinking Water Act (SDWA) as amended, which requires EPA to 

review and revise, as appropriate, each national primary drinking water regulation promulgated 

under the SDWA at least every six years. As with the current Total Coliform Rule, the proposed 

Revised Total Coliform Rule applies to all PWSs. 

ES.1 Need for the Rule 

EPA promulgated the 1989 TCR to decrease the risk of waterborne illness. Among all 

SDWA rules promulgated for preventing waterborne illness, only the TCR applies to all PWSs, 

making the rule an essential component of the multi-barrier approach in public health protection 

against endemic (or epidemic) disease. In combination with the other SDWA rules, the proposed 

RTCR will better address the TCR objectives and enhance the multi-barrier approach to 

protecting public health, especially with respect to small ground water PWSs. 

 

In recent years, the number of violations under the current TCR have remained relatively 

steady, as shown in Exhibit 4.11 and discussed in Appendix G of the RTCR EA. EPA believes 

that this is reflective of a steady state among PWSs complying with the current TCR; 

improvements likely to occur under that rule have largely been achieved. In outlining 

recommendations for further reductions in occurrence, EPA and the TCRDSAC developed the 

Agreement in Principle (AIP), which has become the structure of the proposed RTCR. 

The proposed RTCR maintains the objectives of the current TCR and is consistent with the 

recommendations in the AIP. The objectives are: (1) to evaluate the effectiveness of treatment, 

(2) to determine the integrity of the distribution system, and (3) to signal the possible presence of 

fecal contamination. The proposed rule better addresses these objectives by requiring systems 

that may be vulnerable to fecal contamination (as indicated by their monitoring results) to do an 

assessment, to identify whether any sanitary defect(s) is (are) present, and to correct the defects. 
Economic Analysis for the Proposed RTCR ES-2 June 2010

Therefore, greater public health protection is anticipated under the proposed RTCR compared to 

the current TCR because of its more preventive approach to identifying and fixing problems that 

affect or may affect public health. The key provisions of the proposed rule are summarized in 

Section ES.3. 

Public health concerns, fecal contamination, and waterborne pathogens 

The proposed RTCR aims to increase public health protection through the reduction of 

potential pathways of entry for fecal contamination into the distribution system. Since these 

potential pathways represent vulnerabilities in the distribution system whereby fecal 

contamination and/or waterborne pathogens, including bacteria, viruses, and parasitic protozoa 

could possibly enter the system, the reduction of these pathways in general should lead to 

reduced exposure and associated risk from the contaminants. Fecal contamination and 

waterborne pathogens can cause a variety of illnesses, including acute gastrointestinal illness 

(AGI) with diarrhea, abdominal discomfort, nausea, vomiting, and other symptoms. Most AGI 

cases are of short duration and result in mild illness. Other more severe illnesses caused by 

waterborne pathogens include hemolytic uremic syndrome (HUS) (kidney failure), hepatitis, and 

bloody diarrhea (WHO 2004). Chronic disease such as irritable bowel syndrome, reduced kidney 

function, hypertension and reactive arthritis can result from infection by a waterborne agent 

(Clark et al. 2008). 

 When humans are exposed to and infected by an enteric pathogen, the pathogen becomes 

capable of reproducing in the gastrointestinal tract. As a result, healthy humans shed pathogens 

in their feces for a period ranging from days to weeks. This shedding of pathogens often occurs 

in the absence of any signs of clinical illness. Regardless of whether a pathogen causes clinical 

illness in the person who sheds it in his or her feces, the pathogen being shed may infect other 

people directly by person-to-person spread, contact with contaminated surfaces, and other means 

which are referred to as secondary spread. As a result, initially waterborne pathogens may 

subsequently infect other people through a variety of routes (WHO 2004). Sensitive 

subpopulations are at greater risk from waterborne disease than the general population (Gerba et 

al. 1996a). 

Indicators 

Total coliforms are a group of closely related bacteria that, with few exceptions, are not 

harmful to humans. Coliforms are abundant in the feces of warm-blooded animals, but can also 

be found in aquatic environments, in soil, and on vegetation. Coliform bacteria may be 

transported to surface water by run-off or to ground water by infiltration. Total coliforms are 

common in ambient water and may be injured by environmental stresses such as lack of 

nutrients, and water treatments such as chlorine disinfection, in a manner similar to most 

bacterial pathogens and many viral enteric pathogens (including fecal pathogens). EPA considers 

total coliforms to be a useful indicator that a potential pathway exists through which fecal 

contamination can enter the distribution system. The absence (versus the presence) of total 

coliforms in the distribution system indicates a reduced likelihood that fecal contamination 

and/or waterborne pathogens are occurring in the distribution system. 

Under the current TCR, each total coliform-positive sample is assayed for either fecal 

coliforms or E. coli. Fecal coliform bacteria are a subgroup of total coliforms that traditionally 

have been associated with fecal contamination. Since the promulgation of the TCR, more 
Economic Analysis for the Proposed RTCR ES-3 June 2010

information and understanding of the suitability of fecal coliform and E. coli as indicators have 

become available. Study has shown that the fecal coliform assay is imprecise and too often 

captures bacteria that do not originate in the human or mammal gut (Edberg et al. 2000). On the 

other hand, E. coli is a more restricted group of coliform bacteria that almost always originate in 

the human or animal gut (Edberg et al. 2000). Thus, E. Coli is a better indicator of fecal 

contamination than fecal coliforms. 

Presence of fecal contamination 

Fecal contamination is a very general term that includes all of the organisms found in feces, 

both pathogenic and nonpathogenic. Fecal contamination can occur in drinking water both 

through use of contaminated source water as well as direct intrusion of fecal contamination into 

the drinking water distribution system. Biofilms in distribution systems may harbor waterborne 

bacterial pathogens and accumulate enteric viruses and parasitic protozoa (Skraber et al. 2005; 

Helmi et al. 2008). Waterborne pathogens in biofilms may have entered the distribution system 

as fecal contamination from humans or animals. 

Co-occurrence of indicators and waterborne pathogens is difficult to measure. The analytical 

methods approved by EPA to assay for E. coli do not specifically identify most of the pathogenic 

E. coli strains. There are at least 700 recognized E. coli strains (Kaper et al. 2004). About 10 

percent of recognized E. coli strains are pathogenic to humans (Feng 1995; Hussein 2007; Kaper 

et al. 2004). Pathogenic E. coli include E. coli O157:H7, which is the primary cause of HUS in 

the United States (Rangel et al. 2005). The US Centers for Disease Control and Prevention 

(CDC) estimates that there are 73,000 cases of illness each year in the US due to E. coli

O157:H7 (Mead et al. 1999). The CDC estimates that about 15 percent of all reported E. coli

O157:H7 cases are due to water contamination (Rangel et al. 2005). Active surveillance by CDC 

shows that 6.3 percent of E. coli O157:H7 cases progress to HUS (Griffin and Tauxe 1991; Gould et 

al. 2009) and about 12 percent of HUS cases result in death within four years (Garg et al. 2003). 

About 4 to 15 percent of cases are transmitted within households by secondary transmission 

(Parry and Salmon 1998). 

Because EPA-approved standard methods for E. coli do not typically identify the presence 

of the pathogenic E. coli strains, an E. coli-positive monitoring result is an indicator of fecal 

contamination but is not necessarily a measure of waterborne pathogen occurrence. Specialized 

assays and methods are used to identify waterborne pathogens, including pathogenic E. coli. 

One notable exception are the data reported by Cooley et al. (2007), which showed high 

concentrations of pathogenic E. coli strains in samples containing high concentrations of fecal 

indicator E. coli. These data are from streams and other poor quality surface waters surrounding 

California spinach fields associated with the 2006 E. coli O157:H7 foodborne outbreak. Data 

equivalent to these samples are not available from drinking water samples collected under the 

TCR. 

Thus, based on the above discussion, EPA believes that E. coli is a meaningful indicator for 

fecal contamination and the potential presence of associated pathogen occurrence. 
Economic Analysis for the Proposed RTCR ES-4 June 2010

Waterborne disease outbreaks 

The CDC defines a waterborne disease outbreak as occurring when at least two persons (or 

one with amoebic meningoencephalitis) experience a similar illness after ingesting a specific 

drinking water contaminated with pathogens (or chemicals) (Kramer et al. 1996). The CDC 

maintains a database on waterborne disease outbreaks in the United States. The database is based 

upon responses to a voluntary and confidential survey form that is completed by state and local 

public health officials. 

The National Research Council strongly suggests that the number of identified and reported 

outbreaks in the CDC database for surface and ground waters represents a small percentage of 

actual number of waterborne disease outbreaks (NRC 1997; Bennett et al. 1987; Hopkins et al. 

1985 for Colorado data). Under-reporting occurs because most waterborne outbreaks in 

community water systems are not recognized until a sizable proportion of the population is ill 

(Perz et al. 1998; Craun 1996), perhaps 1 percent to 2 percent of the population (Craun 1996). 

EPA drinking water regulations are designed to protect against endemic waterborne disease 

and to minimize waterborne outbreaks. In contrast to epidemic, endemic refers to the persistent 

low to moderate level or the unusual ongoing occurrence of illness in a given population or 

geographic area (Craun et al. 2006). 

ES.2 Consideration of Regulatory Alternatives 

EPA evaluated the following three regulatory options as part of this revised rule proposal: 

(1) the current TCR option, (2) the AIP option, and (3) an Alternative option. EPA discusses the 

three regulatory options briefly in this executive summary and in greater detail in Chapter 3. 

First, the current TCR option reflects EPA’s understanding of how the current TCR 

(USEPA 1989a, 54 FR 27544, June 29, 1989) is currently being implemented. That is, the 

current TCR option is assumed to include “status quo” PWS and state implementation practices. 

Next, the AIP option is a revised TCR based on the recommendations of the advisory committee. 

The provisions of this proposed rule are based on the AIP option and are described in detail in 

section III of the preamble of the proposed RTCR. Third, the Alternative option parallels the AIP 

in most ways but includes variations of some of the provisions that were discussed by the 

advisory committee before consensus was reached on the AIP. Under the Alternative option, at 

the compliance date all PWSs are required to sample monthly for an initial period until they meet 

the eligibility criteria for reduced monitoring. EPA assumes that eligibility for reduced 

monitoring is determined during the next sanitary survey following the RTCR compliance date 

(corresponding to year 11 of the model runs presented later on in this EA). This more stringent 

approach differs from the AIP option that allows PWSs to continue to monitor at their current 

frequencies (with an additional annual site visit or voluntary Level 2 assessment requirement for 

PWSs wishing to remain on annual monitoring) until they are triggered into an increased 

sampling frequency. Under the Alternative option, no PWSs are allowed to reduce monitoring to 

an annual basis. EPA defined the Alternative option this way and included it in this EA to assess 

the relative impacts of a more stringent rule and to better understand the balance between costs 

and public health protection. 
Economic Analysis for the Proposed RTCR ES-5 June 2010

To understand the relative impacts of the options, EPA gathered available data and 

information to develop and provide input into an occurrence and predictive model. EPA 

estimated both baseline conditions and changes to these conditions anticipated to occur over time 

as a result of these revised rule options. The analysis is described in more detail in the remainder 

of this EA. 

ES.3 Summary of the Proposed RTCR Requirements 

The proposed RTCR maintains and strengthens the objectives of the current TCR and is 

consistent with the recommendations in the AIP. The objectives are: (1) to evaluate the 

effectiveness of treatment, (2) to determine the integrity of the distribution system, and (3) to 

signal the possible presence of fecal contamination. The proposed rule better addresses these 

objectives by requiring systems that may be vulnerable to fecal contamination (as indicated by 

their monitoring results) to do an assessment, to identify whether any sanitary defect(s) is (are) 

present, and to correct the defects. Therefore, greater public health protection is anticipated under 

the proposed RTCR compared to the current TCR because of its more preventive approach to 

identifying and fixing problems that affect or may affect public health. The following is an 

overview of the key provisions of the proposed RTCR: 

MCLG and MCL for E. coli and coliform treatment technique for protection against potential 

fecal contamination 

The proposed RTCR establishes a maximum contaminant level goal (MCLG) and 

maximum contaminant level (MCL) for E. coli. It takes a preventive approach to protecting 

public health by establishing a coliform treatment technique for protection against potential fecal 

contamination. The treatment technique uses both total coliforms and E. coli monitoring results 

to start an evaluation process that, where necessary, will require the PWS to conduct follow-up 

and corrective action that could prevent further incidences of contamination and exposure to 

fecal contamination and/or waterborne pathogens. See section III.A.2 of the proposed RTCR 

preamble (USEPA, 2010c) for a detailed discussion on the MCLG, MCL, and coliform treatment 

technique requirements. 

Monitoring 

As with the current TCR, PWSs will continue to monitor for total coliforms and E. coli

according to a sample siting plan and schedule specific to the system. 

Sample siting plans under the proposed RTCR must continue to be representative of the water 

throughout the distribution system. Under the proposed RTCR, systems will have the flexibility 

to propose repeat sample locations that will best verify and determine the extent of potential 

contamination of the distribution system rather than having to sample within five connections 

upstream and downstream of the total coliform-positive sample location. For some systems, most 

likely those that have limited or no distribution systems, the repeat samples may satisfy the 

requirement for source water samples. Because this represents a reduction in monitoring in 

addition to costs, state approval is required. EPA believes that this reduction in monitoring is 

appropriate only if the state determines that the dual purpose sample provides public health 

protection equivalent to that provided by separate repeat and source water samples. EPA believes 

that many ground water systems serving 1,000 or fewer, such as systems with extensive 
Economic Analysis for the Proposed RTCR ES-6 June 2010

distribution systems, will not be able to show that this reduction in monitoring (i.e. a loss of 

repeat sample that is near the total coliform-positive routine sample site, but not near the source 

water sample site) will provide public health protection equivalent to separate samples. 

As with the current TCR, the proposed RTCR allows reduced monitoring for some small 

ground water systems. The proposed RTCR is expected to improve public health protection 

compared to the current TCR by requiring small ground water systems that are on or wish to 

move to reduced monitoring to meet certain eligibility criteria. Examples of the criteria include a 

sanitary survey showing that the system is free of sanitary defects, a clean TCR compliance 

history for 12 months, and a recurring annual site visit by the state and/or a voluntary Level 2 

assessment by a party approved by the state or meeting criteria established by the state for 

systems wishing to remain on or reduce to annual monitoring 

For small ground water systems, the proposed RTCR requires increased monitoring for 

higher-risk systems that meet certain criteria such as unacceptable compliance history under the 

RTCR. The proposed RTCR specifies conditions under which systems will no longer be eligible 

for reduced monitoring and be required to return to routine monitoring or to monitor at an 

increased frequency. 

The proposed RTCR requires systems on a quarterly or annual monitoring frequency 

(applicable only to ground water systems serving 1,000 or fewer people) to conduct additional 

routine monitoring the month following one or more total coliform-positive samples. Under the 

proposed RTCR, systems must collect at least three routine samples during the next month, 

unless the state waives the additional routine monitoring. This is a reduction in the required 

number of additional routine samples from the current TCR, which requires at least five routine 

samples in the month following a total coliform-positive sample for all systems serving 4,100 or 

fewer people. 

The current TCR requires all systems serving 1,000 or fewer people to collect at least 

four repeat samples while PWSs serving 1,000 people or greater to collect three repeat samples. 

The proposed rule requires three repeat samples after a routine total coliform-positive sample, 

regardless of the system type and size. 

Sections III.A.3 and III.A.4 of the proposed RTCR preamble provide detailed discussions 

of the routine monitoring and repeat sampling requirements of the proposed RTCR. 

Seasonal systems 

The proposed RTCR establishes special monitoring requirements for seasonal systems for 

the first time. Seasonal systems represent a special case in that the shutdown and start-up of these 

water systems present additional opportunities for contamination to enter or spread through the 

distribution system. Seasonal systems must demonstrate completion of a state-approved start-up 

procedure. In addition, they must designate the time period(s) for monitoring based on sitespecific considerations (such as during periods of highest demand or highest vulnerability to 

contamination) in their state-approved sample siting plan. Section III.A.3 of the proposed RTCR 

preamble provides a detailed discussion of seasonal systems. 
Economic Analysis for the Proposed RTCR ES-7 June 2010

Assessment and corrective action 

As part of a treatment technique, all PWSs are required to assess their systems when 

monitoring results show that the system may be vulnerable to contamination. Systems must 

conduct a simple self-assessment (Level 1) or a more detailed assessment (Level 2) depending on 

the severity and frequency of contamination. The system is responsible for correcting any 

sanitary defect(s) found through either a Level 1 or Level 2 assessment. Section III.A.5 of the 

proposed RTCR preamble provides more discussion of the treatment technique requirement of 

the proposed RTCR. 

Violations and public notification 

The proposed RTCR establishes an E. coli MCL violation, a treatment technique 

violation, a monitoring violation, and a reporting violation. Public notification is required for 

each type of violation, depending on the degree of potential public health concern consistent with 

EPA’s current public notification requirements under 40 CFR part 141, subpart Q. The proposed 

RTCR also modifies the public notification and Consumer Confidence Report language to reflect 

the construct of the proposed rule. Sections III.A.6 and III.A.7 of the proposed RTCR preamble 

provide detailed discussions of violations and public notification under the proposed RTCR. 

Transition to the RTCR 

The proposed RTCR allows all systems to transition to the new rule at their current TCR 

monitoring frequency, including systems on reduced monitoring under the current TCR. States 

will then evaluate the monitoring frequency during each sanitary survey conducted after the 

compliance effective date of the RTCR. This process reduces state burden by not requiring the 

state to determine appropriate monitoring frequency at the same time as when the state is trying 

to adopt primacy, develop policies, and train their own staff and the PWSs in the state. 

 Exhibit ES.1 shows the implementation schedule, from year 1 through year 10, for the 

proposed RTCR. PWSs will begin sampling under the RTCR in the fourth year after RTCR 

promulgation1

.

 

1

 Chapter 4 of the RTCR EA describes the baseline schedule under which systems would begin sampling following 

the RTCR effective date; Chapter 5 describes how the baseline schedule is adjusted, based on acute and non-acute 

violations incurred during an initial assessment period, to determine the steady state distribution of systems on 

monthly, quarterly, and annual sampling. 
Economic Analysis for the Proposed RTCR ES-8 

Exhibit ES.1 Implementation Schedule 

Year 

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Ye

State 

Implementation 

Revising Sampling Plan 

Routine monitoring, Additional routine monitoring, Repeat Monitoring 

Site Inspections 

Level 1 and Level 2 Site Assessments 

Correction Actions Based on Level 1 and Level 2 Site Asse

Public Notification 

PWS 

Implementation 

Revising Sampling Plan 

Routine monitoring, Additional routine monitoring, Repeat Monitoring 

Site Inspections 

Level 1 and Level 2 Site Assessments 

Correction Actions Based on Level 1 and Level 2 Site Asse

Public Notification 

Source: Draft Information Collection Request for the Proposed Revised Total Coliform Rule, Figure 4.3. Note: Activities occurring in Year 10 continue throughout the remaining years of analysis 
Economic Analysis for the Proposed RTCR ES-9 June 2010 

ES.4 Systems Subject to the Proposed RTCR 

The proposed RTCR will apply to all PWSs in the United States. The baseline inventory 

for the EA is derived from EPA’s Safe Drinking Water Information System (SDWIS), fourth 

quarter 2007 data2

 (USEPA, 2007b), which contains information reported by primacy agencies 

on the approximately 155,000 active PWSs. The systems are subdivided by water source (ground 

water or surface water), type (community water systems (CWS), nontransient noncommunity 

water systems (NTNCWS), and transient noncommunity water systems (TNCWS)), and size 

(nine size categories ranging from those serving fewer than 100 people to those serving more 

than 1 million people). 

EPA developed the baseline water quality used in the RTCR EA from the Six-Year 

Review 2 data collected between 1998 and 2005, which include coliform monitoring data 

voluntarily provided to EPA by 37 primacy agencies (35 states and 2 tribes). The database 

consists of over nine million TCR records collected between 1998 and 2005. In addition, EPA 

incorporated information from the GWR, the U.S. Census, and the current TCR to develop 

assumptions for the model. 

EPA used the available data and the requirements of the regulatory options considered to 

develop a model that predicts the number of systems in each category that experience TC+ and 

EC+ assays over the 25-year period of analysis. The results of the occurrence model and cost 

model indicate the number of systems that conduct the various activities under three regulatory 

options (TCR and AIP and Alternative options). These results are discussed in terms of benefits 

of the current rule (changes in acute violations incurred and corrective actions to be 

implemented) and rule costs in Section ES.5 below. 

ES.5 National Benefits and Costs of the Proposed RTCR 

The consensus resulting from TCRDSAC deliberations was that a proposed RTCR that 

was consistent with the AIP would achieve a net risk reduction compared to the current TCR. 

The committee applied best professional judgment in determining that the increased protection 

provided by the new requirements for implementing focused assessments and appropriate 

corrective actions would more than offset any potential increase in risk introduced by the 

reduction in samples or other changes resulting from the proposed RTCR. 

Based on limitations in available data (described further in Chapter 6, Section 6.3), EPA 

determined that benefits could not be calculated in terms of avoided cases of (or costs related to) 

morbidity or mortality. Since E. coli is an indicator of fecal contamination, EPA assumed that a 

decrease in E. coli occurrence in the distribution system would be associated with a decrease in 

fecal contamination in the distribution system. In general, this decrease in fecal contamination 

should reduce the potential risk to human health for PWS customers. Thus, any reduction in E. 

coli occurrence is considered a benefit of the proposed RTCR. EPA’s qualitative analysis in 

Section 6.2 of this EA considers the overall changes in occurrence of contaminant indicators 

under the proposed RTCR as compared to the current TCR, and predicts a net decrease in risk. 

 

2 SDWIS-Federal Version (SDWIS/FED) is a database created by EPA containing data submitted by States and 

regions regarding inventory as well as compliance with SDWA. 
Economic Analysis for the Proposed RTCR ES-10 June 2010 

As discussed in Chapter 6, this reduction in risk is an indicator of the benefits of the proposed 

RTCR. 

Sections ES.5.1 and ES.5.2 summarize the qualitative benefits analysis and the methods 

used to derive the costs of the rule, respectively. Section ES.5.1 describes the qualitative analyses 

of net changes in TC and EC occurrence anticipated to occur under the proposed RTCR 

compared to the current TCR. As found in Section ES.5.2, EPA’s national cost estimates include 

cost to implement the rule; revise sampling plans; conduct routine monitoring, additional routine 

monitoring, and repeat monitoring; perform Level 1 and Level 2 assessments; implement 

corrective actions; and provide public notification in the case of violations. Estimates for present 

value and annualized national costs are presented using a 3 percent and 7 percent discount rate.3

 

Chapters 6 (benefits), 7 (costs), and 9 (comparison of benefits and costs), as well as the 

appendices, provide a more detailed discussion of all the analyses discussed in the sections 

below. 

Changes in risk associated with proposed RTCR activities are characterized by their 

anticipated effects on potential pathways of contamination into PWS, as indicated by their effects 

on such pathways for TC/E. coli. These activities are considered under each rule component 

presented in Exhibit ES.3. 

ES.5.1 Derivation of Benefits 

In promulgating the RTCR, EPA expects to further reduce the risk of contamination of 

public drinking water from the current baseline risk under the existing TCR. The options 

considered during development of this proposed rule and analyzed as part of this EA (see 

Chapters 6, 7, and 9) are designed to achieve this reduction while maintaining public health 

protection in a cost-effective manner. 

The EA examines the benefits in terms of trade-offs between compliance with the current 

TCR and the other options considered (AIP and Alternative options). Because there are 

insufficient data reporting the co-occurrence in a single sample of fecal indicator E. coli and 

pathogenic organisms and because the available fecal indicator E. coli data from the Six-Year 

Review 2 dataset were limited to presence-absence data, EPA was unable to quantify health 

benefits for the proposed RTCR. EPA used several methods to qualitatively evaluate the benefits 

of the proposed AIP and Alternative options. The qualitative evaluation uses both the judgment 

of EPA as informed by the TCRDSAC deliberations as well as quantitative estimates of changes 

in total coliform occurrence and counts of systems implementing corrective actions. The 

evaluation characterizes, in relative terms, the reduction in risk for each regulatory scenario as 

compared to baseline conditions. 

 

3 There is much discussion among economists of the proper social discount rate to use for policy analysis. 

For RTCR cost analyses, calculations are made using two social discount rates (3 and 7 percent) thought to best 

represent current policy evaluation methodologies. Historically, the use of 3 percent is based on rates of return on 

relatively risk-free investments, as described in the Guidelines for Preparing Economic Analyses (USEPA, 2000c). 

The rate of 7 percent is a recommendation of the Office of Management and Budget (OMB) as an estimate of 

“before-tax rate of return to incremental private investment” (USEPA, 1996b).
Economic Analysis for the Proposed RTCR ES-11 June 2010 

As presented in the description of the baseline (see Chapter 4), the percentages of 

samples that are positive for total coliform and E. coli are generally higher for PWSs serving 

4,100 or fewer people than those serving more than 4,100 people. PWSs with higher total 

coliform and E. coli occurrence are more likely to be triggered into assessments and corrective 

action. As discussed previously, EPA believes that the assessments and corrective action will 

lead to a decrease in total coliform and E. coli occurrence. Because the PWSs serving 4,100 

people or fewer have a higher initial E. coli occurrence and will be triggered into more 

assessments and corrective actions than larger PWSs, the increase in benefits for these small 

systems will likely be more evident as compared to the larger systems. In particular, model 

results suggest that customers of small ground water TNCWSs serving 100 or fewer people, 

which constitute approximately 40 percent of PWSs, experience the most improvement in water 

quality under the proposed RTCR. That is, the occurrence of E. Coli is predicted to decrease 

more for these systems that for other systems types. 

When revising an existing drinking water regulation, one of the main concerns is to 

ensure that backsliding on water quality and public health protection does not occur. SDWA 

requires that EPA at least maintain or improve public health protection for any rule revision. 

EPA believes that the proposed RTCR is more stringent than the current TCR with regard to 

protecting public health. The basis for this perspective is provided in chapters 6 and 9 of this EA. 

Risk reduction for the proposed RTCR is characterized by the activities performed that 

are presumed to reduce risk of exposing the public to contaminated water. These activities are 

considered under each rule component presented in Exhibit ES-3. 

More frequent monitoring has the potential to decrease the risk of contamination in PWSs 

based on an enhanced ability to diagnose and mitigate system issues in a more timely fashion. 

Conversely, less frequent monitoring has the potential to increase risk. Real-time continuous 

sampling would mitigate the most risk possible based on sampling schedule; however, it would 

cost prohibitively more than the periodic sampling practiced under the current TCR and included 

in the AIP and the Alternative options. EPA’s objective in proposing the sampling schedules 

included in the AIP and Alternative options was to find an appropriate balance between the 

factors of risk mitigation and cost management. 

Under the AIP and Alternative options, the reduction in the number of repeat samples and 

additional routine samples for some PWSs has the potential to contribute to increased risk for 

PWS customers. However, this increase in risk is expected to be more than offset by potential 

decreases in risk from increased routine and the addition of the assessments and corrective action 

provisions that find and fix problems indicated by monitoring. Exhibit ES-2 illustrates the 

predicted reduced frequency at which total coliforms occur subsequent to the implementation of 

the AIP and Alternative options. As discussed previously, the proposed RTCR uses total 

coliform and E. coli occurrence as an indicator of potential pathways for possible contamination 

to enter the distribution system. Exhibit ES-2 illustrates the combined effects on total coliform 

occurrence resulting from changes in monitoring and the effects of assessments and corrective 

actions for the different rule options illustrated. The relative trends indicated in Exhibit ES-2 for 

transient noncommunity water systems also pertain to other PWS categories as illustrated in 

Chapter 5. EPA chose to include the characterization for TNCWSs because they represent the 

system category of largest influence on the national impacts. 
Economic Analysis for the Proposed RTCR ES-12 June 2010 

Exhibit ES.2 GW Transient Noncommunity Water System Total Coliform 

Occurrence 

0

0.005

0.01

0.015

0.02

0.025

0.03

0.035

0.04

0.045

0 5 10 15 20 25 30 35

Annual TC Positive Assays Rate

Years

TCR No GWR

TCR

AIP

Alt

Note: 1) Six Year 2005 total coliform-positive occurrence is representative of all GW TNCWS. The rate presented 

may underestimate the occurrence for systems serving 25-4,100 individuals. 2) Graph shows the 30-year modeled 

period discussed in Ch. 5. Model years 3 – 27 represent the 25-year period of analysis for this EA. Model year 11 

begins the steady state, during which systems that qualified for reduced monitoring are now sampling on their 

reduced schedules. The criteria and timing of this monitoring adjustment is discussed in Section 5.3.2.2 of this EA. 

3) The results represented by the curves for TCR and AIP and Alternative options all incorporate the effects of the 

GWR. 

The effect that the proposed changes to public notification requirements for monthly/nonacute MCL violations have on risk is difficult to predict. Some factors, such as reduction in 

available public information and possible PWS complacency, lead to a potential increase in risk 

and other factors, such as less confusion (PN more in line with potential health risks) and PWSs 

resources used more efficiently, lead to a potential decrease, as discussed in Chapter 9. This 

change to PN is addressing a key concern expressed by various stakeholders in the advisory 

committee and during the Six-Year Review 1 comment solicitation process. By eliminating the 

requirement and replacing it with assessment and corrective action requirements, the Agency 

expects less public confusion, more effective use of resources, and increased transparency. Other 

proposed rule components are expected to have a negligible effect on risk. However, the overall 

effect of the proposed RTCR is expected to be a further reduction in risk from the current 

baseline risk under the current TCR. Chapter 6 presents a detailed discussion of the potential 

influence on health risk for each proposed rule component. 
Economic Analysis for the Proposed RTCR ES-13 

Exhibit ES.3 Potential Changes in Risk under the AIP and Alternative Options Relative to th

Proposed Rule 

Component 

Factors Leading to a Potential 

Increase in Risk 

Factors Leading to a Potential Decrease in 

Risk 

Overall Pr

AIP option 

Alternative 

option AIP option 

Alternative 

option AIP optio

Implementation Activities None None None None No changRoutine Monitoring (Including Reduced Monitoring) 

None None 

Increased stringency in requirements to qualify for reduced monitoring along with requirement to return to baseline monitoring upon loss of these criteria is expected to result in decreased risk (i.e., fewer PWSs will qualify and therefore more will monitor more frequently). 

PWSs all monitor monthly in the first few years of implementation of the RTCR, which is an increase in sampling frequency for systems that monitor quarterly or annually under the current TCR. After the first few years, systems may reduce to quarterly, but none may reduce to annual monitoring, creating a decrease in risk for systems on annual monitoring under the current TCR. 

Decreas

Repeat Monitoring 

Required repeat samples reduced from 4 to 3 for systems serving <1,000 people 

Required repeat samples reduced from 4 to 3 for systems serving <1,000 people 

None None Increase 

Additional Additional routine None None Increase 
Economic Analysis for the Proposed RTCR ES-14 

Proposed Rule 

Component 

Factors Leading to a Potential 

Increase in Risk 

Factors Leading to a Potential Decrease in 

Risk 

Overall Pr

Routine Monitoring 

samples are no longer required for PWSs monitoring monthly. Ground water PWSs serving ≤1,000 people would reduce additional routine samples from 5 to 3. 

Additional routine samples are no longer required for PWSs monitoring monthly. Ground water PWSs serving ≤1,000 people would reduce additional routine samples from 5 to 3. 

Annual Inspections 

None (only states currently performing annual inspections are expected to continue) 

Based on discussions with stakeholders, states that currently conduct annual site assessments under the current TCR may no longer have the resources to continue the inspections and conduct quarterly monitoring under the 

None (only states currently performing annual inspections are expected to continue) 

None No chang
Economic Analysis for the Proposed RTCR ES-15 

Proposed Rule 

Component 

Factors Leading to a Potential 

Increase in Risk 

Factors Leading to a Potential Decrease in 

Risk 

Overall Pr

Alternative option. 

Assessments None None 

Mandatory assessments are a new requirement. 

Mandatory assessments are a new requirement. 

Decreas

Corrective Actions None None 

Mandatory corrective actions are a new requirement. 

Mandatory corrective actions are a new requirement. 

Decreas

Public Notification – Monthly/NonAcute MCL Violations 

Reduction in available public information Possible PWS complacency 

Reduction in available public information Possible PWS complacency 

Less confusion (PN more in line with potential health risks) PWS resources used more efficiently 

Less confusion (PN more in line with potential health risks) PWS resources used more efficiently 

Unknow

Public Notification – Monitoring and Reporting Violations 

None None 

Increased stringency of PNs motivates PWSs to conduct required sampling. 

Increased stringency of PNs motivates PWSs to conduct required sampling. 

Decreas

Overall Decreas

Note: Detailed discussion of the rationale for determinations of potential risk for each rule component is presented in Ch. 6 (Section 6Implementation activities consist of administrative activities by PWSs and states to implement the rule. Assessment of potential changes in risk for monitoring components is an overall assessment. Potential changes (or static state) of risk sizes and types differ according to individual regulatory requirements and are discussed in Section 6.2. Chapter 3 provides a detailed regulatory components for all three regulatory scenarios, and the preamble to the RTCR provides additional discussion of the TCRDSArationale underlying the structure of the regulatory options considered.
Economic Analysis for the Proposed RTCR ES-16 June 2010 

Although a qualitative analysis is the primary method employed for analyzing potential 

changes in risk, some quantitative measures are considered in the overall assessment of the 

proposed RTCR, as presented in Chapter 9 of the RTCR EA. In particular, EPA developed a 

model to describe TC and EC occurrence in water systems for the current TCR (baseline for this 

EA) and the proposed RTCR alternatives. The model generates estimates of reduced TC and EC 

occurrence based on requirements of the AIP and Alternative options to perform assessments and 

corrective actions not explicitly required in the current TCR. In addition, the model takes into 

account in the baseline for the current TCR the reductions attributable to the implementation of 

the GWR, which was effective as of December 2009. The predictive occurrence model and 

analyses results are discussed further in Chapters 5, 6, and 9. 

Exhibit ES.4 presents the number of acute violations (current TCR) or E. coli MCL (AIP 

and Alternative options) violations predicted by the RTCR occurrence model to occur under each 

regulatory option considered. These estimates represent the period of analysis beginning in year 

six after promulgation, which begins the steady state following the initial five years during which 

results are skewed by a strong influence from the “All Monthly” sampling under the Alternative 

option. EPA did not quantify changes in violation or trigger rates for systems serving more than 

4,100 people among the current TCR, proposed RTCR, and Alternative options because of: (1) 

limited Six-Year Review data to characterize these systems, (2) the essentially unchanged 

monitoring requirements across options for these systems, and (3) the level of effort already 

occurring to implement the current TCR. 

The estimates of acute violations have two major drivers: the total number of samples 

taken over time (including routine, additional routine, and repeat) and the impact of corrective 

actions taken. When looking at the comparisons between the current TCR option with the 

proposed RTCR across all PWSs, the overall impact of the total numbers of samples taken is 

negligible because the total number of samples predicted to be taken throughout the period of 

analysis is almost the same (approximately 82 million samples) under both the current TCR 

option and the AIP option. For the Alternative option, the analysis predicts that almost 88 million 

total samples will be taken over the period of analysis. 

 The changes in the steady state estimates of annual acute violations from the current TCR 

option to the AIP and Alternative options are shown in Exhibit 6.5. The steady state in the model 

refers to the period beginning in years 7 (CWSs) and 9 (NCWSs) following promulgation, after 

the proportions of systems sampling on monthly, quarterly, or annual regimens are adjusted 

following a period of assessment4

. Systems that qualify for reduced monitoring will begin their 

new regimens in years 7 and 9 after promulgation, respectively, for CWSs and NCWSs. The 

estimates shown in Exhibit ES.4 for small systems are from the predictive model and reflect the 

average annual estimates for the 25-year period of analysis, which includes 3 years of 

implementation followed by 22 years in which new rule requirements are in effect. 

 The steady state reductions in the number of annual acute violations found under the 

proposed RTCR and Alternative option primarily reflect the benefits of corrective actions under 

these two alternatives in preventing many of the acute violations that would otherwise occur over 

this period. Under the proposed RTCR, reductions (or no increases) are predicted for all PWS 

sizes and types, while under the Alternative option, reductions (or no increases) are predicted for 

 

4

 The effective date of the proposed RTCR occurs after 3 years of implementation, at the start of year 4 post 

promulgation. For CWSs, years 4 - 6 post promulgation are the period of assessment for considering potential to 

move to reduced monitoring for systems; for NCWSs, years 4 - 8 are the period of assessment. 
Economic Analysis for the Proposed RTCR ES-17 June 2010 

all PWSs except TNCWSs serving <1,000 people. For these small TNCWSs under the 

Alternative option, increased monitoring is expected to lead to an overall increase in annual 

acute violations (and is also the driver of the greater total number of annual acute violations 

predicted). The interplay of the reducing effect on acute violations that required corrective 

actions induce and the increasing effect from reductions in some monitoring requirements are 

explored in Section 6.4 of this EA. The step-wise analysis presented in Section 6.4 shows how 

acute violations could increase under the Alternative option and concludes that, on balance, more 

acute events are prevented than are missed. 

 
Economic Analysis for the Proposed RTCR ES-18 June 2010 

Exhibit ES.4 Predicted Average Annual Acute (current TCR) or E. coli MCL (AIP and 

Alternative Options) Violations by Regulatory Option and System Type1 

PWS Type

PWS Size

(Population

Served) Number of Systems TCR AIP Option

Alternative 

Option

<100 1,170 7 5 5

101-500 2,150 8 5 5

501-1,000 1,173 5 3 3

1,001-4,100 2,938.0 7.4 6.6 6.6

4,101-33,000 3,164 9 9 9

33,001-96,000 720 3 3 3

96,001-500,000 308 1 1 1

500,001-1 Million 31 0 0 0

> 1 Million 17 0 0 0

Totals 11,671 39 33 33

<100 11,938 52 39 42

101-500 13,892 47 32 34

501-1,000 4,467 13 9 9

1,001-4,100 6,443 22 16 16

4,101-33,000 3,156 12 12 12

33,001-96,000 335 2 2 2

96,001-500,000 63 0 0 0

500,001-1 Million 4 0 00

> 1 Million 3 0 00

Totals 40,301 148 109 116

<100 250 2 1 1

101-500 253 1 1 1

501-1,000 88 0 0 0

1,001-4,100 72 1 1 1

4,101-33,000 22 0 0 0

33,001-96,000 2 0 00

96,001-500,000 1 0 00

500,001-1 Million 0 0 00

> 1 Million 0 0 00

Totals 688 4 3 3

<100 8,826 39 25 33

101-500 6,613 20.31 14.31 20.29

501-1,000 1,718 4.31 3.61 4.51

1,001-4,100 812 8 5 5

4,101-33,000 70 0 0 0

33,001-96,000 2 0 00

96,001-500,000 0 0 00

500,001-1 Million 0 0 00

> 1 Million 0 0 00

Totals 18,041 72 49 63

<100 1,339 20 11 11

101-500 497 8 4 4

501-1,000 88.00 1.25 0.79 0.79

1,001-4,100 67.0 2.3 1.3 1.3

4,101-33,000 18 0 0 0

33,001-96,000 0 0 00

96,001-500,000 0 0 00

500,001-1 Million 0 0 00

> 1 Million 1 0 00

Totals 2,010 31 18 18

<100 60,200 302 249 354

101-500 19,275 94.93 73.11 110.96

501-1,000 1,963 10.07 8.04 10.47

1,001-4,100 617 8 5 5

4,101-33,000 67 0 0 0

33,001-96,000 2 0 00

96,001-500,000 1 0 00

500,001-1 Million 1 0 00

> 1 Million 0 0 00

Totals 82,126 416 336 481

All Systems Grand Total 154,837 710 547 713

TNC GW

CWS SW

CWS GW

NTNC SW

NTNC GW

TNC SW

Source: Output from Proposed RTCR models (described in Sections 5.3 

and 5.4 of this EA). 

1 Average violation estimates are for the 22-year period following the 

effective date of the RTCR and 3 years of implementation activities. 
Economic Analysis for the Proposed RTCR ES-19 June 2010 

ES.5.2 Derivation of Costs 

Costs are estimated for different PWS types and size categories (nine size categories are 

used based on population served) using unit costs developed in the Technology and Cost 

Document for the Proposed Revised Total Coliform Rule (USEPA, 2010d). Cost analyses for 

PWSs include estimates to implement the rule; to revise sampling plans; to conduct routine 

monitoring, additional routine monitoring, and repeat monitoring; to perform Level 1 and Level 

2 assessments and implement corrective actions; and to provide public notification in the case of 

violations. State cost analyses include estimates of the labor burdens that states would incur, 

including staff training on proposed RTCR requirements, conducting annual administration, 

reviewing monitoring reports, reviewing and approving corrective action plans, and for 

recordkeeping. Chapter 7 of this EA provides detailed discussion on the underlying cost-buildup 

for each rule component included in the cost model. 

National costs are estimated using a cost model specifically developed for the proposed 

RTCR. The model builds on the occurrence model described in Chapter 5. Within the modeling 

structure, costs for PWSs serving 4,100 or more retail customers are analyzed differently from 

smaller PWSs to capture differing baseline structures and to account for differences in available 

occurrence data as described in Chapter 4 of this EA. The resulting national cost estimates for 

the RTCR regulatory options considered are shown in Exhibit ES.5. To evaluate the impact of 

costs under the proposed RTCR, emphasis in this EA is placed on the net changes in costs of the 

AIP or Alternative options compared to the current TCR, also shown in Exhibit ES.5. 

As noted throughout the RTCR EA, there is variability among many of the input 

parameters to the proposed cost model and several rule compliance assumptions based on PWS 

size and type (e.g., population served, labor rates, TC hit rates, and occurrence distributions are 

different for different sizes and types of PWSs). However, there is insufficient information to 

fully characterize the distribution of variability (i.e., calculating confidence bounds) within each 

of these PWS classifications on a national scale; therefore, EPA uses mean values for these input 

parameters. 

EPA also recognizes that there is uncertainty in the national cost estimates. Many of the 

uncertainties have the same impact on both the TCR and AIP and Alternative options (e.g., 

baseline assumptions and effects of GWR implementation). Because the EA analyses focus on 

net changes between the TCR and the AIP and Alternative options, these common sources of 

uncertainty do not impact conclusions based on the net change analyses. For assumptions that are 

major drivers of the analyses and differ between the TCR and AIP and Alternative options (e.g., 

corrective action compliance forecast), EPA has evaluated uncertainty and performed sensitivity 

analyses to qualitatively and quantitatively characterize the potential impacts of alternative input 

parameters. Chapters 4 and 5 present a comprehensive discussion of factors contributing 

uncertainty to the occurrence analysis. Chapter 5 presents a sensitivity analysis pertaining to the 

predictive occurrence model results, which also impact the cost calculations. Section 7.7 of the 

EA discusses uncertainty and provides sensitivity analysis results as they specifically pertain to 

the cost analyses. 
Economic Analysis for the Proposed RTCR ES-20 June 2010 

 Exhibit ES.5 Comparison of Total and Net Change from Current TCR in 

Annualized Present Value Costs ($Millions, 2007$) 

Source: Proposed RTCR cost model. 

Notes: 

1) Detail may not add due to independent rounding. 

2) Annualized costs are greater using the 7% than 3% discount rate for the Alternative option. This occurs because 

the costs under the Alternative option are front-loaded in the 25-year time period due to the all-monthly sampling 

requirement (which doesn’t occur under the AIP option). Discounting a given stream using 3% and 7% will always 

result in a higher present value using 3%; annualization of an identical value (any value) using 3% and 7% would 

result in a higher value under 7%. Depending on how costs accrue over the period, and how long the period is, one 

effect will be stronger than the other. Generally, the discounting effect is stronger, resulting in the pattern commonly 

seen where the 3% annualized amount is greater than the 7% one. However, in cases like the Alternative option 

where the costs accrue faster early in the time period, the annualization effect can more than compensate for the 

discounting effect, resulting in a higher annualized value under 7% compared to 3%. 

ES.6 Projected Impacts on Household Costs 

The household cost analysis considers the impact that the costs incurred by CWSs have 

on the households they serve. This analysis considers the potential increase in a household’s 

water bill if a CWS passed the entire cost increase resulting from the proposed rule on to their 

customers. This analysis is a tool to gauge potential impacts and should not be construed as a 

precise estimate of potential changes to household water bills. State costs and costs to TNCWSs 

and NTNCWSs are not included in this analysis since their costs are not typically passed through 

directly to households. Exhibit ES.6 presents the mean expected increases in annual household 

costs for all CWSs, including those systems that do not have to take corrective action. Exhibit 

ES.6 also presents the same information for CWSs that must take corrective action. Household 

costs tend to decrease as system size increases, due mainly to the economies of scale for the 

corrective actions. 

The first section of Exhibit ES.6 presents net costs per household under the AIP and 

Alternative options for all rule components spread across all CWSs. In this scenario, comparison 

to the current TCR shows a cost savings for some households. For those households that are 

expected to see a cost increase, the average annual water bill would be expected to increase by 

less than ten cents on average. 

While the average increase in annual household water bills to implement the proposed 

RTCR is less than a dollar, customers served by a small CWS that have to take corrective actions 

as a result of the proposed rule would incur slightly larger increases in their water bills. The 

subsequent sections of the exhibit present net costs per household for three different subsets of 

CWSs (e.g., CWSs that perform assessments but no corrective actions, CWSs that do perform 

corrective actions, and CWSs that do not perform assessments or corrective actions). As shown 

in the second section of Exhibit ES.6, approximately 67% of households are served by CWSs 

that perform assessments but do not perform corrective actions over the 25-year period of 

PWSs State Total PWSs State Total

TCR - Total $ 0.9 185 $ 186 $ 178 $ 0.9 $ 179 $ 

AIP - Total $ 1.1 199 $ 200 $ 191 $ 1.3 $ 192 $ 

AIP - Net Change 14 $ 0.1 $ 14 $ 13 $ 0.4 $ 14 $ 

AIP - Percent Change 7% 16% 7% 7% 48% 8%

Alternative Option - Total $ 1.2 212 $ 213 $ 207 $ 1.5 $ 209 $ 

Alternative Option - Net Change 27 $ 0.3 $ 27 $ 29 $ 0.6 $ 30 $ 

Alternative Option - Percent Change 15% 32% 15% 16% 67% 17%

3% Discount Rate 7% Discount Rate
Economic Analysis for the Proposed RTCR ES-21 June 2010 

analysis. The 9% of households belonging to CWSs that would perform corrective actions would 

experience an increase in annual net household costs of less than $1 on average for CWSs 

serving >4,100 people to approximately $23 for CWSs serving 100 people or fewer. 

The final section of the exhibit presents the 24% of households belonging to CWSs that 

would not perform assessments or corrective actions. Households of this category would 

experience an increase in cost savings comparable to those performing corrective actions, and a 

decrease in cost savings compared to those performing assessments but no corrective actions. 

This decrease in costs savings is because no PN costs are associated with systems not performing 

assessments. Overall, the main driver of additional household costs under the proposed RTCR is 

whether or not additional corrective actions are performed. 
Economic Analysis for the Proposed RTCR ES-22 June 2010 

Exhibit ES.6 Summary of Net Annual Per-Household Costs for the Proposed 

RTCR (2007$) 

AIP Net

AIP Net Cost per 

Houshold

Alternative 

Option Net

Alternative 

Option Net 

Cost per 

Household AIP Net

AIP Net 

Cost per 

Houshold

Alternative 

Option Net

Alternative 

Option Net 

Cost per 

Household

A B C D=C/A E F=E/B G H=G/A I J=I/B

≤100 307,243 307,243 68,433 $ 0.223 $ 180,905 $ 0.589 $ 170,417 $ 0.555 $ 310,914 $ 1.012 $ 

101-500 1,589,510 1,589,510 323,373 $ 0.203 $ 417,352 $ 0.263 $ 430,801 $ 0.271 $ 557,863 $ 0.351 $ 

501-1,000 1,624,853 1,624,853 35,455 $ 0.022 $ 75,901 $ 0.047 $ 86,936 $ 0.054 $ 138,624 $ 0.085 $ 

1,001-4,100 7,816,592 7,816,592 335,846 $ 0.043 $ 335,846 $ 0.043 $ 390,122 $ 0.050 $ 390,122 $ 0.050 $ 

4,101-33,000 27,997,647 27,997,647 2,295,169 $ 0.082 $ 2,295,169 $ 0.082 $ 2,007,071 $ 0.072 $ 2,007,071 $ 0.072 $ 

33,001-96,000 21,933,438 21,933,438 1,547,791 $ 0.071 $ 1,547,791 $ 0.071 $ 1,284,124 $ 0.059 $ 1,284,124 $ 0.059 $ 

96,001-500,000 26,770,609 26,770,609 1,463,800 $ 0.055 $ 1,463,800 $ 0.055 $ 1,199,384 $ 0.045 $ 1,199,384 $ 0.045 $ 

500,001-1 Million 9,764,979 9,764,979 153,975 $ 0.016 $ 153,975 $ 0.016 $ 122,635 $ 0.013 $ 122,635 $ 0.013 $ 

> 1 Million 16,309,853 16,309,853 (4,876) $ (0.000) $ (4,876) $ (0.000) $ (4,023) $ (0.000) $ (4,023) $ (0.000) $ 

Total 114,114,724 114,114,724 6,218,966 $ 0.054 $ 6,465,863 $ 0.057 $ 5,687,467 $ 0.050 $ 6,006,714 $ 0.053 $ 

≤100 125,340 124,920 (187,747) $ (1.498) $ (151,107) $ (1.210) $ (126,913) $ (1.013) $ (77,760) $ (0.622) $ 

101-500 460,577 464,568 (138,181) $ (0.300) $ (104,157) $ (0.224) $ (83,851) $ (0.182) $ (41,251) $ (0.089) $ 

501-1,000 394,643 401,009 (132,431) $ (0.336) $ (122,868) $ (0.306) $ (110,140) $ (0.279) $ (97,592) $ (0.243) $ 

1,001-4,100 2,341,578 2,341,578 (261,760) $ (0.112) $ (261,760) $ (0.112) $ (212,565) $ (0.091) $ (212,565) $ (0.091) $ 

4,101-33,000 24,827,588 24,827,588 (207,674) $ (0.008) $ (207,674) $ (0.008) $ (88,472) $ (0.004) $ (88,472) $ (0.004) $ 

33,001-96,000 19,232,570 19,232,570 (187,918) $ (0.010) $ (187,918) $ (0.010) $ (156,652) $ (0.008) $ (156,652) $ (0.008) $ 

96,001-500,000 23,912,325 23,912,325 (162,082) $ (0.007) $ (162,082) $ (0.007) $ (146,737) $ (0.006) $ (146,737) $ (0.006) $ 

500,001-1 Million 5,524,188 5,524,188 (45,790) $ (0.008) $ (45,790) $ (0.008) $ (42,392) $ (0.008) $ (42,392) $ (0.008) $ 

> 1 Million - - - $ - $ - $ - $ - $ - $ - $ - $ 

Total 76,818,809 76,828,746 (1,323,584) $ (0.017) $ (1,243,356) $ (0.016) $ (967,721) $ (0.013) $ (863,420) $ (0.011) $ 

≤100 13,927 13,880 325,679 $ 23.385 $ 347,280 $ 25.020 $ 296,928 $ 21.321 $ 318,549 $ 22.950 $ 

101-500 51,175 51,619 469,264 $ 9.170 $ 462,084 $ 8.952 $ 412,574 $ 8.062 $ 410,784 $ 7.958 $ 

501-1,000 43,849 44,557 164,754 $ 3.757 $ 167,578 $ 3.761 $ 143,922 $ 3.282 $ 146,752 $ 3.294 $ 

1,001-4,100 260,175 260,175 556,364 $ 2.138 $ 556,364 $ 2.138 $ 484,508 $ 1.862 $ 484,508 $ 1.862 $ 

4,101-33,000 3,170,059 3,170,059 2,526,599 $ 0.797 $ 2,526,599 $ 0.797 $ 2,132,792 $ 0.673 $ 2,132,792 $ 0.673 $ 

33,001-96,000 2,700,868 2,700,868 1,736,797 $ 0.643 $ 1,736,797 $ 0.643 $ 1,446,819 $ 0.536 $ 1,446,819 $ 0.536 $ 

96,001-500,000 2,858,284 2,858,284 1,624,577 $ 0.568 $ 1,624,577 $ 0.568 $ 1,345,503 $ 0.471 $ 1,345,503 $ 0.471 $ 

500,001-1 Million 613,799 613,799 194,889 $ 0.318 $ 194,889 $ 0.318 $ 161,003 $ 0.262 $ 161,003 $ 0.262 $ 

> 1 Million - - - $ - $ - $ - $ - $ - $ - $ - $ 

Total 9,712,136 9,713,240 7,598,924 $ 0.782 $ 7,616,167 $ 0.784 $ 6,424,050 $ 0.661 $ 6,446,711 $ 0.664 $ 

≤100 167,976 168,442 (69,499) (0.414) $ (15,268) (0.091) $ 402 0.002 $ 70,124 0.416 $ 

101-500 1,077,758 1,073,324 (7,710) (0.007) $ 59,425 0.055 $ 102,079 0.095 $ 188,331 0.175 $ 

501-1,000 1,186,361 1,179,288 3,132 0.003 $ 31,191 0.026 $ 53,154 0.045 $ 89,464 0.076 $ 

1,001-4,100 5,214,839 5,214,839 41,242 0.008 $ 41,242 0.008 $ 118,178 0.023 $ 118,178 0.023 $ 

4,101-33,000 - - - - $ - - $ - - $ - - $ 

33,001-96,000 - - - - $ - - $ - - $ - - $ 

96,001-500,000 - - - - $ - - $ - - $ - - $ 

500,001-1 Million 3,626,992 3,626,992 - - $ - - $ - - $ - - $ 

> 1 Million 16,309,853 16,309,853 - - $ - - $ - - $ - - $ 

Total 27,583,779 27,572,738 (32,836) $ (0.001) $ 116,591 $ 0.004 $ 273,813 $ 0.010 $ 466,097 $ 0.017 $ 

Source:

(C), (E), (G), (I) Exhibit 7.28.

Community Water Systems (CWSs) not performing Level 1/Level 2 Assessments, or Corrective Actions

Number of 

Households 

(Alternative 

Option)

Community Water Systems (CWSs) performing Level 1/Level 2 Assessments (and no Corrective Actions)

Community Water Systems (CWSs) performing Corrective Actions

7% Discount Rate

PWS Size

(Population

Served)

3% Discount Rate

Number of 

Households 

(AIP)

All Community Water Systems (CWSs)

Source: Exhibit 7.23 

ES.7 Comparison of Benefits and Costs, and Regulatory Alternatives of the 

Proposed RTCR 

As required by the SDWA, EPA has determined that the benefits of the proposed RTCR 

justify the costs. In making this determination, EPA considered quantified and nonquantified 

benefits and costs as well as the other components of the HRRCA outlined in section 1412 

(b)(3)(C) of the SDWA. 
Economic Analysis for the Proposed RTCR ES-23 June 2010 

Additionally, EPA used several other techniques to compare benefits and costs including 

a break-even analysis and a cost effectiveness analysis. The break-even analysis (see Chapter 9 

of the proposed RTCR EA) was conducted using two example pathogens responsible for some 

(unknown) proportion of waterborne illness in the United States. The analysis shows that a 

relatively small number of cases (based on E. coli O157:H7 or Salmonella) would need to be 

avoided for the rule to break-even with the best estimates of net costs. 

Under the AIP option, just two deaths would need to be avoided annually using a 3% 

discount rate based on consideration of the bacterial pathogen STEC O157. Alternatively, 

approximately 3,000 or 8,000 non-fatal cases, using the enhanced or traditional benefits 

valuations approaches5

, respectively, would need to be avoided to break even with rule costs. As 

expected based on its costs, the Alternative option would require that a higher number of cases 

be avoided annually for that option to break even (approximately 60% to 100% more than the 

AIP option under the traditional and enhanced approaches, respectively). 

As Exhibit 9.21 shows, approximately 2 deaths would need to be avoided from a 

Salmonella infection for the rule to break even. The estimated number of non-fatal Salmonella 

cases that would need to be avoided to break even is approximately 10,000 or 65,000 cases under 

the enhanced and traditional benefits valuations approaches, respectively. 

As the discussion presented in Chapter 2 of this EA describes, disease and deaths are 

attributable to drinking water contamination across the country. The CDC has found that 15% of 

outbreak cases of STEC 0157:H7 are waterborne (Rangel et al., 2005); if that rate applies as well 

to endemic cases, then approximately 11,000 cases would be due to waterborne exposure to 

STEC 0157:H7 and could be mitigated. Based on that assumption, up to 11,000 cases annually 

may be avoided by measures that mitigate pathways of contamination into PWSs for just this one 

potential contaminant. That amount of reduction in terms of STEC 0157:H7 would be enough for 

the rule to break even based on either the enhanced or traditional cost of illness approaches. If 

more than one contaminant was reduced or prevented from occurring in PWSs, the rule would be 

that much more likely to break even. Avoided illness and death from secondary transmission of 

infection could also be significant. Additionally, fewer cases would need to be avoided if all the 

benefits of the rule as described in chapter 6 were included in the analysis. If increased 

assessments and corrective actions result in a level of knowledge of the system that enables 

earlier mitigation of potential pathways of contamination, then additional illnesses or deaths may 

be avoided beyond those suggested by the decrease in acute events that the model predicts. In the 

case of the outbreak of Salmonella infections in Alamosa, Colorado, as described in Chapter 9 of 

the EA, some of the key factors that contributed to the outbreak include significant levels of 

sediment and the presence of breaches to the integrity of the storage tank. 

Chapter 9 of the proposed RTCR EA has a complete discussion of the break-even 

analysis and how costs per case were calculated. 

 

5

 Both traditional and enhanced COI approaches count the value of the direct medical costs and of time lost that 

would been spent working for a wage, but differ in their assessment of the value of time lost that would be spent in 

nonmarket work (e.g. housework, yardwork, and raising children) and leisure (e.g. recreation, family time, and 

sleep). They also differ in their valuation of (other) disutility, which encompasses a range of factors of well being, 

including both inconvenience and any pain and suffering. A complete discussion of the traditional and enhanced 

COI approaches can be found in Appendix E. 
Economic Analysis for the Proposed RTCR ES-24 June 2010 

Exhibit ES.7 Estimated Annual Breakeven Threshold for Avoided Cases of STEC 

O157 

Non‐fatal

cases only

Fatal cases

only1

Non‐fatal

cases only

Fatal cases

only1

3% 8,000                1.6 16,000         3.1

7% 8,000                1.5 17,000         3.4

3% 3,000                1.6 5,000           3.1

7% 3,000                1.5 6,000           3.4

COI

Methodology

Discount

Rate

AIP Option Alternative Option

Traditional

COI

Enhanced COI

1 Calculations for fatal cases include the non-fatal COI component for the underlying 

illness prior to death. 

Notes: The number of cases needed to reach break-even threshold calculated by dividing 

the net change in costs for the RTCR (Exhibit 9.5) by the average estimated value of 

avoided cases (Exhibit 9.18). Threshold estimates based on a weighted average of the 

cost of “all cases” that includes both fatal and non-fatal cases is shown in Appendix E. 

STEC O157 is only an example of a pathogenic endpoint that could have been used for 

this analysis. Use of additional pathogenic contaminants in addition to this single endpoint 

would result in lower threshold values. Detail may not add due to independent rounding. 

The break-even threshold is higher using a 7% discount rate than a 3% discount rate 

under the Alternative option. This result is consistent with the annualized costs of the 

Alternative option being higher using the 7% discount rate, which is caused by the 

frontloading of costs in the period of analysis, as explained further in Chapter 7 of the EA. 

Exhibit ES.8 Estimated Annual Breakeven Threshold for Avoided Cases of 

Salmonella 

Non‐fatal

cases only

Fatal cases

only1

Non‐fatal

cases only

Fatal cases

only1

3% 65,000             1.6 130,000       3.1

7% 65,000             1.6 141,000       3.4

3% 10,000             1.6 20,000         3.1

7% 10,000             1.6 21,000         3.4

AIP Option Alternative Option

Traditional

COI

Enhanced COI

COI

Methodology

Discount

Rate

1

Note: Calculations for fatal cases include the non-fatal COI component for the underlying 

illness prior to death. 

Note: The number of cases needed to reach break-even threshold calculated by dividing 

the net change in costs for the RTCR (Exhibit 9.5) by the average estimated value of 

avoided cases (Exhibit 9.19). Threshold estimates based on a weighted average of the 

cost of “all cases” that includes both fatal and non-fatal cases is shown in Appendix E. 

Salmonella is only an example of a pathogenic endpoint that could have been used for 

this analysis. Use of additional pathogenic contaminants in addition to this single endpoint 

would result in lower threshold values. Detail may not add due to independent rounding. 

The break-even threshold is higher using a 7% discount rate than a 3% discount rate 

under the Alternative option. This result is consistent with the annualized costs of the 

Alternative option being higher using the 7% discount rate, which is caused by the 

frontloading of costs in the period of analysis, as explained further in Chapter 7 of the EA.
Economic Analysis for the Proposed RTCR ES-25 June 2010 

Cost effectiveness is another way of examining the benefits and costs of the proposed 

rule. ES.9 shows the cost of the rule per corrective action implemented. The cost effectiveness 

analysis, as with the net benefits, is limited because EPA was able to only partially quantify and 

monetize the benefits of the proposed RTCR. The AIP option achieves the lowest cost per 

corrective action implemented among the options considered. 

Exhibit ES.9 Total Net Annual Cost Per Corrective Action Implemented under AIP 

and Alternative Options, Annualized Using 3% and 7% Discount Rates ($2007) 

Regulatory Scenario 3% Discount Rate 7% Discount Rate

AIP Net Cost 13.7 $ 13.7 $ 

AIP Net Corrective Actions (L1 & L2) 598 555

AIP CEA (net rule cost/CA) 22,899 $ 24,610 $ 

Alternative Option Net Cost 27.2 $ 29.7 $ 

Alternative Option Net Corrective Actions (L1 & L2) 785 765

Alternative Option CEA (net rule cost/CA) 34,718 $ 38,812 $ 

Notes: Exhibit includes only the number of corrective actions predicted by the RTCR occurrence model to be 

implemented in addition to those implemented under the current TCR. Includes both L1 & L2 corrective actions. Total 

net costs for each option and total CAs (not incremental) are shown in Exhibit 9.15. Detailed benefits and cost 

information is provided in Appendices A and C, respectively, of this EA. 

EPA also considered the incremental cost effectiveness of the AIP option as compared to 

the Alternative option to determine the additional benefit associated with that portion of cost for 

the Alternative option that exceeds the cost of the proposed RTCR. Exhibit ES.9 shows that in 

incremental terms for all PWSs, the AIP option has a far lower unit cost per unit benefit than the 

Alternative option. EPA further considered the group of 60,200 TNCWSs using GW, which are 

the largest subset of systems by size and type, and which are expected to bear the highest burden 

under the AIP option. ES.10 shows that in incremental terms, the cost effectiveness of the AIP 

far exceeds that of the Alternative options using either a 3% or 7% discount rate. The two 

incremental analyses (ES.9 and ES.10) together indicate that the AIP option is significantly more 

cost effective than the Alternative option for the most burdened subset of systems and for the all 

PWSs together. Additional information about this analysis and other methods used to compare 

benefits and costs can be found in Chapter 9 of the proposed RTCR EA. 
Economic Analysis for the Proposed RTCR ES-26 June 2010 

Exhibit ES.10 Incremental Rule Cost Per Corrective Action Implemented under 

AIP and Alternative Options, Annualized Using 3 and 7 Percent Discount Rates 

($2007) 

Regulatory Scenario 3% Discount Rate 7% Discount Rate

AIP Incremental Net Costs ($ millions)1 $ 13.7 13.7 $ 

AIP Incremental Net Corrective Actions (L1 & L2)1 598 555

AIP Incremental Cost per CA ($) $ 24,613 22,902 $ 

Alternative Option Incremental Net Costs ($ millions)2 $ 16.0 13.5 $ 

Alternative Option Incremental Net Corrective Actions (L1 & L2)2 187 210

Alternative Option Incremental Cost per CA ($) $ 76,299 72,582 $ 

Notes: Exhibit includes only the number of corrective actions predicted by the RTCR occurrence model to be 

implemented in addition to those implemented under the current TCR. Includes both L1 & L2 corrective actions. Total 

net costs for each option and total CAs (not incremental) are shown in Exhibit 9.15. Detailed benefits and cost 

information is provided in Appendices A and C, respectively, of this EA. 

1 Represents the incremental increase of the AIP option over the current TCR. 2

 Represents the incremental increase of the Alternative option over AIP option. Add incremental net values for 

Alternative option to incremental net values for AIP option to calculate total net values of Alternative option over 

current TCR. 

Exhibit ES.11 Incremental Rule Cost Per Corrective Action for TNCWSs using 

GW (Serving <100 People) Implemented under AIP and Alternative options, 

Annualized Using 3 and 7 Percent Discount Rates ($2007) 

Regulatory Scenario 3% Discount Rate 7% Discount Rate

AIP Incremental Net Costs ($ millions)1 $ 5.1 5.1 $ 

AIP Incremental Corrective Actions (L1 & L2) (TNCWS <101 only)1 279 257

AIP Incremental Cost per CA ($) $ 19,965 18,219 $ 

Alternative Option Incremental Net Costs ($ millions)2 $ 9.8 8.3 $ 

Alternative Option Incremental Corrective Actions (L1 & L2) (TNCWS <101 only)2 128 145

Alternative Option Incremental Cost per CA ($) $ 67,762 64,731 $ 

Notes: Detail may not add due to independent rounding. Incremental Net Costs are based on TNCWS serving <101 

people. Detailed benefits and cost information is provided in Appendices A and C, respectively, of this EA. 1

 Represents the incremental increase of the AIP option over the current TCR. 2

 Represents the incremental increase of the Alternative option over AIP option. Add incremental net values for 

Alternative option to incremental net values for AIP option to calculate total net values of Alternative option over 

current TCR. 

ES.8 Conclusion 

EPA is proposing the RTCR as described by the AIP option to further reduce occurrence 

of TC and EC (and any waterborne pathogens that may co-occur) beyond the reductions 

achieved under the TCR. EPA’s goal is to increase public health protection from potential fecal 

contamination and/or waterborne pathogen exposure, while continuing to pursue the objectives 

of the current TCR. Although EPA's analysis of the proposed RTCR has determined that its 

annual costs are most likely below the threshold stated in Executive Order 12866 of $100 

million, EPA has chosen to publish a complete EA for this rule. 

EPA has developed the proposed RTCR based on the AIP because it will not allow for 

backsliding from current levels of protection of public health and will likely reduce risk from 

waterborne disease further while costing relatively little on a net basis. This conclusion is 
Economic Analysis for the Proposed RTCR ES-27 June 2010 

consistent with recommendations of the TCRDSAC. As required by the SDWA, EPA has 

determined that the benefits of the proposed RTCR justify the costs. In making this 

determination, EPA considered quantified and nonquantified benefits and costs as well as the 

other components of the HRRCA outlined in section 1412 (b)(3)(C) of the SDWA. 

As shown in the uncertainty analysis presented in Chapter 6 (section 6.4), reducing repeat 

samples and additional samples both have the potential to increase risk for some PWSs (see also 

sections III.A.3 and III.A.4 of the proposed RTCR preamble for discussions on the repeat sample 

and additional routine sample provisions respectively). However, this increase in risk is expected 

to be more than offset by potential decreases in risk from increased routine monitoring and the 

addition of the assessments and corrective action provisions that find and fix problems indicated 

by monitoring. That is, based on the analyses presented in this EA, EPA concludes that the effect 

of the corrective actions outweighs that of reduced sampling; both the AIP and the Alternative 

options are expected to result in a net decrease in risk as compared to the current TCR. Although 

the Alternative option decreases risk to a greater degree than the AIP option (proposed RTCR), 

this additional reduction is achieved at a higher cost, both in absolute terms and in terms of costeffectiveness. The estimated net cost of the AIP option is small (approximately $14 million 

annually using either a 3% or 7% discount rate) compared to the Alternative option ($27 – $30 

million using a 3% and 7% discount rate, respectively). This cost differential is especially 

important considering the potential concentration of impacts on the smallest TNCWSs and the 

potential front loading of costs under the Alternative option. In addition, the net benefits are 

expected to be positive under the AIP option and no backsliding in overall risk is predicted. 

While the number of corrective actions under the Alternative option would be greater than under 

the AIP option, the achievement of these benefits is not as cost effective as under the AIP option. 

The analyses performed as part of this EA support the collective judgment and consensus 

of the TCRDSAC that the proposed RTCR requirements provide for effective and efficient 

revisions to current TCR regulatory requirements. 
Economic Analysis for the Proposed RTCR 1-1 June 2010 

1. Introduction 

This Economic Analysis (EA) presents the evaluation of the benefits and costs of the 

proposed Revised Total Coliform Rule (RTCR). The analysis is performed in compliance with 

Executive Order 12866, Regulatory Planning and Review (58 FR 51735), which requires the 

United States Environmental Protection Agency (EPA) to estimate the economic impact of rules 

that have an annual effect on the economy of over $100 million and make that analysis available 

to the public in conjunction with publication of the final rule. Although EPA's analysis of the 

proposed RTCR has determined that its annual costs are most likely below this threshold, EPA 

has chosen to publish a complete EA for this rule.

EPA developed the proposed RTCR in collaboration with states, other interested 

stakeholders, and the Total Coliform Rule/Distribution System Advisory Committee 

(TCRDSAC). In the Six-Year Review determination published in July 2003, EPA gave notice of 

its intent to review the Total Coliform Rule (TCR). The Agency’s primary reasons for revising 

the 1989 Total Coliform Rule are implementation-related issues. The proposed revisions offer a 

meaningful opportunity for greater public health protection against waterborne pathogens in the 

distribution systems of public water systems beyond the current Total Coliform Rule. 

This chapter provides a summary of the proposed RTCR in Section 1.1. Section 1.2 

outlines the organization of this EA, and Section 1.3 provides information regarding supporting 

calculations and citations. 

1.1 Summary of the Proposed Revised Total Coliform Rule (RTCR) 

The proposed RTCR applies to all community and noncommunity Public Water Systems 

(PWSs). The proposed RTCR takes a proactive approach to protect public health, maintaining a 

Maximum Contaminant Level Goal (MCLG) and Maximum Contaminant Level (MCL) for E. 

coli and using both E. coli and Total Coliform (TC) monitoring to establish a framework for 

PWSs to assess for sanitary defects and to correct them as appropriate. 

Like the requirements of the current TCR, the requirements of the proposed RTCR ensure 

that PWSs address the following objectives: 

y Evaluate the effectiveness of treatment 

y Determine the integrity of the distribution system; and 

y Signal the possible presence of fecal contamination. 
Economic Analysis for the Proposed RTCR 1-2 June 2010 

 To accomplish the above objectives, the proposed RTCR will use TC as an indicator to 

start an evaluation process that, where necessary, will require the PWS to correct sanitary 

defects, defined in the proposed RTCR as: 

A defect that could provide a pathway of entry for microbial contamination into the 

distribution system or that is indicative of a failure or imminent failure in a barrier that is 

already in place. 

Under the proposed RTCR, E. coli will remain a regulated contaminant with an MCLG of 

zero and an MCL of zero. All fecal coliform provisions (including the MCLG and MCL) are 

removed in the proposed RTCR. There will no longer be an MCL for TC: instead, TC will be 

used as an indicator as part of a coliform treatment technique. 

For all PWSs serving >4,100 people, monitoring requirements under the proposed RTCR 

remain essentially unchanged from existing TCR requirements. However, PWSs serving ≤4,100 

people may face changes in their required monitoring schemes depending on specific size, type, 

and source water categorizations. Changes for these PWSs may be for routine, additional routine 

or repeat monitoring as summarized in Exhibit 1.1 below. 

Under the proposed RTCR, PWSs must complete Level 1 or Level 2 assessments to 

identify the presence of “sanitary defects” and defects in distribution system coliform monitoring 

practices if sampling results in one of the following triggers listed below. 

Level 1 Assessment Triggers 

y For PWSs taking 40 or more samples per month, the PWS exceeds 5.0% TC-positive 

samples for the month; or 

y For PWSs taking fewer than 40 samples per month, the PWS has two or more TC 

positive samples in the same month; or 

y Failure to take every required repeat sample after a single routine TC-positive sample. 

Level 2 Assessment Triggers 

y The PWS has an E. coli violation (See Section III.A.6 of the proposed RTCR 

preamble for a description of what constitutes an E. coli MCL violation.); or 

y The PWS has a second Level 1 treatment trigger within a rolling 12-month period, 

unless the first Level 1 treatment trigger was based on exceeding the allowable 

number of total coliform-positive samples, the State has determined a likely reason 

for the total coliform-positive samples that caused the initial Level 1 treatment 

trigger, and the State establishes that the system has fully corrected the problem; 

y For PWSs with approved reduced annual monitoring, a Level 1 treatment technique 

trigger in two consecutive years. 
Economic Analysis for the Proposed RTCR 1-3 June 2010 

Exhibit 1.1 Proposed RTCR Monitoring Frequency Requirements (AIP Option) 

PWS Type Source Population Served Monitoring Requirements 

Routine Monitoring1

Noncommunity 

(NCWS) 

Ground water ≤ 1,000 people Quarterly monitoring for TC2

Additional 

requirements to qualify for reduced monitoring 

apply3

Community 

(CWS) 

Ground water ≤ 1,000 people Monthly monitoring for TC

Additional requirements to qualify for reduced 

monitoring apply4

All 

(CWS & 

NCWS) 

Surface water All Same requirements as under current TCR 

(Monthly monitoring for TC) 

Ground water > 1,000 people Same requirements as under current TCR 

(Monthly monitoring for TC) 

Additional Routine Monitoring 

All 

(CWS & 

NCWS) 

Ground water ≤ 1,000 people Additional routine monitoring no longer 

required if monitoring monthly 

Number of additional routine samples required 

reduced from five to three if monitoring 

quarterly or annually 

Ground water 1,101 – 4,100 

people 

Additional routine monitoring no longer 

required 

Surface water ≤ 4,100 people Additional routine monitoring no longer 

required 

Ground and 

surface water 

> 4,100 people Same requirements as under current TCR 

(Additional routine monitoring not required) 

Repeat Monitoring 

All 

(CWS & 

NCWS) 

Ground and 

surface water 

≤ 1,000 people Number of repeat samples required reduced 

from four to three 

Ground and 

surface water 

>1,000 people Same requirements as under current TCR 

(Three repeat samples required) 

1

 Seasonal PWSs serving ≤ 1000 people are required to sample monthly while in service but may qualify for reduced 

monitoring. 

2

 PWSs may be increased to monthly monitoring based on compliance with rule. Examples include system with Level 

2 assessment violation, an E. coli MCL violation, an RTCR treatment technique violation, and /or two routine 

monitoring violations in a rolling 12-month period. 

3 PWSs may qualify for annual monitoring based on compliance record, the existence of enhancements to water 

system barriers to contamination, and completion of an initial and recurring annual site visit conducted by the state or 

an annual voluntary Level 2 assessment by a party approved by the state. 

4 PWSs may qualify for quarterly monitoring based on compliance record and either the existence of enhancements 

to water system barriers to contamination or the completion of an annual site visit conducted by the state or an 

annual voluntary Level 2 assessment by a party approved by the state. 
Economic Analysis for the Proposed RTCR 1-4 June 2010 

 The PWS shall be responsible for correcting sanitary defects found through either Level 1 

or Level 2 assessments as defined above by implementing appropriate corrective actions. Failure 

to complete a required assessment or take necessary corrective action constitutes a Treatment 

Technique violation under the proposed RTCR. 

The proposed RTCR requires public notification for three events that are tiered as 

follows: 

Tier 1. E. coli MCL violation 

Tier 2. Treatment technique (TT) violation 

Tier 3. Routine monitoring violation 

The proposed RTCR also provides the primacy agency with the discretion to reduce the 

monitoring frequency for well operated ground water PWSs serving ≤1,000 people, if the PWS 

can demonstrate that it meets the criteria for reduced monitoring stipulated in the rule. The 

specific criteria to qualify for reduced monitoring are described in Chapter 3. 

 Ground Water Rule (GWR) implementation will occur prior to the transition from the 

TCR to the proposed RTCR. Compliance with the GWR requirements, including sanitary 

surveys and site visits, can be used to help determine the level of monitoring required for ground 

water PWSs serving ≤1,000 people. 

1.2 Document Organization 

 The remainder of this EA is organized into the following chapters: 

y Chapter 2 summarizes the technical, regulatory, and public health issues addressed by 

the proposed rule. It also explains the statutory authority for the proposed RTCR and 

the economic rationale for the regulatory approach. 

y Chapter 3 reviews various regulatory options that EPA considered during the 

development of the rule and presents the rationale for selecting the proposed rule 

requirements. 

y Chapter 4 characterizes baseline conditions that exist (including PWS inventory, 

treatment, and water quality data) before PWSs make changes to meet the proposed 

RTCR requirements. 

y Chapter 5 summarizes TC and EC occurrence analysis, providing a description of the 

occurrence model, the sources used, and the limitations or constraints to the analysis 

based on the nature of the data provided by those sources. 

y Chapter 6 presents the relative risk evaluation performed to estimate the potential 

benefits of the proposed RTCR relative to the baseline and other regulatory options 

considered. 
Economic Analysis for the Proposed RTCR 1-5 June 2010 

y Chapter 7 presents an estimate of the net costs of implementing the proposed RTCR 

to industry, households, and states. The net costs of all regulatory options considered 

are compared. 

y Chapter 8 discusses distributional analyses performed to evaluate the effects of the 

rule on different segments of the population, and considers various executive orders 

and requirements, including the Regulatory Flexibility Act (RFA) and Unfunded 

Mandates Reform Act (UMRA). 

y Chapter 9 compares the benefits and costs of the proposed RTCR to evaluate the 

potential net benefits and cost-effectiveness. The results are discussed and compared 

to other regulatory options considered.

y Chapter 10 includes a detailed list of references.

1.3 Calculations and Citations 

 This EA involves detailed and complex analyses, and the following are provided to help 

the reader: 

y The detailed reference section provided in Chapter 10. 

y Appendices containing supporting spreadsheets and analyses: 

– Appendix A – Detailed Predictive Model Results, 

– Appendix B – Graphs of Predicted Hit Rates Over Time, 

– Appendix C – Detailed Cost Model Results, 

– Appendix D – Detailed Compliance Forecast and Unit Costs Estimates, 

– Appendix E – Supporting information for Value of Statistical Life and Cost of 

Illness estimates used in break even analyses, 

– Appendix F – Detailed analysis of potential uncertainty and variability in 

occurrence estimates, 

– Appendix G – Evaluation of representativeness of Six Year Review data, and 

– Appendix H – Analysis of potential impacts of reduced repeat sampling. 

– Appendix I – Supporting Information for Regulatory Flexibility Act Screening 

Analysis 

y Exhibits. Most tabular exhibits include a row that provides the formulas used to 

compute the contents of each column. 

y Sources for values used if they were not calculated within the exhibits. 

y Supporting electronic file outputs (i.e., RTCR occurrence and cost model output). 

y Flowcharts that illustrate methodologies of analyses as well as proposed rule 

requirements.
Economic Analysis for the Proposed RTCR 2-1 June 2010 

2. Statement of Need for the Rule 

2.1 Introduction 

The United States Environmental Protection Agency (EPA) is proposing to revise the 

1989 Total Coliform Rule (TCR) to better protect public health. EPA noticed its intent to revise 

the TCR as part of its Six-Year Review determination published in 2003 (USEPA 2003b, 68 FR 

42907, July 18, 2003). In July 2007 EPA convened a Total Coliform Rule/Distribution System 

Federal Advisory Committee (TCRDSAC or advisory committee) charged with evaluating how 

well the objectives of the TCR are met and recommending possible revisions to the rule. The 

TCRDSAC completed its analysis and provided recommendations for revising the TCR in an 

Agreement in Principle (AIP) (USEPA, 2009) that was signed by advisory committee members 

in September 2008. EPA committed to proposing a rule that was consistent with the 

recommendations in the AIP (see Chapter 3 of this Economic Analysis (EA) for more details on 

the TCRDSAC). 

The proposed RTCR maintains and strengthens the objectives of the current TCR and is 

consistent with the recommendations in the AIP. The objectives are: (1) to evaluate the 

effectiveness of treatment, (2) to determine the integrity of the distribution system, and (3) to 

signal the possible presence of fecal contamination. The proposed rule better addresses these 

objectives by requiring systems that may be vulnerable to fecal contamination (as indicated by 

their monitoring results) to do an assessment, to identify whether any sanitary defect(s) is (are) 

present, and to correct the defects. Therefore, greater public health protection is anticipated under 

the proposed RTCR compared to the current TCR because of its more preventive approach to 

identifying and fixing problems that affect or may affect public health (see Chapter 3 of this EA 

for more details on the AIP and the provisions of the proposed RTCR). 

This chapter summarizes the technical, regulatory, and public health issues addressed by 

the proposed rule. It also explains the statutory authority for the proposed RTCR and the 

economic rationale for choosing a proposed regulatory approach rather than non-regulatory 

alternatives. 

2.1.1 Description of the Issue 

EPA is required to review each existing national primary drinking water regulation 

(NPDWR) every six years. In 2003, EPA completed its review of the TCR and 68 NPDWRs for 

chemicals that were established prior to 1997. The purpose of the review was to identify current 

health risk assessments, changes in technology, and other factors that would provide a health or 

technological basis to support a regulatory revision that will maintain or improve public health 

protection. In the 2003 announcement of the completion of the Six Year Review, EPA provided 

public notice of its intent to revise the TCR (USEPA 2003b, 68 FR 42907, July 18, 2003). 

Implementation-related issues are the primary reason for EPA’s decision to revise the TCR. 

Since promulgation of the TCR, EPA has received comments from a number of stakeholders 

suggesting modifications to reduce the burden of implementing the TCR. These comments 

included, among others, suggestions to modify the TCR’s monitoring requirements (e.g., with 

regards to sampling locations and repeat samples) (USEPA 2002b, 67 FR 19030, April 17, 2002 

and USEPA 2003b, 68 FR 42907, July 18, 2003). 
Economic Analysis for the Proposed RTCR 2-2 June 2010 

The 1989 TCR was promulgated to decrease the risk of waterborne illness. Among all 

rules promulgated for preventing waterborne illness, only the TCR applies to all PWSs, so the 

rule is an essential component of the multiple barrier approach in public health protection against 

endemic and epidemic disease. However, improvements to the current TCR construct and 

requirements can better protect public health as shown in the following discussions. 

In recent years, violation rates under the TCR have remained relatively steady (see 

Chapter 4, Exhibit 4.11 of this Economic Analysis (EA)). EPA believes that this is reflective of a 

steady state among PWSs complying with the current TCR, suggesting the possibility that 

improvements likely to occur under the current TCR have largely been achieved. Potential 

exposure to waterborne pathogens continues to be a health risk. Within the United States, disease 

is caused by a relatively small variety of bacterial, viral, and parasitic protozoan pathogens in 

drinking water. Nevertheless, the number of potential waterborne pathogens and the number of 

potential waterborne illnesses are significant. Humans can be exposed via fecal-oral, inhalation 

or dermal exposure, with fecal-oral exposure being the most significant and prevalent pathway. 

The current TCR established a maximum contaminant level goal (MCLG) and a 

maximum contaminant level (MCL) for total coliforms (including fecal coliforms (FC) and E. 

coli (EC)). A TC MCL violation requires public notification. However, many of the organisms 

detected by total coliform and fecal coliform methods are not of fecal origin and do not have any 

direct public health implication. Information has also become available since promulgation of the 

current TCR in 1989 that indicates that measurement of fecal coliforms sometimes detects 

organisms that may not have any connection to fecal contamination (Edberg et al. 2000). 

Attributing greater public health significance to the presence of total coliforms or fecal coliforms 

could result in public confusion. On the other hand, EPA believes that E. coli is a meaningful 

indicator of fecal contamination and of the potential presence of associated pathogens (see 

Section 2.2.4.1 of this chapter). 

The proposed RTCR aims to maintain and strengthen the objectives of the current TCR 

more effectively and efficiently. E. coli remains a regulated contaminant with a defined 

maximum contaminant level goal (MCLG) and a maximum contaminant level (MCL) while TC 

(including fecal coliforms) no longer has an MCLG and an MCL. Instead, the proposed RTCR 

uses TC as an indicator as part of a coliform treatment technique. The treatment technique uses 

both total coliforms and E. coli monitoring results to start an evaluation process that, where 

necessary, will require the PWS to conduct assessments and corrective actions. The proposed 

rule also takes into account the capacity of small systems (especially for PWSs serving 1,000 or 

fewer people) and primacy agencies to effectively implement the proposed rule requirements. 

Modeling results show that the assessment and corrective action provisions of the RTCR 

result in a decrease in E. coli occurrence (see Exhibit 6.7) which is anticipated to lead to a 

decrease in the potential exposure of the public to fecal contamination and its associated 

pathogens. In general, this decrease in fecal contamination should reduce the potential risk to 

human health of PWS customers. Thus, any reduction in E. coli occurrence is considered a 

benefit of the proposed RTCR. Also, since fecal contamination can contain waterborne 

pathogens including bacteria, viruses, and parasitic protozoa, in general a reduction in fecal 

contamination should also reduce the potential risk from these other contaminants. 
Economic Analysis for the Proposed RTCR 2-3 June 2010 

2.2 Public Health Concerns, Fecal Contamination, and Waterborne Pathogens 

2.2.1 Rule Objectives and Public Health Concerns 

The proposed RTCR aims to increase public health protection through a reduction of 

potential pathways of entry for fecal contamination into the distribution system. Since these 

potential pathways represent vulnerabilities in the distribution system whereby fecal 

contamination and/or waterborne pathogens, including bacteria, viruses, and parasitic protozoa 

could possibly enter the system, the reduction of these pathways in general should lead to 

reduced exposure and associated risk from these contaminants. Waterborne pathogens that can 

be associated with fecal contamination may cause a variety of illnesses, including Acute 

Gastrointestinal Illness (AGI) with diarrhea, abdominal discomfort, nausea, vomiting, and other 

symptoms. Most AGI cases are of short duration and result in mild illness. Consuming water 

contaminated with waterborne pathogens can also result in acute illnesses such as hepatitis, 

hemolytic uremic syndrome (kidney failure), and bloody diarrhea; milder, acute illnesses such as 

conjunctivitis; and severe chronic illnesses such as diabetes and dilated cardiomyopathy. Other 

examples of potential chronic diseases resulting from infection by a waterborne agent include 

irritable bowel syndrome, hypertension, and reactive arthritis; chronic illnesses are generally 

costly to treat.1

 

Sensitive subpopulations are at greater risk from waterborne disease than the general 

population. These sensitive subpopulations include children (especially the very young); the 

elderly; the malnourished; pregnant women; chronically ill patients (e.g., those with diabetes or 

cystic fibrosis); and a broad category of those with compromised immune systems, such as 

Acquired Immunodeficiency Syndrome (AIDS) patients, those with autoimmune disorders (e.g., 

rheumatoid arthritis, lupus erythematosus, and multiple sclerosis), organ transplant recipients, 

and those receiving chemotherapy (Rose, 1997). Sensitive subpopulations represent almost 20 

percent of the population in the United States (Gerba et al. 1996). The severity and duration of 

illness is often greater in sensitive subpopulations than in healthy individuals, and may 

occasionally result in death. 

When humans are exposed to and infected by an enteric pathogen, the pathogen becomes 

capable of reproducing in the gastrointestinal tract. As a result, healthy humans shed pathogens 

in their feces for a period ranging from days to weeks. This shedding of pathogens often occurs 

in the absence of any signs of clinical illness. Regardless of whether a pathogen causes clinical 

illness in the person who sheds it in his or her feces, the pathogen being shed may infect other 

people directly by person-to-person spread, contact with contaminated surfaces, and other means 

which are referred to as secondary spread. As a result, waterborne pathogens that are initially 

waterborne may subsequently infect other people through a variety of routes (WHO 2004). 

Waterborne pathogens include pathogens of both fecal and non-fecal origin. Non-fecal 

pathogens are found in the soil and soil water interface and include Legionella, Naegleria fowleri

and probably Helicobacter pylori, or are components of the distribution system environment and 

can include Mycobacterium avium complex (MAC). Examples of common fecal bacterial 

pathogens include pathogenic E. coli, Salmonella, Shigella, and Campylobacter jejuni. Some 

 

1

 Lifetime costs associated with a new case of diabetes, for example, assuming an average illness duration of 30 

years, are estimated at $255,833 using a three percent discount rate and $161,967 using a seven percent discount rate 

(year 2007 dollars). For dilated cardiomyopathy, the lifetime (21 year average) cost is $68,870 (seven percent 

discount rate, year 2007 dollars). 
Economic Analysis for the Proposed RTCR 2-4 June 2010 

waterborne bacterial pathogens cause disease by rapid growth and dissemination (e.g., 

Salmonella) while others primarily cause disease via toxin production (e.g., Shigella, E. coli 

O157, Campylobacter jejuni). Campylobacter jejuni, E. coli, and Salmonella have a host range 

that includes both animals and humans; Shigella is associated only with humans (Geldreich, 

1996). Unlike viruses, bacteria are able to reproduce outside of the host. 

Because a positive TC assay is an indicator of ambient water entry into or growth within 

the distribution system, it represents an indication of potential for both fecal and non-fecal 

contamination. Because E. coli originates in the gut of warm-blooded animals, it is an indication 

of fecal contamination. Together, the TC/E. coli indicator system can be used to identify the 

potential for fecal contamination by monitoring. Since fecal contamination can contain 

waterborne pathogens including bacteria, viruses, and parasitic protozoa, in general a reduction 

in fecal contamination should also reduce the potential risk from these other contaminants. 

The group of bacteria known as E. coli contains both pathogenic and non-pathogenic 

isolates. The methods approved by EPA to assay for E. coli do not identify most of the 

pathogenic E. coli strains. The most dangerous E. coli bacteria contain the gene for producing 

shiga-toxins. E. coli O157:H7 is the most widespread shiga-toxin producing E. coli but at least 

81 serotypes have been identified (Prager et al. 2005). Release of toxins in the body can result in 

kidney failure, shock and death in otherwise healthy individuals, especially small children. 

Typically, kidney failure occurs in 2-7% of illnesses. Death or end-stage renal disease occurs in 

about 12% of patients four years after diarrhea-associated kidney failure (Garg et al. 2003). 

Twenty five percent of kidney failure survivors demonstrate long-term renal consequences (Garg 

et al. 2003). For patients with moderate and severe gastroenteritis caused by E. coli, long-term 

study shows that they have an increased risk of irritable bowel syndrome, hypertension and 

reduced kidney function (Garg et al. 2005). The Centers for Disease Control and Prevention 

(CDC) indicates that drinking water is responsible for a portion of the 73,000 illnesses each year 

from E. coli O157:H7 (Mead et al. 1999). 

 Ground water outbreaks due to E. coli O157:H7 are prominent because of the fatal 

outcomes associated with those outbreaks. In Walkerton, Ontario, 6 individuals died and 27 

developed kidney failure from ground water contaminated with E. coli O157:H7 (and 

Campylobacter jejuni) (Health Canada, 2000). The outbreak coincided with a reduction in 

chlorination treatment coincident with a large fecal contamination event. In Washington County, 

NY, two individuals (including an otherwise healthy two year old child) died from E. coli 

O157:H7 contamination of a county fair water supply system. (The fair ground’s water supply 

system was not recognized as a PWS because it was used for less than 60 days each year.) Four 

individuals died in Cabool, MO due to E. coli O157:H7 (Swerdlow et al. 1992) in an outbreak 

that was likely due to source water contamination. Another E. coli O157:H7 outbreak occurred in 

ground water in Minnesota but no kidney failures resulted. 

Although manure is often considered to be the source of shiga-toxin producing E. coli, 

they have also been isolated from municipal sewage (Holler et al. 1999). E. coli O157:H7 was 

found to survive on a pasture surface for almost 4 months. About 4-15% of cases are acquired 

via secondary transmission (Parry and Salmon, 1998). In addition to the shiga-toxin producing E. 

coli, there are a substantial number of other E. coli bacteria that are pathogenic, mostly through 

production of other toxins. Little data are available on the hazard associated with waterborne 

transmission for most of the pathogenic E. coli other than E. coli O157:H7. 
Economic Analysis for the Proposed RTCR 2-5 June 2010 

 As the result of a seven year long study of individuals infected or ill during the 

Walkerton, Ontario waterborne disease outbreak due to E. coli O157 and Campylobacter jejuni, 

researchers noted an increased incidence in chronic disease sequellae. Within a few years after 

the outbreak, irritable bowel syndrome, hypertension, reactive arthritis and reduced kidney 

function increased 33-38% (Clark et al. 2008). 

Shigella bacteria are distinct because they are often associated with bloody diarrhea 

(bacillary dysentery). The enterohemorraghic E. coli bacteria acquired the capability to produce 

toxins by exchanging plasmids with Shigella (Murray et al., 2007). Thus, Shigella often also 

causes kidney failure and chronic kidney disease. Shigella contamination only results from 

human fecal contamination and thus it is probably less common than E. coli contamination, 

which has both human and animal sources. 

Campylobacter (like Salmonella) are very common contaminants of food and water. 

Campylobacter is commonly associated with animal manure, especially cow and chicken 

manure. Campylobacter and Salmonella are associated with many common source (food or 

water) exposure deaths, probably in large part because there are a large number of illnesses. 

More deaths may be associated with Campylobacter and Salmonella than with viruses. Uniquely, 

Campylobacter is often associated with Guillain-Barre paralysis that can last for weeks or 

months. About 1 paralysis case occurs for every 1000 cases of campylobacteriosis (Altekruse et 

al. 1999). About 20% of paralysis patients are left with some disability and approximately 5% 

die. Campylobacterosis is also associated with Reiter syndrome (reactive arthritis). 

Approximately 1% of patients with camplybacterosis have arthritis onset in one or more joints 

(especially the knee) in the 7 to 10 days after diarrheal onset (Altekruse et al. 1999). Arcobacter 

(now a separate genus from Campylobacter) was responsible for a ground water outbreak at a 

camp in Coeur d'Alene, Idaho (McMillan, 1996). 

Salmonella causes typhoid fever, once a common and dangerous waterborne disease. 

Typhoid is no longer a problem in the United States, and in recent years, Salmonella has become 

increasingly less common as a common source outbreak agent while campylobacterosis 

outbreaks have correspondingly increased. The reasons for this change are unclear. Seven deaths 

that occurred due to Salmonella contamination in a ground water PWS in Gideon, Missouri were 

due to bird entry into a storage tank (Angulo et al. 1997). Salmonella resulted in a very large 

outbreak in a ground water utility in Riverside, California during the 1960s (16,000 illnesses, 70 

hospitalizations and 3 deaths) prior to the advent of the Total Coliform Rule 

(Boring et al. 1971). A 2008 waterborne outbreak in Alamosa, Colorado was due to Salmonella. 

Salmonella-positive samples were collected from the distribution system but no E. coli was 

identified in other distribution samples collected on the same day. 

Legionella are opportunistic bacterial pathogens that colonize water distributions 

systems. An estimated 8,000-10,000 cases of Legionaires disease and Pontiac fever occur in the 

U.S. each year due to Legionella. Twenty-one of 48 known species are able to infect humans. 

Helicobacter pylori is often associated with ground water (Hegarty et al.1999; RolleKampzczyk et al. 2004) and is known to cause gastric ulcers. However, Helicobacter is not 

culturable and so occurrence data are fairly uncertain. Improved hygiene and water treatment 

have together reduced the number of ulcers caused by this organism over the last few decades 

but it is impossible to quantify that decrease. 
Economic Analysis for the Proposed RTCR 2-6 June 2010 

Most of the waterborne bacterial pathogens cause gastrointestinal illness, but some can 

cause other severe illnesses as well. For example, Legionella causes Legionnaires Disease, a 

form of pneumonia that has a fatality rate of about 15 percent. It can also cause Pontiac Fever, 

which is a milder respiratory infection form of Legionnaires Disease. Several strains of E. coli 

can cause severe disease, including kidney failure. Some bacterial pathogens are opportunistic 

(i.e., they are only infectious in the presence of another, preexisting condition or weakness). 

Opportunistic pathogens usually cause illness only in immunocompromised persons or in other 

sensitive subpopulations, such as the very young or the elderly. Other pathogens, such as 

Salmonella, Shigella, and Campylobacter jejuni, are not entirely opportunistic but result in 

certain diseases with greater frequency and severity in immunocompromised persons (Framm 

and Soave, 1997). 

Examples of common viral pathogens include norovirus and the enteroviruses 

(coxsackievirus, echovirus, poliovirus, enterovirus 70 and 71). The virus can cause a spectrum of 

mild to severe clinical illness, including paralytic disease and death. There is considerable 

information that Type 1 diabetes may be associated with enterovirus infection, including 

infection with coxsackievirus and echoviruses (Maria et al. 2005; Vreugdenhil et al. 2000). 

Dilated cardiomyopathy can follow myocarditis caused by echovirus and other enterovirus infection.

Mild enteroviral illness includes nonspecific febrile illness, respiratory illness, 

photophobia or sensitivity, stiff neck, and gastrointestinal illness. Aseptic meningitis may or may 

not require a doctor’s visit, but more severe illnesses such as viral encephalitis, myocarditis, and 

non-polio flaccid paralysis are likely to require hospitalization. Most likely to be hospitalized are 

infants less than 3 months old with non-specific febrile illnesses that require treatment to rule out 

and expectantly treat serious bacterial illness. Dilated cardiomyopathy can follow myocarditis 

caused by echovirus and other enterovirus infection. 

The health effects of norovirus illness include acute onset of nausea, vomiting, abdominal 

cramps and diarrhea. Vomiting is more prevalent among children. Many adults experience 

vomiting as well as diarrhea. Constitutional symptoms (e.g., headache, fever, chills, and 

myalgia) are frequently reported. Although rare, severe dehydration caused by norovirus 

gastroenteritis can be fatal, with this outcome occurring among susceptible persons (e.g., older 

persons with debilitating health conditions). No long-term sequelae of norovirus infection have 

been reported (CDC, 2001a). Duration of illness is typically 12–60 hours. 

Hepatitis A (HAV) virus is the only waterborne virus that is reportable to CDC. About 

28,000 HAV cases are reported to CDC each year, although that number is expected to decline 

with time because children are currently vaccinated for HAV in high risk states and newer 

recommendations are for increased vaccination coverage. More generally, however, because 

HAV is more severe as an adult disease, an aging U.S. population may have greater disease 

burden. Mead et al. (1999) estimate about 83,000 HAV cases each year, with a hospitalization 

rate of 13% and a mortality rate of 0.3%. 

Hepatitis E (HEV) virus is another fecal oral virus that is potentially waterborne. Using 

serology and case histories of individual patients, HEV is established as endemic within the 

United States (Tsang et al. 2000). However, the data suggest that only one or a few percent of 

the population has been infected. Unlike HAV, no waterborne outbreaks of HEV have occurred 

in the United Sates, although they have occurred in China and Somalia. The disease is severe, 

with up to 20% mortality among pregnant women in developing countries. 
Economic Analysis for the Proposed RTCR 2-7 June 2010 

The adenoviruses are a large group of viruses that produce diverse symptoms. Two 

adenovirus serotypes, adenovirus 40 and 41, produce primarily enteric symptoms, but several 

other adenoviruses are also capable of producing such symptoms. Some cause conjunctivitis. 

Most significantly, adenoviruses caused a fatal outcome in otherwise healthy young males in 

military settings (CDC, 2001b). All adenoviruses, no matter the infection site and characteristic 

illness, are shed copiously through the gut. Thus, the adenoviruses are fecal\oral viruses (Carter, 

2005) potentially transmissible via water to infection sites in the gut or, for the respiratory 

adenoviruses, in the lung, via waterborne aerosol drops. 

Astrovirus is commonly acquired in child care settings and causes mild disease in 

children. Most children are exposed at an early age. However, a small percentage of that large 

population may suffer more significant health effects and may require in-patient care. The 

disease burden in older children and adult populations is underestimated because the disease is 

mild (Carter, 2005). Astroviruses are shed in stool at large numbers. In France, prospective 

epidemiology studies have implicated water as a route of infection (Gofti-Laroche, et al. 2003). 

The Centers for Disease Control and Prevention (CDC) has determined that the incidence 

of rotavirus diarrhea can reach 0.30 episodes/child/year by age two, with a cumulative incidence 

approaching 0.80 episodes/child by age five (Glass et al. 1996). Hospitalizations for rotavirus 

diarrhea are most common in children 6 months to 3 years of age (Parashar et al. 1998), while 

self-limiting norovirus infections are prevalent in school-age children (LeBaron et al. 1990). 

Although deaths from infectious diarrhea have generally declined among U.S. children since 

1965 because of re-hydration therapy, newborn children, especially infants born prematurely, 

remain at risk of death from severe diarrheal illness (Kilgore et al. 1995). Common strain 

rotaviruses typically affect young children, particularly those less than 3 years old, but other 

strains (G1, G2 and G9) have been found to be common in adults and the elderly in nursing 

homes, and found to be responsible for more severe illness in children (Griffin et al. 2000). In 

2006, the U.S. Food and Drug Administration (FDA) approved a new pentavalent vaccine for 

rotavirus (Vesikari et al. 2006) in children. The vaccine protects against the most common 

rotaviruses now found in the U.S. (serotypes G1, G2, G3, G4, G9) but does not protect again all 

rotaviruses found in the U.S. or all rotaviruses. 

Reovirus is recovered in environmental samples using the BGM cell line and is 

commonly found co-occurring with the enteroviruses in PWS wells. Carducci et al. (2002) found 

that, in some cases, enterovirus detection was limited because reovirus reproduction was so 

highly favored. Reovirus is more closely related to rotavirus and thus has some similar 

characteristics. Reovirus is now recognized as a human pathogen in children (Tyler et al. 2004). 

Cryptosporidium is of particular concern to EPA because, unlike pathogens such as 

viruses and bacteria, Cryptosporidium oocysts are resistant to inactivation by many common 

disinfection methods. Since the oocysts are especially resistant to chlorine disinfection, simply 

increasing existing chlorination dosage levels or contact time above those most commonly 

practiced in the United States is not effective. Emerging disinfectant-resistant pathogens, such as 

Microsporidia, Cyclospora, and Toxoplasma, are also a concern for similar reasons. 

Cryptosporidiosis is a protozoal infection that usually causes 7 to14 days of diarrhea, 

possibly accompanied by low-grade fever, nausea, and abdominal cramps in individuals with 

healthy immune systems (Juranek, 1998). It is caused by the ingestion of infectious 

Cryptosporidium oocysts, which are readily carried in water. The most common source of 
Economic Analysis for the Proposed RTCR 2-8 June 2010 

oocysts in water is the feces of infected hosts (Perz et al.1998; Rose, 1997). Although 

cryptosporidiosis often occurs through ingestion of contaminated food or water, it may also 

result from direct or indirect contact with infected people or animals (Casemore 1990; Juranek 

1998; Rose 1997). Infected humans and other animals excrete oocysts, which can then be 

transmitted to others. Cryptosporidiosis can also cause non-gastrointestinal symptoms, such as 

eye and joint pain, headaches, dizziness, and fatigue (Hunter et al. 2004). There is no treatment 

that can eliminate a Cryptosporidium infection, and only a few antiparasite or antimicrobial 

agents have shown even a slight ability to reduce a patient’s parasite load (Guerrant 1997). 

 In some occurrences, cryptosporidiosis can be fatal, particularly among subpopulations 

such as AIDS patients, the elderly with other underlying illnesses, and other immunocompromised individuals. In a Cryptosporidium outbreak in Milwaukee in 1994, 54 people died 

who had cryptosporidiosis listed on their death certificate. Of those, 46 also had AIDS listed as 

an underlying cause of death (Hoxie et al. 1997). The Milwaukee outbreak had an estimated 

403,000 cases of illness (Kramer et al. 1996). 

Giardiasis is a protozoal infection that usually causes a diarrhea, possibly accompanied 

by fever, nausea and abdominal cramps in individuals with healthy immune systems. It is caused 

by ingestion of Giardia cysts. 

In 2003, two five-year old boys living in the same water service area near Phoenix AZ 

died in the same week from Primary Amoebic Meningioencephalitis (PAM) (Marciano-Cabral et 

al. 2003). Both boys lived in homes supplied by untreated PWS wells. Atypically, the wells in 

that area provide water at elevated temperatures, representing the elevated geothermal gradient in 

the subsurface. Seventeen samples taken from the boys homes were positive for Naegleria 

fowleri and N. fowleri was also responsible for the boy's deaths from PAM. It is likely that the 

elevated ground water temperature provided a suitable habitat for N. fowleri colonization and 

growth either in the aquifer, the well, the distribution system or the household plumbing. 

2.2.2 Total Coliforms as Indicators of Treatment Effectiveness and Integrity of the 

Distribution System 

TC is a group of closely related bacteria that, with a few exceptions, are not harmful to 

humans. Many bacteria in the TC group are soil bacteria but some, such as E. coli, originate in 

the gut of warm-blooded animals. Coliform bacteria may be transported to surface water by runoff or to ground water by infiltration. Total coliforms are common in ambient water and may be 

injured by environmental stresses such as lack of nutrients, and water treatment chlorine 

disinfection, in a manner similar to most bacterial pathogens and many viral enteric pathogens 

(including fecal pathogens). EPA considers TC to be a useful indicator of a potential pathway 

through which fecal contamination can enter the distribution system. The absence (versus the 

presence) of total coliforms in the distribution system indicates a reduced likelihood that fecal 

contamination and/or waterborne pathogens are occurring in the distribution system. 

Under the current TCR, each TC-positive sample is assayed for either fecal coliform or E. 

coli. Fecal coliform bacteria are a subgroup of TC that traditionally has been associated with 

fecal contamination. Since the promulgation of the TCR, more information and understanding of 

the suitability of fecal coliform and E. coli as indicators have become available. Study has shown 

that the fecal coliform assay is imprecise and too often captures bacteria that do not originate in 
Economic Analysis for the Proposed RTCR 2-9 June 2010 

the human or mammal gut (Edberg et al. 2000). On the other hand, E. coli is a more restricted 

group of coliform bacteria that almost always originate in the human or animal gut (Edberg et al. 

2000). Thus, E. Coli is a better indicator of fecal contamination than fecal coliforms. 

2.2.3 Sanitary Defects 

As part of the proposed RTCR, TC will be used as an indicator to start an evaluation 

process that, where necessary, will require the PWS to correct sanitary defects, which are defined 

as “a defect that could provide a pathway of entry for microbial contamination into the 

distribution system or that is indicative of a failure or imminent failure in a barrier that is already 

in place.” “Sanitary defect” is a term specific to the TCR assessment and correction provisions. 

Sanitary defects are not intended to be linked directly to the “significant deficiencies” under the 

SWTR and GWR, although some problems could meet either definition. The proposed RTCR is 

not intended to limit the existing authorities of primacy agencies under other regulations. 

2.2.4 Occurrence of Fecal Contamination and/or Waterborne Pathogens 

2.2.4.1 Presence of Fecal Contamination 

Fecal contamination is a very general term that includes all of the organisms found in 

feces, both pathogenic and nonpathogenic. Fecal contamination can occur in drinking water both 

through use of contaminated source water as well as direct intrusion into the drinking water 

distribution system. Biofilms in distribution systems may harbor waterborne pathogens and 

accumulate enteric viruses and parasitic protozoa (Skraber et al. 2005; Helmi et al. 2008). 

Waterborne pathogens in biofilms may have entered the distribution system as fecal 

contamination from humans or animals. 

Co-occurrence of indicators and waterborne pathogens is difficult to measure. The analytical 

methods approved by EPA to assay for E. coli do not specifically identify most of the pathogenic 

E. coli strains. There are at least 700 recognized E. coli strains. About 10% of the recognized E. 

coli strains are pathogenic to humans (Feng 1995, Hussein 2007, Kaper et al. 2004). Pathogenic 

E. coli include E. coli O157:H7, which is the primary cause of hemolytic uremic syndrome 

(HUS) in the United States (Rangel et al. 2005). The CDC estimates that there are 73,000 cases 

of illness each year in the U.S. due to E. coli O157:H7 (Mead et al. 1999). The CDC estimates 

that about 15% of all reported E. coli O157:H7 cases are due to water contamination (Rangel et 

al. 2005). Active surveillance by CDC shows that 6.3 percent of E. coli O157:H7 cases progress 

to HUS (Griffin and Tauxe 1991; Gould et al. 2009) and about 12% of HUS cases result in death 

within four years (Garg et al. 2003). About 4 to 15% of STEC O157 cases are transmitted within 

households by secondary transmission (Parry and Salmon 1998). 

EPA believes that E. coli is a meaningful indicator for fecal contamination and the 

potential presence of associated pathogen occurrence. Because EPA-approved standard methods 

for E. coli do not typically identify the presence of the pathogenic E. coli strains, an E. colipositive monitoring result is an indicator of fecal contamination but is not necessarily a definitive 

measure of waterborne pathogen occurrence. Specialized assays and methods must be used to 

identify waterborne pathogens, including pathogenic E. coli and all others. These specialized 
Economic Analysis for the Proposed RTCR 2-10 June 2010 

assays and methods are generally considered too costly and time consuming to be effective for 

routine monitoring of drinking water distribution systems. 

One notable exception are the data reported by Cooley et al.(2007), which showed high 

concentrations of pathogenic E. coli strains in samples containing high concentrations of fecal 

indicator E. coli. These data are from streams and other poor quality surface waters surrounding 

California spinach fields associated with the recent E. coli O157:H7 foodborne outbreak. Data 

equivalent to these are not available from drinking water samples collected under the TCR. 

2.2.4.2 Waterborne Disease Outbreaks 

The CDC defines a waterborne disease outbreak as occurring when at least two persons 

experience a similar illness, or one person is ill with amoebic meningioencephalitis, after the 

ingestion of drinking water or following exposure to water used for recreational purposes, in 

cases where the epidemiologic evidence implicates water as the probable source of the illness 

(Kramer et al.1996). The CDC maintains a database on waterborne disease outbreaks in the 

United States. The database is based upon responses to a voluntary and confidential survey form 

that is completed by state and local public health officials. 

The National Research Council strongly suggests that the number of identified and 

reported outbreaks in the CDC database for surface and ground waters represents a small 

percentage of the actual number of waterborne disease outbreaks (Safe Water From Every Tap, 

National Research Council 1997; Bennett et al.1987, Hopkins et al.1985 for Colorado data). 

Under-reporting occurs because most waterborne outbreaks in community water systems are not 

recognized until a sizable proportion of the population is ill (Perz et al.1998; Craun 1996), 

perhaps 1% to 2% of the population (Craun 1996). 

EPA drinking water regulations are designed to protect against endemic waterborne 

disease and to minimize waterborne outbreaks. Endemic waterborne disease may be defined as 

any waterborne disease not associated with an outbreak. 

2.3 Statutory Authority for Promulgating the Rule 

 As mentioned previously, SDWA requires EPA to review and revise, as appropriate, each 

existing NPDWR at least once every six years (SDWA section 1412(b)(9), 42 U.S.C. § 300g1(b)(9)). Section 1412(b)(9) of SDWA states: 

 The Administrator shall, not less often than every 6 years, review and revise, as 

 appropriate, each national primary drinking water regulation promulgated under this title. 

 Any revision of a national primary drinking water regulation shall be promulgated in 

 accordance with this section, except that each revision shall maintain, or provide for 

 greater, protection of the health of persons. 

In 2003, EPA completed its review of the TCR and 68 NPDWRs for chemicals that were 

established prior to 1997 (USEPA 2002b, 67 FR 19030, April 17, 2002). In the Six-Year Review 

determination published in July 2003, EPA stated its intent to revise the 1989 TCR (USEPA 

2003b, 68 FR 42907, July 18, 2003). 
Economic Analysis for the Proposed RTCR 2-11 June 2010 

2.4 Economic Rationale 

 As a revision to an existing regulation, the primary goal of the proposed RTCR is to 

achieve the objectives of the 1989 TCR more effectively and efficiently, taking into account the 

changes in regulatory framework for implementing the SDWA over the past 20 years and 

experience with the TCR since it was promulgated in 1989. In this context, the overall economic 

rationale behind the promulgation of the proposed RTCR is the same as the rationale for the 

promulgation of the original TCR. This section addresses the economic rationale for choosing a 

regulatory approach under the proposed RTCR (and TCR) rather than non regulatory options. 

An economic rationale for the rule is required by Executive Order 12866, Regulatory 

Planning and Review (58 FR 51735, October 1993), which states: 

“[E]ach agency shall identify the problem that it intends to address (including, where 

applicable, the failures of the private markets or public institutions that warrant new 

agency action) as well as assess the significance of that problem.” (Section 1, b(1)) 

 In addition, Office of Management and Budget (OMB) guidance, dated January 11, 1996, 

states that “in order to establish the need for the proposed action, the analysis should discuss 

whether the problem constitutes a significant market failure” (USEPA, 1996b). 

In a perfectly competitive market, prices and quantities are determined solely by the 

aggregated decisions of buyers and sellers. Such a market occurs when many producers of a 

product are selling to many buyers, and where both producers and consumers have perfect 

information on the characteristics and prices of each firm’s products. Barriers to entry in the 

industry cannot exist, and individual buyers and sellers must be “price takers” (i.e., their 

individual decisions cannot affect the price). Several properties of the public water supply do not 

satisfy the conditions for a perfectly competitive market and thus lead to market failures that 

require regulation. 

Many PWSs are natural monopolies. A natural monopoly exists when it is impossible for 

more than one firm in each area to recover the costs of production and survive. There are high 

fixed costs associated with reservoirs and wells, transmission and distribution systems, treatment 

plants, and other facilities. For other potential suppliers to enter the market, they would have to 

provide the same extensive infrastructure to realize similar economies of scale and be 

competitive. A splitting of the market with increased fixed costs (e.g., two supplier networks in a 

single market) usually makes this situation unprofitable. The result is a market suitable for a 

single supplier and hostile to alternative suppliers. In such natural monopolies, suppliers have 

fewer incentives for providing quality services or maintaining competitive prices. In these 

situations, governments often intervene to help protect the public interest. 

For example, because PWSs are legal, as well as natural, monopolies, they are often 

subject to price controls, if not outright public ownership. While customers may demand 

improvements in water quality, the regulatory structure may not facilitate the transmission of that 

demand to the water supplier or allow the supplier to raise its price to recover the cost of the 

improvements. If consumers do not believe that their drinking water is safe enough, they cannot 

simply switch to another water utility. Other options for obtaining safe drinking water (e.g., 

buying bottled water or installing point of use filtration) most often represent a higher water cost 
Economic Analysis for the Proposed RTCR 2-12 June 2010 

to consumers than the purchase from PWSs. Therefore, the water supplier may have little 

incentive to improve water quality. 

The public may also not understand the health and safety issues associated with poor 

drinking water quality. Understanding the health risks posed by trace quantities of drinking water 

contaminants involves analysis and synthesis of complex toxicological and health sciences data. 

Therefore, the public may not be aware of the risks it faces. EPA has implemented a Consumer 

Confidence Report (CCR) Rule (63 FR 44512, August 1998) that makes water quality 

information more easily available to consumers. This rule requires CWSs to publish an annual 

report on local drinking water quality. Consumers, however, still have to analyze this 

information for its health risk implications. Furthermore, even if informed consumers are able to 

engage PWSs in a dialogue about health issues, the transaction costs of such interaction 

(measured in personal time and monetary outlays) present another significant impediment to 

consumer expression of risk reduction preferences. 

SDWA regulations are intended to provide a level of protection from exposure to 

drinking water contaminants. The regulations set minimum performance requirements to protect 

consumers from exposure to contaminants. SDWA regulations are not intended to restructure 

market mechanisms or to establish competition in supply; rather, they establish the level of 

service to be provided that best reflects public preference for safety. The federal regulations 

reduce the high information and transaction costs by acting on behalf of consumers in balancing 

risk reduction and the social costs of achieving this risk reduction. 
Economic Analysis for the Proposed RTCR 3-1 June 2010 

3. Consideration of Regulatory Options 

3.1 Introduction 

This chapter describes the regulatory options considered during the development of the 

proposed Revised Total Coliform Rule (RTCR) and evaluated as part of this Economic Analysis 

(EA). 

3.2 Total Coliform Rule/Distribution System Advisory Committee 

In the July 2003 NPDWR review decision, EPA provided public notice of its intent to 

revise the TCR. In 2007, EPA decided to establish a committee under the Federal Advisory 

Committee Act (FACA) called the Total Coliform Rule/Distribution System Advisory 

Committee (TCRDSAC) (USEPA, 2007a). The advisory committee was charged with 

developing an Agreement in Principle (AIP) with recommendations for the TCR revision. The 

advisory committee was to also provide EPA with recommendations needed to understand and 

address possible public health impacts from potential degradation of drinking water quality in 

distribution systems. Specifically, the major objectives of the advisory committee were to 

provide advice and recommendations on: 

• Revisions to the TCR that would improve implementation while maintaining or 

improving public health protection and distribution system water quality. Examples 

of the issues the TCRDSAC considered include: the TCR monitoring framework, 

sanitary survey provisions, definition of Maximum Contaminant Level (MCL) 

violations and potential follow-up corrective actions, and public notification of 

violations. 

• What data should be collected, research conducted, and/or risk management strategies 

evaluated to better project distribution system contaminant occurrence and associated 

public health risks in the distribution systems. This was intended to “initiate a process 

for addressing cross connection control and backflow prevention requirements and 

consider additional distribution system requirements related to significant health 

risks” recommended by the M/DBP Federal Advisory Committee. 

EPA held a series of 13 meetings of the advisory committee between July 2007 and 

September 2008. The 15 committee members, along with other stakeholders, discussed options 

for revising the TCR and began the process of developing the AIP by discussing the purpose, 

efficacy and applicability of the current TCR as well as data collection and research needed to 

better understand potential distribution system risks. The advisory committee formed a Technical 

Work Group (TWG) to provide data analysis and information to inform the advisory 

committee’s discussions. The advisory committee also discussed the relevant provisions of the 

Ground Water Rule (GWR) and discussed the extent to which other rules contribute to the 

objectives of the current TCR. All advisory committee members signed the AIP in September 

2008. All of the recommendations of the AIP, on which all the members of the committee 

agreed, are found in the signed AIP (USEPA 2009, 74 FR 1683, January 13, 2009). The AIP and 
Economic Analysis for the Proposed RTCR 3-2 June 2010 

details about the advisory committee can be found at EPA’s website at: 

http://www.epa.gov/safewater/disinfection/tcr/regulation_revisions.html. 

3.3 Regulatory Options Considered 

EPA evaluated three regulatory options as part of the development of the RTCR proposal 

– the current TCR option, the AIP option, and the Alternative option. The following discussion 

provides an overview of the three regulatory options considered followed by a detailed table 

comparing specific regulatory components. A detailed evaluation and comparison of the benefits 

and costs of each of the three regulatory options for the proposed RTCR is found in later 

chapters of this EA. 

Baseline Option: Current Total Coliform Rule 

The baseline option for the proposed RTCR EA represents the current TCR as written, 

with adjustments made to reflect the effects of the GWR which PWSs need to comply with by 

December 1, 2009. Analysis of this option is primarily based on data collected under the TCR, as 

described in Chapter 4 (Baseline Conditions) of this EA. 

The current TCR requires Public Water Systems (PWSs) to monitor routinely for Total 

Coliform (TC) and fecal coliforms or E. coli. Monitoring requirements are based on system type, 

population served by the PWS and source water type. Each PWS must sample according to a 

written sample siting plan. Plans are subject to state review and revision. 

The current TCR specifies a Maximum Contaminant Level Goal (MCLG) of zero for TC 

(including fecal coliforms and E. coli) as well as an MCL where compliance is based on the 

presence or absence of TC and/or fecal coliforms or E. coli in the samples. A PWS is required to 

take repeat samples following a Total Coliform-positive (TC+) sample and to test the TC+ 

sample for E. coli. A monthly MCL violation is triggered if: (1) a PWS collecting fewer than 40 

samples per month has > 1 routine/repeat sample per month which is TC+; or (2) a PWS 

collecting at least 40 samples per month has > 5.0% of the routine/repeat samples in a month are 

TC+. An acute MCL violation is triggered if any PWS has any Fecal Coliform- or E. coli -

positive (FC+ / EC+) repeat sample or has a FC+ or EC+ routine sample followed by a TC+ 

repeat sample. A PWS must demonstrate compliance with the MCL for total coliforms each 

month it serves water to the public (or each calendar month that sampling occurs for PWSs on 

reduced monitoring). MCL violations must be reported to the state no later than the end of the 

next business day after the PWS learns of the violation. The public must also be notified 

depending on the severity of the MCL violation (within 30 days for monthly MCL violations and 

within 24 hours for acute MCL violations). 

Agreement in Principle Option (as developed by the advisory committee, reflecting the proposed 

RTCR language) 

The AIP option is designed to trigger PWSs that exceed specified levels of TC/ E. coli in 

their finished water to do an assessment, to identify whether sanitary defect(s) is (are) present, 

and to correct such defects accordingly. The advisory committee believed that the AIP option is 

an improvement over the current TCR framework because it takes a more preventive approach to 

identifying and fixing problems with public health implications. Under this option, EPA 
Economic Analysis for the Proposed RTCR 3-3 June 2010 

establishes an MCLG of zero for E. coli, an MCL for E. coli based on TC and E. coli monitoring 

results, and a coliform treatment technique for protection against potential fecal contamination. 

The AIP option maintains the current TCR requirement for all PWSs to monitor for TC 

and E. coli according to a sample siting plan and schedule specific to the PWS. PWSs are 

required to take repeat samples and to test for E. coli following a TC+ sample. 

Under the AIP option, the PWS monitoring frequencies take into account the unique 

characteristics of various PWS types and sizes. Small, well-operated PWSs using ground water 

may be able to reduce monitoring frequencies by meeting specific criteria, thus reducing their 

monitoring and reporting burden. Criteria for reduced monitoring include monitoring results that 

reflect a clean compliance history as well as preventive practices that are designed to continue to 

maintain the integrity of the distribution system. 

The AIP option requires PWSs to complete either Level 1 or Level 2 assessments 

following certain triggers (see Exhibit 3.1). The purpose of Level 1 and 2 assessments is to 

identify the presence of sanitary defects and defects in distribution system coliform monitoring 

practices. The minimum elements of both Level 1 and 2 assessments include review and 

identification of: 

• Inadequacies in sample sites, sampling protocol, and sample processing; 

• Atypical events that may affect distributed water quality or indicate that distributed 

water quality was impaired; 

• Changes in distribution system maintenance and operation that may affect distributed 

water quality including water storage; 

• Source and treatment considerations that bear on distributed water quality, where 

appropriate (e.g. small ground water PWSs); and 

• Existing water quality monitoring data. 

 A Level 1 assessment (completed by the PWS) consists of a simple examination of the 

system and relevant operational practices. The PWS must complete the assessment form and 

submit it to the state for review within 30 days after determination that the PWS has exceeded 

the Level 1 trigger. The completed assessment form must includeassessments conducted, all 

sanitary defects identified (or indicate if no sanitary defect was found), corrective actions 

completed, and a timetable for any corrective actions not already completed. Upon completion 

and submission of the assessment form by the PWS, the state will determine if the PWS has 

identified a likely cause for the Level 1 trigger and determine whether the PWS has corrected the 

problem, or has included a schedule acceptable to the state for correcting the problem. If the state 

determines the assessment insufficient, it will consult with the PWS. If necessary after 

consultation, the PWS must submit a revised assessment form to the state on an agreed-upon 

schedule not to exceed 30 days from the date of consultation. Upon completion and submission 

of the assessment form by the PWS, the state must determine if the PWS has identified a likely 

cause for the Level 1 trigger and, if so, establish that the PWS has corrected the problem, or has 

included a schedule acceptable to the state for correcting the problem. 

The Level 2 assessment must be conducted either by the state, a third party approved by 

the state, or the PWS where the PWS has the staff or management with the required certification 
Economic Analysis for the Proposed RTCR 3-4 June 2010 

or qualifications specified by the state. A Level 2 assessment is a more detailed examination of 

the system’s monitoring and operational practices than a Level 1 assessment. As with the Level 1 

assessment, the completed assessment form for a Level 2 assessment must also be submitted to 

the state for review within 30 days after determination that the PWS has exceeded the Level 2 

trigger. The PWS must also indicate in the completed assessment form the sanitary defects 

detected (or indicate if no sanitary defect was found), corrective actions completed, and a 

timetable for any corrective actions not already completed. Upon completion and submission of 

the assessment form by the PWS, the state will determine if the PWS has identified a likely cause 

for the Level 2 trigger and determine whether the PWS has corrected the problem, or has 

included a schedule acceptable to the state for correcting the problem. If the state determines the 

assessment insufficient, it will consult with the PWS. If necessary after consultation, the PWS 

must submit a revised assessment form to the state on an agreed-upon schedule not to exceed 30 

days from the date of consultation. Upon completion and submission of the assessment form by 

the PWS, the state must determine if the PWS has identified a likely cause for the Level 2 trigger 

and, if so, establish that the PWS has corrected the problem, or has included a schedule 

acceptable to the state for correcting the problem. 

The AIP option requires PWSs to correct sanitary defects found through either a Level 1 

or Level 2 assessment. The current TCR does not require PWSs that have TC MCL violations to 

perform corrective actions. For corrections that are not completed by the time the PWS submits 

the completed assessment form to the state, the PWS must complete the corrective action(s) on a 

schedule determined by the state in consultation with the PWS. The PWS must notify the state 

when each scheduled corrective action is completed. 

The AIP option specifies violations corresponding to different degrees of potential public 

health concern and public notification. A violation of an E. coli MCL occurs when: 

• A routine sample is TC+ and one of its associated repeat samples is EC+; or 

• A routine sample is EC+ and one of its associated repeat samples is TC+ (or as a 

corollary to this condition, a routine sample is EC+ and one of its associated repeat 

samples is EC+); or 

• A system fails to test for E. coli when any repeat sample is TC+; or 

• A system fails to take all required repeat samples following a routine sample that is 

EC+. 

An E. coli MCL violation requires a Tier 1 public notification. A coliform treatment technique 

violation occurs when the PWS exceeds a treatment technique trigger (see Exhibit 3.1) and then 

fails to conduct the required assessment or corrective action within the required timeframes. A 

coliform treatment technique violation requires a Tier 2 public notification. If the system does 

conduct the assessment and satisfies the requirements of the coliform treatment technique 

(including corrective action when a sanitary defect is identified), no public notification is 

required. A monitoring violation occurs when a PWS fails (1) to take every required routine or 

additional routine sample in a compliance period, or (2) to analyze for E. coli following a TC+ 

sample. A reporting violation occurs when (1) a PWS properly conducts monitoring or an 
Economic Analysis for the Proposed RTCR 3-5 June 2010 

assessment but fails to submit a monitoring report or a completed assessment form, or (2) a PWS 

fails to notify the state following an EC+ sample. Both monitoring violation and reporting 

violation require a Tier 3 public notification. 

The provisions of the AIP consider the implication and linkages to other rules 

promulgated by EPA under SDWA (e.g., GWR, Surface Water Treatment Rules (SWTRs), and 

the Disinfectant/ Disinfection Byproduct (DBP) Rules). Compliance activities for other rules, 

such as the sanitary survey, are used under the proposed RTCR as criteria to assess the integrity 

of the PWS and to implement the reduced monitoring provisions in a cost-effective manner. 

Ground water PWSs will have completed the sanitary survey component of the GWR at least 

once no later than January 2015 so sanitary survey findings can be used by states in the 

determination of the monitoring frequency. 

Alternative Option: All PWSs Initially Sample for TC/EC on Monthly Basis 

 

 The third option is the Alternative option which parallels the AIP in most ways but 

includes variations of some of the provisions that were discussed by the advisory committee 

before consensus was reached on the AIP. Under the Alternative option, at the compliance date, 

all PWSs would be required to sample monthly for an initial period until they meet the eligibility 

criteria for reduced monitoring. This more stringent approach differs from the AIP option which 

would allow PWSs to continue to monitor at their current frequencies (with an additional annual 

site visit / voluntary Level 2 assessment requirement for PWSs wishing to remain on annual 

monitoring) until they are triggered into an increased sampling frequency. Under the Alternative 

option, no PWSs would be allowed to reduce monitoring to an annual basis. EPA defined the 

Alternative option this way and included it in the economic analysis to assess the relative 

impacts of a more stringent rule and to better understand the balance between costs and public 

health protection. 

3.3.1 Comparative Summary of Regulatory Options 

Exhibit 3.1 below summarizes the components of each regulatory option considered for 

the proposed RTCR.
Economic Analysis for the Proposed RTCR 3-6 

Exhibit 3.1 Comparison of Proposed RTCR Regulatory Options 

Element Current TCR option AIP option Rule construct • MCLG of zero for TC (including FC 

and EC). 

• TC monthly MCL based on the 

number/percent of TC+ samples in a month. 

• FC / EC acute MCL based on 

FC+/EC+ samples. 

• Tier 1 Public Notification (PN) 

required for MCL violations. 

• No MCLG/MCL for TC, FC no longer used. • EC MCLG of zero, and an EC MCL and a coliform treatment 

technique (TT) based on TC and/or EC results. 

• Assessment (and corrective action if necessary) required if PWS 

has a coliform treatment technique trigger. 

• Tier 1 PN not required for only TC occurrence. 

Transition to the New Rule 

N/A • PWSs continue on their existing TCR monitoring schedule 

provided they meet criteria. 

• Noncommunity Water Systems (NCWSs) on quarterly/annual 

monitoring remain on that schedule unless/until they have an event that triggers increased monitoring. 

• Community Water Systems (CWSs) on reduced monitoring 

remain on that schedule unless/until they have an event that 

triggers return to routine monitoring. 

• Monitoring schedules will be evaluated during the “special 

monitoring evaluation” conducted by the state as part of the periodic sanitary survey to determine if the monitoring frequency is appropriate. 

Routine Monitoring 

• 1 sample per quarter for NCWS 

≤1,000 Ground Water (GW). 

• 1 sample per month for NCWS 

≤1,000 Surface Water (SW) and all CWS 

≤1,000. 

• For all PWS >1,000, the number of 

samples per month is based on population served. 

• Same as current TCR, with more explicit criteria to qualify for 

reduced monitoring (see “Reduced Monitoring”). 

• 1 sample per month for seasonal systems2 with criteria to qualify 

for reduced monitoring. Seasonal systems must also demonstracompletion of a state -approved start-up procedure. 
Economic Analysis for the Proposed RTCR 3-7 

Element Current TCR option AIP option Reduced Monitoring 

• NCWS 

≤1,000 (GW) can reduce to 

1 sample per year if system is free of sanitary defects. 

• CWS 

≤1,000 (GW) can reduce to 1 

sample per quarter if no history of TC contamination, no sanitary defects, and protected GW source. 

• No other systems are eligible for 

reduced monitoring. 

• NCWS 

≤ 1,000 (GW) – same as in current TCR, but more criter

to qualify and remain on reduced annual monitoring. 

o Most recent sanitary survey shows that system is free of 

sanitary defects1, has a protected water source, and meets 

approved construction standards; 

o Clean compliance history for a minimum of 12 months; o Level 2 assessment by party approved by state within the last 

12 months and correction of all identified sanitary defects. System must also have an annual site visit every year thereafter to remain on annual monitoring. 

• Seasonal systems can be eligible for reduced monitoring by 

having an approved sample site plan that designates the time period for monitoring based on demand and vulnerability 

o For quarterly monitoring the system must also have a sanitary 

survey or site visit or Level 2 assessment within last 12 montha protected water source; a clean compliance history for a minimum of 12 months, and be free of sanitary defects. 

o To reduce to 1 sample per year, the system must meet the 

criteria specified above for quarterly monitoring and have in place or adopt one or more additional enhancements to barrieto contamination (cross connection control, certified operator, meet disinfection criteria, maintenance of at least 4-log removor inactivation of viruses, other equivalent enhancements). 

• CWS 

≤ 1,000 (GW) - same as in current TCR, but more criteria 

qualify and remain on reduced quarterly monitoring. 

o State certified operator; o Most recent sanitary survey shows that system is free of 

sanitary defects (or has an approved plan and schedule to correct them), has a protected water source, and meets approved construction standards; 

o Clean compliance history for a minimum of 12 months; 
Economic Analysis for the Proposed RTCR 3-8 

Element Current TCR option AIP option 

o Meets at least one of the following criteria: annual site visit by 

the state or a voluntary Level 2 assessment by a party 

approved by the state or meeting criteria established by the state; cross connection control; meet disinfection criteria; maintenance of at least 4-log removal or inactivation of viruseother equivalent enhancements to water systems as approved by the state. 

• No other systems are eligible for reduced monitoring. 

Increased Monitoring (NCWS) and Return to Routine Monitoring (CWS) 

• N/A (none specified) – NCWS. • N/A (none specified) – CWS 

• NCWS 

≤ 1,000 (GW only) increases from quarterly or annual 

monitoring to monthly monitoring if one of the following occurs: 

o Triggered Level 2 assessment or a 2nd Level 1 assessment in 

12 months; 

o EC MCL violation; 

o Coliform TT violation; or o Two monitoring violations within 12 months if on quarterly 

monitoring or one monitoring violation if on annual. 

• CWS 

≤ 1,000 (GW only) on quarterly monitoring return to month

monitoring based on same criteria above. 
Economic Analysis for the Proposed RTCR 3-9 

Element Current TCR option AIP option Return to Reduced Monitoring (After Being Triggered to Increased Monitoring)

N/A • NCWS 

≤ 1,000 (GW) must meet the following criteria to return to 

routine quarterly monitoring after being triggered to increased monitoring: 

o Within the last 12 months, system must have completed a 

sanitary survey or a site visit by the state or a voluntary Level 

assessment, must be free of sanitary defects, and must have protected water source; and 

o Clean compliance history for a minimum of 12 months. 

• NCWS 

≤ 1,000 (GW) must meet the following criteria to return to 

reduced annual monitoring in addition to meeting the criteria for returning to routine quarterly monitoring: 

o An annual site visit by the state or a voluntary Level 2 

assessment and correction of all identified sanitary defects; a

o Adoption of one or more additional enhancements to the wate

system barriers to contamination (cross connection control, certified operator, meet disinfection criteria, maintenance of aleast 4-log removal or inactivation of viruses, other equivalent enhancements). 

• CWS 

≤ 1,000 (GW) must meet the same criteria for qualifying fo

reduced quarterly monitoring. 

Repeat Monitoring 

• PWS serving > 1,000 people must 

take 3 repeat samples after a TC+ sample. 

• PWS serving 

≤1,000 must take 4 

repeat samples after a TC+ sample. 

• For GWS PWS, 1 sample can be a 

source water sample to comply with the GWR. 

• All PWSs must take 3 repeat samples after a TC+ sample. • PWS 

≤ 1,000, the number of repeat samples is reduced from 4 

samples to 3. 

• GW PWS must still take an additional source sample to comply 

with the GWR. 

• For GW PWS 

≤ 1,000, a single sample can meet both the 

triggered source water requirements of the GWR and the repeat sample requirements of the AIP option, but only if the state

approves the use of the single sample to meet both rule requirements and the use of EC as the fecal indicator. 
Economic Analysis for the Proposed RTCR 3-10 

Element Current TCR option AIP option Additional Routine Monitoring 

PWS taking < 5 routine samples per month (PWS serving 

≤ 4,100) must 

take at least 5 routine samples the month after a TC+ sample.

• For PWS taking samples less than monthly, the number of 

samples required after a TC+ is reduced from 5 to 3. 

• For PWS taking at least 1 sample per month, the additional 

routine sample requirement is eliminated (they take their usual number of samples the following month). 

Sample Siting Plan 

• Sampling must occur at sites 

representative of water quality in the distribution system. 

• Sample siting plans are subject to 

state review/ revision. 

• Special purpose samples are not 

used for determining compliance. 

• Take at least one repeat sample 

within 5 connections up- and downstream of the TC+ site. 

Same as current except: 

• Specifically allows for dedicated sampling stations. • Provides more flexibility for systems in determining the locations 

for taking repeat samples. 

• States may allow entry point sampling at ground water systems 

the overall plan remains representative of water quality in the distribution system. 

Assessment N/A – none required in the current 

TCR.

• The PWS must conduct a Level 1 (self-assessment) if it exceeds 

any of the following triggers: o For systems taking 

≥ 40 samples per month, the PWS exceed

5.0% TC+ samples for the month; or 

o For systems taking < 40 samples per month, the PWS has 

≥ 2 

TC+ samples for the month; or 

o The PWS fails to take every required repeat sample after any 

single routine TC+ sample. 

• The PWS must ensure that a Level 2 assessment is conducted 

either by the state or a state -approved 3rd party (including 

qualified PWS employee) if it exceeds any of the following triggers: 

o The PWS has an E. coli MCL violation. 

o The PWS has a second Level 1 trigger within a rolling 12-mon

period, or in 2 consecutive years for systems on annual 
Economic Analysis for the Proposed RTCR 3-11 

Element Current TCR option AIP option 

monitoring. 

• Assessment results and description of corrective action taken wi

be submitted to the state within 30 days. 

Corrective Action N/A – none required in the current 

TCR. 

• System must correct all sanitary defects found in the assessmen

• If none found, state must be satisfied with the assessment. 

• For corrections not completed by the time the assessment form 

submitted, the systems must be in compliance with a state

determined schedule and must notify the state when completed. 

Violations and Public Notification (PN) 

• EC/FC MCL violation – acute 

violation, Tier 1 PN. 

• Monthly TC MCL violation – Tier 2 

PN. 

• Monitoring or reporting violation – 

Tier 3 PN. 

• PWS must notify state regarding 

single EC+/FC+ result. 

• EC MCL violation – Tier 1 PN. Failure to take repeat samples 

following an EC+ is also an EC MCL violation. 

• Monthly TC MCL violation is dropped – conditions that trigger a 

monthly TC MCL violation under the TCR trigger assessment ancorrective action instead. 

• Coliform TT violation occurs when a PWS fails to conduct requir

assessment and corrective action – Tier 2 PN. 

• Monitoring and reporting violations will be tracked separately – 

Tier 3 PN. 

1 The advisory committee recommended the following definition of “sanitary defect”-“a defect that could provide a pathway of e

contamination into the distribution system or that is indicative of a failure or imminent failure in a barrier that is already in place” 2 As described in the preamble of the proposed RTCR, the AIP defines a seasonal system as “one which operates less than fo

year.” (AIP, p 10) EPA has interpreted this to mean that a seasonal system is one that is shut down for at least one full calend“in” three or fewer calendar quarters). 
Economic Analysis for the Proposed RTCR 3-12 June 2010 

3.4 Proposed Rule Requirements 

Through coordination and consultation with the advisory committee and stakeholders as 

described in Section 3.2, EPA selected the AIP option as the preferred option for proposal. The 

AIP option was developed by the advisory committee with the primary goal of achieving the 

objectives of the 1989 TCR more effectively and efficiently, taking into account the changes in 

regulatory framework for implementing the SDWA over the past 20 years and experience with 

the TCR since it was promulgated in 1989. Additional discussion supporting the selection of the 

AIP option as the preferred regulatory option in terms of benefits and costs is provided in 

Chapters 6 (benefits), 7 (costs), and 9 (benefits and costs). 
Economic Analysis for the Proposed RTCR 4-1 June 2010

4. Baseline Conditions 

4.1 Introduction 

 A primary step in the development of the Economic Analysis (EA) for the proposed 

Revised Total Coliform Rule (RTCR) was to estimate the baseline conditions. The U.S. 

Environmental Protection Agency (EPA) used available data to develop an occurrence and 

predictive model for Public Water Systems (PWSs) serving 4,100 people or fewer based 

primarily on the 2005 Six-Year Review 2 data to predict total coliform and E. coli occurrence, 

Level 1 and Level 2 assessment triggers, corrective actions, and violations, both at the baseline 

and over time. EPA developed another, simpler, predictive model for PWSs serving more than 

4,100 people based primarily on the 2005 Safe Drinking Water Information System-Federal 

Version (SDWIS/FED) violation data (USEPA, 2005a) that predicts triggers, assessments, 

corrective actions, and violations both at the baseline and over time, but not total coliform and E. 

coli occurrence. Because five years of Ground Water Rule (GWR) implementation prior to the 

effective date of the proposed RTCR are expected to cause changes to Ground Water Systems 

(GWSs), the baseline conditions that EPA developed for the EA account for the effects of the 

GWR, as described in this chapter and Chapter 5. The remainder of this chapter describes the 

data sources used to develop the baselines and how the data were used. The resulting estimate of 

baseline conditions serves as a reference point for understanding net impacts of the proposed rule 

revisions, as discussed in Chapters 6, 7, and 9 of this EA. 

4.1.1 Background and Purpose 

 The baseline analysis is a characterization of the water industry and its current operations 

in effect before systems make changes to meet requirements of the proposed RTCR. This chapter 

presents estimates of the number of systems, the population affected, water quality measures, and 

subpopulations affected. The data collected for this profile will serve as the baseline used in the 

proposed RTCR EA. The development of the baseline analysis consists of the following steps: 

• Compilation of a profile of water systems – identifying and collecting information on all 

PWSs. 

• Characterization of current monitoring requirements, including testing requirements, 

sample siting plans, routine and repeat sampling requirements, and sanitary surveys. 

• Characterization of current PWS compliance information, including acute and monthly 

Maximum Contaminant Level (MCL) violations, triggered monitoring, and public 

notification reporting.

 

4.1.2 Chapter Organization 

 The remainder of this document is organized into three general sections: 

Section 4.2 Describes general information on data sources. 
Economic Analysis for the Proposed RTCR 4-2 June 2010

Section 4.3 Describes the baseline conditions. 

Section 4.4 Estimates baseline impact on sensitive populations 

Section 4.5 Presents a summary of assumptions used to develop baseline estimates, 

associated uncertainty and variability, and potential impacts on the results 

of the RTCR EA. 

4.2 Data Sources 

Several primary data sources were used for the EA to characterize the proposed RTCR 

baseline to create system and population baselines, including the SDWIS/FED (USEPA, 2007b), 

the 2005 Six-Year Review of National Primary Drinking Water Regulations (Six-Year Review 

2), the Ground Water Rule EA, and the U.S. Census. Each of these data sources is further 

explained in Sections 4.2.1 – 4.2.3 below. 

4.2.1 Background on SDWIS/FED Data 

SDWIS/FED1

 is EPA’s national regulatory compliance database for the drinking water 

program and is the main source of PWS inventory and violation data for the proposed RTCR 

baseline. SDWIS/FED contains information on each of the approximately 155,000 active PWSs 

as reported by primacy agencies2

, EPA Regions, and EPA headquarters personnel. SDWIS/FED 

does not include sample results, but does include identification of Maximum Contaminant Level 

(MCL) violations and monitoring and reporting violations (both routine and repeat and minor 

and major)3

. It also contains information to characterize the U.S. inventory of PWSs, namely: 

 

1

 Further information on SDWIS/FED can be found on EPA’s website: 

http://www.epa.gov/safewater/databases/sdwis/index.html. 2

 States and Indian Tribes are given primary enforcement responsibility (primacy) for regulations pertaining to 

public water systems in their State/jurisdiction if they meet certain requirements specified under the primacy 

regulations at 40CFR142, Subpart B (revised most recently in 1998). 3

 Under the current TCR, a non-acute (monthly) MCL violation occurs when >1 routine and/or repeat sample are 

Total Coliform-positive (TC+) for systems that take fewer than 40 samples monthly, or greater than 5.0% of 

monthly samples are TC+ for systems that take at least 40 samples. An acute MCL violation is triggered if a PWS 

has a positive fecal coliform (FC) or E. coli (EC) REPEAT sample (following a TC+) or has a positive FC/EC 

ROUTINE sample followed by a TC+ REPEAT sample. Monitoring violations occur when a system 1) does not 

satisfy the sample siting plan requirement; 2) does not sample in accordance with its required schedule; 3) does not 

analyze a positive TC ROUTINE sample for FC or EC; 4) does not collect REPEAT samples within 24 hours and 

analyze for TC following a ROUTINE positive TC; and 5) does not test REPEAT samples that are positive for TC 

for FC or EC. If a system fails to conduct some of the required routine samples in a compliance period, the system 

incurs a Minor Routine Monitoring Violation. Equivalently, a system that fails to conduct some or all of its required 

repeat samples following a positive TC routine sample incurs a Minor Repeat MR Violation or a Major Repeat MR 

Violation, respectively. Reporting violations occur when a PWS does not report to the state or to the public 

according to the schedule for each violation type. For Acute MCL violations, a PWS must report to the state by end 

of day and to the public within 24 hours (by posting, hand delivery, or mass media subject to primacy agency 

approval). For Monthly MCL violations, a PWS must report to the state by end of next day, and to the public within 

30 days by mail, hand delivery, or other methods approved by the primacy agency. For Monitoring violations, a 

PWS must notify the public with 1 year in accordance with general public notification requirements approved by the 

primacy agency. 
Economic Analysis for the Proposed RTCR 4-3 June 2010

system name and location; retail population served; source water type (i.e., Ground Water (GW), 

Surface Water (SW), or Ground Water Under the Direct Influence of Surface Water (GWUDI)); 

whether or not systems disinfect the water; and PWS type, as described below. 

EPA defines a PWS as a system that provides water for human consumption through 

pipes or other constructed conveyances if such a system has at least 15 service connections or 

regularly serves an average of at least 25 individuals per day for at least 60 days per year. PWSs 

are categorized as follows: 

 

• Community Water Systems (CWS) are PWSs that supply water to the same population 

year-round. 

• Noncommunity Water Systems (NCWS) are PWSs that supply water to a varying 

population or one that is served less than year-round. They are sub-categorized as 

follows: 

- Nontransient Noncommunity Water Systems (NTNCWS) are public water 

systems that are not community water systems and that regularly supply water to 

at least 25 of the same people at least six months per year, for example, schools. 

- Transient Noncommunity Water Systems (TNCWS) are NCWSs that provide 

water in places such as gas stations or campgrounds where people do not remain 

for long periods of time. 

 Additionally, PWS are analyzed in this EA according to categories defined by the number 

of people they serve. The following nine categories of populations served by PWSs are used 

throughout this document: 

• ≤100. 

• 101-500. 

• 501-1,000. 

• 1,001-4,100. 

• 4,101-33,000. 

• 33,001-96,000. 

• 96,001-500,000. 

• 501,001-1 Million. 

• Over 1 Million. 

These population categories are mostly consistent with those analyzed for other rules and 

consider the distinctions in cost and system operation that are meaningful when considering the 

economic effects of rule requirements. In particular, under the current Total Coliform Rule 

(TCR), PWSs serving more than 1,000 people all test for Total Coliform (TC) monthly; PWSs 

serving fewer than 1,000 people may monitor quarterly or even annually and (assuming that they 

collect fewer than 5 samples per month) must have a sanitary survey every 5 years. The 33,000 

threshold is significant as it corresponds with sampling requirements (at least 40 samples per 

month are taken) that affect how compliance with the rule is calculated. (PWSs with >33,000 

persons served must take 40 or more samples in a month, and may trigger an MCL violation 

based on the percentage of TC+ samples, in this case, >5.0 percent.) Finally, the size category 
Economic Analysis for the Proposed RTCR 4-4 June 2010

thresholds of 1,000; 4,100; 33,000; and 96,000 are consistent with the size categories used in the 

TCR to determine the monitoring regimen. 

4.2.1.1 Data Used from SDWIS/FED 

To create the system and population baseline, EPA obtained the most current PWS 

inventory data by downloading data from the 4th quarter of 2007 from SDWIS/FED (USEPA, 

2007b). These data represent all current, active PWSs and the population served by these 

systems. This information composes the PWS inventory baseline for this EA, and is summarized 

in Section 4.3. 

EPA also used MCL violations data from SDWIS/FED to validate model predictions for 

systems serving ≤4,100 people as described in Section 5.3.3.2, and to predict E. coli (acute) 

MCL violations (current TCR, the Agreement in Principle or AIP, and Alternative option), total 

coliform (non-acute or monthly) MCL violations (current TCR) and Level 1 and Level 2 

assessment triggers (AIP option and Alternative option) for systems serving more than 4,100 

people, as described in Section 4.3.4.2. 

4.2.1.2 Data Cleaning 

Data obtained from SDWIS/FED comprised PWS inventory data for the 4th quarter of 

2007 and violations data from 3rd quarter 2005. The 4th quarter inventory data included the 

number of each type of PWS and the retail population served by each system for all active 

PWSs, and was used from SDWIS/FED without manipulation for the purpose of this analysis. 

For the SDWIS/FED violations dataset, EPA did exclude some data representing OH, tribes, and 

territories as described in Section 4.3.4.2. The data set taken from the 2005 Six-Year Review 2 

database was cleaned as described in Section 4.2.2 of this EA. 

4.2.1.3 Representativeness and Quality of SDWIS/FED Data 

As noted above, SDWIS/FED is the source of PWS inventory data, and includes 

information on all of the approximately 155,000 PWSs to the extent that such data was entered 

by primacy agencies, EPA Regions, and EPA headquarters personnel. In 1998, EPA began a 

major effort to assess the quality of the drinking water data in SDWIS, including performance of 

a data quality assessment that has been published triennially since 2002. The most recent report 

from this periodic assessment, the 2006 Drinking Water Data Reliability Analysis and Action 

Plan (2006 report) (USEPA, 2008a), evaluated data for 2002 – 2004 and found the PWS 

inventory data quality to be high (87%) and the TCR violations data quality to be moderately 

high (81%). For the PWS inventory data used in this analysis, EPA found specifically that: 

“...The overall data quality of the eight inventory (water system identification) parameters 

assessed was 87%. In other words, 87% of PWSs from Data Verification4

 (DV) states 

 

4

 EPA routinely evaluates state programs by conducting Data Verification (DV) audits, which evaluate the accuracy 

of a state’s decisions regarding PWS compliance with SDWA regulations and the accuracy with which inventory 

and compliance data is reported (entered or uploaded into) SDWIS/FED. 
Economic Analysis for the Proposed RTCR 4-5 June 2010

between 2002 and 2004 had consistent data for all eight inventory data elements between 

their state files and SDWIS/FED database, or 13% of PWSs had at least one data element 

reported with a discrepancy. The highest discrepancy rate was for the administrative contact 

address element.” 

The report’s assessment indicates a high degree of completeness and accuracy in 

inventory data submitted by states to SDWIS/FED, and suggests that the information is largely 

representative of the PWSs in the United States. Although the proposed RTCR EA uses 

inventory data from 2007, the assessment above applies to the most recent period analyzed in 

this report (2002-2004); thus EPA believes that the inventory data from SDWIS/FED in 2007 is 

also likely to be representative of the approximately 155,000 PWSs and that uncertainty in the 

data with respect to numbers of systems, water source type5

, and size classification is low. 

For the TCR MCL violations data, the overall data quality estimate was 81%, based on a 

rating of 84% for completeness of data and 97% accuracy of the data in SDWIS/FED as compared to 

data observed in states’ databases during the verification process6

. As described in the report, the 

84% completeness assessment indicates that for approximately 16% of those systems found by EPA 

to have TCR MCL violations, states did not report the data in SDWIS/FED. Additionally, data 

completeness for monitoring and reporting violations as a whole for all SDWA rules in SDWIS/FED 

is low at 29%, although this metric specific to the TCR is not provided in the report. Low compliance 

with monitoring and reporting may occur if systems would rather incur an M/R violation rather than 

risk an MCL violation by sampling. These factors together suggest that violation rates would likely 

be higher if systems were fully in compliance with monitoring and reporting requirements, and if 

states were fully reporting those results to SDWIS/FED. Despite this potential downward bias in the 

MCL violations data, the TCRDSAC was still able to note systematic trends in the data (across 

time and among PWS types and sizes) and informed its decisions based on key observations: 

• Most systems with violations are NCWSs. 

• Lower violation rates observed among larger systems. 

• Higher violation rates observed among GWSs than SWSs. 

• Lower violation rates among disinfecting GWSs than other GWSs. 

An additional concern with the representativeness of the violations data in SDWIS/FED that 

would not be accounted for in the data quality estimate from the 2006 report is the potential bias 

introduced by oversampling. In a recent paper by (Bennear et al., 2009), the authors attempt to 

 

5

 In particular, in the 2006 report the source water type (disinfecting, nondisinfecting, or status unknown) inventory 

item was assessed at 99.3%, indicating that less than 1% of systems from DV states analyzed between 2002 and 

2004 had a discrepancy in this information between State files and SDWIS/FED. For the purpose of the RTCR EA, 

systems with status listed as “unknown” were included in the nondisinfecting group.

6

The Overall Data Quality Estimate in SDWIS/FED measures how many noncompliance determinations are 

correctly reported in SDWIS/FED among all noncompliance determinations (that are either violations or falsepositive violations). This quantity is estimated based on the violations confirmed by EPA and correctly reported to 

SDWIS/FED out of all violations found by EPA or in the state files and SDWIS/FED. When the false positive rate is 

0%, this measure is the product of Completeness and Accuracy. The False Positive rate of the violation data in 

SDWIS/FED describes how much of the reported violation data in SDWIS are, in fact, false violations, expressed as 

a percentage. Further description can be found in the 2006 Drinking Water Data Reliability Analysis and Action 

Plan (2006 report) (USEPA, 2008a). 
Economic Analysis for the Proposed RTCR 4-6 June 2010

determine how often oversampling is an effort to “sample out” of a potential violation versus just 

overcompliance - taking additional samples to increase the PWS’s diagnostic power is assessing 

the quality of the water. The authors did find evidence that strategic oversampling was occurring 

in the one state included in their analysis7

; some systems were reducing their probability of 

incurring monthly violations (on the basis of TC positives as a percent of total monthly samples 

taken) by increasing the total number of samples taken. Although the study was not broad 

enough in scope to warrant adjusting the data used from SDWIS/FED, the issue is included in 

the discussion of net benefits in Chapter 9 of this EA. Moving forward, removal of the public 

notification requirement for monthly violations should help to reduce some of the incentive for 

strategic sampling of this kind. 

4.2.2 Background on 2005 Six-Year Review 2 Data 

Through an Information Collection Request (USEPA, 2006b), EPA requested that states 

voluntarily submit monitoring data (sample results) that were collected between January 1998 

and December 2005 that were available electronically for specified chemical, radiological, and 

microbiological contaminants. This request included data collected in compliance with the TCR 

regarding the presence/absence of TC, E. coli, and/or fecal coliforms (FC) and any disinfection 

data collected at TCR monitoring sites. (Surface water systems are required to monitor for the 

presence of a disinfectant residual when collecting coliform samples in the distribution system.) 

These data are an important component in supporting EPA’s second Six-Year Review of 

National Primary Drinking Water Regulations (NPDWRs). EPA encouraged each primacy 

agency to submit its contaminant occurrence information because these data directly contribute 

to EPA’s understanding of national contaminant occurrence, populations exposed to regulated 

contaminants, and exposure reductions associated with the current regulations. 

 EPA requested the TCR monitoring results with the intent of conducting analyses and 

developing models to assess the potential impacts of changes to the rule. Models of the 

occurrence of TC and E. coli were developed using the TCR data to assess revisions to 

monitoring requirements and compliance decisions for different types of PWSs as suggested by 

the stakeholders during the TCR Distribution System Advisory Committee (TCRDSAC) process, 

described further in Chapter 3 of this EA. 

For the RTCR EA, EPA used the 2005 Six Year Review data to develop the key parameters 

used in the RTCR predictive model to forecast water quality (in terms of TC and E. coli

occurrence) under the current TCR, the AIP option, and the Alternative option. Additionally, 

2005 Six Year Review data was used to inform EPA’s assumptions regarding the proportion of 

GWSs serving 1,000 or fewer people that sample monthly, quarterly, or annually (presented in 

Exhibit 4.4).

 

7

 Bennear et al. found that violations in the state of Massachusetts may have been approximately 30% greater had 

the oversampling not taken place. 
Economic Analysis for the Proposed RTCR 4-7 June 2010

4.2.2.1 2005 Six-Year Review 2 Data Used 

As described in the Total Coliform Rule Compliance Monitoring Data Quality and 

Completion Report (USEPA, 2010e) (Data Quality Report) prepared during the TCRDSAC 

process prior to this EA, the 2005 Six-Year Review 2 data is based on coliform monitoring data 

voluntarily provided to EPA by 37 primacy agencies (35 states and 2 tribes). The data consist of 

over nine million TCR records collected between 1998 and 2005. The data elements include the 

following: 

• PWS information - system type, population, source water type. 

• Sampling types- routine, repeat, special, unknown. 

• Sampling locations - entry point to the distribution system, distribution system, and, 

for repeat samples, original location, downstream, upstream, and other. 

• Methods - for testing for TC and E. coli. 

• Monitoring results – presence/absence for total coliforms, fecal coliforms, and E. coli. 

EPA prepared a tool that states using the SDWIS/state database system could use to 

easily extract data from their databases and submit it to EPA. The data extraction tool was a 

query that collected the data elements requested in the letter to the states. The states that used this 

extraction tool are categorized as Tier 1 states. States submitting data in formats not compatible 

with the EPA extraction tool are categorized as Tier 2 states. States that submitted incomplete or 

problematic data are categorized as Tier 3, and states that did not provide data are categorized as 

Tier 4 (e.g., California and Pennsylvania). The complete lists of states included in each of the 

Tiers 1 – 4 are provided in the Data Quality Report. 

EPA used 2005 data exclusively in developing this EA. This decision was made for 

several reasons: 

• The 2005 data, being the most recent in the Six-Year Review, were judged to be more 

representative of present conditions than the less recent data, especially in terms of 

the percent of TC records that were positive. 

• There were fewer data in the years before 2005, especially 2001 and earlier, and 

therefore data in earlier years was judged to be too sparse to be comparable with the 

2005 data. The difference in the base of PWSs studied year-to-year might have 

introduced an unknown bias. 

• As noted earlier, the 2005 data had more records than other years, and enough to 

represent the full spectrum of PWSs within states that provided the data. 

• Using only a single year of data was beneficial in that is simplified the analysis to 

include a fairly static set of PWSs, and did not require interpretation of the meaning 

of differences in occurrence data observed across multiple years. Understanding these 

types of differences would involve analysis of changing environmental factors, 
Economic Analysis for the Proposed RTCR 4-8 June 2010

program participation and administration factors, and possibly other factors before the 

data could be used as a baseline in the model. Additionally, a full year (and not less) 

of observed data was required for consistency with the basic unit of time in 

occurrence estimates, which is one year; and a period of 12 consecutive months is 

assumed to capture seasonal variation normally experienced in water quality. 

• A single year of data would allow for use of a single database to store all the data for 

easier analysis.

4.2.2.2 Data Cleaning of 2005 Six-Year Review 2 Data 

The Data Quality Report (USEPA, 2010e) describes how TCR monitoring data were 

obtained, evaluated, and modified where necessary to make the database internally consistent 

and usable for analysis. Exhibit 2.1 in the Data Quality Report provides a complete list of states 

or territories that submitted data and a description of the use of these data. 

To determine whether a PWS’s sampling data were complete in the 2005 Six-Year Review 

2 dataset, a representative month for a system was defined as having at least 50 percent of the 

number of samples expected based on the size of system and current TCR requirements. Using 

this 50% criterion, months that were not representative of a PWS were excluded; this cleaning 

resulted in a decrease of only 2% of submitted data, and is unlikely to have skewed occurrence 

results, as shown by Exhibits 3.1 and 3.2, respectively, of the Data Quality Report. EPA 

determined that a 50% criterion systematically eliminated systems that were only reporting 

positive results or otherwise not reporting many of its samples, while retaining data for systems 

that had increased from one size category to the next (and were therefore expected to have, for 

example, 15 samples per month instead of 10). The Technical Work Group of the Federal 

Advisory Committee agreed with this approach, which is explained further in Section 3.2 of the 

Data Quality Report. 

4.2.2.3 Representativeness of 2005 Six-Year Review 2 Data 

In the course of cleaning the 2005 Six-Year Review 2 data, EPA examined data from the 

10 largest PWSs in each state and found, by matching with SDWIS inventory information, that 

many larger systems were not included in the data submitted by the states. For the largest 

systems that are represented in the 2005 Six-Year Review 2 data, EPA also compared the 

expected number of samples based on population served (i.e., the TCR requires a system serving 

a million people to sample 300 times per month) to the number of samples in the actual data to 

evaluate completeness. In some cases it was found that only data from the state laboratory were 

included. Since many large PWSs have their own laboratory and do not use the state laboratories, 

data for these large systems were not available. In many cases, states handled large PWSs with 

negative samples in a special way, and those data were not captured by the data extraction tool. 

The end result was that large PWSs had a lower percentage of samples included in the data than 

did smaller systems; therefore, data for systems serving more than 4,100 were not used from this 

database. Instead, as described in Section 4.3.4.2, EPA used SDWIS/FED violations data to 

model changes in the number of corrective actions to be implemented and incremental costs 

under the proposed RTCR for PWSs serving greater than 4,100 people. 
Economic Analysis for the Proposed RTCR 4-9 June 2010

Based on the number of smaller PWSs (serving fewer than 4,101 people) in states whose 

data were excluded for data quality/quantity issues or for non-submittal of data, approximately 

39 percent of systems were excluded from the analysis. Specifically, the following states or 

territories submitted data but were excluded because of issues with the quality or quantity of data 

submitted: AL, American Somoa, DC, ME, MD, NJ, SC, SD, TN, and the Navajo Nation. 

Additionally, the following states/territories did not submit data: CA, Guam, HI, LA, MA, MS, 

Northern Mariana Islands, PA, Puerto Rico, TX, Virgin Islands, and WA. The remaining 70 

percent of PWSs’ data were used to simulate occurrence of TC and E. coli under the current TCR 

and AIP option regulatory alternatives and to develop parameters for use in the RTCR predictive 

model, described in Chapter 5 of this EA. 

Although approximately 61 percent of the systems are represented in the analysis, only an 

estimated 32% of the population served by PWSs is represented due to the omission of some 

large population states (i.e., CA, PA, and TX)8

. However, since EPA is not predicting changes in 

ocurrence for the largest systems (i.e., the majority of the population is served by very large 

CWSs) the under-representation of population served in the data is not expected to have a 

significant impact on the analyses performed. 

4.2.3 Background on Other Data and Information Used 

 SDWIS/FED data and 2005 Six-Year Review 2 data represent the largest portion of 

information used for the proposed RTCR baseline analysis. In addition, EPA incorporated 

information from the GWR, the U.S. Census, and the current TCR to develop assumptions for 

the model. EPA also relied upon the knowledge and experience of stakeholders representing 

industry, states, small systems, and the public to inform the process throughout development of 

the proposed RTCR. 

4.2.3.1 Current TCR 

Under the current TCR, PWSs experienced reduced occurrence of fecal indicator 

contamination after the effective date in 1989 as a result of increased sampling, reporting, and to 

some degree corrective actions. In recent years under the TCR, the occurrence of fecal indicators 

has reached a steady state, as reflected in SDWIS/FED violation data (see Section 4.3.4.2 for 

discussion). Additional reductions in occurrence are expected prior to proposed RTCR 

implementation that reflect water quality improvements due to implementation of the GWR. 

Because the water quality data used in this analysis is the Six-Year Review 2 data for 2005, 

adjustments are made to the 2005 data in the modeling to reflect this GWR impact. Further 

reductions in occurrence of fecal indicators under the proposed RTCR can then be properly 

modeled based on more focused assessments and corrective actions in response to TC+ or EC+ 

samples. 

 

8

 As described further in the Data Quality Report, submission of the data was voluntary; CA, PA, and TX did not 

submit data. 
Economic Analysis for the Proposed RTCR 4-10 June 2010

4.2.3.2 GWR data 

 The GWR was promulgated to address microbial contamination of ground water sources 

used to supply drinking water and, specifically, to address the concern about potential adverse 

health risks that may be associated with fecal contamination. Before the GWR was promulgated, 

there were no federal regulations to require filtration or disinfection of ground water sources to 

remove microbial contaminants. The GWR requirements include sanitary surveys, triggered 

monitoring in response to TCR samples testing positive for contaminant indicators, source water 

monitoring for indicators of fecal contamination such as E. coli,

9

 and corrective actions which 

may include disinfection. 

 Both the GWR and the proposed RTCR seek to decrease the level of fecal contamination 

in drinking water. Since the proposed RTCR applies to all public water systems including 

systems that use ground water sources, the implementation of the GWR (requiring compliance 

by December 1, 2009) in advance of the proposed RTCR is expected to modify the TCR baseline 

(see Sections 4.3.1 – 4.3.2 below) taken from the 2007 SDWIS/FED (4th quarter) and 2005 Six 

Year Review data (see Sections 4.2.1 and 4.2.2 for discussion of SDWIS/FED and 2005 Six 

Year Review data, respectively). The number of disinfecting and non-disinfecting public 

groundwater systems prior to the start of GWR implementation in October 2009 (based on 4th

quarter 2007 SDWIS/FED data) is 54,469 and 85,999, respectively. By October 2012 when the 

GWR is fully implemented, EPA predicts that the number of systems disinfecting will have 

increased from the 2007 4th quarter baseline. The proposed RTCR occurrence model estimates 

and incorporates the estimated change in the number of systems with disinfection into this EA 

baseline (Section 5.3.1). 

 

 The RTCR occurrence model (described in further detail in Section 5.3 of this EA) 

accounts for GWR implemention in the following ways: 

• The baseline number of disinfecting systems in the 4th quarter 2007 data of 

SDWIS/FED will be increased to account for the additional systems that are 

estimated to begin disinfecting under the GWR. 

• Sanitary surveys, as required by th GWR, will be phased in for applicable PWSs in 

the model (over five years for systems on a five year sanitary survey cycle; and over 

three years for systems on a three year cycle), resulting in reduced occurrence for 

these systems indefinitely to represent that systems are correcting deficiencies 

identified in the survey. Further detail on this component of the model is provided in 

Chapter 5 of this EA. 

• GWR compliance monitoring will be incorporated with an additional decrease in 

probability of occurrence to represent anticpated efforts by systems to identify and 

correct problems. 

 

9

 Standridge, J. (2008) discusses the use of E. coli as an indicator of drinking water quality. 
Economic Analysis for the Proposed RTCR 4-11 June 2010

• The baseline estimates will account for the decreased levels of TC occurrence and 

fecal contamination achieved under the GWR. This decrease will be reflected in 

model output for the following proposed RTCR rule components: 

- Repeat monitoring 

- Additional routine monitoring 

- Triggers for level 1 and 2 assessments 

- Corrective actions 

- Public notification 

• Under the GWR, if a PWS experiences a TC+ while conducting TCR monitoring, the 

system must sample the source water for the presence of a fecal indicator (E. coli, 

enterococci, or coliphage, as determined by the state). Ground water PWSs that have 

a positive initial fecal indicator sample from the source are required to take five 

repeat fecal indicator samples if they are not required by the state to take corrective 

action. Under the proposed RTCR, PWSs having less than 4-log treatment and 

serving 1,000 people or fewer would only be required to take 3 repeat samples. To 

meet GWR requirements, these systems would need to take one additional sample at 

the source. 

4.2.3.3 U.S. Census Data 

 The baseline analysis incorporates data from the U.S. Census that are publically available 

and include surveys of the U.S. population, economics, industry, and geography. Census 2000 

data were used in the baseline analyses to estimate the sensitive subpopulations in the U.S. who 

may be more susceptible to illness as a result of poor drinking water quality, as explained in 

Section 4.4 of this EA. Additionally, the Census 2008 Annual Social and Economic Supplement 

was used in the estimates of household size as described in Section 4.3.3. 

4.3 Baseline Profile 

The proposed RTCR applies to all PWSs, regardless of their size, water source (ground 

water or surface water), or type (community, noncommunity non-transient, noncommunity 

transient). This section estimates the baseline number of PWSs and the size of the population 

subject to the proposed RTCR in each of these subcategories. EPA used 4th quarter 2007 data 

from SDWIS to develop this inventory baseline because. At the time when the TCRDSAC began 

discussing the proposed rule and its analysis, 2007 data were the most recent inventory data 

available. As described in Section 4.2, the best available occurrence data for smaller PWSs was 

collected in 2005. For larger systems (serving >4,100 people) as Section 4.3.4.2 describes, EPA 

used SDWIS-FED violations data for modeling benefits and costs for PWSs serving more than 

4,100 people because the 2005 Six-Year Review 2 dataset (containing sampling data) for larger 

systems was not as robust. Third quarter 2005 SDWIS/FED data is used for the violation 

baseline since EPA compiles violation data in the 3rd quarter every year (as opposed to the 4th

quarter freeze used for annual compilation inventory data) and was the most recently available 

data at the time that this analysis was begun. Use of the most recent year of data was deemed to 
Economic Analysis for the Proposed RTCR 4-12 June 2010

be equivalent to an average of multiple years due to the steady numbers of violations seen in the 

data over the past several years. 

The baseline described in the following sections is used as a reference point for informing 

net costs and benefits as described in Chapters 6 and 7 of this EA. 

4.3.1 Pre-GWR Baseline 

Estimates of the number of ground water PWSs subject to the proposed RTCR are 

presented in Exhibit 4.1 below. These numbers reflect SDWIS/FED inventory from the fourth 

quarter of 2007, prior to implementation of the GWR. Ground water system inventories indicate 

disinfection status as disinfecting or unreported; since reporting is voluntary, the status of a 

system that did not report disinfection is actually unknown, although EPA assumes in this EA 

that the system is not disinfecting. The number of disinfecting PWSs includes those achieving 

less than 4-log disinfection, which matches the categorization of systems used to estimate the 

underlying distributions of occurrence of TC and E. coli modeled, as described in Chapter 5. 

Exhibit 4.2 presents the number of surface water PWSs subject to the proposed RTCR, 

also derived from the SDWIS/FED database. GWR implementation does not affect the 

disinfection status of surface water systems. 

Exhibit 4.3 presents the population associated with each PWS category of system size 

and type prior to incorporating the effects of the GWR into the model; this is the pre-GWR 

baseline affected population. After incorporating GWR effects, some number of systems shift 

into the disinfecting category, and some of the population shifts accordingly. 

Lastly, Exhibit 4.4 presents the distribution of PWSs by frequency of sampling – 

monthly, quarterly, or annually – under the current TCR for those systems that qualify for 

reduced monitoring (all other systems are required to sample monthly). This is the baseline 

distribution of sampling frequencies used for analyses in this EA. This distribution was derived 

as part of the work done by the Technical Workgroup (TWG) supporting the TCRDSAC, and 

validated by the Association of state Drinking Water Administrators (ASDWA). Workgroup 

members analyzed 2005 Six Year Review and other readily available state data to derive the 

estimates shown in Exhibit 4.4. 
Economic Analysis for the Proposed RTCR 4-13 June 2010

Exhibit 4.1 Pre-GWR Baseline Number of GW Systems 

Disinfecting Non-Disinfecting Disinfecting Non-Disinfecting Disinfecting Non-Disinfecting 

<100 5,806 6,132 2,907 5,919 13,558 46,642 

101-500 9,260 4,632 2,753 3,860 5,341 13,934 

501-1,000 3,502 965 868 850 673 1,290 

1,001-4,100 5,405 1,038 542 270 269 348 

4,101-33,000 2,798 358 56 14 27 40 

33,001-96,000 307 28 2 - - 2 

96,001-500,000 62 1 - - - 1 

500,001-1 Million 4 - - - - 1 

> 1 Million 3 - - - - - 

Total 27,473 12,828 7,128 10,913 19,868 62,258 

Combined Total 

Number of GW PWSs (Pre-GWR)

PWS Size CWS NTNCWS TNCWS

40,301 18,041 82,126

Source: Data extracted from SDWIS/FED PWS Inventory, 2007 4th Quarter Data based on listed disinfection status. 

PWSs listed as “unknown” disinfection status in SDWIS/FED are counted as non-disinfecting. 

Exhibit 4.2 Baseline Number of SW Systems 

CWS NTNCWS TNCWS

<100 250 1,170 1,339 

101-500 2,150 253 497 

501-1,000 1,173 88 88 

1,001-4,100 2,938 72 67 

4,101-33,000 3,164 22 18 

33,001-96,000 720 2 - 

96,001-500,000 308 1 - 

500,001-1 Million 31 - - 

> 1 Million 17 - 1 

Total 11,671 688 2,010 

PWS Size Number of SW PWSs

 Source: Data extracted from SDWIS/FED PWS Inventory, 2007 4th Quarter Data. 

 SW count includes GWUDI systems. 

 
Economic Analysis for the Proposed RTCR 4-14 June 2010

Exhibit 4.3 Pre-GWR Baseline Population Served by GW Systems 

Disinfecting Non-Disinfecting Disinfecting Non-Disinfecting Disinfecting Non-Disinfecting 

<100 342,243 387,558 168,482 326,342 645,949 2,139,529 

101-500 2,375,507 1,085,555 708,424 948,500 1,231,077 3,005,703 

501-1,000 2,570,662 703,562 630,071 600,643 516,707 956,781 

1,001-4,100 11,307,740 2,074,139 991,971 456,985 449,757 599,171 

4,101-33,000 29,346,057 3,627,365 418,368 122,865 194,136 353,290 

33,001-96,000 15,587,186 1,527,861 89,405 - - 119,700 

96,001-500,000 9,935,500 107,323 - - - 100,000 

500,001-1 Million 2,670,841 - - - - 725,000 

> 1 Million 4,389,948 - - - - - 

Total 78,570,999 9,468,048 3,006,721 2,455,335 3,037,626 7,999,174 

Combined Total 

PWS Size

Population Served by GW PWSs (Pre-GWR)

CWS NTNCWS TNCWS

88,039,047 5,462,056 11,036,800

Source: Data extracted from SDWIS/FED PWS Inventory, 2007 4th Quarter Data based on listed disinfection status. 

Populations for PWSs listed as “unknown” disinfection status in SDWIS/FED are counted as non-disinfecting. 

Exhibit 4.4 Percent Distribution of Ground Water PWS Monitoring Frequencies by 

PWS Size and Type for Current TCR 

Disinf?

GW or 

SW?

PWS 

Type Size

 No. 

PWSs Monthly Quarterly Annual

Y GW TNCWS ≤100 13,558 4.8% 62.9% 32.3%

Y GW TNCWS 101-1000 6,014 7.9% 66.9% 25.2%

Y GW TNCWS 1001-4100 269 100.0% 0.0% 0.0%

Y GW NTNCWS ≤100 2,904 19.3% 64.6% 16.0%

Y GW NTNCWS 101-1000 3,621 18.5% 66.7% 14.7%

Y GW NTNCWS 1001-4100 542 100.0% 0.0% 0.0%

Y GW CWS ≤100 6,132 86.6% 13.4% 0.0%

Y GW CWS 101-1000 12,762 88.5% 11.5% 0.0%

Y GW CWS 1001-4100 5,405 100.0% 0.0% 0.0%

N GW TNCWS ≤100 46,642 4.8% 62.9% 32.3%

N GW TNCWS 101-1000 15,224 7.8% 66.8% 25.3%

N GW TNCWS 1001-4100 348 100.0% 0.0% 0.0%

N GW NTNCWS ≤100 5,913 19.3% 64.6% 16.0%

N GW NTNCWS 101-1000 4,710 18.5% 66.7% 14.8%

N GW NTNCWS 1001-4100 270 100.0% 0.0% 0.0%

N GW CWS ≤100 5,806 86.6% 13.4% 0.0%

N GW CWS 101-1000 5,597 88.6% 11.4% 0.0%

N GW CWS 1001-4100 1,038 100.0% 0.0% 0.0%

 Note: All other system sizes and types are required to sample monthly. Source: Based on EPA and TWG 

 analysis of 2005 Six-Year data and individual state statutes during the TCRDSAC and review by ASDWA. 
Economic Analysis for the Proposed RTCR 4-15 June 2010

4.3.2 Post-GWR Baseline 

PWSs must comply with requirements of the GWR by December 1, 2009, which will be 

approximately five years prior to the effective date of the proposed RTCR. To account for the 

impact of the GWR on baseline occurrence for those public water systems using a ground water 

source, EPA performed a number of adjustments to the 2005 data prior to its use in this EA. 

Using 2007 SDWIS inventory data (as explained in Section 4.3.1) as a pre-GWR 

inventory baseline, EPA applied probabilities of Psample and Pwell

10 to determine the probability of 

a positive sample for a fecal indicator in non-disinfecting PWSs. A fraction of those systems 

with a positive sample is expected to move to a disinfecting status in the five years prior to 

proposed RTCR implementation. This modification ensured that systems in the analysis that 

disinfect drew from the probability distribution for TC+ and EC+ for disinfecting systems, which 

is different from the distribution for those that do not disinfect. The model continues to apply 

Pwell and Psample throughout the proposed RTCR period of analysis (the 25 years following 

promulgation). The application of this model parameter, as it is applied in the context of other 

aspects of the predictive occurrence model, is explained in further detail in Chapter 5 of this EA. 

Exhibit 4.5 shows the baseline inventory of ground water systems by disinfection status in model 

year 5, which is the year immediately prior to the effective date of the proposed RTCR. The 

estimates in Exhibit 4.5 of non-disinfecting PWSs include a number of systems that selected a 

corrective action other than converting to a disinfecting system in response to fecal 

contamination at the source. 

As explained in Chapter 5 of this EA, a number of PWSs will undertake sanitary surveys 

(for all GW systems) and compliance monitoring (for disinfecting GW systems) prior to 

implementation of the proposed RTCR; although the costs are not considered in this EA (they 

were considered in the GWR EA), the systems are assigned a reduced occurrence, which is 

reflected in the proposed RTCR baseline. The predictive model incorporates the contribution of 

sanitary survey results to the qualification of systems for reduced monitoring by assuming a 10% 

reduction in the number of systems finding a TC+, which is applied to a portion of systems each 

year and retained throughout the period of analysis. For noncommunity water systems, the 

reduction is applied to one-fifth of systems per year for the five years of GWR implementation 

prior to the RTCR effective date; for community water systems, it is applied to one-third of 

systems in each of the first three years of the GWR implementation period. Similarly, the system 

incorporates the effect of compliance monitoring by disinfecting GW systems by applying an 

additional 10% reduction for systems that are disinfecting as of the RTCR effective date, and 

additionally to those determined in the model to select disinfection as a corrective action; the 

compliance monitoring reduction in occurrence is assumed to apply in all remaining years of the 

analysis once a system qualifies for the reduction. 

As described in Section 5.3.2.2 of this EA, model output was generated for a 30-year 

period to encompass 5 years of the effects of GWR implementation and 25 years of the effects of 

RTCR implementation. Chapter 5 presents this output for the 30-year period. For the purpose of 

 

10 The term “Pwell” refers to the probability that a randomly selected well across the United States will ever test 

positive in its source water for a virus or indicator species, such as TC; “Psample” is the probability that given a 

contaminated well, a random sample at the well will test positive for a virus or indicator. The GWR EA (November 

2006) (USEPA, 2006a), and in particular the Baseline Chapter of that document, provides a detailed explanation of 

the analysis used to generate these Pwell and Psample estimates. 
Economic Analysis for the Proposed RTCR 4-16 June 2010

the benefit-cost analysis, years 3 through 27 of this period are included in the calculations and 

presented in the results shown in Chapter 6 (Benefits Analysis), Chapter 7 (Cost Analysis), and 

Chapter 9 (Comparison of Benefits and Costs). Initially in the modeled period, all systems under 

the current TCR option and the AIP option are assumed to sample based on the sampling 

regimen applicable to their system type, size, type of water source, and whether or not the system 

disinfects(Exhibit 4.4).11 Under the Alternative option, all systems are assumed to sample 

monthly for the first five years after the RTCR effective date. Following an assessment period as 

described in Section 5.3.2.2, monitoring frequencies are adjusted from baseline for GW systems 

serving for fewer than 1,000 people. All other systems remain on monthly monitoring. 

The estimates for distribution of PWSs across the M/Q/A monitoring schedules as 

adjusted from the baseline distribution are presented in Chapter 5 for the current TCR, AIP 

option, and Alternative option (Exhibits 5.10a – 5.10c). 

 

Exhibit 4.5 Post-GWR Baseline Number of GW Systems 

Disinfecting Non-Disinfecting Disinfecting Non-Disinfecting Disinfecting Non-Disinfecting 

≤100 6,308 5,630 2,937 5,889 13,781 46,419 

101 - 500 9,326 4,566 2,777 3,836 5,459 13,816 

501-1,000 3,516 951 873 845 685 1,278 

1,001-4,100 5,423 1,020 547 265 274 343 

4,101-33,000 2,798 358 56 14 27 40 

33,001-96,000 307 28 2 - - 2 

96,001-500,000 62 1 - - - 1 

500,001-1 Million 4 - - - - 1 

> 1 Million 3 - - - - - 

Total 27,746 12,555 7,192 10,849 20,226 61,900 

Combined Total 

PWS Size

Number of GW PWSs (Post-GWR)

40,301 18,041 82,126

CWS NTNCWS TNCWS

Source: proposed RTCR Predictive Occurrence Model Output. 

4.3.3 Baseline Population Served 

PWS population characteristics are important to this analysis for determining the number 

of people, both prior to and following implementation of the GWR, for which risk changes under 

each component of the proposed RTCR, as discussed in Chapter 6 of this EA. These population 

estimates are based on SDWIS/FED 2007 4th quarter data as described in Section 4.2.1, and 

stratified by PWS size, type, whether the system disinfects or not and whether the system uses 

GW or SW sources. The estimates represent the number of systems which disinfect water and 

their populations served; both estimates are adjusted upward based on predicted impacts of the 

GWR in the five years prior to the effective date of proposed RTCR requirements, as shown in 

Exhibits 4.6 and 4.7 below. (See Exhibits 4.1 and 4.3 for PWS counts and population served by 

disinfection status prior to affects of GWR.) 

 

11 Based on EPA and TWG analysis of Six-Year data and individual state statutes during the TCRDSAC and review 

by ASDWA. 
Economic Analysis for the Proposed RTCR 4-17 June 2010

Exhibit 4.6 Post-GWR Baseline Population Served by GW Systems 

Disinfecting Non-Disinfecting Disinfecting Non-Disinfecting Disinfecting Non-Disinfecting 

≤100 397,933 331,868 170,149 324,675 656,169 2,129,309 

101 - 500 2,390,906 1,070,156 714,232 942,692 1,256,597 2,980,183 

501-1,000 2,580,602 693,622 633,813 596,901 525,325 948,163 

1,001-4,100 11,343,429 2,038,450 999,929 449,027 458,707 590,221 

4,101-33,000 29,346,057 3,627,365 418,368 122,865 194,136 353,290 

33,001-96,000 15,587,186 1,527,861 89,405 - - 119,700 

96,001-500,000 9,935,500 107,323 - - - 100,000 

500,001-1 Million 2,670,841 - - - - 725,000 

> 1 Million 4,389,948 - - - - - 

Total 78,642,402 9,396,645 3,025,896 2,436,160 3,090,935 7,945,865 

Combined Total 

PWS Size

Population Served by Post-GWR PWSs

88,039,047 5,462,056 11,036,800

CWS NTNCWS TNCWS

Source: Estimates calculated based on the proportion of PWSs changing disinfection status, which is an output from 

the predictive occurrence model, as described in Chapter 5 of this EA. 

Exhibit 4.7 Baseline Population Served by SW Systems 

CWS NTNCWS TNCWS

<100 13,297 56,740 57,454 

101-500 608,084 68,083 116,529 

501-1,000 885,400 67,958 70,147 

1,001-4,100 6,628,597 140,168 143,347 

4,101-33,000 38,700,554 174,408 147,423 

33,001-96,000 39,034,554 121,446 - 

96,001-500,000 58,489,936 203,000 - 

500,001-1 Million 22,327,506 - - 

> 1 Million 37,363,275 - 2,000,000 

Total 204,094,646 788,360 2,534,900 

PWS Size Population Served by SW PWSs

Source: Data extracted from SDWIS/FED PWS Inventory, 2007 4th Quarter Data. 

Population figures for SW systems include GWUDI systems. 

Number of Households Served 

Because PWS costs are often passed onto customers in the form of water rate increases, 

the proposed RTCR EA also includes analyses to assess the impact of the rule provisions at a 

household level. The number of households served by CWSs expected to be subject to the 

proposed RTCR is estimated by dividing the population for each PWS size category (Exhibits 

4.6 and 4.7 above) by the average number of people per household, which was estimated as 2.56 

for the year 2007 (U.S. Census Bureau Annual Social and Economic Supplement, 2008). Exhibit 

4.8 below shows the number of households served in groundwater and surface water systems, 

respectively. 
Economic Analysis for the Proposed RTCR 4-18 June 2010

Exhibit 4.8 Household Baseline 

SW CWSs

Disinfecting Non-Disinfecting Disinfecting

<100 133,689 151,390 22,164 

101-500 927,932 424,045 237,533 

501-1,000 1,004,165 274,829 345,859 

1,001-4,100 4,417,086 810,211 2,589,296 

4,101-33,000 11,463,304 1,416,939 15,117,404 

33,001-96,000 6,088,745 596,821 15,247,873 

96,001-500,000 3,881,055 41,923 22,847,631 

500,001-1 Million 1,043,297 - 8,721,682 

> 1 Million 1,714,823 - 14,595,029 

Total 30,691,796 3,698,456 79,724,471 

GW CWSs

Number of Households

PWS Size

 Sources: U.S. Census Bureau, Current Population Survey, 2008 Annual Social and Economic 

 Supplement; SDWIS/FED PWS Inventory, 2007 4th Quarter Data 

 

4.3.4 Baseline Water Quality 

The following sections provide an overview of summary statistics relating to baseline 

water quality. The source data from which these summary statistics are derived form the basis of 

further analysis in the proposed RTCR occurrence and risk assessment models as described in 

later chapters of the EA. 

4.3.4.1 Percent of TC and EC Positive Samples Based on 2005 Six-Year Review 2 

Data 

Exhibit 4.9 below shows the percent of TC+ and EC+, samples based on PWS type and 

size. As described in Section 4.2.2.2, the 2005 Six-Year Review 2 data was cleaned using a 

criterion that a given system-month of data should include a minimum of 50% of the expected 

number of samples based on the system’s population served and water system category. 

The “TC+ samples” column was calculated by taking the total number of routine TC+ 

samples and dividing by the number of routine TC samples. For small PWSs, additional routine 

TC samples in the month following a TC+ were included in the denominator. To calculate the 

EC+ rate, the total number of EC+ samples was divided by the total number of TC- samples12

plus the number of TC+ samples that were tested for E. coli. This EC+ computation did not 

include additional routine samples taken in the month following a TC+ because a significant 

number of PWSs did not provide data on EC+ or EC- samples, and some systems tested for FC 

and not E. coli. 

 

12 EPA assumes that a PWS will not test for EC if the TC assay is negative. 
Economic Analysis for the Proposed RTCR 4-19 June 2010

Exhibit 4.9 Total Coliform and E. coli Percent Positive by System Size and Type 

PWS

Type

Source

Water

Population

Served

TC

(# Samples)

TC

(+ Samples)

TC

(% Positive)

EC

(# Samples) 1

EC

(+ Samples)

EC

(% Positive)2

≤100 93,105 2,479 2.66% 1,172 72 0.08%

101 - 500 125,490 2,500 1.99% 1,639 61 0.05%

501-1,000 48,265 736 1.52% 483 20 0.04%

1,001-4,100 110,391 1,176 1.07% 732 21 0.02%

4,101-33,000 183,721 877 0.48% 458 22 0.01%

33,001-100,000 96,361 214 0.22% 44 2 0.00%

>100,000 64,965 289 0.44% 34 1 0.00%

Total GW 722,298 8,271 1.15% 4,562 199 0.03%

≤100 6,735 95 1.41% 64 6 0.09%

101 - 500 19,716 227 1.15% 159 10 0.05%

501-1,000 12,828 90 0.70% 70 7 0.05%

1,001-4,100 55,310 314 0.57% 233 17 0.03%

4,101-33,000 175,758 525 0.30% 399 41 0.02%

33,001-100,000 112,894 157 0.14% 106 5 0.00%

>100,000 112,143 235 0.21% 99 2 0.00%

Total SW 495,384 1,643 0.33% 1,130 88 0.02%

GW & SW Total CWS 1,217,682 9,914 0.81% 5,692 287 0.02%

≤100 163,730 7,820 4.78% 5,820 316 0.20%

101 - 500 52,891 2,418 4.57% 1,869 99 0.19%

501-1,000 6,952 299 4.30% 217 4 0.06%

>1,000 7,062 143 2.02% 85 2 0.03%

Total GW 230,635 10,680 4.63% 7,991 421 0.18%

≤100 6,723 150 2.23% 141 17 0.25%

101 - 500 2,854 75 2.63% 69 13 0.46%

501-1,000 523 19 3.63% 19 - 0.00%

>1,000 988 6 0.61% 37 - 0.00%

Total SW 11,088 250 2.25% 266 30 0.27%

GW & SW Total TNCWS 10,930 241,723 4.52% 8,257 451 0.19%

≤100 46,505 1,476 3.17% 1,061 34 0.07%

101 - 500 33,084 893 2.70% 628 19 0.06%

501-1,000 9,531 166 1.74% 103 2 0.02%

>1,000 13,138 177 1.35% 103 5 0.04%

Total GW 102,258 2,712 2.65% 1,895 60 0.06%

≤100 1,668 32 1.92% 30 4 0.24%

101 - 500 2,304 9 0.39% 9 2 0.09%

501-1,000 932 6 0.64% 5 - 0.00%

>1,000 1,316 1 0.08% 1 - 0.00%

Total SW 6,220 48 0.77% 45 6 0.10%

GW & SW Total NTNCWS 2,760 108,478 2.54% 1,940 66 0.06%

NTNCWS

GW

SW

CWS

GW

SW

TNCWS

GW

SW

Source: Derived using 2005 Six-Year Review 2 Data, which was filtered by including a month of data for a given 

system (system-month) only if it represented at least 50% of the expected number of samples for a month based on 

the system’s size. The Total Coliform Rule Compliance Monitoring Data Quality and Completion Report (USEPA, 

2010e) includes a detailed description of this data cleaning process. 

Notes: 1 “#EC samples” is the denominator of the EC% positive calculation, and includes # TC- samples plus #TC+ 

samples that were tested for EC. 2

 Percent EC+ was calculated as (# EC+ samples)/(“# EC samples”) 
Economic Analysis for the Proposed RTCR 4-20 June 2010

4.3.4.2 Violation Levels Based on SDWIS/FED Data 

Non-acute violations are triggered under the current TCR by water quality violations. 

They are defined as >1 routine or repeat monitoring sample testing positive for TC in a given 

compliance period (month, quarter, or year) for PWSs serving fewer than 33,001 people, or by 

>5.0 percent of samples being positive for systems taking >40 samples per month (typically 

those systems serving greater than 33,000 people). Acute violations are triggered when any PWS 

has a repeat sample with an EC+ or FC+ or has an FC+ or EC+ routine sample followed by a 

TC+ repeat sample in a given month. 

Exhibit 4.10 below presents an assessment of water quality prior to the proposed RTCR 

promulgation in terms of the number of acute and non-acute violations incurred by PWSs. The 

number of violations from this data are directly input into the cost model for PWSs serving more 

than 4,100 people to derive estimates of the number of assessments and corrective actions that 

will be undertaken under the proposed RTCR. As noted in Exhibit 4.10, the data used is from 

2005 3rd quarter. Exhibit 4.11 presents the seven years of PWS violation data13 evaluated by the 

TWG. Appendix G presents further detail on this assessment, including queries used in 

SDWIS/FED and the resulting datasets downloaded. 

In addition to the acute and non-acute system violation data, Exhibit 4.11 also presents 

data on the numbers of PWSs with monitoring and reporting violations (minor and major for 

routine and repeat monitoring and reporting). Although PWS monitoring and reporting violation 

data is not used directly in the quantitative anlyses performed for the EA, the TCRDSAC did 

consider the data in its deliberations on the impact of the regulation. In particular, the TCRDSAC 

determined that the proposed revisions to the RTCR may significantly reduce the high numbers 

of monitoring and reporting violations by reducing the numbers of additional routine and repeat 

samples required and providing more flexibility in development of sampling site plans. 

The data verification process was used to review individual states’ data in comparison to 

SDWIS/FED data and to compare violations rates across states. This process revealed many 

differences between states in their implementation of the TCR, and allowed EPA to identify and 

review outliers in the national database. Specifically, EPA did not include violation data from 

Ohio, U.S. territories, or tribal PWSs in the summaries presented in Exhibits 4.10 and 4.11. 

Review of the data verification information revealed that Ohio’s broad interpretation of what 

constitutes a violation led to abnormally high violation counts compared (on average) to other 

states. For U.S. territories and tribal systems, it was established that unique environmental 

factors and operating conditions contribute to abnormally high TC+ results and associated 

violations. Thus, inclusion of these results would skew the national averages used for analysis, 

and were therefore excluded. 

 

13 Exhibit 4.11 presents PWS counts (PWSs with at least one violation during the year) to be consistent with the 

metric evaluated by the TCRDSAC TWG. Exhibit 4.10 presents total violation counts, which are used as inputs to 

the predictive modeling for the EA. 
Economic Analysis for the Proposed RTCR 4-21 June 2010

Exhibit 4.10 Baseline Number of TCR Violations by System Size and Type (2005) 

Non-Acute Acute Non-Acute Acute

ABC D E F

CWSs

<100 905 52 16 3 11,709 1,133 

101-500 809 34 50 7 13,508 2,067 

501-1,000 203 13 16 3 4,299 1,112 

1,001-3,300 272 8 55 7 5,490 2,406 

3,301-10,000 171 8 75 3 2,628 2,015 

10,001-50,000 125 8 78 4 1,247 1,752 

50,001-100,000 11 2 5 4 147 362 

100,001-250,000 1 1 3 1 

250,001-500,000 - - - - 

500,001-1 Million - - 1 - 

> 1 Million - - - - 3 15 

Total 2,497 126 299 32 39,092 11,168 

NTNCWSs

<100 514 34 7 2 8,392 249 

101-500 346 20 4 - 6,294 246 

501-1,000 57 6 2 - 1,622 87 

1,001-3,300 58 4 - - 726 66 

3,301-10,000 9 2 1 - 102 23 

10,001-50,000 1 - - - 11 4 

50,001-100,000 - - - - - 1 

100,001-250,000 - - - - - 

250,001-500,000 - - - - - 

500,001-1 Million - - - - - 

> 1 Million - - - - - -

Total 985 66 14 2 17,147 677 

TNCWSs

<100 2,665 278 19 5 58,396 1,334 

101-500 833 76 11 1 18,184 492 

501-1,000 133 11 4 - 1,868 85 

1,001-3,300 58 2 1 - 578 57 

3,301-10,000 5 - 1 - 77 22 

10,001-50,000 - - - - 11 3 

50,001-100,000 - - - - 3 - 

100,001-250,000 - - - - 

250,001-500,000 - - - - 

500,001-1 Million - - - - 

> 1 Million - - - - - 1 

Total 3,694 367 36 6 79,118 1,994 

 - 1 

 306 61 

Number of Violations in GW 

PWSs

Number of Violations in SW 

PWSs Total Number 

of GW PWSs 

(without OH & 

PR)

Total Number 

of SW PWSs 

(without OH & 

PR)

 1

Source: SDWIS/FED annual data for period ending 3rd quarter 2001 – 2007 . OH, U.S. territories, tribal PWS data 

excluded. Data was not available for 4th quarter (it is posted in the 3rd quarter annually). 
Economic Analysis for the Proposed RTCR 4-22 June 2010

Exhibit 4.11 Number of PWSs with Violations by System Type (2001 – 2007) 

2001 2002 2003 2004 2005 2006 2007

CWS 143 144 185 171 151 171 171

NTNCWS 51 53 70 58 65 68 45

TNCWS 261 278 322 351 349 361 295

All 455 475 577 580 565 600 511

CWS 2,074 2,110 2,204 2,314 2,196 2,095 1,996

NTNCWS 601 679 725 750 753 735 655

TNCWS 2,707 2,934 3,036 3,132 3,039 3,244 3,209

All 5,382 5,723 5,965 6,196 5,988 6,074 5,860

CWS 3,312 3,327 3,900 3,924 3,760 3,659 3,415

NTNCWS 1,503 1,561 1,676 1,679 1,588 1,468 1,377

TNCWS 10,360 10,531 11,230 11,043 10,426 10,630 10,389

All 15,175 15,419 16,806 16,646 15,774 15,757 15,181

CWS 1,218 1,257 1,389 1,445 1,302 1,285 1,244

NTNCWS 187 182 200 233 194 214 183

TNCWS 701 842 883 903 875 843 839

All 2,106 2,281 2,472 2,581 2,371 2,342 2,266

PWS Type

Year

Acute MCL Violations

Non-Acute MCL Violations

Major Monitoring and Reporting Violations (Routine and Repeat) 

Minor Monitoring and Reporting Violations (Routine and Repeat)

Note: PWSs counts are of systems that had at least one violation during the year. 

Source: SDWIS/FED annual data for period ending 3rd quarter 2001 – 2007. OH, U.S. territories, tribal PWS data 

excluded. Data was not available for 4th quarter (it is posted in the 3rd quarter annually). 

4.4 Sensitive Sub-populations 

Under the Safe Drinking Water Act (SDWA) Amendments of 1996 (PL 104-182), EPA 

must analyze health impacts of rulemaking on sensitive subpopulations. Sensitive populations 

include “infants, children, pregnant women, the elderly, individuals with a history of serious 

illness, and other subpopulations that are identified as likely to be at a greater risk of adverse 

health effects due to exposure to contaminants in drinking water than the general population.” 

(USEPA, 1996a) 

 Exhibit 4.12 presents the EPA’s estimates of the number of U.S. individuals who are at 

increased risk of developing more severe symptoms from illnesses caused by waterborne 

pathogens. Persons suffering from certain diseases and/or conditions are believed to be sensitive 

to microbes and chemicals in drinking water. These subgroups of the population include 

pregnant women, the very young, the elderly, and the immunocompromised. In total, these 

subgroups represent approximately 20 percent of the current population of the United States. 
Economic Analysis for the Proposed RTCR 4-23 June 2010

Exhibit 4.12 Estimates of Sensitive Subpopulations in the United States 

Sensitive 

Population Individuals

Approximate 

Percent of 

U.S. 

Population1 Citation/Notes

Pregnant women and neonates 

Pregnant Women 6,240,000 2.2 Vital and Health Statistics, CDC (Ventura et 

al., 2000) 

Neonates (under one 

month)2 317,137 0.1 U.S. 2000 Census (US Census Bureau, 

2001a) 

Age-based sensitive populations 

Children (< 5 years 

old) 19,175,798 6.8 U.S. 2000 Census (US Census Bureau, 

2001a) 

Elderly (> 65 years 

old) 34,991,753 12.4 U.S. 2000 Census (US Census Bureau, 

2001a) 

Compromised immune status 

Bone marrow 

transplant Recipients 20,000 0.01 National Marrow Donor Program 

http://.marrow.org/MEDIA/facts_figures.pdf 

AIDS Patients 816,149 0.3 HIV/AIDS Surveillance Report, cases 

through 2001 (CDC, 2002) 

Organ transplant 

recipients 23,143 0.01 U.S. Census Bureau, Statistical Abstract of 

the U.S., based on 1998 data (2001b) 

Total 61,583,980 21.8 1 Based on U.S. Census estimate (July 2000). 

2 1/12 of the 2000 census population for age <1 year. 

4.5 Summary of Baseline Assumptions 

In Section 4.3 (Data Sources), EPA discusses the representativeness and quality of the data 

used from the 2005 Six-Year Review 2 data and SDWIS/FED. An additional source of 

uncertainty is introduced into the baseline in the monitoring frequencies estimated for systems, 

shown in Exhibit 4.4. As described in that section, to arrive at this distribution EPA and the 

Technical Workgroup conducted an analysis of 2005 Six-Year Data and individual state statutes, 

and had the results validated by ASDWA during the TCRDSAC deliberations. 

Exhibit 4.13 below presents a summary of the assumptions made in developing the RTCR 

EA baseline. These assumptions may introduce uncertainty into the predictive model and its 

outcomes in terms of benefits and costs. However, all of the assumptions influencing the EA 

baseline (current TCR) do so in the same way as for the proposed RTCR and Alternative option. 

Therefore, EPA does not expect the net results of the analyses presented in this EA to be 

significantly influenced by the uncertainty in the assumptions applied in developing the RTCR 

EA baseline. 
Economic Analysis for the Proposed RTCR 4-24 June 2010

Exhibit 4.13 Summary of Baseline Assumptions Influencing RTCR Estimates 

UnderestimateOverestimateUnknown 

Impact

UnderestimateOverestimateUnknown 

Impact

Pre-GWR baseline distribution of 

systems across sampling 

frequency categories (M/Q/A)

Varies per system category as 

shown in Ex. 4.4 4.3.1

Variability,

Uncertainty X X

Selection of 2005 data from Six 

Year Review for use as baseline 

Data are adequately 

representative of U.S. PWSs and 

of sufficient quality. (Note 2)

4.2.2 Variability, 

Uncertainty X X

Use of SDWIS/FED for inventory 

data (2007 Q3) and violations 

data (2001 - 2007 Q3)

Data are adequately 

representative of U.S. PWSs and 

of sufficient quality. 4.2.1

Variability, 

Uncertainty X X

Distribution of systems across 

sampling frequency categories 

(M/Q/A) following 

implementation of GWR sanitary 

surveys prior to RTCR 

implemlentation

Varies per system category as 

shown in Ex. 5.14a - 5.14c 5.3.2.2

Variability,

Uncertainty X X

Pwell - the portion of GWSs 

having viral pathogens in their 

source waters (adopted from 

GWR EA) 21.58% 5.3.1

Constant, 

Uncertainty X X

Psample - the probability that a 

random sample will test positive 

for viral pathogens given a 

contaminated source water 

(adopted from GWR EA)

Variable drawn from a beta 

distribution with a range of alpha 

and beta estimates having a 

median value of 5.8 percent and 

an expected value of 12.4 

percent. 5.3.1

Variability,

Uncertainty X X

Reduced occurrence for sanitary 

surveys performed under the 

GWR

90% of baseline occurrence; 

applied to equal number of 

systems annually over the 

sanitary survey cycle (20% each 

year of 5 years for CWSs; 33.3% 

each year for 3 years for 

NCWSs) 5.3.1

Constant, 

Uncertainty X X

Reduced occurrence for GWR 

compliance monitoring (applies 

to subset of GWSs that 

disinfect). 90% of baseline occurrence 5.3.1

Constant, 

Uncertainty X X

% of non-disinfecting GWSs 

choosing disinfection CA vs nondisinfection CA in response to 

source water quality issue 

(adopted from GWR)

Range: High end is the 

percentage of CWS entry points 

employing disinfection by 

system size, low end assumed 

to be 10% based on discussions 

with State representatives. 5.3.1

Constant, 

Uncertainty X X

Population and sensitive sub 

population estimates Varies by category

4.2.3.3 and 

4.4

Variability, 

Uncertainty X X

Uncertainty Factor Current Assumption

Section with 

Full 

Discussion 

of 

Uncertainty 

or Factor

Contributes 

Variability, 

Uncertainty, 

or Constant?

Most Likely Effect on 

Benefits (Note 1)

Most Likely Effect on Costs 

(Note 1)

Notes: 1) All baseline variables or factors were incorporated into the predictive model in the same way for the Current 

TCR (baseline option) and the other two regulatory options considered in this EA (AIP option and Alternative option); 

therefore, EPA expects that any under- or over-estimation would affect the baseline and other options similarly, 

resulting in no signficant net effect on the results of the analysis. 2) A complete discussion of the data cleaning and 

assumption used in preparing 6 Year Review data for use in the RTCR baseline is provided in the Total Coliform Rule 

Compliance Monitoring Data Quality and Completion Report (USEPA, 2010e). 
Economic Analysis for the Proposed RTCR 5-1 June 2010 

5. Occurrence and Predictive Model 

5.1 Introduction 

Based on evaluation of the Safe Drinking Water Information System-Federal Version 

(SDWIS/FED) violation data, the U.S. Environmental Protection Agency (EPA) assumes that the 

national occurrence of total coliform (TC) and E. coli (EC) has reached a steady state in recent 

years under the current Total Coliform Rule (TCR). Cycles of normal deterioration and 

repair/replacement appear to be occurring at the individual system level, while the numbers of 

violations at the national level remain relatively unchanged. Chapter 4 (Exhibit 4.11) presents the 

number of Public Water Systems (PWSs) with TCR violations over the last several years, which 

shows that national violation rates have remained relatively steady. Revisions to the TCR would 

affect this steady state, likely resulting in a reduction of the underlying occurrence and associated 

violations. However, prior to the proposed Revised Total Coliform Rule (RTCR) 

implementation, the Ground Water Rule (GWR), which became effective December 2009, would 

also have an effect on the steady state. This chapter explains the development of a model that 

both reproduces the steady-state occurrence conditions under the current TCR and predicts the 

effects of both the proposed RTCR and the GWR in further reducing occurrence from current 

estimated levels. 

 The occurrence and predictive model was used for PWSs serving 4,100 people or fewer 

and it has two components. Occurrence and predictive modeling focuses on small PWSs (those 

serving ≤4,100 people) because (a) there are adequate data to support development of the 

occurrence distributions that are needed for the predictive components of the model, (b) these 

systems are known to have higher occurrence levels than larger systems, and (c) these systems, 

in particular, are subject to changes in the monitoring requirements under the proposed RTCR. 

The first component of the model characterizes how the presence or positive rates of TC and EC 

detections vary across the population of small (serving 4,100 people or fewer) public water 

systems in the U.S. These rates vary by the type of sample (routine or repeat), by analyte (TC or 

EC), and by system type (Community Water System (CWS), Noncommunity Water System 

NCWS, or Transient Noncommunity Water Systems (TNCWS)) and size. EPA determined from 

the Six-Year Review data1

 that systems differ considerably with respect to the observed 

occurrence of TC and EC in both routine and repeat sampling. Some of this variability can be 

explained by the type, size, water source, and disinfection practices of the systems. However, 

even among systems having the same characteristics, some systems were found to rarely 

experience positive assays, while others often did. The second component of the model uses the 

TC and EC occurrence distributions, together with the various sampling and response 

requirements, to simulate a set of nationally-representative systems within the context of the 

three regulatory options (current TCR, Agreement in Principle or AIP, and Alternative) to 

predict changes in TC and EC occurrence, triggers, assessments, corrective actions over time, 

and violations. The model generates estimates of reduced TC and EC occurrence based on 

requirements of the proposed RTCR to perform assessments and corrective actions not explicitly 

required in the current TCR. (In addition, the models take into account reductions attributable to 

the implementation of the GWR, the effective date of which is December 2009.) 

 

1

 A discussion of the use of data from the Six-Year Review of SDWA regulations is presented in Chapter 4 of this 

EA. 
Economic Analysis for the Proposed RTCR 5-2 June 2010 

The occurrence model produces outputs over a 30-year time horizon2 that include 

national estimates of TC and EC occurrence in PWSs across the U.S., and the resulting Level 1 

and Level 2 assessments3

 and corrective actions performed. These outputs are used to 

characterize reduced exposure to the potential contamination under each regulatory scenario 

considered, as presented in Chapter 6 of this EA, and to estimate incremental costs for PWSs 

across the U.S., as described in Chapter 7 of this EA. 

The two major components of the occurrence and predictive model used for systems 

serving ≤4,100 people are described in Sections 5.2 and 5.3 of this chapter. 

For systems serving more than 4,100 people, EPA estimated violation and trigger rates 

using SDWIS/FED (USEPA, 2005a) because the Six-Year Review data for PWSs serving more 

than 4,100 people were not as robust as the Six-Year Review data for systems serving 4,100 or 

fewer people. EPA did not quantify changes in violation or trigger rates for systems serving more 

than 4,100 people among the current TCR, AIP option, and Alternative option because of: (1) 

limited Six-Year Review data to characterize these systems, (2) the essentially unchanged 

monitoring requirements across options for these systems, and (3) the level of effort already 

occurring to implement the current TCR. 

A complete description of the methods for developing the occurrence estimates as 

described above is found in the remaining sections of this chapter: 

Section 5.2 Describes development of parameter estimates α, β based on empirical 

 occurrence data for use in the model developed for the proposed 

 RTCR. 

Section 5.3 Describes the occurrence model developed for systems serving ≤4,100 

people (Sections 5.3.1-5.3.2), predictions from the model (5.3.3) and 

uncertainty in the model (5.3.3.1), including a comprehensive list of 

assumptions contributing to uncertainty, a sensitivity analysis, and a 

discussion of model validation. 

Section 5.4 Describes how outcomes were predicted for systems serving more than 

4,100 people. 

 

2

 The model includes an additional 5 years prior to the commencement of AIP option monitoring to account for 

effects of the GWR after it is fully implemented, plus 25 years of RTCR analysis, for a total of 30 modeled years. 

3 The AIP and Alternative option require PWSs to complete either a Level 1 or Level 2 assessment following 

triggers specified in Exhibit 3.1 of this EA. The purpose of Level 1 and 2 assessments is to identify the presence of 

sanitary defects and deficiencies in distribution system coliform monitoring practices, similar to an annual 

inspection but more focused on determining the cause of a contamination event. In order to complete a Level 2 

assessment the PWS must perform a more detailed examination of the system than for a Level 1 assessment, 

including its monitoring and operational practices. 
Economic Analysis for the Proposed RTCR 5-3 June 2010 

5.2 Modeling of Current Total Coliform and E. coli Occurrence for Systems 

Serving up to 4,100 People 

This section describes the development of parameters used to define variability across 

and within groups of similar PWSs with regard to occurrence of TC and EC. Details related to 

this section are provided in Appendix F to this EA. 

5.2.1 Distributional Model and Notation 

The Six-Year Review data demonstrate that, even among systems of similar size and 

type, there are some PWSs that rarely find routine samples to be TC-positive and others that 

often find TC-positive samples. For example, among the very small (serving <101) TNCWSs 

using nondisinfected ground water, 47 systems reported ten or more routine TC positives while 

assaying 40 or fewer samples during 2005. Among the same set of small TNCWSs with 

nondisinfected ground water are 60 that assayed 20 or more routine samples, finding all of them 

TC-negative. Clearly, routine TC-positive rates vary considerably within this set of systems. 

Significantly different fractions positive can be found among any basic subsets of systems 

(defined by system type, water type, and population served, as described in Section 5.2.2 of this 

EA) and for any type of assay (both routine and repeat TC and both routine and repeat E. coli). 

Within a group of similar systems, pRTTCi, which is defined as the probability that a 

routine sample taken from system i will test positive, is assumed to vary as a beta random 

variable. The beta distribution is commonly used to model varying probabilities because it is 

limited to values between 0 and 1 and can assume a wide variety of shapes. EPA used a beta 

distribution to describe how probabilities of virus-positive samples vary among viruscontaminated wells in the Economic Analysis for the Ground Water Rule (USEPA 2006a). 

 Samples that test negative for TC are generally not tested further for the presence of EC, 

as are TC-positive samples. The probability that a TC-positive routine (RT) sample taken from 

system i will also test EC-positive, pRTECi, is assumed to vary among similar systems as 

another beta random variable, but with parameters that can be quite different from those of the 

routine TC samples. Although systems with frequent routine TC positives necessarily generated 

more EC assays, the EC positive rates for these systems did not appear to be significantly 

different than the EC positive rates of systems with rare TC positives. The variables pRTTC and 

pRTEC are therefore modeled as independent beta-distributions. 

 Similar assumptions are extended to the repeat positive probabilities, pRPTCi and 

pRPECi. Like pRTTCi and pRTECi, these are assumed to be independently beta-distributed 

among sets of similar systems. A process for determining “sets of similar systems” is described 

in Sections 5.2.3 and 5.2.4. The process is informed by system-specific data that are reduced 

from the sample-specific data described in Chapter 4 of this EA, as discussed in the following 

section. 
Economic Analysis for the Proposed RTCR 5-4 June 2010 

5.2.2 Data Reduction 

 The occurrence model assumes that positive routine TC measurements for system i result 

from some unobserved probability (pRTTCi). This probability may vary from month-to-month 

and season-to-season. However, in this model each result, whether positive or negative, is 

assumed to be an independent trial with positive probability pRTTCi. Each of these is called a 

Bernoulli trial. The total number positive observed for system i during a year (KRTTCi) is 

therefore a binomial random variable, whose parameters are the system’s positive probability 

(pRTTCi) and the total number of samples assayed (NRTTCi). What is observed for the system 

are the number of positive samples (KRTTCi) and the number of samples assayed (NRTTCi). 

The order of the positives and negatives is unimportant, so the routine TC data needed for any 

system can be reduced to these two values: NRTTCi and KRTTCi. The leading character “N” 

designates the number of samples tested and “K” designates the number positive. 

 Similarly, the routine EC data for system i can be reduced to the number of routine TCpositive samples that were assayed for EC (NRTECi) and, of those, the number testing positive 

(KRTECi). For many systems, both NRTEC and KRTEC will be zero because they encountered 

no routine TC positives during 2005 (KRTTC = 0), and EPA assumes that in the case of a TCnegative, no EC assay is performed. 

 Finally, the data for repeat samples for system i can be reduced to four numbers: NRPTC, 

KRPTCi, NRPECi, and KRPECi. Again, the leading characters, “N” and “K”, designate numbers 

of samples assayed and numbers positive, respectively. “RP” designates that these are repeat 

samples, while “TC” and “EC” designate assays for TC and EC, respectively. For many systems, 

all four of these numbers are zero because no routine samples were TC positive. 

 It is important to note that only TC-positive samples are assayed for EC. The positive 

probabilities for EC are therefore conditional, that is, they apply only to samples that have tested 

TC positive. All TC-negative samples are assumed to be EC negative. The overall 

(unconditional) probability that a routine sample from system i will be EC positive is the product 

pRTTCi*pRTECi and the overall (unconditional) probability that a repeat sample from the 

system will be EC-positive is the product pRPTCi*pRPECi. 

 The reduced dataset includes eight integer values (for NRTTC, KRTTC, NRTEC, 

KRTEC, NRPTC, KRPTC, NRPEC, KRPEC) for each of approximately 93,000 systems. 

Although none of the NRTTC are zero (all systems assayed at least one routine TC sample 

during 2005), the great majority of the other values are zeros. 

5.2.3 Basic Subsets of Systems 

 The 92,747 systems serving ≤4,100 people in the Six-Year Review dataset (which 

represent the approximately 147,000 total systems that exist in this size range) can be classified 

by system type, source water type and disinfection status, and population served. The three types 

of systems are CWS, TNCWS and nontransient noncommunity (NTNCWS). The three source 

water types are surface water (SW), which is always disinfected, nondisinfected ground water 

(NondisGW) and disinfected ground water (DisGW). Three important size categories are small 

systems (serving ≤100 people), systems serving 101 to 1,000 people, and systems serving 1,001 

to 4,100 people. Systems serving more than 4,100 people are not included here, for reasons 
Economic Analysis for the Proposed RTCR 5-5 June 2010 

discussed in Chapter 4 of this EA and earlier in this chapter. In total, there are 27 possible 

categories that each PWS may belong to (3 system types x 3 source water types x 3 population 

served sizes). Each PWS may only be in one of the 27 categories. Exhibit 5.1 lists the 27 basic 

subsets and corresponding numbers of systems in the dataset. 

Exhibit 5.1 Basic Classifications of PWSs Used for Occurrence Modeling 

Subset System Type Water Type Population 

Served Group 

Number of 

Systems in 6-

Year Review 

Data 

1 TNCWS SW ≤100 838 

2 TNCWS SW 101-1000 358 

3 TNCWS SW 1001-4100 30 

4 NTNCWS SW ≤100 114 

5 NTNCWS SW 101-1000 172 

6 NTNCWS SW 1001-4100 33 

7 CWS SW ≤100 484 

8 CWS SW 101-1000 2,034 

9 CWS SW 1001-4100 1,699 

10 TNCWS DisGW ≤100 8,112 

11 TNCWS DisGW 101-1000 3,007 

12 TNCWS DisGW 1001-4100 119 

13 NTNCWS DisGW ≤100 1,577 

14 NTNCWS DisGW 101-1000 1,780 

15 NTNCWS DisGW 1001-4100 252 

16 CWS DisGW ≤100 3,662 

17 CWS DisGW 101-1000 7,678 

18 CWS DisGW 1001-4100 2,707 

19 TNCWS NondisGW ≤100 32,028 

20 TNCWS NondisGW 101-1000 10,217 

21 TNCWS NondisGW 1001-4100 217 

22 NTNCWS NondisGW ≤100 4,026 

23 NTNCWS NondisGW 101-1000 3,264 

24 NTNCWS NondisGW 1001-4100 152 

25 CWS NondisGW ≤100 3,788 

26 CWS NondisGW 101-1000 3,755 

27 CWS NondisGW 1001-4100 644 

TOTAL 92,747 

Note: Water Type includes disinfection status, as informed by information from SDWIS-FED. Systems with no 

indication of disinfection status in SDWIS-FED were assumed to not disinfect (Nondis). 
Economic Analysis for the Proposed RTCR 5-6 June 2010 

5.2.4 Estimation Methodology 

 The methodology described in this section applies to all four kinds of measurements, 

routine TC (RTTC), routine E. coli (RTEC), repeat TC (RPTC) and repeat E. coli (RPEC). 

However, to simplify the presentation, the description will be expressed only in terms of RTTC. 

Results presented in Section 5.2.5 show that the final system classifications used to model TC 

(both routine and repeat) are quite different from the final subsets used to model EC occurrence. 

 For any individual subset of systems from Exhibit 5.1 or grouping of these subsets, two 

methods were used to estimate parameters of the beta-distributed RTTC: maximum likelihood 

estimation and Bayesian Markov Chain Monte Carlo (MCMC) sampling. The MCMC samples 

are used to test whether two basic subsets have equal average positive rates and to check the 

maximum likelihood estimates (MLEs). This check was conducted to ensure that the algorithm 

used to find the MLE had not stopped too soon. 

 Both the MLE and MCMC methodologies require computation of the likelihood function, 

L(data | α,β), where α and β are parameters of beta-distributed pRTTC. For a specific system in 

a set of similar systems, the number of positive RTTC samples is a binomial random variable 

with parameters NRTTC and pRTTC, which are the numbers of RTTC samples assayed by the 

system and the system’s unobserved probability of a positive, respectively. The probability of a 

positive, pRTTC, is a beta random variable, whose parameters are α and β. Exhibit 5.2 is a 

directed graph showing the model structure. At the top are the two high-level parameters (α and 

β) and arrows from them showing their influence on the distribution of the system-specific 

parameters, the positive probabilities or pRTTCs. Finally, the exhibit shows how the pRTTCs, 

together with the numbers of samples assayed (NRTTCs), influenced the numbers estimated to 

be positive (KRTTCs). 
Economic Analysis for the Proposed RTCR 5-7 June 2010 

Exhibit 5.2 Directed Graph of Model Used for RTTC Occurrence 

This same model could have been equally well represented with all of the arrows pointing up to 

show the direction of inference, starting with the data (NRTTCs and KRTTCs), which inform 

estimates of the unobserved positive probabilities (pRTTCs), and then those informing estimates 

of the high level parameters (α and β). 

 

5.2.4.1 Maximum Likelihood Estimation 

NOTE: From this point through the end of this chapter, the approach for estimating 

parameters for routine total coliform occurrence (RTTC) is the same approach used for repeat 

total coliform (RPTC) and both routine and repeat E. coli occurrence (RTEC and RPEC). To 

simplify the notation, the designation of measurement type (e.g., RTTC) will be dropped. For 

example, KRTTC is reduced to K, NRTTC is reduced to N, and pRTTC is reduced to p. 

Subscript i is used to denote a particular system in a basic subset of systems. 

For a single system in a subset, if pi were known, the likelihood of the system’s RTTC data 

(Ki positives observed among Ni routine samples) would be given by the binomial probability 

mass function: 

( ) ( ) ( ) i Ni Ki

i

K

i

i i i

i

i i i p 1 p K ! N K !

N ! dbinom K , N , p −

⎥ × −

⎦

⎤ ⎢

⎣

⎡

− =

 But pi is not known, nor can it be observed explicitly. It is, therefore, treated as a beta 

random variable. The expected value of the likelihood function is obtained by integrating the 
Economic Analysis for the Proposed RTCR 5-8 June 2010 

product of the beta probability density function and the binomial probability mass function. The 

beta probability density function is: 

Γα β ( ) +

Γ α( )⋅Γ β( ) p( )i

α−1 ⋅ 1 pi − ( )β−1 ⋅

And the expected likelihood is: 

0

1

p

Ni

!

Ki

! Ni Ki − ( ) ⋅ !

Γα β ( ) +

Γ α( )⋅Γ β( ) ⋅ ( ) p

α−1+Ki ⋅ ( ) 1 p − β−1+Ni−Ki ⋅

⌠

⎮

⎮

⎮

⌡

d

 Because both Ni and Ki are constant (observed data), the function only depends on the 

factors involving p, α, and β, so the factorial terms in the above may be ignored when seeking to 

maximize the likelihood function. This simplifies the computation considerably, and the 

resulting integral has a closed-form solution, which is: 

Γα β ( ) + Γ α Ki + ( ) ⋅ Γ β Ni + Ki − ( ) ⋅

Γ α( )⋅Γ β( ) Γα β + Ni + ( ) ⋅

Beta α Ki + β Ni + Ki , − ( )

Beta( ) α β, =

The total likelihood for a set of systems is the product of the system-specific likelihoods: 

Likelihood( ) α β, 

i

Beta α Ki + β Ni + Ki , − ( ) ∏ Beta( ) α β +

In order to find maximum likelihood parameter estimates of parameters α, and β, some 

additional steps were taken: 

1. Log likelihood, rather than likelihood, was computed to avoid the problems of 

numerical overflow and underflow. Because the log transformation is positive and 

monotonic, parameters found to maximize the log likelihood function will also 

maximize the untransformed likelihood function: 

LogLikelihood( ) α β, 

i

ln

Beta α Ki + β Ni + Ki , − ( )

Beta( ) α β +

⎛

⎜

⎝

⎞

∑ ⎠

2. Parameters of the Beta distribution were expressed in terms of the mean (a=α/(α+β)) 

and dispersion (b=1/sqrt(α+β)). In terms of these new parameters, the log likelihood 

function is: 

LogLikelihood a b ( ) , 

i

ln

Beta

a

b

2

Ki +

1 a −

b

2

Ni + Ki , − ⎛

⎜

⎝

⎞

⎠

Beta

a

b

2

1 a −

b

2

+ ⎛

⎜

⎝

⎞

⎠

⎛

⎜

⎜

⎜

⎜

⎝

⎞

⎟

⎟

⎠

∑

3. Bayesian MCMC estimation, as described in Appendix F was used to check the 

MLEs and to support decisions about combining (pooling) different categories or 

subsets of systems. 

4. Where subsets of systems were found to have insufficient data to support maximum 

likelihood estimation, engineering judgment was used to decide if combining with 
Economic Analysis for the Proposed RTCR 5-9 June 2010 

other subsets made sense, for the purpose of parameter estimation. Rationale and 

strategies for this are described in Appendix F. 

5.2.5 Results 

Appendix F of this EA describes how systems and their data were combined, or pooled, 

for the purpose of RTTC, RTEC, RPTC, and RPEC modeling. Section 5.2.5.1 and 5.2.5.2 report 

the resulting MLEs in terms of a, b and α, β. 

RTTC data were addressed first because a) so much more data were available for RTTC 

than for the other three measurement types (RTEC, RPTC, and RPEC); and b) summary statistics 

suggested that systematic differences due to system size and other factors were larger for TC 

than for EC measurements. 

When evaluating data for any one type of measurement, system size was evaluated first 

because it was expected to be important for a number of reasons, primarily: a) Larger systems 

have more resources and are more likely to employ full-time professional operators than smaller 

systems; and b) Having more resources, the larger systems may provide better treatment and 

distribution systems. System type and water type were evaluated after system size, but the order 

in which these were evaluated does not appear to have been important. 

5.2.5.1 Maximum Likelihood Estimates 

 Exhibit 5.3 provides MLEs for routine and repeat TC, while Exhibit 5.4 provides MLEs 

for routine and repeat EC. Note that both of these exhibits present the a and b parameters as 

defined in Section 5.2.4. 
Economic Analysis for the Proposed RTCR 5-10 June 2010 

Exhibit 5.3 Maximum Likelihood a and b Parameter Estimates for RTTC and 

RPTC 

Disinf?

GW or

SW? Sys Type Size No. Systems aRTTC bRTTC aRPTC bRPTC

Y SW TNCWS ≤100 838 0.02312 0.2992 0.1439 1.108

Y SW TNCWS 101‐1000 358 0.02312 0.2992 0.1439 1.108

Y SW TNCWS 1001‐4100 30 0.02312 0.2992 0.1439 1.108

Y SW NTNCWS ≤100 114 0.01584 0.3576 0.1064 1.078

Y SW NTNCWS 101‐1000 172 0.01127 0.2458 0.1064 1.078

Y SW NTNCWS 1001‐4100 33 0.01127 0.2458 0.1064 1.078

Y SW CWS ≤100 484 0.01502 0.2090 0.06464 0.6107

Y SW CWS 101‐1000 2034 0.009458 0.1490 0.06464 0.6107

Y SW CWS 1001‐4100 1699 0.005864 0.1275 0.03430 0.2721

Y GW TNCWS ≤100 8112 0.02312 0.2992 0.1439 1.108

Y GW TNCWS 101‐1000 3007 0.02312 0.2992 0.1439 1.108

Y GW TNCWS 1001‐4100 119 0.02312 0.2992 0.1439 1.108

Y GW NTNCWS ≤100 1577 0.01584 0.3576 0.1064 1.078

Y GW NTNCWS 101‐1000 1780 0.01127 0.2458 0.1064 1.078

Y GW NTNCWS 1001‐4100 252 0.01127 0.2458 0.1064 1.078

Y GW CWS ≤100 3662 0.01592 0.2243 0.09415 0.8493

Y GW CWS 101‐1000 7678 0.01243 0.2142 0.09415 0.8493

Y GW CWS 1001‐4100 2707 0.007767 0.1841 0.05221 0.4916

N GW TNCWS ≤100 32028 0.04758 0.3990 0.2788 1.068

N GW TNCWS 101‐1000 10217 0.04758 0.3990 0.2487 0.9359

N GW TNCWS 1001‐4100 217 0.02467 0.3121 0.1694 0.4052

N GW NTNCWS ≤100 4026 0.03658 0.4044 0.2575 0.9319

N GW NTNCWS 101‐1000 3264 0.02690 0.2840 0.2575 0.9319

N GW NTNCWS 1001‐4100 152 0.02690 0.2840 0.2575 0.9319

N GW CWS ≤100 3788 0.03147 0.2680 0.1898 0.8407

N GW CWS 101‐1000 3755 0.02690 0.2840 0.1898 0.8407

N GW CWS 1001‐4100 644 0.02690 0.2840 0.1312 0.6938

Note: Disinfection status (“Disinf?”) is from information downloaded from SDWIS/FED. Systems with no indication 

of disinfection status in SDWIS/FED are assumed to not disinfect. 
Economic Analysis for the Proposed RTCR 5-11 June 2010 

Exhibit 5.4 Maximum Likelihood a and b Parameter Estimates for RTEC and 

RPEC 

Disinf?

GW or

SW? Sys Type Size No. Systems aRTEC bRTEC aRPEC bRPEC

Y SW TNCWS ≤100 838 0.1291 0.6287 0.05175 1.153

Y SW TNCWS 101‐1000 358 0.1291 0.6287 0.05175 1.153

Y SW TNCWS 1001‐4100 30 0.1291 0.6287 0.05175 1.153

Y SW NTNCWS ≤100 114 0.1291 0.6287 0.05175 1.153

Y SW NTNCWS 101‐1000 172 0.1291 0.6287 0.05175 1.153

Y SW NTNCWS 1001‐4100 33 0.1291 0.6287 0.05175 1.153

Y SW CWS ≤100 484 0.1291 0.6287 0.05175 1.153

Y SW CWS 101‐1000 2034 0.1291 0.6287 0.05175 1.153

Y SW CWS 1001‐4100 1699 0.07514 0.8767 0.05175 1.153

Y GW TNCWS ≤100 8112 0.08599 0.8796 0.07063 1.196

Y GW TNCWS 101‐1000 3007 0.08599 0.8796 0.07063 1.196

Y GW TNCWS 1001‐4100 119 0.08599 0.8796 0.07063 1.196

Y GW NTNCWS ≤100 1577 0.08599 0.8796 0.07063 1.196

Y GW NTNCWS 101‐1000 1780 0.08599 0.8796 0.07063 1.196

Y GW NTNCWS 1001‐4100 252 0.08599 0.8796 0.07063 1.196

Y GW CWS ≤100 3662 0.05449 0.6387 0.03950 1.168

Y GW CWS 101‐1000 7678 0.05449 0.6387 0.03950 1.168

Y GW CWS 1001‐4100 2707 0.05449 0.6387 0.03950 1.168

N GW TNCWS ≤100 32028 0.04223 0.8129 0.0357 1.059

N GW TNCWS 101‐1000 10217 0.04223 0.8129 0.03569 1.059

N GW TNCWS 1001‐4100 217 0.04223 0.8129 0.03569 1.059

N GW NTNCWS ≤100 4026 0.04223 0.8129 0.03569 1.059

N GW NTNCWS 101‐1000 3264 0.04223 0.8129 0.03569 1.059

N GW NTNCWS 1001‐4100 152 0.04223 0.8129 0.03569 1.059

N GW CWS ≤100 3788 0.04223 0.8129 0.03569 1.059

N GW CWS 101‐1000 3755 0.04223 0.8129 0.03569 1.059

N GW CWS 1001‐4100 644 0.04223 0.8129 0.03569 1.059

Note: Disinfection status (“Disinf?”) is from information downloaded from SDWIS/FED. Systems with no indication 

of disinfection status in SDWIS/FED are assumed to not disinfect. 

5.2.5.2 Derivation of α, β from Maximum Likelihood Estimates 

Using the estimates of a and b presented in Exhibits 5.3 and 5.4, EPA derived α, β

estimates of the variation in PWSs within groups of systems, and incorporated these into the 

occurrence model as described in Section 5.2.4. 

These parameters are derived from a and b as follows: 

α = a / b2 

β = (1- a) / b2 

Exhibits 5.5 and 5.6 present the estimates of α, β corresponding to estimates of a and b in 

exhibits 5.3 and 5.4. 
Economic Analysis for the Proposed RTCR 5-12 June 2010 

Exhibit 5.5 α and β Parameter Estimates for RTTC and RPTC 

Disinf?

GW or

SW? Sys Type Size No. Systems αRTTC βRTTC αRPTC βRPTC

Y SW TNCWS ≤100 838 0.2584 10.92 0.117 0.6972

Y SW TNCWS 101‐1000 358 0.2584 10.92 0.117 0.6972

Y SW TNCWS 1001‐4100 30 0.2584 10.92 0.117 0.6972

Y SW NTNCWS ≤100 114 0.1239 7.697 0.092 0.7697

Y SW NTNCWS 101‐1000 172 0.1866 16.37 0.092 0.7697

Y SW NTNCWS 1001‐4100 33 0.1866 16.37 0.092 0.7697

Y SW CWS ≤100 484 0.3438 22.54 0.173 2.508

Y SW CWS 101‐1000 2034 0.4262 44.63 0.173 2.508

Y SW CWS 1001‐4100 1699 0.3608 61.17 0.463 13.04

Y GW TNCWS ≤100 8112 0.2584 10.92 0.1172 0.6972

Y GW TNCWS 101‐1000 3007 0.2584 10.92 0.1172 0.6972

Y GW TNCWS 1001‐4100 119 0.2584 10.92 0.1172 0.6972

Y GW NTNCWS ≤100 1577 0.1239 7.697 0.09164 0.7697

Y GW NTNCWS 101‐1000 1780 0.1866 16.37 0.09164 0.7697

Y GW NTNCWS 1001‐4100 252 0.1866 16.37 0.09164 0.7697

Y GW CWS ≤100 3662 0.3166 19.57 0.1305 1.256

Y GW CWS 101‐1000 7678 0.2709 21.53 0.1305 1.256

Y GW CWS 1001‐4100 2707 0.2291 29.26 0.2160 3.922

N GW TNCWS ≤100 32028 0.2989 5.983 0.2444 0.6323

N GW TNCWS 101‐1000 10217 0.2989 5.983 0.2839 0.8577

N GW TNCWS 1001‐4100 217 0.2532 10.01 1.03175 5.059

N GW NTNCWS ≤100 4026 0.2236 5.890 0.2965 0.8550

N GW NTNCWS 101‐1000 3264 0.3336 12.07 0.2965 0.8550

N GW NTNCWS 1001‐4100 152 0.3336 12.07 0.2965 0.8550

N GW CWS ≤100 3788 0.4381 13.49 0.2685 1.146

N GW CWS 101‐1000 3755 0.3336 12.07 0.2685 1.146

N GW CWS 1001‐4100 644 0.3336 12.07 0.2726 1.805

Note: Disinfection status (“Disinf?”) is from information downloaded from SDWIS/FED. Systems with no indication 

of disinfection status in SDWIS/FED are assumed to not disinfect. 
Economic Analysis for the Proposed RTCR 5-13 June 2010 

Exhibit 5.6 α and β Parameter Estimates for RTEC and RPEC

Disinf?

GW or

SW? Sys Type Size No. Systems αRTEC βRTEC αRPEC βRPEC

Y SW TNCWS ≤100 838 0.3266 2.203 0.03891 0.7129

Y SW TNCWS 101‐1000 358 0.3266 2.203 0.03891 0.7129

Y SW TNCWS 1001‐4100 30 0.3266 2.203 0.03891 0.7129

Y SW NTNCWS ≤100 114 0.3266 2.203 0.03891 0.7129

Y SW NTNCWS 101‐1000 172 0.3266 2.203 0.03891 0.7129

Y SW NTNCWS 1001‐4100 33 0.3266 2.203 0.03891 0.7129

Y SW CWS ≤100 484 0.3266 2.203 0.03891 0.7129

Y SW CWS 101‐1000 2034 0.3266 2.203 0.03891 0.7129

Y SW CWS 1001‐4100 1699 0.0978 1.203 0.03891 0.7129

Y GW TNCWS ≤100 8112 0.1112 1.181 0.04936 0.6496

Y GW TNCWS 101‐1000 3007 0.1112 1.181 0.04936 0.6496

Y GW TNCWS 1001‐4100 119 0.1112 1.181 0.04936 0.6496

Y GW NTNCWS ≤100 1577 0.1112 1.181 0.04936 0.6496

Y GW NTNCWS 101‐1000 1780 0.1112 1.181 0.04936 0.6496

Y GW NTNCWS 1001‐4100 252 0.1112 1.181 0.04936 0.6496

Y GW CWS ≤100 3662 0.1336 2.318 0.02896 0.7041

Y GW CWS 101‐1000 7678 0.1336 2.318 0.02896 0.7041

Y GW CWS 1001‐4100 2707 0.1336 2.318 0.02896 0.7041

N GW TNCWS ≤100 32028 0.0639 1.449 0.03184 0.8602

N GW TNCWS 101‐1000 10217 0.0639 1.449 0.03184 0.8602

N GW TNCWS 1001‐4100 217 0.0639 1.449 0.03184 0.8602

N GW NTNCWS ≤100 4026 0.0639 1.449 0.03184 0.8602

N GW NTNCWS 101‐1000 3264 0.0639 1.449 0.03184 0.8602

N GW NTNCWS 1001‐4100 152 0.0639 1.449 0.03184 0.8602

N GW CWS ≤100 3788 0.0639 1.449 0.03184 0.8602

N GW CWS 101‐1000 3755 0.0639 1.449 0.03184 0.8602

N GW CWS 1001‐4100 644 0.0639 1.449 0.03184 0.8602

Note: Disinfection status (“Disinf?”) is from information downloaded from SDWIS/FED. Systems with no indication 

of disinfection status in SDWIS/FED are assumed to not disinfect. 

5.3 Predictive Modeling of Occurrence for Systems Serving Up to 4,100 People 

For the purpose of understanding both the potential to reduce exposure to potential 

contamination and for estimating incremental costs that may be incurred under the proposed 

RTCR, EPA developed a model to predict the changes in TC and EC occurrence over the 

modeled period with respect to requirements of the proposed RTCR regulatory scenarios. This 

predictive occurrence model takes into account the requirements of existing regulations (TCR 

and GWR) and develops estimates of changes in occurrence (as well as the frequency of the new 

Level 1 and Level 2 assessments and corrective actions) based on requirements of the regulatory 

alternatives considered under the proposed RTCR. The resulting estimates are used to generate 

cost estimates that can be compared across the three regulatory scenarios4

 – the current TCR 

 

4

 The three regulatory scenarios considered in the RTCR EA (current TCR option, AIP option, and Alternative 

option) are described in detail in Chapter 3 of this EA. Briefly, the AIP and Alternative options both differ from the 

current TCR primarily in the requirements for Level 1 and Level 2 assessments and corrective actions and for 

reduced monitoring eligibility. The AIP allows a continuation of current monitoring frequency while the Alternative 
Economic Analysis for the Proposed RTCR 5-14 June 2010 

option, the AIP option, and the Alternative option, as described in Chapter 7 of this EA. Potential 

benefits are compared in terms of changes in the level of occurrence associated with each 

regulatory scenario, as presented in Chapter 6 of this EA. 

The occurrence model focuses on a 30-year period beginning with full implementation of 

the GWR and covering a 25-year period of analysis from the anticipated proposed RTCR 

effective date of 2015. The predictive model is implemented as a Monte Carlo simulation and 

currently uses 10,000 iterations (simulated systems) within each of the 27 type, source and size 

categories to predict the effects of changes to the current rule over the modeling period. 

The PWSs included in this model are those serving ≤4,100 people primarily because 

these are the systems that will experience the major changes in monitoring frequency and other 

requirements that will affect their TC and EC occurrence. For systems serving more than 4,100 

people, which will not have significant monitoring frequency changes, a separate analysis was 

performed based on historical violations rates instead of occurrence rates, as explained in Section 

5.4 of this EA. The characteristics of all systems are described in Section 4.3 of this EA. 

5.3.1 Summary of GWR factors and timing affecting the TCR and Proposed RTCR 

The triggered and compliance monitoring requirements of the GWR must be 

implemented by December 2009, which will be approximately five years prior to the anticipated 

compliance date of the proposed RTCR. Sanitary survey (SS) requirements must be implemented 

by states by December 2012 for most CWSs, and not until December 2014 for higher performing 

CWSs and NCWSs. To account for the impact of the GWR requirements on baseline occurrence 

for those public water systems using a ground water source (and serving ≤4,100 people), the 

model performs a number of adjustments to the existing data prior to its application in the model 

as a baseline. 

Using 2005 SDWIS data (as explained in Section 4.3.1 of this EA) as a pre-GWR 

inventory baseline, EPA applies probabilities of Psample and Pwell

5

 to determine the number of 

nondisinfecting systems that are expected to move to a disinfecting status in the five years prior 

to proposed RTCR implementation. EPA derived Psample and Pwell

 6 in the GWR EA (November 

2006); Pwell is a fixed value of 21.58 percent, and Psample is drawn from a beta distribution with a 

range of alpha and beta estimates having a median value for each system of 5.8 percent and an 

expected value of 12.4 percent. Incorporation of these factors into the model ensures that the 

corrective actions anticipated to be performed under the GWR are reflected in reduced 

 option requires systems to sample monthly for an initial period. Both allow reduced monitoring for qualified 

systems, but only the AIP allows annual monitoring. Systems on annual would require an annual site visit or an 

annual voluntary Level 2 assessment. 

5

 The term “Pwell” refers to the probability that a randomly selected well across the United States will test positive for 

a virus or fecal indicator species, such as EC, in its source water; “Psample” is the probability that given a 

contaminated well, a random sample at the well will eventually test positive for a virus or fecal indicator. The GWR 

EA (November 2006), and in particular the Baseline Chapter of that document, provide a detailed explanation of the 

analysis used to generate these Pwell and Psample estimates. 6

 Under the GWR, GWSs with less than 4 log of treatment for viruses must sample their source for a fecal indicator 

(e.g., E. coli) when they incur a TC+ under the TCR (or AIP option). If sample water is fecal indicator positive, the 

system may be required to implement remedial actions at the source, one of which achieves disinfection to 4 log for 

viruses. 
Economic Analysis for the Proposed RTCR 5-15 June 2010 

occurrence for systems implementing them. In the predictive model, simulated nondisinfecting 

ground water systems having a Total Coliform-positive (TC+) take one or more source water 

samples per the GWR triggered monitoring requirement and test the samples for fecal indicator 

presence (EC is assumed to be the fecal indicator used)7

. The probability of observing an E. colipositive (EC+) is based on the product of Pwell and the Psample value drawn for that system. If 

positive, a second assessment is done to determine if that system implements disinfection or a 

nondisinfection corrective action based on the estimated proportion choosing those options as 

defined in the GWR EA for the various types and sizes of systems.8

The simulation model keeps track of systems that begin as nondisinfecting ground water 

systems at the start of the analysis period and elect disinfection at some point during the 30-year 

period from the effective date of the GWR (December 2009) through the end of the analysis 

period for the proposed RTCR. The inventory for disinfecting and nondisinfecting ground water 

systems are then adjusted accordingly for subsequent stages of the analysis. 

Exhibit 4.4 in Chapter 4 of this EA presents the baseline inventory of ground water 

systems by disinfection status at the beginning of proposed RTCR implementation. Those 

Ground Water Systems (GWSs) achieving < 4 log disinfection must sample at their source. 

Sampling costs were accounted for in the GWR EA (USEPA 2006a). 

Throughout the modeling period, Ground Water (GW) systems that do not currently 

disinfect or add disinfection may have EC+ source water samples and implement a 

nondisinfection corrective action. Modeling in the GWR EA did not incorporate estimates of the 

effectiveness of implementing GWR requirements because the GWR was only effective as of 

December 2009. Absent this data, EPA applied best professional judgment in assuming that 

these corrective actions would have approximately the same effectiveness as a Level 2 corrective 

action since they are similar in nature to an acute violation under TCR. As shown in Exhibit 5.8, 

if a nondisinfecting system performs a nondisinfecting corrective action, the model assumes that 

occurrence is 0% for the remainder of that year and 2 full years after that. As a result of this 

assumption, baseline occurrence will be significantly reduced as a function of movement from 

non-disinfecting to disinfecting status. The modeling then assumes the P values are only 25 

percent of baseline values for an additional five years. The model assumes the system returns to 

baseline P values after that (approximately) seven year period. 

Additionally, the model incorporates the effect of SSs performed under the GWR as of 

January 2010, which is estimated by EPA to reduce TC and EC occurrence by 10 percent for the 

remainder of the period of analysis. For transient PWSs, which are on a 5 year SS cycle under 

the GWR, this reduction is initially applied to 20 percent of qualifying systems for each of the 5 

years from 2010 to 2015. For CWSs, which are on a 3 year cycle, this reduction is initially 

applied to 1/3 of systems annually from 2010 to 2012. EPA considers the estimate of 10 percent 

in reduction of occurrence to be a conservative estimate of the effectiveness of the sanitary 

survey provision of the GWR based on best professional judgment of the TCRDSAC. However, 

absent empirical information to assume otherwise and because the factor is similarly 

incorporated by the model into the estimates of occurrence for all three regulatory scenarios, 

EPA assumes that this conservatism does not significantly affect the net results for the AIP 

option or Alternative option, which are calculated by comparison to the current TCR (baseline). 

 

7

 Edberg, R. (2000) discusses the use of E. coli as an indicator of drinking water quality. 

8

 Costs for compliance with the GWR were considered in the GWR EA (November 2006) and are not included in 

the RTCR EA. 
Economic Analysis for the Proposed RTCR 5-16 June 2010 

A third GWR requirement that the model incorporates is compliance monitoring by the 

subset of GWSs that disinfect, for which the model assigns a 10 percent reduction in occurrence 

in effect throughout the period of analysis. Again, this GWR effectiveness estimate may be 

conservative, but EPA assumes that because it is incorporated by the model into occurrence 

estimates for all three regulatory scenarios, the net effect on results of the AIP option and 

Alternative options (in comparison to the current TCR) is unlikely to be significant. Taking into 

account the effect of both SS and compliance reductions, the disinfecting GWSs are expected to 

ultimately have TC and EC occurrence rates that are 81 percent of the values derived from the 

occurrence distributions (from 90 percent for sanitary surveys x 90 percent for compliance 

monitoring). 

A fourth and last GWR requirement that the model incorporates concerns the repeat 

number of samples following a TC positive. The GWR allows PWSs to use of one of the 

required four repeat samples for source water testing (for GWSs serving ≤1,000 people for EC 

following a case of a TC+ assay) under the current TCR. By comparison, under the AIP option, 

Alternative option, and the current TCR scenarios for systems serving >1,000 people, only 3 

repeat samples are required and in these cases an additional, separate sample is used for the 

GWR source water EC assay. 

As mentioned above with regard to SS and disinfecting system GWR compliance, the 

actual reductions in occurrence that will result from implementation of GWR requirements may 

differ from those predicted based on assumptions used in this model. EPA believes this would 

affect neither the net analysis nor how the AIP or Alternative options compare to each other, 

since both would be affected similarly. Section 5.3.3.1 describes the various sources of 

uncertainty and variability considered in this EA and presents analysis of key variables. 

5.3.2 Summary of Predictive Model 

As the following Sections 5.3.2.1 – 5.3.2.2 describe, EPA modeled the expected trend in 

occurrence of TC and EC positive assays over a pre-RTCR monitoring period of 5 years (to 

capture applicable GWR effects), and a subsequent 25-year period of analysis for the three 

regulatory scenarios: continuation of the current TCR, AIP option, and Alternative option9

. EPA 

sought to capture the changes in occurrence from the implementation of the GWR requirements, 

and in turn, the implementation of requirements of the AIP option and the Alternative option. 

Along with changes in TC and EC occurrence, the model predicts behavioral changes: the 

number of Level 1 and Level 2 assessments (and associated number of Level 1 or Level 2 

corrective actions) to be performed and further resulting adjustments to occurrence, and changes 

in sampling regimens as systems qualify for reduced monitoring requirements. 

 

5.3.2.1 Approach to Estimating Parameters 

As described in Section 5.2 of this chapter, EPA derived Beta distributions, characterized 

by their α, β parameters, based on analyses of the variation in TC and EC positive assays that 

occurred both between and within 27 groupings of systems (as defined in Section 5.2.); the 

 

9

 Footnote 4 briefly describes the three regulatory scenarios. 
Economic Analysis for the Proposed RTCR 5-17 June 2010 

resulting α, β parameter estimates are presented in Exhibits 5.5 and 5.6. Based on an initial 

analysis, the 27 groups were condensed into the groups presented in Appendix F of this EA. The 

final Beta distributions were based on these groupings to make the best use of the available data, 

combining groups of systems when their occurrence levels were similar to avoid having small 

sample size in any of the final groups. 

5.3.2.2 Description of Predictive Model 

Model output in this chapter (Exhibits 5.10 – 5.21) was generated for a 30-year period to 

encompass 5 years of the effects of GWR implementation and 25 years of the effects of RTCR 

implementation. For the purpose of the benefit-cost analysis, years 3 through 27 of this period 

are included in the calculations and presented in the results shown in Chapter 6 (Benefits 

Analysis), Chapter 7 (Cost Analysis), and Chapter 9 (Comparison of Benefits and Costs). 

Initially in the modeled period, all systems under the current TCR option and the AIP option are 

assumed to sample based on the sampling regimen applicable to their system type, size, type of 

water source, and whether or not the system disinfects.10 Under the Alternative option, all 

systems are assumed to sample monthly for the first five years after the RTCR effective date. 

 For the AIP option, the model adjusts these monitoring frequencies for ground water 

systems serving fewer than 1,000 people in years 9 and 11 of the 30-year period, or 3 and 5 years 

after the RTCR effective date, respectively, for CWSs and NCWSs. The adjustments are made 

based on the acute and non-acute violations incurred during these 3 and 5 year periods,11 and the 

period of assessment coincides with the sanitary survey for CWSs and NCWSs. The adjusted 

monitoring frequencies then apply from years 9 – 30 and years 11 – 30 of the analysis for CWSs 

and NCWSs, respectively. 

For the Alternative option, the model adjusts the monitoring frequencies from the allmonthly regimen based on the acute and non-acute violations12 predicted during the assessment 

period, which is the first five years after the RTCR effective date, during which all systems 

sample monthly. The model applies the schedule thus adjusted in years 11 -30 of the analysis. 

The timing for the adjustments made to the monitoring frequency schedules – effective in 

years 9 and 11 for CWSs and NCWSs, respectively, following GWR implementation under the 

AIP and Alternative options – are consistent with the length of time of the respective sanitary 

survey cycles. Although EPA uses the sanitary cycle to define the period of assessment for 

updating the schedule, the results of the surveys are not predicted in this model and are not 

directly incorporated into the calculations in any way. Assumptions for the percentage of systems 

 

10 Based on EPA and TWG analysis of Six-Year data and individual state statutes during the TCRDSAC and review 

by ASDWA. 

11 Systems incurring 1 or more acute or non-acute violations in this period are assumed to be on monthly 

monitoring. For the AIP option, the remaining systems (incurring no acute or non-acute violations) are distributed 

between quarterly and annual monitoring according to the percentage distribution from the initial M/Q/A estimates 

prior to GWR implementation (Exhibit 4.4). Constraints to these adjustments include: 1) The final estimates of the 

proportion of community disinfecting systems on monthly monitoring should not decrease from the current baseline 

estimate. 2) For the noncommunity systems, there are caps on the % that move to annual monitoring under the AIP: 

TNCWS <500: 13.8%; TNCWS >500: 8.6%; NTNCWS < 500: 7.3%; NTNCWS>500: 3.0%. 

12 Systems incurring 1 or more acute or non-acute violations in this period are assumed to be on monthly 

monitoring. For the Alternative option, all of the remaining systems (incurring no acute or non-acute violations) 

move to quarterly monitoring. 
Economic Analysis for the Proposed RTCR 5-18 June 2010 

on monthly, quarterly, or annual monitoring upon proposed RTCR implementation are shown in 

Exhibit 5.9a – 5.9c. 

Using the monitoring frequencies described above, the model applies the baseline 

occurrence associated with each category of PWS at the start of each modeled year (i.e., the level 

of occurrence in 2005 under the current TCR updated to reflect GWR implementation, as 

described in Section 5.3.1), as described in Exhibits 5.7 and 5.8 for surface and ground water 

systems, respectively. The TC and EC occurrence (both from routine and repeat samples) are 

modeled by combining the Beta distributions described previously with the binomial distribution 

to simulate TC and EC positives (i.e., successes) given the number of samples (i.e., trials) each 

month. 

For each simulated system in the model, a probability (P) is drawn randomly for each of 

the RTTC, RPTC, RTEC, and RPEC types of samples from their corresponding Beta 

distributions. These P values are used in the binomial distribution, together with the number of 

samples taken each month, to predict the number of TC and EC positives. In the absence of any 

corrective actions being performed under the proposed RTCR, those P values remain the same 

for that system for the entire modeling period. If TC or EC occurrence is found that results in a 

specific corrective action under the proposed RTCR, temporary reductions in these P values are 

made as described further below. In addition, when a system has a TC+ in a particular month that 

does not result in a specific corrective action, it is assumed, (for both the current TCR and the 

proposed RTCR), that the RTTC rate in the following month will change to reflect either some 

worsening of the problem or an improvement based on some other actions taken that are not part 

of the specific corrective actions being considered. This was carried out by selecting at random a 

different RTTC P value in those months following a TC+ for which explicit corrective actions 

were not initiated. In the second month following a TC+ that does not result in a corrective 

action, the RTTC rate reverts to the rate applicable in the month in which the TC+ occurred. 

EPA determined that this approach provided overall results for the current TCR that 

approximated what was observed in the 6-Year Review data and SDWIS data as discussed in the 

Section 5.3.3.2 (model validation) below. 

Based on the frequency of sampling and the occurrence probabilities for each system, the 

model determines what percentage of these systems will be required to take an action (i.e., 

perform a Level 1 or Level 2 assessment in response to exceeding the threshold of multiple TC 

positive assays or one EC positive assay, and, in some cases, implement a corrective action). 

For the percentage of systems predicted to require a Level 1 assessment following the 

requisite number of TC positives, the model assumes that 10 percent will find and address the 

exact source of the problem under the AIP option and Alternative option. This represents an 

incremental increase over the number expected to implement such a corrective action under the 

current TCR. The model assumes that systems that successfully identify and correct the problem 

will not have a positive assay for the remainder of that year nor 1 additional full year after the 

assessment, after which the probability of a TC or EC positive will be 50 percent that of the 

baseline P value for 3 additional years.13 After this period of reduced occurrence, the model 

 

13Using best professional judgment informed by deliberations within the TCRDSAC, EPA assumes that some 

systems will have 0% occurrence for some number of years longer than one year, and some will have occurrence 

levels that are >0% within the first year. The assumption used in the analysis (systems will have 1 year with 0% 

occurrence, plus 2 to 3 years of reduced occurrence from their baseline occurrence) is meant to represent an average 

system that experiences occurrence that is between these two scenarios. 
Economic Analysis for the Proposed RTCR 5-19 June 2010 

assumes that occurrence probabilities for this subset of systems return to those that were initially 

assigned. Because the Level 1 and Level 2 assessments are a new requirement, empirical data on 

their effectiveness in determining an appropriate corrective action is not available. Absent this 

evidence, EPA has applied best professional judgment in choosing what it believes to be a 

significant but conservative success rate – 10% of assessments will result in determining the root 

of the problem and effectively implementing an appropriate corrective action. 

Similarly, for the systems predicted to require a Level 2 assessment based on observing 

the requisite number of TC and/or EC positives, under the AIP option and Alternative options an 

incremental 10 percent more of those systems than under the current TCR are assumed to then 

implement a corrective action that addresses the cause of the problem. For those systems, the 

model assumes that occurrence is 0% for the remainder of that year and then for 2 full years after 

that. The modeling then assumes the P values are only 25 percent of baseline values for an 

additional five years. The model assumes the system returns to baseline P values after that 

(approximately) seven year period. 

For nondisinfecting GWSs, a percentage of positive samples is estimated (from the Pwell

and Psample parameters) to be related to a source water problem. All nondisinfecting GWSs 

having sourcewater EC positives14 will implement disinfection or nondisinfecting corrective 

action. Those adding disinfection essentially get removed from the nondisinfecting category and 

are reassigned to the disinfecting category for the remainder of the modeling period. For the 

portion of this subset that are assumed to implement a nondisinfecting corrective action15, the 

systems are assumed to experience the same reduced occurrence levels as those addressing Level 

2 Assessments (i.e., 0% occurrence for 2 years, then occurrence at 25 percent of baseline for an 

additional 5 years). As Chapter 7 of this EA explains, no costs are attributed to the proposed 

RTCR for any corrective action related to source water EC occurrence since such costs have 

already been considered in the GWR EA (November 2006). 

Outputs generated from this predictive simulation model (for PWSs serving 4,100 or 

fewer people) include the following for each modeled year: occurrence of TC and EC positive 

assays, the number of Level 1 and Level 2 assessments conducted, and the number of Level 1 

and Level 2 corrective actions implemented. Based on these model outputs and the criteria for 

reduced monitoring, the model also provides estimates of the number of systems on monthly, 

quarterly, and annual sampling regimes (and by implication the number of routine, repeat, and 

additional routine samples taken annually) under the AIP option and Alternative option. These 

requirements are detailed in Chapter 3 of this EA. 

The results of the proposed RTCR predictive occurrence model are presented in the 

following Section, 5.3.3. 

 

14 The model determines source water occurrence separately based on the subset of nondisinfecting GW systems, as 

described in Section 5.3.1 (2nd paragraph) of this chapter. 15 Estimates of the number of systems implementing a nondisinfection corrective action are taken from Exhibit 

6.21b ("Estimated Distribution of Source Water Contamination Corrective Actions") of the GWR EA (USEPA 

2006x). The GWR EA estimated the number of systems choosing a nondisinfection corrective action based on a 

range; the high end was the percentage of CWS entry points employing disinfection at that time by system size , and 

the low end was assumed to be 10% based on discussions with state representatives. 
Economic Analysis for the Proposed RTCR 5-20 June 2010 

Exhibit 5.7 Simulated Impact of the AIP and Alternative Options on Systems 

Serving ≤4,100 People – Surface Water Systems 
Economic Analysis for the Proposed RTCR 5-21 June 2010 

Exhibit 5.8 Simulated Impact of the AIP and Alternative Options on Systems 

Serving ≤4,100 People – Ground Water Systems 
Economic Analysis for the Proposed RTCR 5-22 June 2010 

Exhibit 5.9a Percent of GW Systems Assumed to be on Monthly, Quarterly, and 

Annual (M/Q/A) Monitoring by System Category under Current TCR (Baseline) – 

Initial Estimates (Post GWR Implementation) 

Disinf?

GW or 

SW? Sys Type Size

 No. 

Systems Monthly Quarterly Annual

Y GW TNCWS ≤100 13,558 4.8% 62.9% 32.3%

Y GW TNCWS 101-1000 6,014 7.9% 66.9% 25.2%

Y GW TNCWS 1001-4100 269 100.0% 0.0% 0.0%

Y GW NTNCWS ≤100 2,904 19.3% 64.6% 16.0%

Y GW NTNCWS 101-1000 3,621 18.5% 66.7% 14.7%

Y GW NTNCWS 1001-4100 542 100.0% 0.0% 0.0%

Y GW CWS ≤100 6,132 86.6% 13.4% 0.0%

Y GW CWS 101-1000 12,762 88.5% 11.5% 0.0%

Y GW CWS 1001-4100 5,405 100.0% 0.0% 0.0%

N GW TNCWS ≤100 46,642 4.8% 62.9% 32.3%

N GW TNCWS 101-1000 15,224 7.8% 66.8% 25.3%

N GW TNCWS 1001-4100 348 100.0% 0.0% 0.0%

N GW NTNCWS ≤100 5,913 19.3% 64.6% 16.0%

N GW NTNCWS 101-1000 4,710 18.5% 66.7% 14.8%

N GW NTNCWS 1001-4100 270 100.0% 0.0% 0.0%

N GW CWS ≤100 5,806 86.6% 13.4% 0.0%

N GW CWS 101-1000 5,597 88.6% 11.4% 0.0%

N GW CWS 1001-4100 1,038 100.0% 0.0% 0.0%

Notes: 

 1) EPA assumes that the frequencies noted in this exhibit for the current TCR would also apply under the AIP 

option in the first 10 years of the analysis period. Under the Alternative option, all systems would monitor monthly 

for the first 5 years after the RTCR effective date. 

2) Estimates for the size categories presented in this exhibit are produced from weighted averages from the 

following size categories (and corresponding estimates of proportion sampling monthly, quarterly, or annually): 

≤100, 101-500, 501-1000, 1001-2500, 2501-3300, and 3301-4100. Water Type includes disinfection status, as 

informed by information from SDWIS-FED. 

3) Systems with no indication of disinfection (“Disinf?”) status in SDWIS-FED were assumed to not disinfect. 

4) Some figures may not add due to rounding in the model. 
Economic Analysis for the Proposed RTCR 5-23 June 2010 

Exhibit 5.9b Percent of GW Systems Predicted to be on M/Q/A Monitoring by 

System Category under AIP Option – Adjusted Estimates (Post RTCR 

Implementation) 

Disinf?

GW or 

SW? Sys Type Size

 No. 

Systems Monthly Quarterly Annual

Y GW TNCWS ≤100 13,558 6.4% 79.8% 13.8%

Y GW TNCWS 101-1000 6,014 6.5% 80.2% 13.2%

Y GW TNCWS 1001-4100 269 100.0% 0.0% 0.0%

Y GW NTNCWS ≤100 2,907 3.0% 89.7% 7.3%

Y GW NTNCWS 101-1000 3,621 2.5% 91.2% 6.3%

Y GW NTNCWS 1001-4100 542 100.0% 0.0% 0.0%

Y GW CWS ≤100 6,132 86.6% 13.4% 0.0%

Y GW CWS 101-1000 12,762 88.5% 11.5% 0.0%

Y GW CWS 1001-4100 5,405 100.0% 0.0% 0.0%

N GW TNCWS ≤100 46,643 14.4% 71.8% 13.8%

N GW TNCWS 101-1000 15,225 16.1% 70.5% 13.4%

N GW TNCWS 1001-4100 348 100.0% 0.0% 0.0%

N GW NTNCWS ≤100 5,919 15.1% 77.6% 7.3%

N GW NTNCWS 101-1000 4,711 11.4% 82.0% 6.5%

N GW NTNCWS 1001-4100 270 100.0% 0.0% 0.0%

N GW CWS ≤100 5,806 86.6% 13.4% 0.0%

N GW CWS 101-1000 5,597 88.6% 11.4% 0.0%

N GW CWS 1001-4100 1,038 100.0% 0.0% 0.0%

Notes: 

1) M/Q/A percentage estimates are based on model predictions of acute and non-acute violations from years 6 – 10 

(NCWSs) and 6 – 8 (CWSs) of the 30-year modeled period. Systems incurring 1 or more acutes or non-acutes in 

this period are assumed to be on monthly monitoring for years 11 – 25 of the analysis; the remaining systems are 

distributed between quarterly and annual monitoring according to the percentage distribution from the initial M/Q/A 

estimates (Exhibit 5.9a). Other constraints apply to the determination of the M/Q/A distribution of systems as 

described in Section 5.3.2 above. 

2) Estimates for the size categories presented in this exhibit are produced from weighted averages from the 

following size categories (and corresponding estimates of proportion sampling monthly, quarterly, or annually): 

≤100, 101-500, 501-1000, 1001-2500, 2501-3300, and 3301-4100. 

3) Systems with no indication of disinfection (“Disinf?”) status in SDWIS-FED were assumed to not disinfect. 

4) Some figures may not add due to rounding in the model. 
Economic Analysis for the Proposed RTCR 5-24 June 2010 

Exhibit 5.9c Percent of GW Systems on M/Q/A Monitoring by System Category 

under Alternative option – Adjusted Estimates (Post RTCR Implementation) 

Disinf?

GW or 

SW? Sys Type Size

 No. 

Systems Monthly Quarterly Annual

Y GW TNCWS ≤100 13,558 13.0% 87.0% 0.0%

Y GW TNCWS 101-1000 6,014 12.4% 85.7% 0.0%

Y GW TNCWS 1001-4100 269 100.0% 0.0% 0.0%

Y GW NTNCWS ≤100 2,907 4.9% 95.1% 0.0%

Y GW NTNCWS 101-1000 3,621 4.5% 95.5% 0.0%

Y GW NTNCWS 1001-4100 542 100.0% 0.0% 0.0%

Y GW CWS ≤100 6,132 86.6% 13.4% 0.0%

Y GW CWS 101-1000 12,762 88.5% 11.5% 0.0%

Y GW CWS 1001-4100 5,405 100.0% 0.0% 0.0%

N GW TNCWS ≤100 46,642 25.6% 74.4% 0.0%

N GW TNCWS 101-1000 15,224 25.9% 74.1% 0.0%

N GW TNCWS 1001-4100 348 100.0% 0.0% 0.0%

N GW NTNCWS ≤100 5,919 22.9% 77.1% 0.0%

N GW NTNCWS 101-1000 4,710 17.2% 82.8% 0.0%

N GW NTNCWS 1001-4100 270 100.0% 0.0% 0.0%

N GW CWS ≤100 5,806 86.6% 13.4% 0.0%

N GW CWS 101-1000 5,597 88.6% 11.4% 0.0%

N GW CWS 1001-4100 1,038 100.0% 0.0% 0.0%

Notes: 

1) M/Q/A percentage estimates are based on model predictions from years 6 – 10 (NCWSs) and 6 – 8 (CWSs) of 

the period of analysis. Systems incurring 1 or more acutes or non-acutes in this period are assumed to be on 

monthly monitoring for years 11 – 25 of the analysis; the remaining systems are assumed to be on quarterly 

monitoring. Other constraints apply to the determination of the M/Q/A distribution of systems as described in Section 

5.3.2 above. 

2) Estimates for the size categories presented in this exhibit are produced from weighted averages from the 

following size categories (and corresponding estimates of proportion sampling monthly, quarterly, or annually): 

≤100, 101-500, 501-1000, 1001-2500, 2501-3300, and 3301-4100. 

3) Systems with no indication of disinfection (“Disinf?”) status in SDWIS-FED were assumed to not disinfect. 

4) Some figures may not add due to rounding in the model. 

5.3.3 Predictive Model Results 

As noted above, the predictive model produces output that includes national estimates of 

sampling and occurrence in PWSs across the United States, the resulting Level 1 and Level 2 

assessments, corrective actions resulting from Level 1 and Level 2 assessments, and reductions 

in sampling and occurrence for these systems in accordance with requirements under the current 

TCR option, the AIP option, and the Alternative option. In Exhibits 5.10 through 5.15, output 

includes the model years 1 – 30 described in Section 5.3.2.2. Years 1 - 5 are summed for the 

current TCR only and represent the period prior to the start of monitoring under the proposed 

RTCR, including 5 years after the GWR effective date and 3 overlapping years of RTCR 

implementation prior to the RTCR effective date. Year 5 in the analysis (also for just the current 
Economic Analysis for the Proposed RTCR 5-25 June 2010 

TCR) is also shown separately because it represents the baseline year, reflecting conditions just 

prior to the start of monitoring under the proposed RTCR. Model years 6 through 30 are summed 

for the current TCR, the AIP option, and the Alternative option because they represent the 25-

year period of analysis following promulgation of the proposed RTCR. 

For all types of PWSs, the model output is presented for the current TCR option (i.e., the 

baseline regulatory scenario for this EA), the AIP option, and the Alternative option. The TCR 

with the GWR effects incorporated serves as the appropriate baseline for comparisons with the 

AIP option. 

EPA’s general expectations for TC occurrence for GW systems shown in Exhibits 5.16 – 

5.18 are as follows: 

1. Years 1-5 show a decline in the TC+ rates due to GWR implementation effects. These 

include expected reductions in RTTC rates for all GW systems related to sanitary 

surveys, for disinfecting GW systems related to the compliance monitoring, and for nondisinfecting GW systems due to corrective actions taken following a source water EC+ 

sample. 

 

2. Years 6-30 reflect additional reductions (beyond GWR effects) in TC+ rates due to the 

AIP option or Alternative option. The AIP option and Alternative option occurrence rates 

are generally lower than those for TCR with the GWR primarily because of the additional 

corrective actions (Level 1 and Level 2). In some subgroups, some counts are higher 

under the Alternative option than under the current TCR due to the increased sampling 

e.g., routine TC and routine EC positives for GW NTNCWSs (Ex. 5.11). The balance of 

the two effects of reduced sampling (reduced additional and repeat samples) and the 

additional assessments and corrective actions, which move the counts in opposite 

directions, is explored in the sensitivity analysis in Section 5.3.3.1 of this chapter. 

3. In Years 6 through 10 and years 11 – 30 differences in TC+ rates between the AIP option 

and Alternative option are due to different proportions of systems that are performing 

monthly, quarterly, or annual monitoring. In general, more monitoring (e.g., more doing 

monthly than quarterly, or more doing quarterly than annual) – in conjunction with the 

corrective actions – will push the TC occurrence levels down (more samples are expected 

to be taken and fewer are likely to be positive). 

a. In years 6 – 10, the Alternative option has a lower TC+ rate than the AIP option 

because all systems under the Alternative option begin the five year period on 

monthly sampling. 

b. By year 11, the systems are sampling according to their “steady state” regimens, 

when all of the systems that qualified for reduced monitoring during their 

respective periods of assessment (as described in Section 5.3.2.2) are assigned to 

their reduced regimens in the model. For the AIP option, the proportions of 

systems on M/Q/A sampling is identical to those under the current TCR; under 

the Alternative option, however, systems that would qualify under the current 

TCR for annual monitoring can only reduce to quarterly monitoring. 
Economic Analysis for the Proposed RTCR 5-26 June 2010 

In Exhibit 5.16 (Community GW systems), the graph shows the expected drop in TC 

rates for years 1-5 as the GWR is implemented prior to AIP option. There are only very small 

differences between AIP option and Alternative options, and these are not observable on this 

graph. A comparison of the estimates in Exhibit 5.10 clarifies these small differences. Most of 

these systems are already on monthly sampling, so there is no significant difference seen 

between the AIP and Alternative options in years 6-8 for those few not on monthly and it is 

assumed that the monthly/quarterly distribution after this period returns to that under the current 

TCR. Therefore, the TC+ rates over the 25 year period for these systems show no difference 

between the AIP and Alternative options. 

In Exhibit 5.17 (Non-transient Noncommunity (NTNC) GW systems), the graph also 

shows the expected drop in TC+ rates for years 1-5 as the GWR is implemented prior to the 

proposed RTCR. For the years 6-10 the occurrence rates decrease due to the implementation of 

corrective actions, and the rates for the Alternative option are lower than for the AIP option since 

all systems are on monthly sampling under the Alternative option for this period (having the 

effect of reducing the occurrence level as noted above). However, from year 11 to 30, the M/Q/A 

distributions for these two are essentially the same and therefore the TC occurrence levels are the 

same over this period. 

In Exhibit 5.18 (TNCWS GW), the graph also shows the expected drop in TC+ rates for 

years 1-5 as the GWR is implemented prior to the proposed RTCR. For the years 6-10, the TC 

rates drop further as the corrective actions implemented in response to Level 1 and Level 2 

assessments are begun for both the AIP and Alternative options. TC occurrence is markedly 

lower during this period for the Alternative option where all are on monthly, whereas the 

majority of systems under the AIP option are on quarterly. Beginning in Year 11, there is a shift 

under the AIP option toward more systems on monthly than under the TCR, and more systems 

on quarterly than under the TCR, and hence the overall TC+ rate drops. For the AIP option, 

beginning in Year 11, a substantial portion move from the all monthly sampling during years 6-

10 to quarterly sampling (but none on annual). Because there are slightly more systems under 

Alternative option that end up on monthly and quarterly than under the AIP option for years 11-

30, the TC+ rate for the AIP option is slightly higher than for the Alternative option. 

EPA’s general expectations for TC+ rates for SW systems shown in Exhibits 5.19 – 5.21 

are as follows: 

1. The current TCR is provided as the baseline for comparison with the proposed RTCR 

(the GWR does not apply to surface water systems and therefore its effect is not included 

in these graphs). 

2. Because all surface water systems of all sizes do monthly monitoring (no systems are on 

quarterly or annual monitoring), the applicable provisions of the proposed RTCR are 

identical for the AIP and Alternative options. 

3. The reductions in TC+ rates shown by the proposed RTCR relative to the current TCR 

therefore reflect solely the effects of the corrective actions implemented in response to 

Level 1 and Level 2 assessments. 
Economic Analysis for the Proposed RTCR 5-27 June 2010 

In Exhibit 5.19 (Community SW systems), the graph shows little difference in TC+ rates 

between the current TCR and proposed RTCR. This is primarily because the current TC+ rate is 

very low for these systems, and therefore there are few corrective actions implemented over the 

25 year period. 

In Exhibit 5.20 (NTNC SW), the graph shows that there is a slightly greater difference 

between the current TCR and the proposed RTCR for the NTNC SW systems than for the 

community systems shown in Exhibit 5.19. This is because the baseline TC+ rate is slightly 

higher and, therefore, more corrective actions are performed. 

In Exhibit 5.21 (TNCWS SW), the graph indicates that this group exhibits the most 

significant change between the current TCR and proposed RTCR since the baseline TC+ rate for 

these systems is approximately twice that of the NTNC and community systems. 

A comparison of results for SW versus GW systems reveals a pattern of lower occurrence 

for SW systems; this is explained by the uniform requirement that SW systems disinfect. Many 

GW systems are not required to disinfect, and the result is a level of occurrence that is 

periodically elevated in some systems, raising the overall average in GW system categories. This 

difference is larger in the noncommunity GW systems than for the community water systems 

based on the relatively large proportion of noncommunity water systems that do not disinfect. 

The difference is largest among the transient noncommunity water systems, a category in which 

the largest proportion of GW systems do not disinfect. 

Complete results from the model (by year and system size) and additional graphs are 

shown in Appendices A and B, respectively. The implications of these results in terms of 

changes in the level of risk associated with contamination of PWS water supplies are discussed 

in Chapter 6 of this EA. Model results are used to calculate national estimates of incremental 

costs for PWSs in Chapter 7 of this EA. 
Economic Analysis for the Proposed RTCR 5-28 

Exhibit 5.10 Ground Water Community Water System Model Output Cumulative End

Period

Regulatory Scenario

Reg Rout 

Samples

Reg Rout 

Samples 

if Addls 

Taken

Repeat 

Samples

GWR 

Samples RTTC+ RPTC+ RTEC+ RPEC+

GWR 

EC +

Nonacutes Acutes L1 Assmt L2 Assmt 

12,712,859 1,052,957 816,079 0 215,787 111,640 10,267 4,344 0 55,639 5,773 34,556 30,6

TCR 12,761,616 864,605 588,252 93,331 176,379 66,797 7,236 2,106 872 39,769 3,335 26,947 18,54AIP 12,984,469 19,027 488,523 83,140 162,841 48,053 6,438 1,347 816 30,271 2,362 22,112 11,6Alt 13,073,297 16,686 490,683 83,299 163,561 47,829 6,562 1,595 781 29,955 2,511 21,917 11,6

2,542,182 254,662 197,228 0 52,150 27,053 2,471 1,033 0 13,486 1,391 8,410 7,3

TCR 2,550,295 180,676 122,391 19,799 36,791 14,208 1,532 460 312 8,358 711 5,542 4,1

508,401 42,520 32,969 0 8,719 4,613 402 176 0 2,259 240 1,415 1,24

TCR 510,266 35,345 24,060 3,864 7,231 2,655 297 70 48 1,605 130 1,107 7

sum years 

6-30

TCR No GWR

sum years TCR No GWR

1-5

TCR No GWR Year 5

Source: RTCR predictive model. Note: Years 1 – 5 in the model reflect incorporation of GWR effects (explained in Section 5.3.3) into pre-GWR baseline data; Year 5 in tconditions immediately prior to the effective date of the RTCR; and Years 6 – 30 represent a period of 25 years after monitoring begins u

Exhibit 5.11 Ground Water Nontransient Noncommunity Water System Model Output Cumul

Period

Regulatory Scenario

Reg Rout 

Samples

Reg Rout 

Samples 

if Addls 

Taken

Repeat 

Samples

GWR 

Samples RTTC+ RPTC+ RTEC+ RPEC+

GWR 

EC +

Nonacutes Acutes L1 Assmt L2 Assmt 

2,661,114 328,889 264,574 0 68,232 59,455 3,484 2,338 0 24,614 2,723 14,759 14,02

TCR 2,668,723 271,756 178,204 42,339 55,965 34,716 2,534 1,269 446 17,922 1,778 11,658 8,9AIP 2,564,440 90,884 145,401 37,384 48,467 25,164 2,115 841 435 13,642 1,213 10,157 5,0Alt 3,274,430 67,297 181,342 47,000 60,447 30,963 2,566 1,058 484 16,967 1,506 11,673 7,42

532,239 66,134 53,191 0 13,714 11,904 693 446 0 4,925 531 2,956 2,7

TCR 533,205 58,599 38,489 9,192 12,094 7,867 574 288 150 3,924 403 2,477 2,0

106,453 13,330 10,711 0 2,760 2,425 137 89 0 1,001 102 603 5

TCR 106,725 10,980 7,219 1,717 2,267 1,416 95 48 23 729 68 473 3TCR No GWR Year 5

sum years 

1-5

TCR No GWR

sum years 

6-30

TCR No GWR

Source: RTCR predictive model. Note: Years 1 – 5 in the model reflect incorporation of GWR effects (explained in Section 5.3.3) into pre-GWR baseline data; Year 5 in tconditions immediately prior to the effective date of the RTCR; and Years 6 – 30 represent a period of 25 years after monitoring begins u
Economic Analysis for the Proposed RTCR 5-29 

Exhibit 5.12 Ground Water Transient Noncommunity Water System Model Output Cumulat

Period

Regulatory Scenario

Reg Rout 

Samples

Reg Rout 

Samples 

if Addls 

Taken

Repeat 

Samples

GWR 

Samples RTTC+ RPTC+ RTEC+ RPEC+

GWR 

EC +

Nonacutes Acutes L1 Assmt L2 Assmt 

7,508,835 1,766,220 1,489,330 0 374,523 373,849 17,881 14,195 0 143,238 15,757 87,899 79,74

TCR 7,524,239 1,458,180 966,919 253,032 305,814 213,958 12,859 7,416 2,651 105,646 10,326 70,031 51,5AIP 9,780,374 674,328 981,521 283,807 327,174 191,401 13,121 5,792 2,993 99,961 8,421 71,817 39,6Alt 13,983,988 459,373 1,309,762 378,723 436,587 245,373 17,405 7,559 3,417 128,639 11,120 82,133 63,3

1,501,831 350,417 295,149 0 74,227 73,576 3,577 2,709 0 28,251 3,150 17,357 15,6

TCR 1,503,848 311,414 206,844 54,227 65,441 47,969 2,873 1,791 942 22,651 2,360 14,769 11,52

300,376 70,103 59,023 0 14,844 14,766 686 612 0 5,627 610 3,545 3,0

TCR 300,923 59,747 39,565 10,447 12,536 8,813 506 331 129 4,269 429 2,821 2,1TCR No GWR Year 5

sum years 

6-30

TCR No GWR

sum years TCR No GWR

1-5

Source: RTCR predictive model. Note: Years 1 – 5 in the model reflect incorporation of GWR effects (explained in Section 5.3.3) into pre-GWR baseline data; Year 5 in tconditions immediately prior to the effective date of the RTCR; and Years 6 – 30 represent a period of 25 years after monitoring begins u

Exhibit 5.13 Surface Water Community Water System Model Output Cumulative End

Period

Regulatory Scenario

Reg Rout 

Samples

Reg Rout 

Samples 

if Addls 

Taken

Repeat 

Samples

GWR 

Samples RTTC+ RPTC+ RTEC+ RPEC+

GWR 

EC +

Nonacutes Acutes L1 Assmt L2 Assm

TCR 3,516,224 137,063 98,139 0 27,729 5,244 2,909 293 0 3,322 666 2,829 1,23AIP 3,565,200 0 81,187 0 27,062 3,860 2,866 180 0 2,755 502 2,415 90Alt 3,565,200 0 81,187 0 27,062 3,860 2,866 180 0 2,755 502 2,415 90

sum years 

1-5 TCR 703,236 27,458 19,651 0 5,550 1,066 584 57 0 675 137 573 25

Year 5 TCR 140,622 5,559 3,956 0 1,117 224 119 13 0 138 29 115 5

sum years 

6-30

Source: RTCR predictive model. Note: Years 1 – 5 in the model reflect incorporation of GWR effects (explained in Section 5.3.3) into pre-GWR baseline data; Year 5 in tconditions immediately prior to the effective date of the RTCR; and Years 6 – 30 represent a period of 25 years after monitoring begins u
Economic Analysis for the Proposed RTCR 5-30 

Exhibit 5.14 Surface Water Nontransient Noncommunity Water System Model Output Cumul

Period

Regulatory Scenario

Reg Rout 

Samples

Reg Rout 

Samples 

if Addls 

Taken

Repeat 

Samples

GWR 

Samples RTTC+ RPTC+ RTEC+ RPEC+

GWR 

EC +

Nonacutes Acutes L1 Assmt L2 Assm

TCR 222,494 13,728 10,670 0 2,796 1,127 360 51 0 458 105 292 29AIP 225,900 0 8,183 0 2,728 675 350 37 0 330 76 232 18Alt 225,900 0 8,183 0 2,728 675 350 37 0 330 76 232 18

sum years 

1-5

TCR 

44,500 2,740 2,131 0 558 221 72 10 0 90 21 57 5

Year 5 TCR 8,898 554 429 0 113 43 15 2 0 17 4 11 1

sum years 

6-30

Source: RTCR predictive model. Note: Years 1 – 5 in the model reflect incorporation of GWR effects (explained in Section 5.3.3) into pre-GWR baseline data; Year 5 in tconditions immediately prior to the effective date of the RTCR; and Years 6 – 30 represent a period of 25 years after monitoring begins u

Exhibit 5.15 Surface Water Transient Noncommunity Water System Model Output Cumulat

Period

Regulatory Scenario

Reg Rout 

Samples

Reg Rout 

Samples 

if Addls 

Taken

Repeat 

Samples

GWR 

Samples RTTC+ RPTC+ RTEC+ RPEC+

GWR 

EC +

Nonacutes Acutes L1 Assmt L2 Assm

TCR 609,514 71,280 57,424 0 14,612 8,365 1,855 398 0 3,148 765 1,893 2,21AIP 625,200 0 39,905 0 13,302 4,311 1,679 218 0 2,037 437 1,357 1,20Alt 625,200 0 39,905 0 13,302 4,311 1,679 218 0 2,037 437 1,357 1,20

sum years 

1-5 TCR 121,900 14,265 11,476 0 2,920 1,671 382 81 0 628 152 370 44

Year 5 TCR 24,373 2,891 2,314 0 589 331 77 17 0 124 30 74 8

sum years 

6-30

Source: RTCR predictive model. Note: Years 1 – 5 in the model reflect incorporation of GWR effects (explained in Section 5.3.3) into pre-GWR baseline data; Year 5 in tconditions immediately prior to the effective date of the RTCR; and Years 6 – 30 represent a period of 25 years after monitoring begins u
Economic Analysis for the Proposed RTCR 5-31 June 2010 

Exhibit 5.16 Ground Water Community Water System TC Occurrence 

0

0.002

0.004

0.006

0.008

0.01

0.012

0.014

0.016

0.018

0 5 10 15 20 25 30 35

Annual TC Positive Assays Rate

Years

TCR No GWR

TCR

AIP

Alt

Source: RTCR Predictive Model 

Notes: 

TCR No GWR: Represents the predicted TC occurrence, absent the effects of GWR implementation, under the 

current TCR requirements. The current TCR is the baseline regulatory scenario for the RTCR EA. 

TCR: Represents the projected TC occurrence under the current TCR requirements, including the effect of GWR 

implementation. The TCR is the baseline regulatory scenario for the EA. 

AIP: Represents the projected TC occurrence under AIP requirements, including the effects of GWR 

implementation. 

Alt: Represents the projected TC occurrence under the Alternative option requirements, including the effects of 

GWR implementation. 

Steady state: By Year 11, all systems that qualify for reduced monitoring during their assessment period (Section 

5.3.2.2) have moved to their reduced sampling schedule under the AIP and Alternative options. This period in the 

model (from years 11 – 30) reflects a steady state with regard to proportions of systems sampling on monthly, 

quarterly, or annual regimens. 
Economic Analysis for the Proposed RTCR 5-32 June 2010 

Exhibit 5.17 Ground Water Nontransient Noncommunity Water System TC 

Occurrence 

0

0.005

0.01

0.015

0.02

0.025

0 5 10 15 20 25 30 35

Annual TC Positive Assays Rate

Years

TCR No GWR

TCR

AIP

Alt

 Source: RTCR Predictive Model 

Notes: 

TCR No GWR: Represents the predicted TC occurrence, absent the effects of GWR implementation, under the 

current TCR requirements. The current TCR is the baseline regulatory scenario for the RTCR EA. 

TCR: Represents the projected TC occurrence under the current TCR requirements, including the effect of 

GWR implementation. The TCR is the baseline regulatory scenario for the EA. 

AIP: Represents the projected TC occurrence under AIP requirements, including the effects of GWR 

implementation. 

Alt: Represents the projected TC occurrence under the Alternative option requirements, including the effects of 

GWR implementation. 

Steady state: By Year 11, all systems that qualify for reduced monitoring during their assessment period (Section 

5.3.2.2) have moved to their reduced sampling schedule under the AIP and Alternative options. This period in the 

model (from years 11 – 30) reflects a steady state with regard to proportions of systems sampling on monthly, 

quarterly, or annual regimens. 
Economic Analysis for the Proposed RTCR 5-33 June 2010 

Exhibit 5.18 Ground Water Transient Noncommunity Water System TC 

Occurrence 

0

0.005

0.01

0.015

0.02

0.025

0.03

0.035

0.04

0.045

0 5 10 15 20 25 30 35

Annual TC Positive Assays Rate

Years

TCR No GWR

TCR

AIP

Alt

Source: RTCR Predictive Model 

Notes: TCR No GWR: Represents the predicted TC occurrence, absent the effects of GWR implementation, 

under the current TCR requirements. The current TCR is the baseline regulatory scenario for the RTCR EA. 

TCR: Represents the projected TC occurrence under the current TCR requirements, including the effect of 

GWR implementation. The TCR is the baseline regulatory scenario for the EA. 

AIP: Represents the projected TC occurrence under AIP requirements, including the effects of GWR 

implementation. 

Alt: Represents the projected TC occurrence under the Alternative option requirements, including the effects of 

GWR implementation. 

Steady state: By Year 11, all systems that qualify for reduced monitoring during their assessment period (Section 

5.3.2.2) have moved to their reduced sampling schedule under the AIP and Alternative options. This period in the 

model (from years 11 – 30) reflects a steady state with regard to proportions of systems sampling on monthly, 

quarterly, or annual regimens. 
Economic Analysis for the Proposed RTCR 5-34 June 2010 

Exhibit 5.19 Surface Water Community Water System TC Occurrence 

0

0.002

0.004

0.006

0.008

0.01

0.012

0.014

0 5 10 15 20 25 30 35

Annual TC Positive Assays Rate

Years

TCR

AIP and Alt

Source: RTCR Predictive Model 

Notes: 

TCR: Represents the projected TC occurrence under the current TCR requirements. The TCR is the baseline 

regulatory scenario for the EA. 

AIP and Alt: Represents the projected TC occurrence under the AIP and Alternative option, which have the 

same requirements for SW systems, resulting in the same TC occurrence under the two options. 
Economic Analysis for the Proposed RTCR 5-35 June 2010 

Exhibit 5.20 Surface Water Nontransient Noncommunity Water System TC 

Occurrence 

0

0.002

0.004

0.006

0.008

0.01

0.012

0.014

0 5 10 15 20 25 30 35

Annual TC Positive Assays Rate

Years

TCR

AIP and Alt

Source: RTCR Predictive Model 

Notes: 

TCR: Represents the projected TC occurrence under the current TCR requirements, which compose the 

baseline regulatory scenario for the RTCR EA. 

AIP and Alt: Represents the projected TC occurrence under the AIP and Alternative option, which have the 

same requirements for SW systems, resulting in the same TC occurrence under the two options. 

 
Economic Analysis for the Proposed RTCR 5-36 June 2010 

Exhibit 5.21 Surface Water Transient Noncommunity Water System TC 

Occurrence 

0

0.005

0.01

0.015

0.02

0.025

0 5 10 15 20 25 30 35

Annual TC Positive Assays Rate

Years

TCR

AIP and Alt

Source: RTCR Predictive Model 

Notes: 

TCR: Represents the projected TC occurrence under the current TCR requirements. The TCR is the baseline 

regulatory scenario for the EA. 

AIP and Alt : Represents the projected TC occurrence under the AIP and Alternative option, which have the 

same requirements for SW systems, resulting in the same TC occurrence under the two options. 

5.3.3.1 Uncertainty and Sensitivity Analysis in Occurrence Modeling 

There are two primary sources of uncertainty in the proposed RTCR occurrence 

modeling: uncertainty related to the baseline occurrence model due to the limited data on which 

the model is based, and uncertainty regarding the frequency and effectiveness of corrective 

actions and their effects on subsequent TC and EC occurrence. 

Data limitations in part derive from a lack of observed data on the effects of the 

requirements of the GWR, for which implementation began as of December 2009. In the absence 

of this data, EPA made assumptions regarding the effectiveness of each of the relevant 

requirements, as described in Section 5.3.1 of this chapter. Each of these assumptions affects the 

modeled current TCR, which is the baseline for this EA. The predictive model uses this same 

baseline (current TCR) in determining the net influence of both the AIP option and Alternative 

option requirements on occurrence. Therefore, although the actual reductions in occurrence 

resulting from GWR implementation may differ from the assumptions used in this model, this 
Economic Analysis for the Proposed RTCR 5-37 June 2010 

difference would likely not affect the net results of the AIP option and Alternative option relative 

to the current TCR, or their performance relative to each other. Other data limitations are 

discussed in Section 4.2 of this EA. 

Many other assumptions incorporated into the predictive model also have no net effect on 

results. More generally, assumptions that contribute to uncertainty in the predictive model results 

can be separated into two categories: those that have no net effect on results and those that may 

bias results downward or upward. Exhibit 5.22a below presents assumptions that influence the 

baseline (current TCR) and the RTCR options considered (AIP option and Alternative option) in 

the same way, and therefore are expected to have no significant effect on net results. Exhibit 22b 

presents those assumptions that may have a significant effect on net results because they 

influence only the AIP and Alternative options, but not the current TCR option. Exhibits 5.22a 

and 5.27b also include EPA’s best estimate of whether the assumption would tend to overestimate, under-estimate, or have an unknown impact. 

Based on a lack of empirical data, EPA did not include in the model an estimate for the 

number of systems that might be required to return to more frequent monitoring after having 

been operating on a reduced schedule. A result of more frequent monitoring when combined 

with assessments and corrective actions as required under the AIP option (or Alternative option), 

as described elsewhere in this chapter, is expected to be an increase in TC and EC hits, and a 

corresponding increase in assessments and Corrective Actions (CAs), resulting in improved 

water quality. EPA expects that the result of not accounting for movement of systems back to a 

more rigorous monitoring schedule will tend to underestimate benefits and costs for the AIP and 

Alternative options relative to the current TCR option. It may have more of an impact on net 

results for the AIP option than for the Alternative option because the AIP option is expected to 

have a larger proportion of systems on more reduced monitoring. 
Economic Analysis for the Proposed RTCR 5-38 June 2010 

Exhibit 5.22a Summary of Model Parameters Influencing RTCR Baseline and 

Options 

UnderestimateOverestimateUnknown 

Impact

UnderestimateOverestimateUnknown 

Impact

Distribution of systems across 

sampling frequency categories.

Varies per system 

category as shown in Ex. 

5.14a - 5.14c 5.3.2.2

Variability,

Uncertainty

X 

(Note 1)

X 

(Note 1)

Alpha, beta parameters developed as 

model inputs describing distribution of 

occurrence based on Six Year Data 

(2005)

Varies per system 

category as shown in Ex. 

5.10 - 5.11 Appendix F

Variability,

Uncertainty

X 

(Note 1)

X 

(Note 1)

Pwell - the portion of GWSs having 

viral pathogens in their source waters 

(adopted from GWR EA) 21.58% 5.3.1

Constant, 

Uncertainty

X 

(Note 1)

X 

(Note 1)

Psample - the probability that a 

random sample will test positive for 

viral pathogens given a contaminated 

source water (adopted from GWR EA)

Variable drawn from a beta 

distribution with a range of 

alpha and beta estimates 

having a median value of 

5.8 percent and an 

expected value of 12.4 

percent. 5.3.1

Variability,

Uncertainty

X 

(Note 1)

X 

(Note 1)

Reduced occurrence for sanitary 

surveys performed under the GWR. 

90% of baseline 

occurrence; applied to 

equal number of systems 

annually over the sanitary 

survey cycle (20% each 

year of 5 years for CWSs; 

33.3% each year for 3 

years for NCWSs) 5.3.1

Constant, 

Uncertainty

X 

(Note 1)

X 

(Note 1)

Reduced occurrence for GWR 

compliance monitoring (applies to 

subset of GWSs that disinfect).

90% of baseline 

occurrence 5.3.1

Constant, 

Uncertainty

X 

(Note 1)

X 

(Note 1)

% of non-disinfecting GWSs choosing 

disinfection CA vs non-disinfection CA 

in response to source water quality 

issue (adopted from GWR)

Range: High end is the 

percentage of CWS entry 

points employing 

disinfection by system 

size, low end assumed to 

be 10% based on 

discussions with State 

representatives. 5.3.1

Constant, 

Uncertainty

X 

(Note 1)

X 

(Note 1)

Seasonal variation in TC hit rates.

TC hit rates are assumed 

to be constant over the 

course of the year. 5.3.1

Variability, 

Uncertainty

X 

(Note 1)

X 

(Note 1)

The RTTC rate in the month following 

TC+ not resulting in CA assumed to 

change to reflect either some 

worsening of the problem or an 

improvement based on some other 

actions taken that are not part of the 

specific corrective actions being 

considered. 

This was carried out by 

selecting at random a 

different pRTTC value in 

those months following a 

TC+ without explicit 

corrective actions being 

initiated. 5.3.2.2

Variability, 

Uncertainty

X 

(Note 1)

X 

(Note 1)

Applies to Current TCR, AIP Option, and Alternative Option

Most Likely Effect on Benefits

Section with 

Full 

Discussion of 

Uncertainty or 

Model Parameter Current Assumption Factor

Contributes Most Likely Effect on Costs

Variability, 

Uncertainty, or 

Constant?

Note: For variables or factors that were incorporated into the predictive model in the same way for the Current TCR 

(baseline) and the other two regulatory options considered in this EA (AIP and Alternative options), EPA expects that 

any under- or over-estimation would affect the baseline and other options in the same way, resulting in no significant 

effect on the net results for the AIP or Alternative option. 
Economic Analysis for the Proposed RTCR 5-39 June 2010 

Exhibit 5.22b Summary of Model Parameters Influencing Proposed RTCR 

Options Only 

UnderestimateOverestimateUnknown 

Impact

UnderestimateOverestimateUnknown 

Impact

% Implementing an Effective 

Corrective Action after a Level 1 or 

Level 2 Assessment 10% 5.3.3.1

Constant, 

Uncertainty X X

Hit rate immediately following CA 

implementation for period of 3 or 5 

years (Level 1 and 2, respectively) (or 

non-disinfecting GWS choosing a nondisinfection CA) 0% 5.3.3.1Constant, 

Uncertainty X X

Duration of initial phase of reduced hit 

rate (0%) following CA implementation 

Remainder of year 

+ 1 or 2 years 

(Level 1 and 2, 

respectively) 5.3.3.1

Constant, 

Uncertainty X X

Hit rate in second phase following CA 

implementation (after initial phase of 

0% hit rate)

50% or 25% of baseline 

occurrence

(Level 1 and 2, 

respectively) 5.3.3.1

Constant, 

Uncertainty X X

Duration of reduced hit rate in second 

phase following CA implementation

3 or 5 years 

(Level 1 and 2, 

respectively) 5.3.3.1

Constant, 

Uncertainty X X

Duration of reduced hit rate (0%) in 

initial phase following CA 

implementation (applies to nondisinfecting GWSs choosing nondisinfecting CA)

Remainder of year 

+ 2 years 

reference 

discussion in 

5.3.3.1

Constant, 

Uncertainty X X

Hit rate in second phase following CA 

implementation (after initial phase of 

0% hit rate) (applies to nondisinfecting GWSs choosing nondisinfecting CA)

25% of baseline 

occurrence

reference 

discussion in 

5.3.3.2

Constant, 

Uncertainty X X

Duration of reduced hit rate in second 

phase following CA implementation 

(applies to non-disinfecting GWSs 

choosing non-disinfecting CA) 5 years 

reference 

discussion in 

5.3.3.3

Constant, 

Uncertainty X X

For systems serving more than 4,100 

people: Application of a rate that 

varies by type of system and water 

source but is held constant through 

time (does not change over the 25 

years of analysis) 

Assumption that these 

groups would incur the 

same number of violations 

annually throughout the 25 

years of the analysis (i.e., 

no reduction in violations in 

the years immediately 

following CA 

implementation.) This 

number of violations is 

used to calculate the 

number of Level 1 and Level 

2 assessments and 

corrective actions by PWS 

category that systems will 

implement under the 

proposed RTCR 

alternatives. 5.4.1

Variability, 

Uncertainty X X

Applies Only to AIP Option and Alternative Option

Model Parameter

Most Likely Effect on Costs

Current Assumption

Section with 

Full 

Discussion of 

Uncertainty or 

Factor

Contributes 

Variability, 

Uncertainty, or 

Constant?

Most Likely Effect on Benefits

Note: For variables and factors that affect the options considered (AIP and Alternative options) but do not have a 

parallel influence on the current TCR (baseline), EPA expects that any under- or over-estimation will have an effect 

as noted in the above exhibit on the net results for the AIP or Alternative option. 
Economic Analysis for the Proposed RTCR 5-40 June 2010 

Key Factors Driving Analysis Uncertainty 

The remainder of this section focuses on those assumptions identified in Exhibit 5.22b as 

contributing the most uncertainty to the net results of the analysis: the frequency and 

effectiveness of corrective actions (i.e., % reduction in occurrence and duration of reduction 

period resulting from correction actions) applied in the predictive model. These are the key 

drivers in determining net results, that is, the difference between the AIP option or Alternative 

options and the current TCR option. 

As described previously in Section 5.3, EPA incorporated the following assumptions 

(also shown in Exhibits 5.12 and 5.13) for the frequency and effectiveness of the corrective 

actions that systems will implement following a Level 1 or a Level 2 assessment: 

Level 1: Following a Level 1 Assessment in a particular year, 10 percent of the systems 

performing the assessment will implement corrective actions that will reduce the TC and EC 

occurrence levels to 0% for the remainder of that year and for one full year after that. Then, for 

an additional 3 full years, the TC and EC occurrence levels for each of these systems will be 

reduced to 50 percent of their initial values. After that, the TC and EC occurrence levels return to 

their initial values. 

Level 2: Following a Level 2 Assessment in a particular year, 10 percent of the systems 

performing the assessment will implement corrective actions that will reduce the TC and EC 

occurrence levels to 0% for the remainder of that year and for 2 full years after that. Then, for an 

additional 5 full years, the TC and EC occurrence levels for each of these systems will be 

reduced to 25 percent of their initial values. After that, the TC and EC occurrence levels return to 

their initial values. 

Also, for the nondisinfecting ground water systems that are found in the simulation to 

have an EC+ in their source water but do not move to disinfection, the assumptions for the 

effectiveness of the nondisinfecting corrective actions are identical to those above for Level 2 

corrective actions. (However, note that all nondisinfecting systems that discover EC+ source 

water that do not go to disinfection will implement these corrective actions (under GWR), not 

just 10 percent as assumed for systems that already disinfect.) 

To assess the influence of these assumptions on the model results, EPA ran the model 

with alternative assumptions reflecting corrective actions that are less effective (50% of the 

assumption of efficacy in the primary analysis in this EA) and corrective actions that are more 

effective (2x the assumption of efficacy in the primary analysis). The assumptions made in the 

primary analysis, and the alternative assumptions made in this sensitivity analysis, do not 

represent a sum of the effectiveness of all individual CAs, but indicate the average frequency 

across all systems with which a given system will correctly diagnose and effectively implement a 

corrective action, mitigating the source of the problem. The alternative assumptions assume this 

frequency will be half or twice that used in the primary analysis. Using these alternative 

assumptions, key model outputs that can serve as proxy indicators of the costs and benefits of the 

proposed RTCR were compared with those same outputs from the main model assumptions for 

the proposed RTCR. 
Economic Analysis for the Proposed RTCR 5-41 June 2010 

For the less effective corrective actions, the alternative assumptions for Level 1 and Level 

2 are: 

Level 1: Following a Level 1 Assessment in a particular year, 5 percent of the systems 

performing the assessment will implement corrective actions that reduce the TC and EC 

occurrence levels to 0% for the remainder of that year only. Then, for an additional 2 full years, 

the TC and EC occurrence levels for each of these systems will be reduced to 50 percent of their 

initial values. After that, the TC and EC occurrence levels return to their initial values. 

Level 2: Following a Level 2 Assessment in a particular year, 5 percent of the systems 

performing the assessment will implement a corrective action that will reduce the TC and EC 

occurrence levels to 0% for the remainder of that year and for 1 full year after that. Then, for an 

additional 3 full years, the TC and EC occurrence levels for that system will be reduced to 25 

percent of their initial values. After that, the TC and EC occurrence levels return to their initial 

values. (These alternative Level 2 durations were also applied to the nondisinfecting GWR 

corrective actions.) 

For the more effective corrective actions, the alternative assumptions for Level 1 and 

Level 2 are: 

Level 1: Following a Level 1 Assessment in a particular year, 20 percent of the systems 

performing the assessment will implement corrective actions that will reduce the TC and EC 

occurrence levels to 0% for the remainder of that year and for two full years after that. Then, for 

an additional 6 full years, the TC and EC occurrence levels for that system will be reduced to 50 

percent of their initial values. After that, the TC and EC occurrence levels return to their initial 

values. 

Level 2: Following a Level 2 Assessment in a particular year, 20 percent of the systems 

performing the assessment will implement corrective actions that will reduce the TC and EC 

occurrence levels to 0% for the remainder of that year and for 4 full years after that. Then, for an 

additional 10 full years, the TC and EC occurrence levels for that system will be reduced to 25 

percent of their initial values. After that, the TC and EC occurrence levels return to their initial 

values. (Again, these alternative Level 2 durations were also applied to the nondisinfecting GWR 

corrective actions.) 

A summary of the assumptions used in these alternative analyses is provided in Exhibit 

5.22a – 5.22b. The analyses were run in the predictive model for the AIP option for the 

approximately 60,000 nondisinfecting transient noncommunity groundwater systems serving 

≤500 people. This subgroup contains the largest number of systems and has on average the 

largest number of violations of all subgroups; as a group they stand to experience the largest 

change in activity under the proposed rule because, unlike the larger systems that have more 

resources at their disposal, these systems are not generally going beyond requirements of the 

current TCR, and generally have less frequent requirements for sampling under the current TCR, 

than the larger systems. To conduct the sensitivity analysis described in this section, EPA applied 

to the predictive model the alternative assumptions that are presented in Exhibit 5.23 along with 

assumptions applied in the primary analysis for comparison. 
Economic Analysis for the Proposed RTCR 5-42 June 2010 

Exhibit 5.23 Sensitivity Analysis Assumptions for Frequency and Effectiveness 

of Corrective Actions following Level 1 or 2 Assessments 

Type of 

Assess

ment

% performing 

Corrective Action 

after a Level 1 or 

Level 21 

Assessment

Reduced hit rate 

immediately after 

Corrective Action

Period of time for 

reduced hit rate2

Additional 

period of 

reduced hit rate 

(yrs)

Reduction from 

initial hit rate in 

additional reduced 

period

Level 1 10% 0% Remainder + 1 3 50%

Level 2 10% 0% Remainder + 2 5 25%

Level 1 5% 0% Remainder only 2 50%

Level 2 5% 0% Remainder + 1 3 25%

Level 1 20% 0% Remainder + 2 6 50%

Level 2 20% 0% Remainder + 4 10 25%

Predictive Model

Sensitivity 1 - 

Less Effective 

Sensitivity 2 - 

More effective

Notes: 

1

Level 2 assumptions for the predictive model and sensitivity analyses are also applied to 100% of nondisinfecting 

ground water systems that incur an EC+ in the source water and implement a nondisinfecting corrective action. 

2

"Remainder" refers to the balance of the year following implementation of a corrective action. 

Exhibit 5.24a Cumulative Effect of Alternative Assumptions for Corrective Action 

Effectiveness and Duration on AIP Option Model Results 

(Nondisinfecting TNCWS Serving ≤500 People over 25 Years) 

RTTC+

RTTC+

as rate RPTC+ RTEC+ RPEC+ GWR EC + Nonacutes Acutes L1 Assmt L2 Assmt L1 CA L2 CA

Low CAs1 300,209 3.81% 204,124 11,585 6,613 3,364 104,161 9,162 68,941 48,658 3,539 2,395

AIP2 277,776 3.55% 174,200 9,937 5,038 2,906 90,389 7,170 64,275 36,090 6,448 3,671

High CAs3 240,248 3.11% 124,822 8,271 3,942 2,240 67,662 5,352 53,823 20,710 10,664 3,918

Low CAs1 8.1% 7.42% 17.2% 16.6% 31.2% 15.8% 15.2% 27.8% 7.3% 34.8% ‐45.1% ‐34.7%

High CAs3 ‐13.5% ‐12.43% ‐28.3% ‐16.8% ‐21.8% ‐22.9% ‐25.1% ‐25.4% ‐16.3% ‐42.6% 65.4% 6.7%

Low CAs1 1.08 1.08 1.17 1.17 1.31 1.16 1.15 1.28 1.07 1.35 0.55 0.65

High CAs3 0.86 0.83 0.72 0.83 0.78 0.77 0.75 0.75 0.84 0.57 1.65 1.07

                                 % Change from AIP

                                 Relative Change

Notes:

1 "Low CAs" uses half of the primary analysis estimate, or 5% incremental increase in CAs beyond the current TCR (50% decrease in the assumption). 2

"AIP" refers to the AIP option under assumptions used in the primary analysis, which includes an assumption that 10% more CAs adddressing the root  cause of a

TC/EC event will be implemented than under the current TCR (0% change in the assumption). 3 "High CAs" doubles the primary analysis CAs estimate from 10% to 20% (100% increase in the assumption).

Model Output Corrective

Actions

Assumption

Note: Cumulative effects shown in this exhibit are based on application in the predictive occurrence model of the 

alternative assumptions for frequency and effectiveness of corrective actions following Level 1 or 2 Assessments, as 

presented in Ex. 5.23. The effectiveness of corrective actions is based both on the effectiveness of the Level 1 or Level 

2 assessments performed in diagnosing the correct system deficiency(ies) and upon the effectiveness of implementation 

of the intended corrective action. 

The results of these runs indicate that, as would be expected, the less frequent and less 

effective corrective action assumptions result in finding more TC+ and EC+ samples and having 

more nonacute and acute events than the main assumptions. In addition, more L1 and L2 

assessments are conducted in response to those additional events, but fewer corrective actions are 

performed. 
Economic Analysis for the Proposed RTCR 5-43 June 2010 

Conversely, the more frequent and more effective corrective action assumptions lead to 

fewer TC+, EC+, nonacute, and acute events occurring and more L1 and L2 CAs being 

performed. 

The fewer number of TC+, EC+, nonacute and acute events occurring with the more 

effective corrective action assumptions relative to the main assumptions can be viewed as events 

that are prevented from occurring as a result of those more effective actions relative to the main 

assumptions. Similarly, the increased number of those events occurring with the less effective 

corrective actions can be viewed as those that would not be prevented relative to the main 

assumptions. 

It is important to note that this sensitivity analysis is not intended as a rigorous, 

quantitative comparison of the alternatives but rather as a general indicator of the magnitude and 

direction of change in these outputs relative to the magnitude and direction of the changes in 

these inputs. Broadly speaking, since the input assumptions reflect changes that are 

approximately (but not precisely) factors of one half (0.5) and twice (2.0) the main assumptions, 

outputs that have ratios that are substantially less than 0.5 or significantly greater than 2.0 could 

be considered to be very sensitive to the changes in these input assumptions. Outputs with ratios 

that fall between 0.5 and 2.0 can be considered to be much less sensitive to the input assumptions 

(ratios equal to or approaching 1.0 indicate that the output is essentially not sensitive to changes 

in the input assumptions. 

As indicated in Exhibit 5.24, all of the ratios for outputs fall within the 0.5 to 2.0 range, 

indicating that these outputs do not appear to be highly sensitive to these alternative assumptions 

for corrective action effectiveness. 

 

The outputs that could serve as indicators of the sensitivity of the benefits on these 

assumptions are the numbers of TC and EC positives predicted as well as the number of 

nonacute and acute events predicted. These outputs have factors that generally fall well within 

the 0.5 to 2.0 range, indicating that these changes in the inputs assumptions appear to result in 

relatively small changes in these outputs. That is, the less effective corrective action assumptions 

do not appear to result in “missing” a disproportionately greater number of these events, and the 

more effective corrective actions appear to result in “finding” a disproportionately greater 

number of these events. 

 

The outputs that could serve as indicators of the sensitivity of the costs on these 

assumptions are the Level 1 and Level 2 assessments and the Level 1 and Level 2 corrective 

actions. The assessments have ratios that, like those for the outputs like TC and EC positives, are 

generally well within the 0.5 to 2.0 range. The ratios for the corrective actions are also within 

this range but tend to be close to the 0.5 and 2.0 values. The input assumptions used for the 

number of corrective actions done is directly proportional to the number of assessments 

performed, so these changes would be expected to be more directly linear (closer to 0.5 or 2.0). 

For example, using the more effective corrective action assumptions, the number of TC+ 

samples predicted is reduced, as are the number of Level 1 assessments that are related to TC+ 

events. The ratio for Level 1 assessments under the more effective corrective action assumptions 

is 0.84, indicating that under these assumptions systems will only need to perform about 85% of 

the Level 1 assessments over the 25 year period (that is, the others are prevented by the more 

effective actions). However, this set of alternative assumptions includes a factor that 20% of 
Economic Analysis for the Proposed RTCR 5-44 June 2010 

those doing Level 1 assessments go on to do Level 1 corrective actions (which is twice the 10% 

assumption in the main model). Therefore, we see that almost twice as many of these Level 1 

corrective actions are performed as under the main model. More specifically, the ratio for Level 

1 corrective actions is 1.65 which is approximately 2x the 0.84 ratio noted for Level 1 

assessment predicted. 

 An additional analysis was run to test the model's sensitivity to the primary analysis 

assumption that 10% more CAs addressing the root cause of a TC/EC event will be implemented 

than under the current TCR. The additional sensitivity analysis investigates the implications of a 

much greater rate of CA implementation – 50% rather than 10%, or a 400% increase from the 

primary analysis assumption. All other parameters in this sensitivity test, including the 

effectiveness and duration of the CAs, are identical to those of the AIP primary analysis. 

Exhibit 5.24b Cumulative Effect of 50% Assumption for Corrective Action 

Implementation Rate on AIP Option Model Results 

 (Nondisinfecting TNCWS Serving ≤500 People over 25 Years) 

RTTC+

RTTC+

as rate RPTC+ RTEC+ RPEC+ GWR EC + Nonacutes Acutes L1 Assmt L2 Assmt L1 CA L2 CA

AIP1 277,776 3.55% 174,200 9,937 5,038 2,906 90,389 7,170 64,275 36,090 6,448 3,671

50% Option2 229,270 2.97% 110,839 7,887 3,225 2,641 61,424 4,534 53,896 12,506 27,227 6,288

50% Option2 ‐17.5% ‐16.22% ‐36.4% ‐20.6% ‐36.0% ‐9.1% ‐32.0% ‐36.8% ‐16.1% ‐65.3% 322.3% 71.3%

50% Option2 0.83 0.77 0.64 0.79 0.64 0.91 0.68 0.63 0.84 0.35 4.22 1.71

Model Output Corrective

Actions

Assumption

                                 % Change from AIP

                                 Relative Change

Notes:

1

"AIP" refers to the AIP option under assumptions used in the primary analysis, which includes an assumption that 10% more CAs addressing the root  cause of a

TC/EC event will be implemented than under the current TCR (0% change in the assumption). 2

"50% option" uses a CAs estimate of 50%  instead of the primary analysis assumption of 10% (400% increase in the assumption).

As might be expected, this modification causes rates of Level 1 and Level 2 CAs to 

increase. This in turn decreases the RTTC+ rate and other levels of occurrence, including the 

number of Level 1 and Level 2 assessments. It is interesting to note that the rate of Level 1 CAs 

increases much more dramatically than the rate of Level 2 CAs. One possible explanation for this 

is that with the higher CA implementation rate, more systems move to a reduced TC occurrence 

level during the first years of RTCR. Thereafter these systems are more likely to trigger Level 1 

assessments than Level 2 assessments, causing the ratio of Level 1 CAs to Level 2 CAs to shift 

substantially from that predicted in the primary analysis. 

Since this analysis involves changing a parameter by a factor of five, changes in model 

output greater than a factor of five would indicate a high degree of sensitivity to the parameter. 

In the table it is evident that no changes on that scale occur. Nonetheless, the analysis does 

indicate that an increase in the rate of implementation of CAs would reduce the long-run 

incidence of TC/EC events and that it would increase the number of Level 1 CAs more 

dramatically than it would increase the number of Level 2 CAs. 
Economic Analysis for the Proposed RTCR 5-45 June 2010 

Additional Factors Assessed 

As described in the introduction to this section, there were assumptions in addition to the 

frequency and effectiveness of corrective actions that EPA considered might influence the 

analysis. These assumptions were categorized as those that were unlikely to have an impact on 

net results (5.22a), and those that affected the RTCR options differently than the current TCR 

(5.22b), thus having the potential to impact net results. 

Because the effect of seasonality on occurrence is commonly a concern when using 

annual average occurrence rates in an analysis, and because RTTC occurrence rates were found 

to be twice as high in the summer and fall as in the winter and spring, EPA ran a sensitivity 

analysis on the influence of seasonal trends. This analysis was performed on the subset including 

transient non-disinfecting groundwater systems serving fewer than 101 people because of its 

relatively large number of systems and high occurrence rate. For simplicity, the sensitivity 

analysis was limited to only the AIP option. 

EPA performed the sensitivity analysis through two runs of the RTCR AIP model. The 

first run established a baseline, and the second multiplied the assigned baseline pRTTC values by 

a factor of 0.67 during December-May and by a factor of 1.33 during June-November. (No 

seasonality factors were applied for systems on annual sampling.) 

Summary results in Table 5.25 show expected yearly averages for selected occurrence 

metrics during the first 25 years under full implementation of the RTCR. Overall the differences 

between the model results are small. Also, they are not consistently higher for one model (e.g. 

when accounting for seasonality, total TC occurrence is slightly higher but the number of L2 

Corrective Actions is slightly lower). These variations are likely within the range of Monte Carlo 

error. Therefore, EPA determined that not incorporating seasonality into the occurrence model is 

an acceptable simplification. 

Exhibit 5.25 Effect of Seasonality on Occurrence Analysis Endpoints 

RTCR AIP Metric

No 

Seasonality Seasonality

Total TC Positives 8524 8556

Total Level 1 Triggers 2742 2784

Total Acutes1 240 240

L1 Corrective Actions 200 194

L2 Corrective Actions 107 104

Note: Estimates represent a yearly average during the first 25 years under full 

implementation of the RTCR. 

1

Includes those Level 2 Triggers resulting from an EC+ (does not include those 

resulting from a second Level 1 trigger occurring within a 12-month rolling period).

5.3.3.2 Model Validation 

There are a limited number of ways in which outputs from the predictive model for the 

systems serving ≤4,100 people can be compared to observed data. EPA has identified two types 

of analyses where comparisons can be made. One of these is to compare the model’s predictions 
Economic Analysis for the Proposed RTCR 5-46 June 2010 

of average annual TC and EC occurrence levels for various types and sizes of systems under the 

current TCR against the observations from the 2005 Six-Year Review data used to parameterize 

the model. The other is to compare the model’s predictions for the current TCR against those 

reported in SDWIS/FED. 

It is necessary to keep in mind that the primary purpose of the modeling effort for the 

systems serving ≤4,100 people was not to exactly match observed results but to provide a 

framework for comparing relative changes across regulatory options. Nevertheless, it is 

important that, to the extent possible, the model outputs for conditions that can be checked 

against observed data compare reasonably well. This provides assurance that the model is 

operating in a manner that is a reasonable simulation of how the TCR currently operates and 

provides some measure of confidence that the relative changes seen for the rule options are 

meaningful. 

 

Exhibit 5.25 provides a comparison of the model results for average annual TC+ assays 

under the current TCR with those observed in the 2005 Six-Year Review data. 
Economic Analysis for the Proposed RTCR 5-47 June 2010 

Exhibit 5.25 Comparison of TC+ Occurrence Predicted as a 25-Year Annual 

Average under the Current TCR with 2005 Six-Year Review Data 

TC

(% Positive)

EC

(% Positive)

TC

(% Positive)

EC

(% Positive)

<=100 2.66% 0.08% 2.24% 0.10%

101‐500 1.99% 0.05% 1.64% 0.08%

501‐1,000 1.52% 0.04% 1.52% 0.07%

1,001‐4,100 1.07% 0.02% 0.92% 0.05%

<=100 1.41% 0.09% 1.46% 0.18%

101‐500 1.15% 0.05% 0.91% 0.12%

501‐1,000 0.70% 0.05% 0.90% 0.12%

1,001‐4,100 0.57% 0.03% 0.57% 0.04%

<=100 4.78% 0.20% 2.18% 0.19%

101‐500 4.57% 0.19% 2.18% 0.19%

501‐1,000 4.30% 0.06% 3.92% 0.20%

1,001‐4,100 2.02% 0.03% 2.14% 0.13%

<=100 2.23% 0.25% 2.19% 0.28%

101‐500 2.63% 0.46% 2.18% 0.28%

501‐1,000 3.63% 0.00% 2.19% 0.28%

1,001‐4,100 0.61% 0.00% 1.98% 0.26%

<=100 3.17% 0.07% 2.89% 0.14%

101‐500 2.70% 0.06% 1.99% 0.10%

501‐1,000 1.74% 0.02% 1.90% 0.10%

1,001‐4,100 1.35% 0.04% 1.46% 0.09%

<=100 1.92% 0.24% 1.42% 0.18%

101‐500 0.39% 0.09% 1.05% 0.13%

501‐1,000 0.64% 0.00% 1.08% 0.14%

1,001‐4,100 0.08% 0.00% 1.03% 0.13%

Predictive Model

TNCWS

GW

SW

CWS

GW

SW

System

Type

Source

Water

Six Yearreview

NTNCWS

GW

SW

Population

Served

 Source: Six Year Review data from Exhibit 4.9. Current TCR data from model output. 

The comparison of the predictive model output with the Six-Year data for TC and EC 

occurrence levels (based on number of TC routine samples taken) shows a reasonable 

concordance for all types and sizes of systems. With respect to the differences, the model does 

not appear to be either systematically overestimating or underestimating the occurrence levels 

compared with the Six-Year Review data (except where the Six-Year Review data show 0% 

observed, the model does show a low level of occurrence). 

Exhibit 5.26 provides a comparison of the model results of the average annual nonacute 

and acute violations for the current TCR with the same metric from SDWIS data for 2005 3Q. 

(Violations data are downloaded from SDWIS on an annual basis in 3rd quarter only, and are not 

disaggregated by month.) 
Economic Analysis for the Proposed RTCR 5-48 June 2010 

Exhibit 5.26 Comparison of SDWIS Data for Nonacute and Acute Violations with 

Predictive Model Annual Results for the Current TCR 

SDWIS

No GWR

(Avg) SDWIS

No GWR

(Avg) SDWIS

No GWR

(Avg) SDWIS

No GWR

(Avg)

CWSs

<100 905 955 16 31 52 97 3 7 

101-500 809 733 50 34 34 81 7 8 

501-1,000 203 191 16 19 13 19 3 5 

1,001-4,100 338 347 83 49 12 35 6 7 

Totals 2,255 2,226 165 133 111 231 19 27 

NTNCWSs

<100 514 560 7 7 34 60 2 2 

101-500 346 265 4 6 20 30 - 1 

501-1,000 57 61 2 2 6 7 - 0 

1,001-4,100 62 98 1 3 6 12 - 1 

Totals 979 985 14 18 66 109 2 4 

TNCWSs

<100 2,665 4,109 19 81 278 445 5 19 

101-500 833 1,371 11 31 76 156 1 8 

501-1,000 133 144 4 5 11 16 - 1 

1,001-4,100 58 105 2 9 2 13 - 2 

Totals 3,689 5,730 36 126 367 630 6 31 

Grand Total 6,923 8,940 215 277 544 970 27 61 

SW

Non-Acute Violations Acute Violations

GW SW GW

 Source: SDWIS 2005 Q3 download and occurrence and predictive model results. 

 The comparison of the predictive model output with the SDWIS violations data also 

shows a reasonable concordance for all types and sizes of systems. EPA believes there is some 

under-counting of actual violations in SDWIS due to monitoring and reporting violations, which 

the model does not incorporate. Therefore, EPA generally expects that the model would generate 

results that are higher than the observed SDWIS data. While a comparison reveals that some of 

the model estimates are lower than the SDWIS statistics, the grand totals for the model are 

consistently higher than those observed in SDWIS. 

5.4 Occurrence Analysis for Systems Serving More Than 4,100 People 

Systems serving populations greater than 4,100 are similar in many ways. In particular, 

these systems generally have the resources and are managed in ways that lead to generally high 

expectations for the integrity of the distribution systems and the ability of the systems to identify 

and correct problems. Some of these differences include:

• Most of these systems operate with certified operators, are staffed at all operating times, 

and usually operate continuously. 

• Most of these systems have operators for whom producing water is their primary activity, 

and most are owned by communities rather than run as ancillary businesses. 
Economic Analysis for the Proposed RTCR 5-49 June 2010 

• As a result of the professional operations, these systems have a much lower incidence of 

monitoring and reporting violations. 

• Many of these systems have their own laboratory for analyzing samples. 

• Many more of these systems disinfect their water. 

• These systems take at least 5 samples per month. The largest of these systems take 

hundreds of samples per month. There is no requirement for “additional next month 

samples” as there is for smaller systems because these larger systems already take at least 

5 samples each month. 

• The proposed monitoring changes to the TCR mostly do not affect systems serving more 

than 4,100 people; all take at least 5 samples per month. 

For systems serving more than 4,100 people, EPA assumes that occurrence may change 

based on the extra distribution system awareness created by: a) applying the Level 1 and Level 2 

assessments in lieu of prior assessments that may, in some cases, have been less structured, and 

b) reporting the assessment results. Therefore, EPA developed a simple model to predict the 

effects of the AIP and Alternative options on PWSs and to compare those data to the baseline 

data predicted for the current TCR. EPA did not quantify changes in violation or trigger rates for 

systems serving more than 4,100 people among the current TCR, AIP option, and Alternative 

options because of: (1) limited Six-Year Review data to characterize these systems, (2) the 

essentially unchanged monitoring requirements across options for these systems, and (3) the 

level of effort already occurring to implement the current TCR. 

5.4.1 Model 

As input for this model, EPA first considered 2005 TCR data on sampling and positive 

assays that were compiled under the Six-Year Review, as was incorporated into the model for 

smaller systems. However, as discussed in Section 4.2.2.3, detailed sampling results from the Six 

Year Review data were not representative of the universe of larger systems. EPA instead found 

that violations data were adequately representative of the universe of large systems. This input to 

the model, based on 2005 SDWIS data (see Exhibit 4.10), was used to predict violations that 

systems serving more than 4,100 people will incur in the 25-year period of AIP option analysis, 

and the behavioral responses (Level 1 and Level 2 assessments and Corrective Actions) that 

would result. 

The model uses the same stratification as smaller systems – by system type (CWS, 

TNCWS, or NTNCWS) and by water source (SW or GW). For each system in a given category 

the model applies the 2005 SDWIS violations rate for that category. This rate is applied in each 

year of the analysis, that is, the violations rate is a constant in the model. For estimating the 

effects on violations under the AIP and Alternative option, the model estimates that 10 percent of 

the assessments resulting from violations will result in corrective actions, the same value applied 

in the analysis of the smaller systems. This 10% represents the incremental increase in efficacy 

of addressing the root cause of system contamination under either regulatory alternative for the 

proposed RTCR as compared to the current TCR. 
Economic Analysis for the Proposed RTCR 5-50 June 2010 

Repeat samples are reduced in the model under both regulatory alternatives from the 

current TCR. They are calculated by applying the ratios of repeat samples to routine samples 

from the smaller system category (serving 1,001 – 4,100 people) to the systems serving more 

than 4,100 people. 

The model output, shown in Section 5.4.2, includes predictions of the annual number of 

violations (non-acute = Level 1, acute = Level 2), and the number of Level 1 and Level 2 

assessments and corrective actions to be implemented. 

5.4.2 Model Results 

Exhibits 5.27 through 5.29 present model results for systems serving more than 4,100 

people by size category. 

5.4.3 Model Uncertainty 

As explained in Section 5.4.1 of this chapter, EPA does not expect systems serving 

>4,100 people to experience changes in routine monitoring or repeat sample regimes under the 

regulatory alternatives; furthermore, all systems in this size range are on monthly sampling. 

Therefore, the larger systems model was relatively simple compared to that for the smaller 

systems, and EPA did not develop an uncertainty analysis for this group of systems.
Economic Analysis for the Proposed RTCR 5-51 June 2010 

Exhibit 5.27 Results for Systems Serving more than 4,100 People – Current TCR 

A BC D E FGH I

Community Water Systems (CWSs) - SW

4,101-33,000 10,636,296 - 186,781 - 2,152 - 197 - - 

33,001-96,000 11,058,960 - 194,204 - 534 - 56 - - 

96,001-500,000 10,190,400 - 178,951 - 233 - 24 - - 

500,001-1 Million 2,019,600 - 35,466 - 22 - - - - 

> 1 Million 1, - 686,960 29,624 - - - - - - 

Community Water Systems (CWSs) - GW

4,101-33,000 9,145,224 - 230,201 - 4,545 - 263 - - 

33,001-96,000 4,884,000 - 122,938 - 656 - 53 - - 

96,001-500,000 1,945,680 - 48,976 - 129 - 10 - - 

500,001-1 Million 253,440 - 6,380 - - - - - - 

> 1 Million - 269,280 6,778 - - - - - - 

Nontransient Noncommunity Water Systems (NTNCWSs) - SW

4,101-33,000 50,424 - 1,632 - 5 - - - - 

33,001-96,000 34,320 - 1,111 - - - - - - 

96,001-500,000 31,680 - 1,025 - - - - - - 

500,001-1 Million - - - - - - - - - 

> 1 Million - - - - - - - - - 

Nontransient Noncommunity Water Systems (NTNCWSs) - GW

4,101-33,000 153,648 - 5,936 - 123 - 9 - - 

33,001-96,000 23,760 - 918 - 4 - - - - 

96,001-500,000 - - - - - - - - - 

500,001-1 Million - - - - - - - - - 

> 1 Million - - - - - - - - - 

Transient Noncommunity Water Systems (TNCWSs) - SW

4,101-33,000 40,656 - - - 8 - - - - 

33,001-96,000 - - - - - - - - - 

96,001-500,000 - - - - - - - - - 

500,001-1 Million - - - - - - - - - 

> 1 Million - 102,960 - - - - - - - 

Transient Noncommunity Water Systems (TNCWSs) - GW

4,101-33,000 156,288 - 8,909 - 116 - 4 - - 

33,001-96,000 34,320 - 1,956 - - - - - - 

96,001-500,000 26,400 - 1,505 - - - - - - 

500,001-1 Million 63,360 - 3,612 - - - - - - 

> 1 Million - - - - - - - - - 

Number of 

Non-Acute 

Violation 

Assessments 

(Single 

Violations)

Number of 

Corrective 

Actions

(based on 

Single NonAcute 

Violation 

Assessment)

Number of 

Acute 

Violation 

Assessments

Number of 

Non-Acute 

Violation 

Assessments

(Multiple 

Violations)

Number of 

Corrective 

Actions

(based on 

Acute and 

Multiple NonAcute Violation 

Assessments)

PWS Size

(Population

Served)

Number of 

Routine 

Monitoring 

Samples

Number of 

Additional 

Routine 

Monitoring 

Samples

Number of 

Repeat 

Monitoring 

Samples

PWSs 

Performing 

Additional 

Annual Site 

Inspections

Note: Corrective actions output from the model are incremental additions to those already performed under the 

current TCR (baseline conditions); therefore, columns F and I (corrective actions) are blank (zero) for the current 

TCR. 
Economic Analysis for the Proposed RTCR 5-52 June 2010 

Exhibit 5.28 Results for Systems Serving more than 4,100 People – AIP option 

A BC D E F GH I

Community Water Systems (CWSs) - SW

4,101-33,000 10,636,296 - 175,689 - 2,152 215 197 - 20 

33,001-96,000 11,058,960 - 182,671 - 534 53 56 - 6 

96,001-500,000 10,190,400 - 168,324 - 233 23 24 - 2 

500,001-1 Million 2,019,600 - 33,360 - 22 2 - - - 

> 1 Million 1,686,960 - 27,865 - - - - - - 

Community Water Systems (CWSs) - GW

4,101-33,000 9,145,224 - 217,321 - 4,545 454 263 - 26 

33,001-96,000 4,884,000 - 116,060 - 656 66 53 - 5 

96,001-500,000 1,945,680 - 46,236 - 129 13 10 - 1 

500,001-1 Million 253,440 - 6,023 - - - - - - 

> 1 Million 269,280 - 6,399 - - - - - - 

Nontransient Noncommunity Water Systems (NTNCWSs) - SW

4,101-33,000 50,424 - 1,395 - 5 0 - - - 

33,001-96,000 34,320 - 950 - - - - - - 

96,001-500,000 31,680 - 877 - - - - - - 

500,001-1 Million - - - - - - - - - 

> 1 Million - - - - - - - - - 

Nontransient Noncommunity Water Systems (NTNCWSs) - GW

4,101-33,000 153,648 - 5,157 - 123 12 9 - 1 

33,001-96,000 23,760 - 797 - 4 0 - - - 

96,001-500,000 - - - - - - - - - 

500,001-1 Million - - - - - - - - - 

> 1 Million - - - - - - - - - 

Transient Noncommunity Water Systems (TNCWSs) - SW

4,101-33,000 40,656 - 2,040 - 8 1 - - - 

33,001-96,000 - - - - - - - - - 

96,001-500,000 - - - - - - - - - 

500,001-1 Million - - - - - - - - - 

> 1 Million 102,960 - 5,167 - - - - - - 

Transient Noncommunity Water Systems (TNCWSs) - GW

4,101-33,000 156,288 - 7,188 - 116 12 4 - 0 

33,001-96,000 34,320 - 1,578 - - - - - - 

96,001-500,000 26,400 - 1,214 - - - - - - 

500,001-1 Million 63,360 - 2,914 - - - - - - 

> 1 Million - - - - - - - - - 

Number of 

Routine 

Monitoring 

Samples

Number of 

Additional 

Routine 

Monitoring 

Samples

Number of 

Level 2 

Assessments 

(based on NonAcute 

Violations)

Number of 

Corrective 

Actions (based 

on Level 2 

Assessments)

Number of 

Corrective 

Actions (based 

on Level 1 

Assessments)

Number of 

Level 2 

Assessments 

(based on 

Acute 

Violations)

Number of 

Repeat 

Monitoring 

Samples

PWSs 

Performing 

Additional 

Annual Site 

Inspections

Number of 

Level 1 

Assessments

PWS Size

(Population

Served)

Note: Estimates of the number of assessments and corrective actions are incremental increases in activity predicted 

to occur under the AIP and Alternative option relative to the current TCR; estimates of “zero” reflect that no additional 

such activity occurs as compared to baseline (the current TCR). 
Economic Analysis for the Proposed RTCR 5-53 June 2010 

Exhibit 5.29 Results for Systems Serving more than 4,100 People – Alternative 

option 

A BC D E F GH I

Community Water Systems (CWSs) - SW

4,101-33,000 10,636,296 - 175,689 - 2,152 215 197 - 20 

33,001-96,000 11,058,960 - 182,671 - 534 53 56 - 6 

96,001-500,000 10,190,400 - 168,324 - 233 23 24 - 2 

500,001-1 Million 2,019,600 - 33,360 - 22 2 - - - 

> 1 Million 1,686,960 - 27,865 - - - - - - 

Community Water Systems (CWSs) - GW

4,101-33,000 9,145,224 - 217,321 - 4,545 454 263 - 26 

33,001-96,000 4,884,000 - 116,060 - 656 66 53 - 5 

96,001-500,000 1,945,680 - 46,236 - 129 13 10 - 1 

500,001-1 Million 253,440 - 6,023 - - - - - - 

> 1 Million 269,280 - 6,399 - - - - - - 

Nontransient Noncommunity Water Systems (NTNCWSs) - SW

4,101-33,000 50,424 - 1,395 - 5 0 - - - 

33,001-96,000 34,320 - 950 - - - - - - 

96,001-500,000 31,680 - 877 - - - - - - 

500,001-1 Million - - - - - - - - - 

> 1 Million - - - - - - - - - 

Nontransient Noncommunity Water Systems (NTNCWSs) - GW

4,101-33,000 153,648 - 5,157 - 123 12 9 - 1 

33,001-96,000 23,760 - 797 - 4 0 - - - 

96,001-500,000 - - - - - - - - - 

500,001-1 Million - - - - - - - - - 

> 1 Million - - - - - - - - - 

Transient Noncommunity Water Systems (TNCWSs) - SW

4,101-33,000 40,656 - 2,040 - 8 1 - - - 

33,001-96,000 - - - - - - - - - 

96,001-500,000 - - - - - - - - - 

500,001-1 Million - - - - - - - - - 

> 1 Million 102,960 - 5,167 - - - - - - 

Transient Noncommunity Water Systems (TNCWSs) - GW

4,101-33,000 156,288 - 7,188 - 116 12 4 - 0 

33,001-96,000 34,320 - 1,578 - - - - - - 

96,001-500,000 26,400 - 1,214 - - - - - - 

500,001-1 Million 63,360 - 2,914 - - - - - - 

> 1 Million - - - - - - - - - 

PWS Size

(Population

Served)

PWSs 

Performing 

Additional 

Annual Site 

Inspections

Number of 

Routine 

Monitoring 

Samples

Number of 

Additional 

Routine 

Monitoring 

Samples

Number of 

Repeat 

Monitoring 

Samples

Number of 

Level 1 

Assessments

Number of 

Corrective 

Actions (based 

on Level 1 

Assessments)

Number of 

Level 2 

Assessments 

(based on 

Acute 

Violations)

Number of 

Level 2 

Assessments 

(based on NonAcute 

Violations)

Number of 

Corrective 

Actions (based 

on Level 2 

Assessments)

Note: Estimates of the number of assessments and corrective actions are incremental increases in activity predicted 

to occur under the AIP and Alternative option relative to the current TCR; estimates of “zero” reflect that no additional 

such activity occurs as compared to baseline (the current TCR). 
Economic Analysis for the Proposed RTCR 5-54 June 2010 

5.5 Summary of Key Drivers for Benefit and Cost Analyses Output from the 

Predictive Model 

As presented in Exhibits 5.10– 5.15, the model for small systems (serving ≤4,100 people) 

produces estimates of the number of samples, the number of Level 1 and Level 2 assessments, 

and the number of corrective actions implemented as a result of Level 1 and Level 2 assessments 

under each regulatory scenario. For the AIP and Alternative options, the model calculates the 

CAs performed as a net increase from those performed under the current TCR. Those being 

performed under the current TCR are described in Chapter 7 in the discussion of current TCR 

costs. The net change in each of the model outputs, in particular sampling regimens and 

implementation of assessments and corrective actions, relative to the baseline (current TCR) 

under both alternative regulations considered provides the basis for estimating the benefits in the 

rule, described in Chapter 6 of this EA. Similarly, the cost model applies unit costs to the 

activities described by these outputs to produce net costs for each regulatory scenario, as 

described in Chapter 7. 

As described in the uncertainty discussion and sensitivity analysis presented in Section 

5.3.3.1, these key drivers represent the most significant source of uncertainty in the analysis. 

However, the sensitivity analysis showed that a 100% increase in the implementation and 

effectiveness assumptions for CAs (the proportional increase in the number of effective 

corrective actions implemented and the duration and extent of reduced occurrence) implemented 

under the AIP option would result in only approximately a 30% decrease in acute events. 

Conversely, a 50% reduction in CA implementation and effectiveness was estimated to induce 

less than an 18% increase in acute events. These results are expected to apply similarly to all 

categories of systems. Based on these results, EPA concludes that changing the assumptions 

within the likely range (a doubling or halving of current assumptions) would not have a 

significant effect on the conclusions drawn from this EA. Similarly, varying the assumptions by 

size and type of system within a likely range would not be expected to have a significant effect 

on the results. 

 For larger systems (serving >4,100 people), incremental costs are estimated for the 

additional reporting activity required under the rule, as well as a slight increase in the number of 

corrective actions implemented for systems serving more than 4,100 people. As described in 

Section 5.4, however, the sampling regimens are not expected to change for these systems, and 

they’ll experience minimal changes in risk and cost, as described in Chapter 6 and Chapter 7 of 

this EA, respectively. 
Economic Analysis for the Proposed RTCR 6-1 June 2010 

6. Benefits Analysis 

6.1 Introduction 

This chapter considers the overall change in risk of contamination to Public Water 

Systems (PWSs), as indicated by the presence of total coliforms (TC) and E. coli, associated with 

compliance with the current Total Coliform Rule (current TCR option) and with the proposed 

Revised Total Coliform Rule (RTCR) (Agreement in Principle or AIP) and the Alternative 

option. Since E. coli is an indicator of fecal contamination, EPA assumed that a decrease in E. 

coli occurrence in the distribution system would be associated with a decrease in fecal 

contamination in the distribution system. In general, this decrease in fecal contamination should 

reduce the potential risk to human health for PWS customers. Thus, any reduction in E. coli

occurrence is considered a benefit of the proposed Revised Total Coliform Rule (RTCR). Also, 

since fecal contamination may contain waterborne pathogens including bacteria, viruses, and 

parasitic protozoa, in general, a reduction in fecal contamination should also reduce the risk from 

these other contaminants. 

Based on limitations in available data as described further in Section 6.3 of this chapter, 

EPA determined that benefits could not be calculated in terms of avoided costs or other 

quantified benefits related to avoided morbidity or mortality. Therefore, this Economic Analysis 

(EA) focuses on a qualitative analysis of risk, which is supported by quantitative analysis of 

predicted outcomes for each regulatory option. The quantitative discussion focuses on net 

changes in occurrence of contaminant indicators under both regulatory options considered as 

compared to the current TCR option. The qualitative analysis considers the direction of 

anticipated changes in risk related to changes in sampling and corrective action regimens under 

each regulatory scenario (Section 6.2). EPA considered the results of the qualitative and 

quantified assessments to determine how the current TCR option compares to the AIP and 

Alternative option in terms of overall change in risk to the population served by PWSs across the 

United States. 

The remainder of this chapter is organized as follows: 

6.2 Qualitative Benefits Analyses 

6.3 Assessment of Predictive Analysis Results 

6.4 Uncertainty Sensitivity Analyses 

6.5 Other Potential Benefits 
Economic Analysis for the Proposed RTCR 6-2 June 2010 

6.2 Qualitative Benefits Analyses 

When revising an existing drinking water regulation, one of the main concerns is to 

ensure that backsliding on water quality and public health protection does not occur. Risk 

reduction for the AIP is characterized by the activities performed that are presumed to reduce 

risk of exposing the public to contaminated water. These activities are considered under each 

rule component discussed in Sections 6.2.1 – 6.2.8 and summarized in Figure 6.1 below. The 

discussion in Section 6.2.9 considers how expected overall decreases in this risk for some rule 

components are offset by expected overall increases resulting from other components, and 

provides a net assessment of the direction in change of risk for the regulatory options considered. 

The qualitative analysis uses the best professional judgment of EPA as informed by Total 

Coliform Rule Distribution System Advisory Committee (TCRDSAC) deliberations1

, as well as 

certain quantitative estimates, to estimate the directional change in risk for each regulatory 

component of the AIP and the Alternative option. Quantitative estimates considered include the 

changes in total coliform occurrence and counts of systems conducting assessments and 

implementing corrective actions shown in Exhibits 6.2 – 6.6 below. Exhibit 6.1 below presents a 

summary of this evaluation for the AIP and Alternative option as compared to the current TCR 

option. The qualitative analysis discusses the influence of the individual regulatory components 

under each regulatory option considered on the occurrence of Total Coliform-positive (TC+) and 

E. coli-positive (EC+) samples. Since a dose-response relationship between exposure to the fecal 

indicator E. coli and adverse health effects from waterborne pathogens that can be present with 

fecal contamination is not adequately quantified, the resulting risk to human health is discussed 

only in terms of the anticipated change in direction of risk. 

6.2.1 Implementation Activities 

Rule implementation activities are expected to be similar under the AIP and Alternative 

option. These activities are primarily administrative in nature and include items such as reading 

and understanding the rule, training, and development of reporting and recordkeeping protocols. 

Because of the similarities in expected implementation activities under the regulatory options, 

they are not expected to have an observably different affect on overall risk relative to current 

regulations. Both PWSs and states would incur additional burden and costs for transitioning to 

operations under the AIP or Alternative option requirements. Because the activities undertaken 

to make the transition are primarily administrative, the additional activities are not expected to 

have any direct impact on risk. 

6.2.2 Routine Monitoring 

EPA expects that more frequent monitoring would decrease the risk of contamination in 

PWSs based on an enhanced ability to diagnose and mitigate system issues in a more timely 

fashion. Conversely, EPA assumes that a less frequent monitoring schedule would result in 

increased risk. Real-time continuous sampling would mitigate the most risk possible based on 

 

1

 TCRDSAC deliberations are described in Chapter 3 of this EA. 
Economic Analysis for the Proposed RTCR 6-3 June 2010 

sampling schedule; however, it would cost prohibitively more than the periodic sampling 

practiced under the current TCR and included in the AIP and the Alternative option. EPA’s 

objective in proposing the sampling schedules included in the AIP and Alternative option was to 

find an appropriate balance between the factors of risk mitigation and cost management. 

Current TCR Option 

 The current TCR option requires that a large portion (approximately 40%) of water 

systems (including all ground water and surface water systems) to perform monthly monitoring 

for total coliforms. Some systems are eligible for reduced monitoring, as follows. 

• Ground water Noncommunity Water Systems (NCWSs) serving ≤1,000 people are 

required to monitor quarterly. States may allow annual monitoring if a sanitary 

survey conducted in the past five years shows the system is supplied solely by 

protected Ground Water (GW) sources and is free of sanitary defects. 

• Ground water Community Water Systems (CWSs) serving ≤1,000 people may 

monitor quarterly if they have no history of total coliform contamination in their 

current configurations and a sanitary survey conducted in the past five years 

shows that the system is supplied solely by a protected GW source and has no 

sanitary defects. 

AIP 

The eligibility requirements for ground water systems to qualify for reduced monitoring 

under the AIP are more stringent than under the current TCR option, leading to a higher total 

number of routine samples being taken over the 26-year period of analysis. The primacy agency 

has the discretion to reduce monitoring frequency for well operated ground water NCWSs and 

ground water CWSs serving ≤1,000 people. Under the AIP, eligibility for reduced monitoring for 

NCWSs and CWSs, respectively, is discussed as follows: 

NCWSs 

 To be eligible to qualify for and remain on annual monitoring after the compliance 

effective date, noncommunity ground water systems serving ≤1,000 people must meet each of 

the following criteria: 

• The most recent sanitary survey shows the system is free of sanitary defects and has a 

protected water source and meets approved construction standards; 

• The system must have a clean (TCR) compliance history (no MCL violations, Level 1 

triggers, Level 2 triggers, treatment technique violations or monitoring violations) for 

a minimum of 12 months; 

• An annual site visit (recurring) by the primacy agency within the last 12 months and 

correction of all identified sanitary defects. A voluntary Level 2 assessment by a party 

approved by the primacy agency may be substituted for the primacy agency annual 

site visit; and 
Economic Analysis for the Proposed RTCR 6-4 June 2010 

• The primacy agency should encourage additional enhancements to the barriers 

protecting the distribution system from contamination. These measures could include 

but are not limited to the following: 

- Cross connection control, as approved by the primacy agency; 

- An operator certified by an appropriate primacy agency certification program, 

which may include regular visits by a circuit rider; 

- Continuous disinfection entering the distribution system and a residual in the 

distribution system in accordance with criteria specified by the primacy 

agency; and 

- Maintenance of at least a 4-log inactivation of viruses each day of the month 

based on daily monitoring as specified in the Ground Water Rule (GWR) 

(with allowance for a 4-hour exception). 

- Other equivalent enhancements to water system barriers as approved by the 

primacy agency. 

CWSs 

To be eligible for quarterly reduced monitoring, community ground water systems 

serving ≤1,000 people on monthly monitoring after the compliance effective date must be in 

compliance with primacy agency certified operator provisions and meet each of the following 

criteria: 

• The most recent sanitary survey shows the system is free of sanitary defects (or has 

an approved plan and schedule to correct them), has a protected water source, and 

meets approved construction standards; 

• The system must have a clean (TCR) compliance history (no MCL violations, Level 1 

or Level 2 triggers, treatment technique violations or monitoring violations) for a 

minimum of 12 months; and 

• Meet at least one of the following criteria: 

- An annual site visit by the primacy agency or a voluntary Level 2 assessment 

by a party approved by the primacy agency and correction of all identified 

sanitary defects (or an approved plan and schedule to correct them), or 

- A cross connection control program, as approved by the primacy agency, or 

- The system must maintain continuous disinfection entering the distribution 

system and a residual in the distribution system in accordance with criteria 

specified by the primacy agency, or 

- The system must maintain at least a 4-log inactivation of viruses each day of 

the month based on daily monitoring as specified in the GWR (with allowance 

for a 4-hour exception); or 
Economic Analysis for the Proposed RTCR 6-5 June 2010 

- Other equivalent enhancements to water systems as approved by the primacy 

agency. 

Based on the additional protection provided by the more stringent criteria to qualify for 

reduced monitoring, the AIP is expected to reduce risk for Ground Water Systems (GWSs) that 

qualify for reduced monitoring compared to the eligibility requirements under the current TCR 

option. In addition, those systems that no longer qualify for reduced monitoring are expected to 

have a reduced risk as a function of the increased numbers of samples taken. 

Seasonal systems (noncommunity water systems that are operating three or fewer 

quarters per calendar year) that sample on a reduced schedule under the current TCR option may 

retain their current schedules unless a state determines that more frequent sampling is 

appropriate. For seasonal systems required to move to an increased monitoring schedule, risk 

would decrease as a function of the increase in monitoring. In addition, more explicit procedural 

requirements related to monitoring under the AIP option (i.e., samples must be taken during the 

period of highest vulnerability or peak usage) would also be expected to reduce risk for seasonal 

systems. 

Alternative option 

Under the Alternative option, all systems must initially collect total coliform samples 

monthly regardless of size or type (i.e., water source), which is more frequent for those systems 

on reduced monitoring schedules under the current TCR option or AIP option. Over time, in the 

second year of rule implementation and beyond, the Alternative option would allow some ground 

water PWSs to reduce to quarterly monitoring if the systems meet the same qualifications 

required for quarterly monitoring under the AIP option. Reduced monitoring on an annual 

schedule is not allowed under the Alternative option, creating a further increase in samples taken 

over the current TCR option and AIP option. Overall, the more frequent monitoring requirements 

(i.e., all PWSs monitor monthly in the first few years after promulgation and no annual reduced 

monitoring is allowed) would reduce risk as compared to the current TCR option to a greater 

extent than under the AIP option. 

6.2.3 Repeat Monitoring 

 Under the current TCR option, PWS serving ≤1,000 people take 4 repeat samples at and 

within five service connections upstream and downstream of the initial total coliform positive 

(TC+) occurrence event over the course of 24 hours following the event. Three repeat samples 

are required for PWSs serving >1,000 people, including one sample at the site of the initial TC+ 

and two additional samples within five service connections up or downstream of that site. 

Under the AIP option and Alternative option, PWSs serving ≤1,000 people are only 

required to take three repeat samples. The reduction in the number of repeat samples required 

could increase risk for any individual sampling event. However, the effect of the reduced 

sampling is expected to be minor. Analysis of the data (see Appendix H for the complete 

analysis) shows that for all PWSs serving 1,000 people or fewer, two or more of the repeat 
Economic Analysis for the Proposed RTCR 6-6 June 2010 

samples are positive in 75 percent of those instances in which there are any positive repeat 

samples. For those 75 percent of instances, reducing the number of repeat samples from four to 

three would have no effect on the number of systems that would be triggered to conduct an 

assessment of the system under the AIP option. In these cases, at least one of the remaining 

repeat samples would still be total coliform-positive, and only one positive repeat sample is 

required to trigger an assessment. 

The data show that one repeat sample is positive in 25 percent of the instances in which 

any of the four repeat samples is positive. For these instances, EPA estimates that if only three 

repeat samples had been taken instead of four, three out of four (or 75 percent) of these positive 

samples would still have been encountered. The analysis indicates that if the number of required 

repeats were reduced from four to three, there would still be almost as many (approximately 94 

percent) situations leading to an assessment being triggered for the system (0.75 + 0.75*0.25 = 

0.94). 

Although dropping the required number of repeat samples from four to three means that 

some fraction of triggers may be missed representing an increase in risk, EPA believes that the 

other provisions of the AIP option as described in this chapter compensate for that change and 

that, taken as a whole, the provisions of the AIP option provide for greater protection of public 

health. 

6.2.4 Additional Routine Monitoring 

Under the current TCR option, PWSs serving ≤4,100 people must conduct additional 

routine monitoring in the month following a TC+ sample. All systems must collect and test a 

minimum of five samples in the month following the TC+ sample, unless the primacy agency 

finds that additional sampling is unnecessary or the primacy agency determines the cause of the 

TC+ sample and establishes that the system has corrected or would correct the problem. 

EPA is proposing to retain the requirement of taking additional routine samples the 

month following a TC+ sample for systems on quarterly or annual monitoring. The advisory 

committee recognized both the benefits and the limitations of additional routine monitoring. 

Under the AIP option, a system that has a Level 1 trigger must conduct an assessment, and if a 

problem is found, the system must take corrective action. Under such circumstances, the 

advisory committee believed that additional samples collected the following month are 

appropriate to help to recognize the problem if it still persists. Without the provision of 

additional monitoring, systems on annual or quarterly monitoring would not take any samples the 

following month. Systems having a Level 2 assessment are triggered into a monthly monitoring 

and therefore have less need for additional routine monitoring to indicate if a problem persists. 

 

For systems required to take the additional routine samples the following month (i.e., 

systems on quarterly or annual monitoring), the AIP option changes the requirement from taking 

a total of five routine samples to a requirement of just three routine samples. The advisory 

committee recognized that it is appropriate to drop from five to three samples the following 

month to reduce monitoring costs while still maintaining a substantial likelihood of identifying a 
Economic Analysis for the Proposed RTCR 6-7 June 2010 

problem if a problem persists. EPA recognizes that a reduction in the number of samples taken 

could also mean a reduction in the number of positive samples found. However, the reduction in 

the number of additional routine samples in conjunction with the new assessment and corrective 

action provisions of the proposed RTCR (discussed in section III.A.5 of the proposed RTCR 

preamble (USEPA, 2010c) leads to a rule that is ultimately more protective of public health (i.e., 

more E. coli MCL violations being prevented) and improvement in water quality (i.e., decrease 

in the total coliform and E. coli-positive hit rates observed as shown by EA occurrence modeling 

results). 

For systems taking at least one sample monthly, the advisory committee recommended 

no additional routine samples for these systems for the following reason. Taking no additional 

routine samples the following month substantially reduces monitoring costs. The assessment and 

corrective action provisions will give systems the ability to identify and prevent the occurrence 

of problems. EA modeling results show that although there is a decrease in the number of E. coli

MCL violations found with the decrease in the number of additional routine samples taken (i.e., 

going from five samples to one during the month following a TC+ sample), the assessment and 

corrective action provisions leads to more E. coli MCL violations being prevented compared to 

the current TCR (see Exhibit 6.7 for more details). 

In addition, whenever a TC+ sample occurs during routine sampling, there is also a 

requirement to conduct repeat sampling to clarify if potential pathways to contamination persist. 

For small systems serving 1,000 people or fewer, if a repeat sample is TC+, at least a Level 1 

assessment will be triggered. If a sanitary defect(s) is (are) found, the system is required to 

correct the sanitary defect(s). The absence of any repeat positive sample provides some 

indication that the problem is not persisting. For systems on monthly monitoring, these two 

conditions mitigate the need for additional routine sampling for the following month. 

Although the changes to the additional routine monitoring provisions mean that some 

fraction of triggers may be missed representing an increase in risk, EPA believes that the other 

provisions of the proposed RTCR as described in this chapter compensate for that change and 

that, taken as a whole, the provisions of the RTCR provide for greater protection of public 

health. 

6.2.5 Annual Site Inspections 

 The current TCR option does not include any requirements for annual site inspections. 

However, based on discussions with stakeholders, some states do perform annual site visits for 

any systems on an annual sampling schedule. 

Under the AIP, ground water NCWSs serving ≤1,000 people must, within one year of the 

compliance effective date, have an initial (and annually thereafter) visit by the state or an annual 

voluntary Level 2 assessment by a party approved by the state to remain on an annual monitoring 

schedule. Because of the cost differential between conducting annual site inspections and the 

alternative (quarterly monitoring), EPA has estimated that only those states that already 

voluntarily conduct annual site inspections under the current TCR option would also do so under 
Economic Analysis for the Proposed RTCR 6-8 June 2010 

the AIP. Therefore, no risk reduction is expected for these systems (and thus overall) from this 

regulatory component under the AIP. 

The Alternative option does not allow systems to reduce to a frequency of annual 

monitoring and therefore does not include an annual site inspection requirement. However, based 

on discussions with stakeholders, those states that currently conduct annual site assessments 

under the current TCR option may no longer have the resources to continue the inspections and 

conduct quarterly monitoring under the Alternative option. For NCWSs on annual monitoring, 

the TCRDSAC believed that requiring a system to have an annual site visit or a Level 2 

assessment provides at least an equivalent level of diagnosis of problems and vulnerabilities that 

might exist as compared to quarterly monitoring without an annual site visit. This trade-off 

between annual monitoring with site inspections and three additional routine samples (i.e., 

quarterly monitoring with no site inspections) would potentially result in an increased risk for the 

Alternative option compared to the AIP. 

6.2.6 Assessments 

Under the current TCR option, although there is no explicit “assessment” required, some 

level of investigation is necessary to evaluate the cause of a problem. In particular, a system must 

investigate a problem and is required to notify the public and state under different scenarios. 

Specifically, a PWS must: 

• Report any acute MCL violation to the state no later than the end of the business after 

the system learns of a violation; 

• Notify the public within 24 hours of an acute MCL violation. 

• Notify the public within 30 days of a monthly/non-acute MCL violation; 

 Under the AIP and Alternative option2

, PWSs are required to perform and submit a 

Level 1 assessment if: 

• Systems taking 40 or more samples per month have more than 5.0% total coliform 

positive samples; 

• Systems taking less than 40 samples per month have two or more total coliform 

positive samples in one month; or 

• A system fails to take all required repeat samples after a single total coliform positive 

sample. 

 

2

 Requirements for the current TCR, proposed RTCR, and Alternative option are described in detail in Chapter 3 of 

this EA. 
Economic Analysis for the Proposed RTCR 6-9 June 2010 

A more detailed examination of the system, including its monitoring and operational 

practices (a Level 2 assessment), is required if a system has: 

• An E. coli MCL violation; 

• An E. coli monitoring violation; or 

• A second Level 1 trigger within a rolling 12 month period. 

Mandatory assessments are a new requirement under the AIP and Alternative option, and 

also represent an increased focus on problem solving from the less defined investigations 

conducted under the current TCR option. Because of the more explicit requirements of the 

assessments, it is expected that more problems would be identified and resolved. As a result, the 

risk relative to the current TCR option is assumed to decrease. 

6.2.7 Corrective Actions 

Corrective actions are not explicitly required under the current TCR option. However, 

systems do perform corrective actions based on investigations they perform (see Section 6.2.6) in 

response to positive samples. 

Under the AIP and Alternative option, PWSs are responsible for correcting any sanitary 

defects found during either a Level 1 or Level 2 assessment. For corrections not completed by 

the time of submission of the assessment form, systems must complete the corrective action(s) 

on a schedule determined by the state in consultation with the system. Systems would be 

required to notify the state when they have completed each corrective action. Failure to 

implement a corrective action is considered a treatment technique violation, subject to public 

notification. 

EPA does not have data on the existing rates at which corrective actions are taken under 

the current TCR option, so an assumption of the incremental percentage of assessments resulting 

in corrective action (10 percent)3

 is made as part of this EA and subsequent evaluation of 

changes in risk. Overall, increased protection provided by this net increase in corrective action as 

a result of requiring systems to implement a correction action through an enforceable mechanism 

would reduce risk under both the AIP and Alternative option. 

 

3

 The 10 percent assumption is based on EPA discussions with stakeholders regarding experiences with 

implementing the current TCR and the expected impact of proposed RTCR revisions. A sensitivity analysis 

evaluating alternative assumptions was conducted. Results of these analyses are discussed in Chapter 5 (section 

5.3.3.1). 
Economic Analysis for the Proposed RTCR 6-10 June 2010 

6.2.8 Public Notification 

Monthly/Non-acute MCL Violations 

The current TCR option requires public notification within 30 days of a monthly/nonacute MCL violation or 24 hours of an acute MCL violation. 

Both the AIP and Alternative option would require: 

• Tier 1 public notification within 24 hours of an E. coli MCL violation; 

• Tier 2 public notification within 30 days of a treatment technique (TT) violation; and; 

• Tier 3 public notification within a year following either a routine monitoring violation 

or a reporting violation. 

However, under either option, the public notification requirements for monthly/non-acute MCL 

violations would no longer be required (the AIP and Alternative options do not include 

monthly/non-acute MCL violations). Since monthly/non-acute violations account for a large 

number of violations under the current TCR option, there is expected to be a large decrease in the 

number of notices presented to the public. If it is assumed that such notices provide information 

that aid in risk avoidance by water customers, risk may increase as a result of reducing this 

public notification requirement to the extent that a risk exists. Because PWSs are no longer 

required to send out notices for monthly/non-acute MCL violations or the monitoring results4

that triggered them under the current TCR, there is also the potential that some PWSs may 

become less responsive in addressing TC hits or preventing them from occurring in the first 

place. 

The TCRDSAC evaluation of the current TCR option public notification also concluded 

that the numbers of monthly/non-acute MCL violation notices that go out to the public are 

confusing. Unlike acute MCL violations associated with positive E. coli samples, monthly/nonacute MCL violations may have no connection to a direct health risk because TC+ samples do 

not indicate a direct threat to public health. To the extent that a high number of notices issued for 

monthly/non-acute MCL violations result in false alarms, consumers may not appreciate a notice 

of an acute MCL violation. Therefore, the EPA concluded, using best professional judgment 

informed by TCRDSAC’s evaluation, that risk may decrease through the elimination of the 

Public Notification (PN) requirement for monthly/non-acute MCL violations under the AIP and 

Alternative option. Additionally, resources used to issue high numbers of monthly/non-acute 

MCL violations and (as well as the time spent responding to customer inquiries about the 

violations) may be better employed on other PWS issues which could result in further reduced 

risk. 

As discussed above, the influences on risk of eliminating the PN requirements for 

monthly/non-acute MCL violations may move risk in both directions. A decrease in the overall 

 

4

 Under the current TCR option, for systems taking fewer than 40 samples per month, an acute violation occurs if 2 

or more samples are TC+; for systems taking 40 or more samples per month, an acute violation is triggered by >5% 

of TC+ samples. 
Economic Analysis for the Proposed RTCR 6-11 June 2010 

information received by consumers may result in reduced ability to undertake averting behaviors 

necessary to avoid potentially contaminated drinking water when appropriate, increasing 

potential risk. Conversely, overly abundant notices may cause confusion or indifference that may 

result in consumers not taking averting actions when appropriate (i.e., ignoring an acute violation 

notice). Thus focusing on fewer, yet more “serious” notices may result in a decrease in potential 

risk. Risk may also decrease as a result of PWSs being able to better employ resources currently 

used on notice issuance and follow-up. 

 

EPA also considered the effect of Tier 2 PN requirements for TT violations, which allow 

for up to a 30-day time delay between incurrence of the violation and notification to the public. 

This time delay could equate to some increased risk for the public relative to a scenario where an 

immediate notification was required. However, the change in risk relative to the current TCR 

option, which does not require assessments or corrective actions, is a decrease in risk. In 

allowing PWSs the flexibility to take up to a month before issuing PN, EPA is attempting to 

balance the potential public health benefits associated with having prompt notification for all TT 

violations with the potential inefficiency and extra costs related to cases where the same level of 

expedience may not be necessary. 

 

In summary, EPA assumes that there would not be an overall change in risk by changing 

PN requirements for monthly/non-acute MCL violations under the proposed RTCR, but given 

the contradictions in potential risk reductions the potential change in risk is best characterized as 

"unknown." 

Monitoring and Reporting Violations 

The TCRDSAC also evaluated the effects of revised PN requirements for monitoring and 

reporting violations under the AIP and Alternative option and concluded that significant 

reductions in monitoring and reporting violations and associated costs may be realized through 

the revised regulatory framework of the AIP. For the current TCR option, monitoring and 

reporting violations result in Tier 3 PN. Under the AIP and Alternative option, monitoring 

violations are separate from the reporting violations, and the monitoring PN requirements are 

more stringent as compared to the monitoring and reporting violations under the current TCR. 

For repeat sampling, a PWS that fails to take every required repeat sample following a 

routine EC+ sample must: 

• Initiate Tier 1 PN within 24 hours; 

• Initiate consultation with the state no later than 24 hours after learning of the 

violation, to determine additional PN requirements, if any; 

• Perform a level 2 assessment/corrective action: and 

• Increase to a minimum of monthly monitoring. 

For a PWS that fails to take every required repeat sample after any single TC+ sample, the PWS 

must perform a level 1 assessment/corrective action. Failure to perform a required assessment 
Economic Analysis for the Proposed RTCR 6-12 June 2010 

and/or corrective action results in a treatment technique violation (Tier 2) and a minimum of 

monthly monitoring. 

For routine and additional routine monitoring, a PWS that does not take every required 

routine sample, or every required additional routine sample, in a compliance period is still 

subject to Tier 3 PN; noncompliance with sampling requirements does not necessarily increase 

the likelihood that a PWS will be contaminated with fecal contamination and/or a waterborne 

pathogen and so does not present a direct or immediate public health risk. However, if the PWS 

has monitoring violations in 2 of 4 quarters (for systems on quarterly monitoring) or misses its 

required annual sample (for systems on annual monitoring), the PWS must revert to monitoring 

no less than monthly. 

Overall, the added PN stringency for monitoring violations is expected to decrease 

potential risk under the AIP and Alternative option as PWSs opt to perform required sampling to 

avoid transition to increased monitoring requirements or other additional actions. 

Summary Exhibit 

 The component discussions in Sections 6.2.1 through 6.2.8 above address the individual 

effects under each rule component on the various system types and sizes. The terms “increase,” 

“decrease,” and “no change” in Exhibit 6.1 indicate the direction of change in risk under the AIP 

and Alternative option relative to the current TCR option. Risk may change for some system 

sizes or types and not for others under a given rule component. In such cases, Exhibit 6.1 reflects 

the overall change in risk direction and does not necessarily apply to all types and sizes of 

systems. 
Economic Analysis for the Proposed RTCR 6-13 

Exhibit 6.1 Potential Changes in Risk under the AIP and Alternative Option Relative to the 

Proposed Rule 

Component 

Factors Leading to a Potential 

Increase in Risk 

Factors Leading to a Potential Decrease in 

Risk 

Overall 

AIP option 

Alternative 

option AIP option 

Alternative 

option AIP op

Implementation Activities None None None None No chaRoutine Monitoring (Including Reduced Monitoring) 

None None 

Increased stringency in requirements to qualify for reduced monitoring along with requirement to return to baseline monitoring upon loss of these criteria is expected to result in decreased risk (i.e., fewer PWSs will qualify and therefore more will monitor more frequently). 

PWSs all monitor monthly in the first few years of implementation of the RTCR, which is an increase in sampling frequency for systems that monitor quarterly or annually under the current TCR. After the first few years, systems may reduce to quarterly, but none may reduce to annual monitoring, creating a decrease in risk for systems on annual monitoring under the current TCR. 

Decrea
Economic Analysis for the Proposed RTCR 6-14 

Proposed Rule 

Component 

Factors Leading to a Potential 

Increase in Risk 

Factors Leading to a Potential Decrease in 

Risk 

Overall 

Repeat Monitoring 

Required repeat samples reduced from 4 to 3 for systems serving <1,000 people 

Required repeat samples reduced from 4 to 3 for systems serving <1,000 people 

None None Increa

Additional Routine Monitoring 

Additional routine samples are no longer required for PWSs monitoring monthly. Ground water PWSs serving ≤1,000 people would reduce additional routine samples from 5 to 3. 

Additional routine samples are no longer required for PWSs monitoring monthly. Ground water PWSs serving ≤1,000 people would reduce additional routine samples from 5 to 3. 

None None Increa

Annual Inspections 

None (only states currently performing annual inspections are expected to continue) 

Based on discussions with stakeholders, states that currently conduct annual site assessments under the current TCR may no longer have the 

None (only states currently performing annual inspections are expected to continue) 

None No cha
Economic Analysis for the Proposed RTCR 6-15 

Proposed Rule 

Component 

Factors Leading to a Potential 

Increase in Risk 

Factors Leading to a Potential Decrease in 

Risk 

Overall 

resources to continue the inspections and conduct quarterly monitoring under the Alternative option. 

Assessments None None 

Mandatory assessments are a new requirement. 

Mandatory assessments are a new requirement. Decrea

Corrective Actions None None 

Mandatory corrective actions are a new requirement. 

Mandatory corrective actions are a new requirement. 

Decrea

Public Notification – Monthly/NonAcute MCL Violations 

Reduction in available public information Possible PWS complacency 

Reduction in available public information Possible PWS complacency 

Less confusion (PN more in line with potential health risks) PWS resources used more efficiently 

Less confusion (PN more in line with potential health risks) PWS resources used more efficiently 

Unkno
Economic Analysis for the Proposed RTCR 6-16 

Proposed Rule 

Component 

Factors Leading to a Potential 

Increase in Risk 

Factors Leading to a Potential Decrease in 

Risk 

Overall 

Public Notification – Monitoring and Reporting Violations 

None None 

Increased stringency of PNs motivates PWSs to conduct required sampling. 

Increased stringency of PNs motivates PWSs to conduct required sampling. 

Decrea

Overall Decrea

Note: Detailed discussion of the rationale for determinations of potential risk for each rule component is presented in Ch. 6 (Section 6.2) oactivities consist of administrative activities by PWSs and states to implement the rule. Assessment of potential changes in risk for monitoring components is an overall assessment. Potential changes (or static state) of risk for 

and types differ according to individual regulatory requirements and are discussed in Section 6.2. Chapter 3 provides a detailed descriptio

components for all three regulatory scenarios, and the Preamble to the RTCR provides additional discussion of the TCRDSAC process anthe structure of the regulatory options considered. 
Economic Analysis for the Proposed RTCR 6-17 June 2010 

6.2.9 Summary of Qualitative Benefits Analyses 

The discussions above describe relative risks in terms of individual components of the 

regulatory options. Based on the discussions presented above, EPA has used best professional 

judgment informed by the TCRDSAC to qualitatively estimate the relative risk of each 

regulatory option. These assessments were made with contributions from a wide range of 

drinking water experts, including public health scientists, engineers, administrators, and 

regulatory experts. The overall change in risk relative to the current TCR baseline is a result of 

the complex interactions of all regulatory components. As the discussion above shows, under 

repeat and additional routine monitoring provisions for the AIP and Alternative option, there is a 

potential for increased risk for PWS customers because total coliform monitoring frequency may 

be reduced for some PWSs. However, this increase is expected to be more than offset by 

potential decreases in risk from increased routine monitoring and the addition of the assessments 

and corrective action provisions that will find and fix problems identified by monitoring. 

The consensus opinion resulting from the TCRDSAC deliberations was that the proposed 

RTCR, as described in the AIP, would achieve a net risk reduction compared to the current TCR 

option. The committee applied best professional judgment in determining that the increased 

protection provided by the new requirements for implementing focused assessments and 

implementing appropriate corrective actions would more than offset any potential increase in risk 

introduced by the reduction in samples and other changes resulting from the AIP. The committee 

considered that the Alternative option presents potential for further reduction in risk due to the 

increased numbers of samples taken, especially in the first several years of implementation. 

However, the additional burden5

 of requiring all PWSs to initially monitor on a monthly basis 

(regardless of PWS size or type) and limiting reduced monitoring to quarterly (disallowing 

annual monitoring) would fall disproportionately on small systems based on their proportionately 

large increase in activity under the AIP. 

6.3 Assessment of Predictive Analysis Results 

Based on discussions in and information developed for the TCRDSAC meetings 

(described in Chapter 3 of this EA), EPA anticipated prior to beginning this EA that the proposed 

RTCR would not be a significant rule in terms of costs (i.e., less than $100 million annually). 

However, EPA considered the feasibility of performing a traditional risk assessment that would 

produce quantified estimates of costs, benefits, and net costs and benefits, as outlined in section 

1412 (b)(3)(C) of the Safe Drinking Water Act (SDWA). For this type of analysis, the minimum 

information requirements comprise data on contaminant occurrence; exposure rates in the 

population defined for the various pathways (i.e., water consumption, inhalation, and dermal 

contact); potential health effects associated with exposure to contaminated water; and a doseresponse relationship. A quantified benefits analysis would use this information to estimate the 

number of avoided cases of morbidity or mortality associated with the rule, which would then be 

valued in terms of saved lives and preserved quality of life and work capacity. 

 

5

 Additional costs under the Alternative option are discussed Chapter 7 of this EA. 
Economic Analysis for the Proposed RTCR 6-18 June 2010 

For the proposed RTCR EA, the available information includes data on the incidence of 

positive TC+ samples collected under the current TCR option over the 6 year period from 1998 – 

2005, from which EPA selected one complete year (2005) to use for analyses in this EA, as 

explained in Section 4.2 of this EA. For the year 2005, EPA also has data on TC+ samples that 

subsequently test positive for E. coli (using EPA-approved standard methods available at that 

time). No other national occurrence data are available. 

 As discussed in Chapter 2 of this EA, the presence of E. coli is an indication that the 

water contains fecal contamination. Some E. coli strains (or serotypes) such as E. coli O157:H7, 

for example, are pathogens. However, EPA recognizes that the EPA-approved standard methods 

available for E. coli do not typically identify the presence of the pathogenic E. coli strains, such 

as E. coli O157:H7. Thus, E. coli occurrence, as used in this EA, serves as an indication of fecal 

contamination but not necessarily pathogenic contamination. E. coli occurrence does not confer 

any significant quantitative information about the likelihood of health effects (e.g. acute 

gastrointestinal illness or chronic illnesses as described in Chapter 2 of this EA) from consuming 

drinking water contaminated with fecal indicator organisms. 

There are few data reporting the co-occurrence in a single sample of fecal indicator E. 

coli (assayed using EPA-approved standard methods) and pathogenic E. coli strains. One notable 

exception are the data reported by Cooley et al. (2007), which showed high concentrations of 

pathogenic E. coli strains in samples containing high concentrations of fecal indictor E. coli. 

These data are from streams and other poor quality surface waters surrounding California 

spinach fields associated with the recent E. coli O157:H7 foodborne outbreak. Data equivalent to 

these are not available from drinking water samples collected under the current TCR option. 

Absent any definitive data on co-occurrence of fecal indicator (E. coli) and pathogenic E. 

coli, EPA did not estimate the cases of morbidity or mortality avoided. Instead, EPA estimated 

changes in occurrence and the resulting changes in assessments and corrective actions performed 

for systems serving ≤4,100 people. For systems serving >4,100 people, EPA applied the 2007 

violations data to estimate the increase in effective corrective actions implemented. Discussion 

of reductions in risk, then, considers the change in occurrence and corrective actions 

implemented for systems serving <4,100 and the changes in corrective actions implemented for 

systems serving >4,100.6

 

For all systems, EPA also estimated the behavioral response of the regulated community 

based on projected occurrence rates or violations under the AIP and Alternative option, including 

the frequency of Level 1 or Level 2 assessments and the type and number of corrective actions 

implemented by PWSs to address the problems identified. EPA expects that the effects of these 

changes on risk will be varied, as described in Section 6.3.1. 

 

6

 The rationale for using different metrics as proxies for risk reduction in systems serving ≤4,100 people and those 

serving > 4,100 is explained in Chapters 4 and 5 of this EA. 
Economic Analysis for the Proposed RTCR 6-19 June 2010 

6.3.1 Assessment of Predictive Analysis Results for Small (Serving ≤4,100 People) and 

Large (Serving >4,100 People) Systems 

Because the PWSs serving 4,100 people or fewer have a higher initial E. coli occurrence 

and will be triggered into more assessments and corrective actions than larger PWSs, the 

increase in benefits for these small systems will be more evident as compared to the larger 

systems. In particular, model results suggest that customers of small ground water TNCWSs 

serving 100 or fewer people, which constitute approximately 40 percent of PWSs, experience the 

most improvement in water quality under the proposed RTCR. That is, the occurrence of E. Coli

is predicted to decrease more for these systems that for other systems types. 

6.3.1.1 Small Systems (Serving ≤4,100 People) 

 For small systems7

 (serving ≤4,100 people), EPA developed a model to simulate 

regulatory responses for a 30-year period of analysis, including years 1 – 5 in which GWR8

 is in 

effect, years 3 – 5 in which RTCR is being implemented, and years 6 - 30 during which RTCR 

requirements are in effect. The 30-year modeled time period includes a total of 28 years of 

RTCR impacts post promulgation. Although this EA considers benefits and costs for only 25 

years post promulgation, the 30-year period was presented in Chapter 5 for broader consideration 

of the appropriateness of the model in terms of its results. The 25 years post promulgation that 

are considered in this EA encompass years 3 – 27 of the 30-year modeled period. A complete 

description of the model is provided in Chapter 5 of this EA, and data sources used are described 

in Chapter 4. 

 Output from the smaller system simulation model includes the following estimates for 

each year of analysis: 

- Samples taken (routine, additional routine, and repeat); 

- Number of positive results (TC+ and/or EC+) 

- Level 1 and Level 2 assessments conducted based on non-acute violations; 

- Level 2 assessments conducted based on acute violations; and 

- Corrective actions based on Level 1 assessments and Level 2 assessments. 

 The results of analyses in terms of expected changes in hit rates (positive samples/totals 

samples taken) over time are presented in chapter 5 (Section 5.3.3) and Appendix B. Predicted 

TC+ hit rate results reflect the overall increase in water quality expected over time under the AIP 

and Alternative option. Exhibits 6.2 – 6.4 present a summary of the additional endpoints listed 

above for the 25-year period of analysis following rule promulgation. 

 

7

 The threshold for defining PWSs as “small” varies depending on the context. For the purpose of this EA, small 

systems are defined as those serving <4,100 people. 8

 Reductions in EC+ occurrence or violations are only attributable to the proposed RTCR if they result from 

requirements of the proposed RTCR alternatives; reductions resulting from the GWR are not attributable to the 

proposed RTCR and are not considered further in this chapter. As described in sections 4.2, 4.3, and 5.2 of this EA, 

GWR effects are incorporated to adjust source data to the appropriate baseline for this EA. 
Economic Analysis for the Proposed RTCR 6-20 June 2010 

 As discussed earlier in this section, because a dose-response relationship between EC+ 

occurrence (i.e., acute violations) and illness is not available, EPA is focusing on changes in EC+ 

occurrence. EPA assumes that reduced occurrence in PWSs should generally correlate with a 

reduction in risk of contamination to PWS drinking water. Therefore, the acute violation rates 

predicted under the AIP and Alternative option (Exhibits 6.3 – 6.4) represent a level of risk of 

contamination that is reduced from that predicted under the current TCR option (Exhibit 6.2). 

The numbers of predicted acute violations have two major drivers. First, improvements in water 

quality are predicted to result in fewer acute violations. Second, the monitoring frequency 

impacts the number of acute violations found, regardless of water quality. Both decreases in 

acute violations attributable to water quality improvements and increases due to additional 

diagnostic ability of more samples taken result in reduced risk. The combination of these two 

influences in the predictive model means that the risk is expected to be lower even though the 

number of predicted acute violations may actually be higher or lower than under the current TCR 

option as reflected in exhibits 6.2 – 6.4. This concept is discussed in the uncertainty analysis in 

Section 6.4 of this chapter. 

 The changes in the steady state estimates of annual acute violations from the current TCR 

option to the AIP and Alternative option are shown in Exhibit 6.5 and 6.6 in absolute numbers 

and as a percentage change from the TCR, respectively. The steady state in the model refers to 

the period beginning in years 7 (CWSs) and 9 (NCWSs) following promulgation, after the 

proportions of systems sampling on monthly, quarterly, or annual regimens are adjusted 

following a period of assessment.9

 Systems that qualify for reduced monitoring will begin their 

new regimens in years 7 and 9 after promulgation, respectively, for CWSs and NCWSs. The 

estimates shown in Exhibit 6.5 for small systems are from the predictive model and reflect the 

average annual estimates for the 25-year period of analysis, which includes 3 years of 

implementation followed by 22 years in which new rule requirements are in effect. To accurately 

reflect the results under this schedule, the model output for the 22 years of post-implementation 

activity is divided by 22, rather than the entire 25 years, which would distort the results 

downward. The steady state reductions in the number of annual acute violations found under the 

AIP and Alternative option primarily reflect the benefits of corrective actions under these two 

options in preventing many of the acute violations that would otherwise occur over this period. 

 These results show that under the AIP, no subgroups are predicted to experience an 

increase in annual acute violations. While most categories of systems/sizes would experience a 

decrease in predicted numbers of violations under the Alternative option, six categories would 

actually experience an increase (a positive percent value in this exhibit): NTNC ground water 

 

9

 The effective date of the proposed RTCR occurs after 3 years of implementation, at the start of year 4 post 

promulgation. For CWSs, years 4 - 6 post promulgation are the period of assessment for considering potential to 

move to reduced monitoring for systems; for NCWSs, years 4 - 8 are the period of assessment. In Chapter 5 of this 

EA, these transitions are presented on the 30-year scale of the modeling period rather than the 25-year scale of the 

RTCR EA period of analysis. In Chapter 5, Ex. 5.16 – 5.21 show that the steady state begins in model year 9 

(CWSs) and model year 11 (NCWSs). Under the Alternative option, the period of assessment occurs in years 4 – 8 

post promulgation; this represents model years 6 – 10. PWSs under the Alternative option begin their steady state 

regarding reduced monitoring schedules in year 9 post promulgation (model year 11). Chapter 5 provides a 

description of the criteria used to determine the percent of systems qualifying for reduced monitoring under the 

proposed RTCR and Alternative option. This assessment is not made for simulating systems operating under the 

current TCR; they are assumed to remain on the initial schedule presented in Chapter 4 (baseline). 
Economic Analysis for the Proposed RTCR 6-21 June 2010 

systems serving 501-1,000 people and Transient Noncommunity (TNC) ground water systems 

serving ≤100, 101-500, and 501-1,000 people. It is important to note that in all cases except two, 

the absolute increases in annual acute violations predicted under either option is very small (≤1 

annual acute violation as shown in Exhibit 6.5), but translate into observable percentage changes 

in Exhibit 6.6. The two categories with an increase of greater than one annual acute violation are 

the TNC GW systems serving ≤100 people and those serving 101-500 people, for which 

increases of approximately 52 and 16 annual acute violations, respectively, are predicted. For 

these small TNCWSs under the Alternative option, increased monitoring is expected to lead to 

an overall increase in annual acute violations (and is also the driver of the greater total number of 

annual acute violations predicted). 

 As discussed earlier, a decrease in acute violations may be caused by an improvement in 

water quality, which in this model would result from an increased number of effective corrective 

actions being implemented (i.e., occurrence events are “prevented”). An increase in acute 

violations can be attributable to a decrease in water quality or a PWS improving its ability to 

diagnose more issues (e.g., through more sampling). Alternatively, a decrease in acute violations 

could be caused by a decreased ability in PWSs to diagnose the occurrence of TC/EC because of 

a reduced sampling schedule, resulting in undetected or “missed” occurrence events. Section 6.4 

of this chapter presents a stepwise analysis to discern the relative significance of the effects of 

reduced additional routine samples and increased corrective action efficacy as shown by 

predictions of “prevented”, “found”, and “missed” acute violations under the AIP. 

 

6.3.1.2 Large Systems (Serving >4,100 People) 

The number of acute and non-acute MCL violations for a given group (based on system 

type and water source) of PWSs serving >4,100 people was estimated using 2005 Safe Drinking 

Water Information System-Federal Version (SDWIS/FED) data (USEPA 2005a). These 

estimates were used to determine the number of Level 1 and Level 2 assessments and associated 

corrective actions triggered for large systems in the period of analysis. EPA made a simplifying 

assumption that for PWSs serving >4,100 people the number of annual assessment triggers 

would remain constant throughout the 22 years following proposed RTCR implementation. As 

does the occurrence model for smaller systems, this analysis assumes that systems responding to 

a Level 2 assessment trigger (i.e., an acute MCL violation under the current TCR option) would 

identify and specifically address the cause of the contamination at a rate increased by 10 percent 

under the AIP and Alternative option compared to the current TCR option10. 

 Exhibits 6.2 – 6.4, described in Section 6.3.1.1 for small systems, also include the number 

of activities (assessments and corrective actions) EPA expects PWSs to implement under each of 

the regulatory options considered for large systems. Any reduction in risk is estimated to derive 

from the additional corrective actions predicted per the explanation above. Exhibit 6.5 also 

reflects that EPA is not quantifying any potential change in the number of annual acute 

violations for PWSs serving >4,100 people during the period. This assumption simplifies the 

analysis and is consistent with EPA’s understanding based on TCRDSAC deliberations and best 

professional judgment that larger systems are at a relatively steady state with regard to 

 

10 See footnote 3. 
Economic Analysis for the Proposed RTCR 6-22 June 2010 

operations. Larger systems have been in a position relative to smaller systems to diagnose more 

and address the cause of acute violations more, and they have likely had more resources to apply 

in maintaining and updating their systems on a regular basis. Therefore, EPA does not believe 

that larger systems will make many changes based on RTCR implementation, or that they will 

experience large changes in their occurrence rates for TC and EC after RTCR promulgation. 
Economic Analysis for the Proposed RTCR 6-23 June 2010

Exhibit 6.2 Predicted Outcomes (25-Year Period of Analysis) under Current TCR 

A BC DE F G H I J=E+G+H

Community Water Systems (CWSs) - SW

≤100 1,170 304,098 23,747 19,160 541 - 156 168 - 864 

101 - 500 2,150 562,214 26,578 21,338 621 - 181 112 - 913 

501-1,000 1,173 306,733 14,501 11,641 339 - 99 61 - 498 

1,001-4,100 2,938 1,920,789 55,202 33,730 931 - 149 123 - 1,203 

4,101-33,000 3,164 10,636,296 - 186,781 2,152 - 197 - - 2,349 

33,001-96,000 720 11,058,960 - 194,204 534 - 56 - - 590 

96,001-500,000 308 10,190,400 - 178,951 233 - 24 - - 257 

500,001-1 Million 31 2,019,600 - 35,466 22 - - - - 22 

> 1 Million 17 1,686,960 - 29,624 - - - - - - 

Totals 11,671 38,686,051 120,028 710,896 5,373 - 861 463 - 6,697 

Community Water Systems (CWSs) - GW

≤100 11,938 2,815,951 286,073 194,462 9,772 - 1,141 5,383 - 16,295 

101 - 500 13,892 3,344,578 243,895 171,252 8,169 - 1,025 4,214 - 13,408 

501-1,000 4,467 1,072,202 70,803 51,673 2,250 - 284 1,050 - 3,584 

1,001-4,100 6,443 3,997,293 160,710 100,618 3,545 - 477 2,808 - 6,831 

4,101-33,000 3,156 9,145,224 - 230,201 4,545 - 263 - - 4,807 

33,001-96,000 335 4,884,000 - 122,938 656 - 53 - - 709 

96,001-500,000 63 1,945,680 - 48,976 129 - 10 - - 139 

500,001-1 Million 4 253,440 - 6,380 - - - - - - 

> 1 Million 3 269,280 - 6,778 - - - - - - 

Totals 40,301 27,727,648 761,481 933,279 29,066 - 3,253 13,455 - 45,773 

Nontransient Noncommunity Water Systems (NTNCWSs) - SW

≤100 250 65,009 4,918 4,005 93 - 38 67 - 197 

101 - 500 253 66,038 3,734 3,008 80 - 29 39 - 148 

501-1,000 88 22,970 1,299 1,046 28 - 10 14 - 52 

1,001-4,100 72 41,740 2,147 1,351 43 - 16 33 - 91 

4,101-33,000 22 50,424 - 1,632 5 - - - - 5 

33,001-96,000 2 34,320 - 1,111 - - - - - - 

96,001-500,000 1 31,680 - 1,025 - - - - - - 

500,001-1 Million - - - - - - - - - - 

> 1 Million - - - - - - - - - - 

Totals 688 312,182 12,097 13,179 248 - 92 153 - 493 

Nontransient Noncommunity Water Systems (NTNCWSs) - GW

≤100 8,826 971,538 128,775 84,992 5,581 - 856 3,829 - 10,267 

101 - 500 6,613 725,785 66,525 43,597 3,130 - 447 1,273 - 4,849 

501-1,000 1,718 190,649 16,037 10,680 744 - 95 298 - 1,136 

1,001-4,100 812 460,470 28,214 17,790 818 - 169 974 - 1,961 

4,101-33,000 70 153,648 - 5,936 123 - 9 - - 132 

33,001-96,000 2 23,760 - 918 4 - - - - 4 

96,001-500,000 - - - - - - - - - - 

500,001-1 Million - - - - - - - - - - 

> 1 Million - - - - - - - - - - 

Totals 18,041 2,525,850 239,551 163,913 10,400 - 1,577 6,373 - 18,350 

Transient Noncommunity Water Systems (TNCWSs) - SW

≤100 1,339 345,443 39,654 32,349 1,277 - 508 943 - 2,728 

101 - 500 497 128,109 15,365 12,541 487 - 202 372 - 1,062 

501-1,000 88 22,683 2,720 2,220 86 - 36 66 - 188 

1,001-4,100 67 39,816 3,990 2,590 102 - 52 122 - 276 

4,101-33,000 18 40,656 - - 8 - - - - 8 

33,001-96,000 - - - - - - - - - - 

96,001-500,000 - - - - - - - - - - 

500,001-1 Million - - - - - - - - - - 

> 1 Million 1 102,960 - - - - - - - - 

Totals 2,010 679,667 61,730 49,700 1,960 - 797 1,504 - 4,262 

Transient Noncommunity Water Systems (TNCWSs) - GW

≤100 60,200 4,493,808 905,554 600,315 44,730 - 6,649 25,425 - 76,805 

101 - 500 19,275 1,614,924 316,238 210,714 14,530 - 2,089 8,864 - 25,483 

501-1,000 1,963 177,264 32,730 22,064 1,477 - 221 896 - 2,595 

1,001-4,100 617 335,283 29,957 19,113 927 - 186 1,138 - 2,251 

4,101-33,000 67 156,288 - 8,909 116 - 4 - - 120 

33,001-96,000 2 34,320 - 1,956 - - - - - - 

96,001-500,000 1 26,400 - 1,505 - - - - - - 

500,001-1 Million 1 63,360 - 3,612 - - - - - - 

> 1 Million - - - - - - - - - - 

Totals 82,126 6,901,647 1,284,478 868,188 61,780 - 9,149 36,324 - 107,253 

Grand Total 154,837 76,833,044 2,479,366 2,739,154 108,828 - 15,728 58,272 - 182,828 

Number of 

Corrective 

Actions

(based on 

Acute and 

Multiple NonAcute Violation 

Assessments)

Number of 

Non-Acute 

Violation 

Assessments 

(Single 

Violations)

Number of 

Acute 

Violation 

Assessments

Number of 

Non-Acute 

Violation 

Assessments

(Multiple 

Violations)

Number of 

Corrective 

Actions

(based on 

Single NonAcute Violation 

Assessment)

Number of 

Routine 

Monitoring 

Samples

Number of 

Additional 

Routine 

Monitoring 

Samples Tier 2 PNs

PWS Size

(Population

Served)

PWSs Subject 

to Current 

TCR

Number of 

Repeat 

Monitoring 

Samples

Notes: 1) Predicted outcomes for systems serving ≤4,100 are output from the occurrence model 

detailed in Ch. 5 of this EA; those for systems serving >4,100 people are from the larger systems 

model based on 2007 SDWIS violations data. 2) Zero corrective actions are indicated in the two 

Number of Corrective Actions columns (F and I) because these columns represent incremental 

changes from the level of corrective actions that EPA estimates would be implemented under the 

current TCR option. 3)Results differ slightly from those presented in Ex. 5.10 – 5.15 because 

they’re capturing slightly different time periods of the 30 modeled years. For completeness in 

discussing the simulation model, Chapter 5 exhibits show 30 years of results, beginning with 5 

years of GWR in effect, the last 3 of which also include RTCR implementation, followed by 25 

years of RTCR in effect. Alternatively, Ex. 6.2 – 6.4 include the modeled period that encompasses 

the 3 years of proposed RTCR implementation and the 22 years that follow of RTCR in effect 

(Years 3 – 28 of the 30-year period). During the 3 years of RTCR implementation, under either the 

AIP or Alternative option, systems are still working under the requirements of the GWR while 

incurring costs for implementing the new rule requirements. 
Economic Analysis for the Proposed RTCR 6-24 June 2010

Exhibit 6.3 Predicted Outcomes (25-Year Period of Analysis) for AIP 

A BC DE F G H I J=E+H

Community Water Systems (CWSs) - SW

≤100 1,170 308,849 - 12,875 363 39 112 73 17 437 

101 - 500 2,150 567,486 - 15,333 465 43 135 55 20 520 

501-1,000 1,173 309,610 - 8,366 254 23 74 30 11 284 

1,001-4,100 2,938 1,950,717 - 32,222 846 83 161 96 23 942 

4,101-33,000 3,164 10,636,296 - 175,689 2,152 215 197 - 20 2,152 

33,001-96,000 720 11,058,960 - 182,671 534 53 56 - 6 534 

96,001-500,000 308 10,190,400 - 168,324 233 23 24 - 2 233 

500,001-1 Million 31 2,019,600 - 33,360 22 2 - - - 22 

> 1 Million 17 1,686,960 - 27,865 - - - - - - 

Totals 11,671 38,728,879 - 656,704 4,869 482 758 253 100 5,122 

Community Water Systems (CWSs) - GW

≤100 11,938 2,870,075 8,760 156,897 8,004 791 853 3,523 398 11,527 

101 - 500 13,892 3,391,200 6,127 136,906 6,502 669 696 2,399 335 8,901 

501-1,000 4,467 1,085,730 1,844 39,659 1,780 168 188 626 85 2,406 

1,001-4,100 6,443 4,079,328 - 96,939 3,208 318 342 1,705 206 4,913 

4,101-33,000 3,156 9,145,224 - 217,321 4,545 454 263 - 26 4,545 

33,001-96,000 335 4,884,000 - 116,060 656 66 53 - 5 656 

96,001-500,000 63 1,945,680 - 46,236 129 13 10 - 1 129 

500,001-1 Million 4 253,440 - 6,023 - - - - - - 

> 1 Million 3 269,280 - 6,399 - - - - - - 

Totals 40,301 27,923,956 16,731 822,439 24,824 2,480 2,405 8,253 1,056 33,077 

Nontransient Noncommunity Water Systems (NTNCWSs) - SW

≤100 250 65,986 - 2,840 69 7 27 33 6 102 

101 - 500 253 66,766 - 2,073 66 7 24 21 4 87 

501-1,000 88 23,223 - 721 23 2 8 7 2 30 

1,001-4,100 72 42,751 - 1,183 38 4 12 18 3 56 

4,101-33,000 22 50,424 - 1,395 5 0 - - - 5 

33,001-96,000 2 34,320 - 950 - - - - - - 

96,001-500,000 1 31,680 - 877 - - - - - - 

500,001-1 Million - - - - - - - - - - 

> 1 Million - - - - - - - - - - 

Totals 688 315,151 - 10,038 201 20 72 79 15 280 

Nontransient Noncommunity Water Systems (NTNCWSs) - GW

≤100 8,826 932,025 48,142 68,123 4,797 493 559 2,010 254 6,807 

101 - 500 6,613 678,688 25,630 35,860 2,794 271 315 757 107 3,552 

501-1,000 1,718 180,145 6,166 8,601 675 66 79 168 24 843 

1,001-4,100 812 473,352 - 15,887 690 68 114 530 65 1,221 

4,101-33,000 70 153,648 - 5,157 123 12 9 - 1 123 

33,001-96,000 2 23,760 - 797 4 0 - - - 4 

96,001-500,000 - - - - - - - - - - 

500,001-1 Million - - - - - - - - - - 

> 1 Million - - - - - - - - - - 

Totals 18,041 2,441,617 79,938 134,426 9,084 912 1,077 3,466 450 12,550 

Transient Noncommunity Water Systems (TNCWSs) - SW

≤100 1,339 353,461 - 20,787 1,004 99 336 426 80 1,430 

101 - 500 497 131,149 - 7,816 372 34 125 165 28 537 

501-1,000 88 23,222 - 1,384 66 6 22 29 5 95 

1,001-4,100 67 42,209 - 2,118 90 9 32 62 9 152 

4,101-33,000 18 40,656 - 2,040 8 1 - - - 8 

33,001-96,000 - - - - - - - - - - 

96,001-500,000 - - - - - - - - - - 

500,001-1 Million - - - - - - - - - - 

> 1 Million 1 102,960 - 5,167 - - - - - - 

Totals 2,010 693,657 - 39,312 1,541 149 515 682 122 2,222 

Transient Noncommunity Water Systems (TNCWSs) - GW

≤100 60,200 6,076,163 446,166 631,105 47,190 4,755 5,477 20,628 2,593 67,818 

101 - 500 19,275 1,940,946 135,822 194,697 13,780 1,363 1,608 5,694 799 19,474 

501-1,000 1,963 206,130 14,078 20,078 1,396 143 177 585 76 1,982 

1,001-4,100 617 348,480 - 16,027 773 77 117 638 76 1,412 

4,101-33,000 67 156,288 - 7,188 116 12 4 - 0 116 

33,001-96,000 2 34,320 - 1,578 - - - - - - 

96,001-500,000 1 26,400 - 1,214 - - - - - - 

500,001-1 Million 1 63,360 - 2,914 - - - - - - 

> 1 Million - - - - - - - - - - 

Totals 82,126 8,852,088 596,065 874,801 63,256 6,349 7,383 27,546 3,544 90,801 

Grand Total 154,837 78,955,347 692,734 2,537,720 103,775 10,391 12,210 40,278 5,287 144,053 

PWS Size

(Population

Served)

PWSs Subject 

to RTCR

Number of 

Repeat 

Monitoring 

Samples

Number of 

Routine 

Monitoring 

Samples

Number of 

Additional 

Routine 

Monitoring 

Samples

Level 1 and 

Level 2 (based 

on non-acute 

triggers) 

Assessments

Number of 

Corrective 

Actions (based 

on Level 2 

Assessments)

Number of 

Level 1 

Assessments

Number of 

Level 2 

Assessments 

(based on 

Acute 

Violations)

Number of 

Level 2 

Assessments 

(based on nonacute 

triggers)

Number of 

Corrective 

Actions (based 

on Level 1 

Assessments)

Notes: 1) Predicted outcomes for systems serving ≤4,100 are output from the occurrence model detailed 

in Ch. 5 of this EA; those for systems serving >4,100 people are from the larger systems model based on 

2007 SDWIS violations data. 2) The two Number of Corrective Actions columns (F and I) represent the 

incremental changes in the level of corrective actions that EPA estimates would be implemented under 

the regulatory option in comparison to the current TCR option. 3) Results differ slightly from those 

presented in Ex. 5.10 – 5.15 because they’re capturing slightly different time periods of the 30 modeled 

years. For completeness in discussing the simulation model, Chapter 5 exhibits show 30 years of results, 

beginning with 5 years of GWR in effect, the last 3 of which also include RTCR implementation, followed 

by 25 years of RTCR in effect. Alternatively, Ex. 6.2 – 6.4 include the modeled period that encompasses 

the 3 years of proposed RTCR implementation and the 22 years that follow of RTCR in effect (Years 3 – 

28 of the 30-year period). During the 3 years of RTCR implementation, under either the AIP or 

Alternative option, systems are still working under the requirements of the GWR while incurring costs for 

implementing the new rule requirements. 
Economic Analysis for the Proposed RTCR 6-25 June 2010

Exhibit 6.4 Predicted Outcomes (25-Year Analysis Period) for Alternative Option 

A BC DE F G H I J=E+H

Community Water Systems (CWSs) - SW

≤100 1,170 308,880 - 13,764 400 36 100 102 21 501 

101 - 500 2,150 567,600 - 15,660 539 56 119 75 20 615 

501-1,000 1,173 309,672 - 8,708 277 27 75 40 12 317 

1,001-4,100 2,938 1,951,224 - 33,326 920 95 146 132 29 1,052 

4,101-33,000 3,164 10,636,296 - 181,661 2,152 215 197 - 20 2,152 

33,001-96,000 720 11,058,960 - 188,880 534 53 56 - 6 534 

96,001-500,000 308 10,190,400 - 174,046 233 23 24 - 2 233 

500,001-1 Million 31 2,019,600 - 34,493 22 2 - - - 22 

> 1 Million 17 1,686,960 - 28,812 - - - - - - 

Totals 11,671 38,729,592 - 679,350 5,076 507 717 349 110 5,425 

Community Water Systems (CWSs) - GW

≤100 11,938 2,908,469 7,545 158,439 7,871 812 926 3,272 432 11,143 

101 - 500 13,892 3,428,876 5,264 137,959 6,495 667 747 2,543 322 9,038 

501-1,000 4,467 1,098,488 1,616 39,580 1,772 174 203 607 83 2,379 

1,001-4,100 6,443 4,079,328 - 96,939 3,208 318 342 1,705 206 4,913 

4,101-33,000 3,156 9,145,224 - 217,321 4,545 454 263 - 26 4,545 

33,001-96,000 335 4,884,000 - 116,060 656 66 53 - 5 656 

96,001-500,000 63 1,945,680 - 46,236 129 13 10 - 1 129 

500,001-1 Million 4 253,440 - 6,023 - - - - - - 

> 1 Million 3 269,280 - 6,399 - - - - - - 

Totals 40,301 28,012,784 14,425 824,956 24,675 2,504 2,544 8,127 1,077 32,802 

Nontransient Noncommunity Water Systems (NTNCWSs) - SW

≤100 250 66,000 - 3,040 75 8 28 41 7 116 

101 - 500 253 66,792 - 2,169 69 7 19 24 4 93 

501-1,000 88 23,232 - 756 24 2 6 9 2 33 

1,001-4,100 72 42,768 - 1,228 37 4 13 23 4 59 

4,101-33,000 22 50,424 - 1,448 5 0 - - - 5 

33,001-96,000 2 34,320 - 985 - - - - - - 

96,001-500,000 1 31,680 - 910 - - - - - - 

500,001-1 Million - - - - - - - - - - 

> 1 Million - - - - - - - - - - 

Totals 688 315,216 - 10,536 209 22 67 98 17 306 

Nontransient Noncommunity Water Systems (NTNCWSs) - GW

≤100 8,826 1,314,175 36,965 91,416 5,673 562 723 3,390 399 9,063 

101 - 500 6,613 976,627 19,382 48,269 3,551 356 446 1,333 183 4,884 

501-1,000 1,718 249,760 4,802 11,817 814 81 99 298 41 1,112 

1,001-4,100 812 473,352 - 15,887 690 68 114 530 65 1,221 

4,101-33,000 70 153,648 - 5,157 123 12 9 - 1 123 

33,001-96,000 2 23,760 - 797 4 0 - - - 4 

96,001-500,000 - - - - - - - - - - 

500,001-1 Million - - - - - - - - - - 

> 1 Million - - - - - - - - - - 

Totals 18,041 3,191,322 61,149 173,343 10,855 1,080 1,393 5,551 689 16,406 

Transient Noncommunity Water Systems (TNCWSs) - SW

≤100 1,339 353,496 - 23,122 796 76 250 425 66 1,221 

101 - 500 497 131,208 - 8,192 278 27 90 154 25 432 

501-1,000 88 23,232 - 1,533 50 5 17 25 4 75 

1,001-4,100 67 42,240 - 2,312 73 7 29 69 10 142 

4,101-33,000 18 40,656 - 2,225 8 1 - - - 8 

33,001-96,000 - - - - - - - - - - 

96,001-500,000 - - - - - - - - - - 

500,001-1 Million - - - - - - - - - - 

> 1 Million 1 102,960 - 5,636 - - - - - - 

Totals 2,010 693,792 - 43,020 1,204 116 386 674 105 1,878 

Transient Noncommunity Water Systems (TNCWSs) - GW

≤100 60,200 9,524,123 333,524 912,589 57,597 5,737 7,796 37,532 4,450 95,129 

101 - 500 19,275 3,021,771 104,732 282,740 17,358 1,616 2,441 10,924 1,337 28,282 

501-1,000 1,963 304,534 10,412 27,932 1,661 163 230 1,015 123 2,676 

1,001-4,100 617 348,480 - 16,027 773 77 117 638 76 1,412 

4,101-33,000 67 156,288 - 7,188 116 12 4 - 0 116 

33,001-96,000 2 34,320 - 1,578 - - - - - - 

96,001-500,000 1 26,400 - 1,214 - - - - - - 

500,001-1 Million 1 63,360 - 2,914 - - - - - - 

> 1 Million - - - - - - - - - - 

Totals 82,126 13,479,275 448,667 1,252,181 77,506 7,605 10,589 50,109 5,986 127,615 

Grand Total 154,837 84,421,981 524,241 2,983,387 119,526 11,834 15,695 64,908 7,983 184,433 

Number of 

Corrective 

Actions (based 

on Level 2 

Assessments)

Number of 

Level 2 

Assessments 

(based on 

Acute 

Violations)

Number of 

Level 2 

Assessments 

(based on nonacute 

triggers)

Number of 

Corrective 

Actions (based 

on Level 1 

Assessments)

Number of 

Routine 

Monitoring 

Samples

Number of 

Additional 

Routine 

Monitoring 

Samples

Number of 

Level 1 

Assessments

Level 1 and 

Level 2 (based 

on non-acute 

triggers) 

Assessments

PWS Size

(Population

Served)

PWSs Subject 

to RTCR

Number of 

Repeat 

Monitoring 

Samples

Notes: 1) Predicted outcomes for systems serving ≤4,100 are output from the occurrence model detailed 

in Ch. 5 of this EA; those for systems serving >4,100 people are from the larger systems model based on 

2007 SDWIS violations data. 2) The two Number of Corrective Actions columns (F and I) represent the 

incremental changes in the level of corrective actions that EPA estimates would be implemented under 

the regulatory option in comparison to the current TCR option. 3) Results differ slightly from those 

presented in Ex. 5.10 – 5.15 because they’re capturing slightly different time periods of the 30 modeled 

years. For completeness in discussing the simulation model, Chapter 5 exhibits show 30 years of results, 

beginning with 5 years of GWR in effect, the last 3 of which also include RTCR implementation, followed 

by 25 years of RTCR in effect. Alternatively, Ex. 6.2 – 6.4 include the modeled period that encompasses 

the 3 years of proposed RTCR implementation and the 22 years that follow of RTCR in effect (Years 3 – 

28 of the 30-year period). During the 3 years of RTCR implementation, under either the AIP or 

Alternative option, systems are still working under the requirements of the GWR while incurring costs for 

implementing the new rule requirements. 
Economic Analysis for the Proposed RTCR 6-26 June 2010

Exhibit 6.5 Predicted Average Annual Acute Violations by Reg. 

Option and System Type1 

PWS Type

PWS Size

(Population

Served) Number of Systems TCR AIP Option

Alternative 

Option

<100 1,170 7 5 5

101-500 2,150 8 5 5

501-1,000 1,173 5 3 3

1,001-4,100 2,938.0 7.4 6.6 6.6

4,101-33,000 3,164 9 9 9

33,001-96,000 720 3 3 3

96,001-500,000 308 1 1 1

500,001-1 Million 31 0 0 0

> 1 Million 17 0 0 0

Totals 11,671 39 33 33

<100 11,938 52 39 42

101-500 13,892 47 32 34

501-1,000 4,467 13 9 9

1,001-4,100 6,443 22 16 16

4,101-33,000 3,156 12 12 12

33,001-96,000 335 2 2 2

96,001-500,000 63 0 0 0

500,001-1 Million 4 0 00

> 1 Million 3 0 00

Totals 40,301 148 109 116

<100 250 2 1 1

101-500 253 1 1 1

501-1,000 88 0 0 0

1,001-4,100 72 1 1 1

4,101-33,000 22 0 0 0

33,001-96,000 2 0 00

96,001-500,000 1 0 00

500,001-1 Million 0 0 00

> 1 Million 0 0 00

Totals 688 4 3 3

<100 8,826 39 25 33

101-500 6,613 20.31 14.31 20.29

501-1,000 1,718 4.31 3.61 4.51

1,001-4,100 812 8 5 5

4,101-33,000 70 0 0 0

33,001-96,000 2 0 00

96,001-500,000 0 0 00

500,001-1 Million 0 0 00

> 1 Million 0 0 00

Totals 18,041 72 49 63

<100 1,339 20 11 11

101-500 497 8 4 4

501-1,000 88.00 1.25 0.79 0.79

1,001-4,100 67.0 2.3 1.3 1.3

4,101-33,000 18 0 0 0

33,001-96,000 0 0 00

96,001-500,000 0 0 00

500,001-1 Million 0 0 00

> 1 Million 1 0 00

Totals 2,010 31 18 18

<100 60,200 302 249 354

101-500 19,275 94.93 73.11 110.96

501-1,000 1,963 10.07 8.04 10.47

1,001-4,100 617 8 5 5

4,101-33,000 67 0 0 0

33,001-96,000 2 0 00

96,001-500,000 1 0 00

500,001-1 Million 1 0 00

> 1 Million 0 0 00

Totals 82,126 416 336 481

All Systems Grand Total 154,837 710 547 713

TNC GW

CWS SW

CWS GW

NTNC SW

NTNC GW

TNC SW

Source: Output from Proposed RTCR models as described in Sections 

5.3 and 5.4 of this EA for smaller systems and larger systems, 

respectively. 

Notes: 1 Average violation estimates are for the 22-year period following 

the effective date of the RTCR and 3 years of implementation activities. 
Economic Analysis for the Proposed RTCR 6-27 June 2010

Exhibit 6.6 Predicted Change in Average Annual Acute Violations1 by Regulatory 

Option and System Type 

PWS Type

PWS Size

(Population

Served)

AIP 

Option

Alternative 

Option

<100 -36% -36%

101-500 -29% -29%

501-1,000 -27% -27%

1,001-4,100 -10% -10%

Totals -17% -17%

<100 -25% -19%

101-500 -32% -27%

501-1,000 -34% -29%

1,001-4,100 -28% -28%

Totals -26% -22%

<100 -20% -20%

101-500 -35% -35%

501-1,000 -32% -32%

1,001-4,100 -30% -30%

Totals -28% -28%

<100 -35% -15%

101-500 -30% 0%

501-1,000 -16% 5%

1,001-4,100 -32% -32%

Totals -32% -12%

<100 -42% -42%

101-500 -47% -47%

501-1,000 -37% -37%

1,001-4,100 -43% -43%

Totals -43% -43%

<100 -18% 17%

101-500 -23% 17%

501-1,000 -20% 4%

1,001-4,100 -37% -37%

Totals -19% 16%

All Systems Grand Total -23% 1%

TNC GW

CWS SW

CWS GW

NTNC SW

NTNC GW

TNC SW

Source: Exhibit 6.5. Percentages may not match results 

calculated directly from exhibit 6.5 due to rounding in exhibit 

6.5. 

Notes: 1

 Average violation estimates are for the 22 year 

period (following 3 years of implementation) after systems 

have fully implemented their new sampling regimes. 

Negative changes indicate reductions in the number of acute 

violations under either option in comparison to the current 

TCR option; positive changes indicate increases in acute 

violations. As described further in Section 6.4, a net increase 

in acute violations is caused by increased diagnostic power 

from increased sampling. 

Systems serving >4,100 were omitted from this table because 

there were no changes predicted in the number of violations 

to be incurred.
Economic Analysis for the Proposed RTCR 6-28 June 2010

6.3.1.3 Overall Assessment of Predictive Analysis Results 

For PWSs serving ≤4,100 people, EPA expects risk to decrease under the AIP and 

Alternative option as compared to the current TCR option. As shown by the year by year detail 

of the output provided in Appendix A of this EA and summarized in Exhibits 5.21 – 5.26, risk is 

further reduced for PWSs under the Alternative option relative to baseline (the current TCR 

option) for the first 5 years after the effective date as compared to the AIP relative to baseline. 

This additional reduction in risk under the Alternative option is driven by the increase in 

additional sampling that would occur while all systems were still on monthly sampling. Over 

time, some of these systems could qualify to move from monthly to quarterly under either 

option, or from quarterly to annual sampling under the AIP. Unlike the AIP, no systems under 

the Alternative option would be able to sample annually. However, additional costs are incurred 

under the Alternative option for this increased monitoring, especially for the systems most 

impacted by the AIP (TNCWSs serving ≤500 people). Chapter 7 presents the full discussion of 

costs associated with implementation of the regulatory options considered. 

When considering the period beginning in Year 9 after RTCR promulgation through the 

end of the period of analysis (model year 11 in Exhibits 5.21 – 5.26), the AIP and Alternative 

option generally have similar estimates of occurrence. Year 9 after RTCR promulgation 

represents the first year of the steady state for monitoring regimens, when all PWSs that qualified 

for reduced monitoring are following their new regimens. However, for some categories and 

sizes of PWSs the AIP actually has a lower rate of occurrence than the Alternative option. This 

may occur because PWSs under the AIP may have more resources available to perform the 

annual inspection more regularly based on states needing fewer resources for monitoring than 

under the Alternative option. Appendix B includes graphs of predicted occurrence for each of the 

size and PWS categories considered in this analysis. 

EPA does not expect changes in risk for the PWSs serving >4,100 people under the AIP 

to be as obvious as for the smaller systems. The larger systems are starting from a smaller 

baseline level of occurrence than smaller systems and have a correspondingly lower level of 

triggered assessment and correction action activity. This suggests that percentage increases in 

these activities will result in less obvious changes. Additionally, monitoring requirements for 

PWSs serving >4,100 people would remain essentially unchanged under either the AIP or 

Alternative option as compared to the current TCR option. Thus the observed overall net 

increase in benefits (and costs) for PWSs serving >4,100 people is driven by the requirements to 

conduct assessments and to correct any sanitary defects that are found. The increase of 10% from 

baseline in effective CAs implemented applies to these larger systems just as it does to systems 

serving ≤4,100 people; however, as shown in Chapter 4 (Exhibit 4.8), the larger systems have a 

much smaller level of violations than smaller systems, based on reasons discussed in Chapter 5 

(Section 5.4). Therefore, increases in CAs will be less evident in absolute (not percentage) terms. 

6.4 Uncertainty and Sensitivity Analyses 

 Key sources of uncertainty in the estimates provided in this EA include the data used to 

develop baseline estimates and the assumptions made regarding model input variables, as 
Economic Analysis for the Proposed RTCR 6-29 June 2010

described in Chapters 4 and 5 of this EA, respectively. The quality and representativeness of the 

data used in this EA are discussed in Section 4.2, while uncertainty in model input variables is 

discussed in Section 5.3.3.1. A summary of assumptions made in developing the baseline and 

input parameters to the predictive model that contribute uncertainty to the analysis are included 

in Chapters 4 and 5 (Exhibits 4.13 and 5.22a-b). By definition, those uncertainty factors that are 

incorporated into the baseline will have a similar effect on the current TCR option, the AIP and 

Alternative option; therefore, EPA believes that they will not significantly affect the net results 

of the EA. These assumptions are shown in Ex. 5.22a, and include the estimates representing 

GWR effects. Although EPA believes its GWR efficacy estimates are conservative, the estimates 

are applied in similar fashion to the baseline (current TCR option) and AIP and Alternative 

option, therefore any bias that could be introduced is essentially canceled out in the net analysis. 

By contrast, the assumptions listed in Ex. 5.22b include those assumptions that will affect only 

the AIP and Alternative option, such as the assumed increase in the number of effective CAs 

implemented as compared to the current TCR option. These types of assumptions are not 

canceled out in the net analysis, and are expected to have some effect on net results. Therefore, 

EPA has identified the key drivers of the analysis among this type of assumption and performed 

a sensitivity analysis on their values (Chapter 5, Section 5.3.3.1). 

 This discussion focuses on the provisions of the AIP and Alternative option for 

conducting corrective actions based on the results of Level 1 and Level 2 assessments performed, 

and the reductions in repeat samples following TC positives and in the additional routine samples 

required in the month following a TC positive. The analyses performed and presented here are 

intended to provide insight into the overall impact of these two changes in rule provisions under 

the proposed RTCR, each of which moves risk (as defined in this EA) in opposite directions. 

Unlike the uncertainty analysis presented in Chapter 5 (Occurrence and Predictive Model), this 

analysis does not consider variations on the assumptions related to corrective actions, but instead 

tests the relative impact of changes in the sampling regimen given the assumptions for corrective 

actions applied in the primary analysis of this EA (and summarized in Section 5.3). 

 The primary benefit of the proposed RTCR is a potential reduction in exposure to 

microbial contaminants from drinking water provided by public water systems. Two features of 

the proposed RTCR are expected to influence the exposure reduction. 

 The first feature is the requirement to perform corrective actions based on the results of 

the Level 1 and Level 2 assessments performed in response to their individual triggers. 

Implementation of additional corrective actions beyond the level currently implemented under 

the TCR will reduce exposure to microbial contamination both by addressing the immediate 

problem identified by the Level 1 or Level 2 assessment and by preventing some additional 

future exposures to fecal contamination. 

 The second feature, which primarily affects the smaller systems, is the reduction in the 

numbers of additional routine and repeat samples that systems are required to take whenever 

routine samples are found to be TC positive. This reduction in sampling may contribute to 

increased exposure and risk because fewer samples provide fewer opportunities to identify and 

address TC and EC exposures. 
Economic Analysis for the Proposed RTCR 6-30 June 2010

 The analyses that were performed used the predictive model with the occurrence input 

parameters for the nondisinfecting ground water TNCWS serving <101 people. This set of 

systems was chosen because 1) it contains the largest number of systems of the 27 occurrence 

sets (46,642 systems in this set); 2) it is subject to all of the changes in sampling requirements; 

and 3) it has the highest routine TC hit rate so that effects on this set of systems are likely to be 

more pronounced (and therefore more clearly observable) than other sets. The analysis was 

carried out by running simulations of 10,000 systems each for monthly, quarterly, or annual 

monitoring schedules. 

There were 5 sampling and corrective action “regimens” considered in the model. As 

shown in Exhibit 6.7, Regimens 1 through 3 assume a routine sampling regimen equivalent to 

the current TCR option (i.e., 1 regular routine sample and a minimum of 5 routine samples in the 

month following a TC positive). Regimen 1 is the only one of the 5 regimens that assumes there 

are no corrective actions (incremental beyond those already conducted under the current TCR 

option); regimens 2 through 5 all assume corrective actions are conducted in accordance with 

requirements under the AIP. Regimens 3 through 5 decrease the repeat samples from 4 to 3. 

Regimen 4 also decreases the minimum number of routine samples in the month following a TC 

positive from 5 to 3; Regimen 5 uses the sampling requirements of the RTCR where systems 

doing monthly sampling need only take their 1 regular routine sample in a month following a TC 

positive, while for those that monitor quarterly and annually, the requirement remains for a 

minimum of 3 additional routine samples in the month following a TC positive. 

In this analysis, Regimen 1 describes the current TCR option and Regimen 5 describes 

the AIP. Going from Regimen 1 to Regimen 2, where corrective actions are brought in without 

any change in sampling, provides key insights to the benefits (reduction in exposure) derived 

from the corrective action aspect of the AIP. Going from Regimen 2 through Regimen 5 provides 

some insight into how much of those corrective action benefits might be foregone because of the 

small reductions in the number of TC samples required. 

 

The metric used for comparing the relative impacts of these 5 regimens was the number 

of acute violations based on EC-positive assays (referred to as “acutes” throughout this section), 

because this was considered to be the most relevant measure of the potential microbial health 

risk-based benefits of the proposed RTCR. The numbers presented are the average annual 

numbers of acute violations. 

It is important to note that in order to isolate the effects of the proposed RTCR corrective 

actions and sampling changes, this analysis excluded any effect of the GWR. To further 

understand the effects of sampling regimen, this analysis also presents the results separately for 

monthly, quarterly, and annual sampling since one of the changes in the proposed RTCR applies 

only to those on monthly sampling. Exhibit 6.7 provides a summary of the results of this 

analysis. 
Economic Analysis for the Proposed RTCR 6-31 June 2010

Exhibit 6.7 Relative Impacts Analysis for TNCWS Serving <101 People 

for the Range of Corrective Action and Sampling Regimens Predicted 

MQA M Q A M Q A M Q A M Q A

1 5 5 5 4 No 168,252 60,980 15,317 279 106 25

2 5 5 5 4 Yes 160,394 59,693 15,103 198 92 26 80 14 ‐10 0 0

3 5 5 5 3 Yes 156,779 57,851 14,894 172 79 25 70 12 ‐1 37 14 2

4 3 3 3 3 Yes 151,500 189 77 13

5 1 3 3 3 Yes 146,129 175 71 32

Ratios of Prevented to Found: 0.41 0.15 ‐0.05

L1 & L2

CAs?

Average Acutes Per Year

Found

5

Average Acutes

Per Year

Missed

Regimen

Minimum

Samples in

Month

Following a

TC+ Repeat

Samples

Average Total

TC Samples per Year

55,411 13 14,031 82 ‐1

Average Acutes

Per Year

Prevented

21 11

Key: (CA) = correction action; L1 and L2 = Level 1 and Level 2; M = monthly; Q = quarterly; and A = annual. 

Definitions: Acutes “found” are acute violations the model predicts will be identified; acutes “prevented” are those 

avoided by implementation of CAs; acutes “missed” are those found under the sampling regimen of the current TCR 

option (Regimen 1) that were not found under the reduced sampling of Regimens 3, 4, and 5 (calculated by 

subtracting acutes found under Regimens 3, 4, and 5 from those found under Regimen 1). 

Notes: 

- Results shown are averages based on simulations of 10,000 systems each for monthly, quarterly, and 

annual monitoring using occurrence inputs for nondisinfecting GW TNCWS serving <101 people. 

- Assumptions for L1 and L2 corrective action efficacy and resulting duration of reduced occurrence are those 

used in the primary analysis. 

- For the purpose of isolating the relative impacts of changes in monitoring regimens and implementation of 

L1 and L2 corrective actions, no GWR effects (including GWR corrective actions) are modeled in these runs. 

- Ratios of acutes “prevented” to those “found” are based on Regimen 2 results, which reflect the current TCR 

option sampling regimen but includes implementation of L1 and L2 correction actions. 

Regimen 1, representing the current TCR option, provides a “baseline” against which the 

other regimens can be compared. Although arguably more acute violations could be found if 

more routine and repeat samples were taken, the numbers of acute violations shown here as 

“found” (monthly = 279, quarterly = 106, and annual = 25) represent the maximum number that 

can be found given the amount of sampling done. This finding is based on analysis using 10,000 

simulated systems each for monthly, quarterly, and annual; the sampling scheme under the 

current TCR option; and no additional corrective actions being performed. 

Regimen 2 uses the exact same sampling scheme as Regimen 1, but includes the 

performance of Level 1 and Level 2 corrective actions consistent with the AIP. Here there is a 

reduction observed in the number of acutes found for monthly and quarterly sampling although 

not for annual sampling. Since there is no change in the sampling requirements, differences (and 

similarities) between Regimen 1 and Regimen 2 numbers are due to: a) the implementation of 

corrective actions under Regimen 2; and b) and random variation that is endemic to the Monte 

Carlo simulation. 

For monthly sampling, which requires a large number of TC samples per year, Monte 

Carlo variation is relatively small with respect to the effect of the parameter adjustments. Thus, 

80 acute violations occur under monthly sampling for Regimen 1 (279 acutes) but not under 

Regimen 3 (198 acutes) as the result of corrective actions. Quarterly and annual sampling 
Economic Analysis for the Proposed RTCR 6-32 June 2010

regimens require far fewer TC samples per year, and therefore the Monte Carlo variation may 

obscure the salient data trends in those model results. For instance, the increase in the number of 

acutes under annual sampling under Regimen 1 from 25 to 26 under Regimen 2, which is not 

consistent with the trend seen in the larger sample size in the simulation of monthly systems, is 

likely to be reflective of stochastic noise from the Monte Carlo simulation peformed rather than 

of the impact of corrective actions. For this reason most of the discussion that follows on the 

trends across these regimens focuses on the monthly sampling results. 

 Regimen 3 reflects the reduction in repeat sampling requirements of 4 to 3 following a 

TC+. As would be expected, this also results in a small reduction in the number of acutes found. 

For example, in the monthly sampling group this falls from 198 to 172. Using an assumption that 

the ratio of acutes prevented to acutes found observed in Regimen 2 apply to the other regimens 

as well, then results for the monthly sampling group (where 80/198 = 0.41) indicate that 70 

acutes are still prevented. The sum of those found (179) and those prevented (70) for the monthly 

group totals 249. This implies, then, that as a result of the reduction in repeat sampling from 4 to 

3, 37 acutes are missed (279 “found” under the current TCR option sampling regimen - 172 - 70 

= 37). That is, they are neither found nor prevented, but are assumed to occur unobserved. 

 Regimen 4 reduces the number of routines in a month following a TC positive from 5 to 

3, but retains the 3 repeats and the corrective action requirements. The number of acutes now 

“missed” changes to 13, 11, and 5 respectively for those on monthly, quarterly, and annual 

sampling. 

 

 Regimen 5, which represents the proposed RTCR as described by the AIP, excludes any 

additional routine samples in the month following a TC+ for those on monthly sampling. Here 

the number of “missed” acutes for those on monthly increases from 13 to 32. There are no 

changes for those on quarterly or annual sampling relative to Regimen 4 since systems sampling 

quarterly and annually are treated identically in both scenarios. 

 In addition to displaying the changes in the number of annual average acutes for these 5 

regimens, Exhibit 6.6 also shows the average annual number of TC samples (regular routine, 

additional routines and repeat samples) taken. The number of samples declines considerably 

across the regimens due both to the reduction in actual sampling requirements and to reduced 

number of additional routines and repeats that need to be taken because of the prevention of TC 

occurrence by the corrective actions taken. 

 This analysis points first and foremost to the highly positive public health benefits of 

including the corrective actions as part of the proposed RTCR (based on the modest assumptions 

regarding their effectiveness used in the occurrence analysis detail in Chapter 5 of this EA). This 

is seen not only in the number of acutes that are found for which corrective actions may be 

performed, but also – and perhaps more importantly – in the large number of additional acutes 

that are prevented from occurring again in those systems as a result of the corrective actions. 

 While some of these potential benefits are “missed” as a result of the reductions in 

additional routine and repeat sampling requirements, these numbers (shown in Exhibit 6.7) seem 

small when compared to the numbers found and prevented. This is particularly important when 
Economic Analysis for the Proposed RTCR 6-33 June 2010

considering the potential cost savings from reducing the number of TC samples that are taken, as 

discussed in Chapter 9 (Net Benefits) of this EA. 

The group of 46,642 TNCWSs serving ≤100 currently has, and will continue to have, a 

vast majority of systems on either quarterly or annual sampling in the steady state of the analysis 

period, beginning in approximately Year 9 after RTCR promulgation. Since quarterly and annual 

estimates of acutes are less stable, predictions for this specific subset of systems are less reliable. 

Nonetheless, since the vast majority of systems affected by RTCR are on monthly sampling, the 

trends in the monthly numbers cited above should be indicative of trends for other types and 

sizes of systems included in this model (those serving fewer than 4,100 people). That is, relative 

to the current TCR option, the inclusion of the Level 1 and Level 2 corrective actions will always 

result in more benefit accruing from corrective actions being performed and acute violations 

being avoided than the relatively small reductions in sample numbers will result in “missing” 

acute violations. 

Because all of the other system types have lower overall TC and EC hit rates than the 

nondisinfecting ground water TNCWS serving <101 people, on a “per system basis” their missed 

acute violations would be fewer than those estimated for the set of systems addressed in this 

analysis. Furthermore, for the systems serving 1,001 to 4,100 people where the proposed RTCR 

change in the minimum number of samples to be taken in the month following a TC+ is smaller, 

the number of “missed” acute violations would be less than that seen in this analysis for the 

smaller systems. For example, for systems serving 3,301 to 4,100 (which are all on monthly 

sampling), the minimum number of next month samples is reduced from 5 to 4 compared with a 

reduction from 5 to 1 for the systems serving fewer than 1,001 people that perform monthly 

sampling. Thus this analysis presents an estimate that is near the higher end of the range for 

various system types in expected “missed” acute violations due to reduced sampling 

requirements under the proposed RTCR. In spite of this conservative estimate, the effect of the 

proposed RTCR requirements for corrective actions more than balances this effect with a larger 

change in risk in the opposite (reducing) direction, as shown by the relatively large number of 

“prevented” to “missed” acute violations. 

6.5 Other Potential Benefits 

 A number of benefits may accrue to PWS and their populations served that are not 

included in the qualitative relative risk comparison or reductions in occurrence discussed in 

Sections 6.1 – 6.4 (above), they are described in the following sections. 

6.5.1 Increased System Knowledge 

 By requiring additional assessments focused on isolating and identifying system 

problems in response to TC+ or EC+ samples, the proposed RTCR will increase the likelihood 

that PWS operators, in particular those of systems triggered to conduct assessments, will develop 

further general understanding of system operations and potential issues. This heightened 

familiarity with the system may increase preventive maintenance, or may increase the efficiency 
Economic Analysis for the Proposed RTCR 6-34 June 2010

with which future problems are identified, decreasing risk to the PWS population served in both 

cases. Delaying system component replacement costs or avoiding an increase in treatment costs 

may also result in cost savings for some communities. 

6.5.2 Accelerated Infrastructure Repair/Replacement 

As described in 6.5.1 (above), the increased familiarity of operators with their systems 

may encourage an increase in preventive maintenance, preempting some potential contamination 

issues and decreasing risk for the PWS population served. Some systems may see additional nonquantified benefits associated with the acceleration of their capital replacement fund investments 

in response to early identification of impending problems with large capital components. 

Although such capital investment would have occurred anyway, earlier investment may ensure 

that problems are addressed in a preventive manner and may preclude some decrease in 

protection that may have occurred otherwise. At the very least, the increased operator awareness 

should reduce the occurrence of unplanned capital expenditures in any given year. However, 

because of the difficulty of projecting when capital replacements would occur, EPA has not 

costed this acceleration of capital replacement, so there would also be a non-quantified cost of 

making such investments sooner. 

6.5.3 Reduction in Averting Behavior 

As the risk of contamination is reduced in PWSs over time following RTCR 

promulgation, EPA expects that the public will eventually become aware of increased quality, 

and consistency of quality, of their water. This may lead to PWS customers becoming 

increasingly comfortable with drinking tap water and cause them to exercise less averting 

behavior (e.g., drinking bottled water or using Point of Use (POU) filtration devices). Such 

averting behaviors are costly relative to consuming tap water. 

6.5.4 Reduction of Co-Occurring and Other Contaminants 

In addition to the specific E. coli endpoint targeted by the proposed RTCR, there are 

many potentially co-occurring and emerging pathogens (such as viruses, parasitic protozoa 

and/or other bacteria) that may be avoided as part of any avoided contamination event. To the 

extent that E. coli co-occurs with pathogens sufficiently in abundance to result in health affects, 

the proposed RTCR offers the potential for additional morbidity and mortality prevention. 

Potential benefits from the proposed RTCR include avoidance of a full range of health 

effects, including acute and chronic illness, endemic and epidemic disease, associated outbreaks 

and death that may occur from the consumption of fecally contaminated drinking water. Also 

since fecal contamination may contain waterborne pathogens including bacteria, viruses, and 

parasitic protozoa, in general, a reduction in fecal contamination should also reduce the risk from 

these other contaminants. 
Economic Analysis for the Proposed RTCR 6-35 June 2010

Systems may choose corrective actions that also address other drinking water 

contaminants. For example, correcting for a pathway of potential contamination into the 

distribution system can mitigate a variety of potential contaminants. Due to a lack of 

contamination co-occurrence data that quantify the effect that treatment corrective action may 

have on contamination entering through distribution system pathways, EPA has not quantified 

such potential benefits. 

6.5.5 Reduction in Outbreak Risk and Response Costs 

Besides reducing the endemic risk of illnesses from waterborne pathogens, the proposed 

RTCR would reduce the likelihood of major outbreaks from occurring. These avoided illnesses 

and other costs are not estimated or included in the proposed RTCR analyses and would be 

difficult to quantify. The economic value of reducing the risk of outbreaks could be quite high 

when the magnitude of potential costs is considered. The Agency was unable to quantify or 

monetize the cost associated with acute and chronic illnesses or death acquired from consuming 

water contaminated with waterborne pathogens because cases avoided could not be calculated, as 

described in Section 6.2. Examples of potential illnesses associated with ingestion of waterborne 

pathogens and their potential costs are described in Chapter 2 of this EA. 

 Other types of costs associated with outbreaks include spending by local, state, and 

national public health agencies; emergency corrective actions by utilities; and possible legal 

costs if liability is a factor. Affected water systems and local governments may incur costs 

through provisions of alternative water supplies and issuing customer water use warnings and 

health alerts. Commercial establishments (e.g., restaurants) and their customers may incur costs 

due to interrupted and lost service. Local businesses, institutions, and households may incur costs 

associated with undertaking averting and defensive actions. Thus, to the extent that the proposed 

RTCR reduces the likelihood of waterborne disease outbreaks, avoided response costs are 

potentially numerous and significant. For example, an analysis of the economic impacts of a 

waterborne disease outbreak in Walkerton, Ontario (population 5,000) estimated the economic 

impact excluding medically related costs to be over $45.9 million11 in Canadian dollars 

(approximately 42.8 million U.S. dollars)12 (Livernois, 2002). The author believed that this was a 

conservative estimate. 

 

11 Households and businesses in the town of Walkerton were unable to use municipal water for eight months 

following the contamination event. The response involved a massive effort at all levels of government in terms of 

public health response and investigation of the cause. The paper asserts that the impact of the crisis extended beyond 

Walkerton to nearby towns and the countryside, resulting in economic costs that the author expects were at a 

minimum equal to the costs presented in the paper (of which only the non-medical costs are included here). 

12 Updated from $43 million in Canadian dollars, $32 million U.S. dollars in 2000. Costs updated from 2000 

dollars to 2007 dollars using the Canadian core CPI (= 95.71667 ÷ 109.8167 = 1.14731) and the 2007 exchange rate 

(1.0734 Canadian dollars /1.0 U.S. dollars). 
Economic Analysis for the Proposed RTCR 7-1 June 2010 

7. Cost Analysis 

7.1 Introduction 

This chapter presents estimates of the total national and household costs of the proposed 

Revised Total Coliform Rule (RTCR). To estimate the national costs of the proposed RTCR, the 

United States Environmental Protection Agency (EPA or Agency) calculated the net change in 

costs of rule components associated with state1

 practices and activities required under the 

proposed revised rule compared to the current Total Coliform Rule (TCR). The remainder of this 

chapter provides detailed discussion of the methodology used and results from the cost analyses 

and is organized as follows: 

• Section 7.2 describes the cost model and general costing and compliance assumptions 

used to estimate national costs of the proposed RTCR. 

• Section 7.3 describes the methodology of projecting costs over a 25-year period 

(discounted at 3 and 7 percent, respectively) according to the proposed RTCR 

compliance schedule, estimating the present value of each cost, and annualizing each 

over a 25-year period. 

• Section 7.4 describes the methodology for developing costs for all rule activities. 

• Section 7.5 presents household cost estimates. 

• Section 7.6 presents a discussion of nonquantified costs. 

• Section 7.7 presents a discussion of uncertainties in cost estimates. 

• Section 7.8 presents a comparison of cost estimates for all regulatory alternatives. 

 

7.2 General Cost Assumptions and Methodology 

The proposed RTCR cost model builds on the baseline data, occurrence analysis, and 

benefits model results described in Chapters 4 – 6. Based on these analyses, the annual and 

cumulative numbers of Public Water Systems (PWSs) that would be required to comply with 

each rule component of the proposed RTCR over the 25-year compliance period are provided in 

Appendix A (Exhibits 6.2 – 6.4 provide a summary of this information). In general, the numbers 

of PWSs presented in Appendix A are multiplied by the unit cost assumptions described in this 

chapter to calculate total annual costs. 

There are also several general costing assumptions that are unique to the costing process 

and are used as inputs to the cost model. The derivation of these inputs is discussed in detail 

below. 

 

1

 The term “state” in the context of this chapter refers to any state or other primacy agency that has oversight 

authority for drinking water programs. 
Economic Analysis for the Proposed RTCR 7-2 June 2010 

7.2.1 Labor Rates 

For costing purposes, EPA estimates the labor needs and hourly labor rates of PWSs and 

states. EPA recognizes that there may be significant variation in labor rates across all PWSs. 

However, for purposes of this Economic Analysis (EA), and to implement national policy, EPA 

uses national-level estimates from Labor Costs for National Drinking Water Rules (USEPA, 

2003a) (as used in the Ground Water Rule Economic Analysis (USEPA, 2006a)). For the 

proposed RTCR cost analyses, these labor rates were inflated to 2007$ using the Employee Cost 

Index (ECI), and weighted based on the PWS size categories used in the proposed RTCR EA. To 

account for the general composition of staff at PWSs of smaller sizes (e.g., PWSs serving 3,300 

or fewer), EPA uses only the technical rate. For PWSs serving more than 3,300 people, EPA uses 

a ratio of 80 percent technical labor to 20 percent managerial labor to arrive at a labor cost, or 

weighted labor rate. The actual ratio between technical and managerial rates employed may vary 

by PWS and among the different compliance activities under the proposed RTCR. However, for 

simplicity, the 80/20 ratio is used as a general assumption for costing purposes in this EA. A full 

description of the derivation of the labor rates used is provided in the Technology and Cost 

Document for the Proposed Revised Total Coliform Rule (USEPA, 2010d). The weighted labor 

rates ($2007) are shown in Exhibit 7.1. 

Exhibit 7.1 Labor Rates by PWS Size (2007$) 

PWS Size (population served) Weighted Labor Rate ($/hour)

< 100 $ 25.10 

101 - 500 $ 27.03 

501 - 1,000 $ 28.96 

1,001 - 4,100 $ 29.73 

4,101 - 33,000 $ 36.00 

33,001 - 96,000 $ 36.39 

96,001 - 500,000 $ 41.01 

500,001-1 Million $ 41.01 

> 1 Million $ 41.01 

Source: Proposed RTCR T&C Document

Note: Labor rates for each size category are assumed to be the same regardless 

of system type (CWS, NTNCWS, and TNCWS).

For states, the administrative and field engineer labor rates from the 2001 State Drinking 

Water Needs Analysis (ASDWA, 2001) are used in the proposed RTCR EA (as used in the 

Ground Water Rule (GWR) EA (USEPA, 2006a)). These rates include a 60 percent overhead 

rate and were inflated to 2007$ using the ECI. EPA recognizes that there may be significant 

variation in labor rates across all states. The state labor rates in 2007$ are $39.22 for an 

administrative state employee and $43.58 for a state field engineer. EPA assumes that the state 

field engineer would conduct annual site visits, and the administrative state employee would 

work with PWSs on all remaining aspects of the proposed RTCR. Because this separation 

between field engineer and administrative employee is used, the 80/20 weighting ratio between 

technical and managerial rates is not used to develop state costs. 
Economic Analysis for the Proposed RTCR 7-3 June 2010 

7.2.2 TCR Monitoring Costs per Sample 

A cost per sample is associated with distribution system monitoring. For the purpose of 

this cost analysis, PWSs would perform total coliform (TC) monitoring, supplemented by E.coli 

analyses as required. EPA estimated the sample analysis cost for both in-house and commercial 

laboratory analysis. The weighted unit costs for monitoring provided in Exhibit 7.2 are based on 

the percentage of PWSs conducting in-house and commercial laboratory analysis based on 

conversations of the Total Coliform Rule Distribution System Advisory Committee (TCRDSAC) 

Technical workgroup (TWG). For in-house sample analysis, the estimated burden includes 

sample collection and analysis and also accounts for Operations and Maintenance (O&M) costs 

such as equipment and maintenance. For commercial laboratory analysis, the estimated burden 

includes sample collection, shipping and delivery, and the laboratory analysis fee. These 

estimates reflect a national average; however, individual PWSs may realize collection burden 

that is either less than or greater than this average depending on the locations of sampling points 

in a particular PWS. 

 Rates may vary due to regional variations in laboratory fees, the number of samples 

processed (quantity discounts), and laboratory capacity. As shown in Exhibit 7.2, the cost per 

sample decreases as more samples are taken, and as PWSs take advantage of savings from bulk 

shipping. A full description of the derivation of the monitoring costs per sample is provided in 

the Technology and Cost Document for the Proposed Revised Total Coliform Rule (USEPA, 

2010d). 

Exhibit 7.2 Monitoring Costs per Sample (2007$) 

12 3 4 > 5

< 100 $ 50.54 $ 42.64 $ 40.01 $ 38.69 $ 37.90 

101 - 500 $ 51.55 $ 43.63 $ 40.99 $ 39.67 $ 38.87 

501 - 1,000 $ 59.81 $ 51.86 $ 49.21 $ 47.88 $ 47.09 

1,001 - 4,100 $ 60.40 $ 52.45 $ 49.79 $ 48.47 $ 47.67 

4,101 - 33,000 $ 65.26 $ 57.23 $ 54.55 $ 53.21 $ 52.40 

33,001 - 96,000 $ 60.57 $ 56.55 $ 55.21 $ 54.54 $ 54.14 

96,001 - 500,000 $ 72.38 $ 71.57 $ 71.30 $ 71.17 $ 71.09 

500,001-1 Million $ 72.38 $ 71.57 $ 71.30 $ 71.17 $ 71.09 

> 1 Million $ 72.38 $ 71.57 $ 71.30 $ 71.17 $ 71.09 

PWS Size

(population served)

Numbers of Samples Taken and Delivered at the Same Time

Note: Per sample monitoring costs for each size category are assumed to be the same regardless of PWS type (CWS, 

NTNCWS, and TNCWS).

Source: Proposed RTCR T&C Document

7.2.3 Technology Unit Costs and Compliance Forecasts 

EPA has assumed that PWSs may use a variety of existing Best Management Practices 

(BMPs) and technologies to address distribution system deficiencies discovered during Level 1 

and Level 2 assessments. These BMPs and technologies include a combination of flushing 

programs, training of personnel to collect samples, replacing valves/pipes/hydrants/meters, 

installing new water mains, modifying operation of storage facilities, booster disinfection, 

physical security devices, etc. For a full list of technologies and BMPs that are anticipated to be 

used to meet rule requirements, see Appendix D. EPA estimated unit costs for these various 
Economic Analysis for the Proposed RTCR 7-4 June 2010 

components using equipment price lists and quotes, costs associated with BMPs from PWSs, 

engineering cost data sources (e.g., R.S. Means), consultations with the technical workgroup 

supporting the TCRDSAC Federal Advisory Committee (FAC), and other relevant assumptions 

used in economic analyses performed for existing drinking water rules (e.g., GWR). Detailed 

explanations of the unit cost derivations for these BMPs and technologies are presented in the 

Technology and Cost Document for the Proposed Revised Total Coliform Rule (USEPA, 2010d). 

 Compliance forecasts (or technology selection forecasts) are estimates of which 

technologies PWSs undergoing corrective action would use. Section 7.4.6 provides details on 

compliance forecasts for PWSs performing corrective actions based on Level 1 and Level 2 

assessments. 

7.2.4 Cost Model 

 National costs are estimated using a cost model specifically developed for the proposed 

RTCR. The model builds on the occurrence model described in Chapter 5. Within the modeling 

structure, costs for PWSs serving >4,100 retail customers are analyzed differently from smaller 

PWSs to capture differing baseline structures and to account for differences in available 

occurrence data as described in Chapter 4. 

PWS costs are estimated for different PWS types and size categories (nine size categories 

are used based on population served, consistent with the Technology and Cost Document for the 

Proposed Revised Total Coliform Rule (USEPA, 2010d)). PWS cost analyses include estimates 

to implement the rule; to revise sampling plans; to conduct routine monitoring, additional routine 

monitoring, and repeat monitoring; to perform Level 1 and Level 2 assessments and implement 

corrective actions; and to provide public notification. State cost analyses include estimates of the 

labor burdens that states would face, including staff training on proposed RTCR requirements 

and conducting annual administration, reviewing monitoring reports, reviewing and approving 

corrective action plans, and recordkeeping. Section 7.4 provides detailed discussion on the 

underlying cost-buildup for each rule component analyzed within the cost model. 

7.2.5 Modeled Variability and Uncertainty in National Costs 

 As noted throughout this EA, there is variability among many of the input parameters to 

the proposed RTCR cost model and several rule compliance assumptions based on PWS size and 

type (e.g., population served, labor rates, TC hit rates, and occurrence distributions are different 

for different sizes and types of PWSs). However, there is insufficient information to fully 

characterize the distribution of variability (i.e., calculating confidence bounds) within each of 

these PWS size and type classifications on a national scale; therefore, EPA uses mean values for 

these input parameters. 

 EPA also recognizes that there is uncertainty in the national cost estimates, much of 

which has the same impact on the modeled results of both the TCR and proposed RTCR options 

(e.g., baseline assumptions and effects of GWR implementation). Because the EA analyses focus 

on net changes between the TCR and the proposed RTCR options, these common sources of 

uncertainty cancel each other out in the net change analyses. For assumptions that are major 

drivers of the analysis and differ between the TCR and proposed RTCR options (e.g., corrective 
Economic Analysis for the Proposed RTCR 7-5 June 2010 

action compliance forecast), EPA has evaluated uncertainty and performed sensitivity analyses to 

qualitatively and quantitatively characterize the potential impacts of alternative input parameters. 

Chapter 5 discusses uncertainty and presents sensitivity analyses pertaining to the predictive 

occurrence model results, which also impact the cost calculations. Section 7.7 discusses 

uncertainty and provides sensitivity analysis results as they specifically pertain to the cost 

analyses. 

7.3 Projecting and Discounting National Costs 

Costs must be expressed in common units so they can be added together to calculate total 

annual costs and compared to benefits to compute net benefits. For the proposed RTCR, the 

performance of activities varies over time in response to regulatory requirements and monitoring 

results. To compare the values of performing these activities the year or years in which all costs 

are expended must be determined and the costs must be calculated as a net present value. For the 

purposes of this EA, one-time and yearly costs were projected over a 25-year time period to 

allow comparison with other drinking water regulations using the same analysis period. The net 

present values of costs are calculated using discount rates of 3 and 7 percent based on EPA 

policy and guidance from the Office of Information and Regulatory Affairs of the Office of 

Management and Budget (OMB).2

 A summary of the steps used in making adjustments to the 

national-level costs presented in this EA is as follows: 

• Estimate all costs (noncorrective action, corrective action, and state) over a 25-

year time horizon based on the rule implementation schedule. 

• Calculate total net present value costs using 3 and 7 percent discount rates. 

• Annualize the costs over 25 years using the same discount rates. 

Appendix C presents step by step results for the projection and discounting of costs to 

show how yearly costs for each rule component are accounted for by the cost model for 

Community Water Systems (CWSs), Nontransient Noncommunity Water Systems (NTNCWSs), 

Transient Noncommunity Water Systems (TNCWSs), and states. Exhibits C.1 through C.9 show 

the nominal costs projected over the rule schedule and the present value of each cost calculated 

to the expected year of rule implementation for the TCR. Exhibits C.10 through C.45 show the 

results for the Agreement in Principle (AIP) and the Alternative option. 

7.4 Derivation of Costs for PWSs and States 

 

 This section presents the methodology and unit costs used to derive national costs for 

PWSs and states to perform TCR- and proposed RTCR -related activities. Chapter 3 contains 

detailed summaries of the activities under TCR and the proposed RTCR options (AIP and 

Alternative option) considered as part of this EA. The following subsections provide a brief 

 

2

 The choice of an appropriate discount rate is a complex and controversial issue among economists and policy 

makers. Therefore, the Agency compares streams of future national level costs and benefits using two alternative 

discount rates, 3 and 7 percent. The underlying logic for each discount rate can be found in Guidelines for Preparing 

Economic Analyses (USEPA, 2000c). 
Economic Analysis for the Proposed RTCR 7-6 June 2010 

summary of each activity and the assumptions used to estimate the burden and costs attributable 

to both PWSs and states for: 

 7.4.1 Rule Implementation and Annual Administration 

 7.4.2 Revising Sampling Plans 

 7.4.3 Monitoring 

 7.4.4 Annual Site Visits 

7.4.5 Assessments 

 7.4.6 Corrective Actions 

 7.4.7 Public Notification 

 

 This chapter uses information from the baseline analysis in Chapter 4 as a starting point 

for analysis of PWSs subject to each rule requirement. Additional baseline information and 

detailed intermediate model outputs are provided in Appendix A. 

 

 There are also 57 states and primacy agencies that would incur costs as a result of the 

proposed rule. 

7.4.1 Rule Implementation and Annual Administration 

PWSs 

 Under the AIP and Alternative option, all PWSs subject to the proposed RTCR would 

incur one-time costs that include time for staff to read the rule and become familiar with its 

provisions and to train employees on rule requirements. No additional implementation burden or 

costs are incurred by PWSs under the TCR to implement the proposed RTCR, as these PWSs 

have already performed implementation and are continuing to perform annual administration 

activities under the TCR. Under the AIP and Alternative option, all PWSs subject to the 

proposed RTCR would perform additional or transitional implementation activities. The labor 

rates presented in Section 7.2.1 are used along with estimates of labor hours to generate 

estimated implementation costs for all PWSs. Based on previous experience with rule 

implementation and consistent with estimates used in the GWR EA, EPA estimates that PWSs 

would require a total of 4 hours to read and understand the rule, and a total of 8 hours to plan and 

mobilize (i.e., assign appropriate personnel and resources to carry out rule activities). 
Economic Analysis for the Proposed RTCR 7-7 June 2010 

Exhibit 7.3 Net Change in PWS Unit Burden and Cost Estimates for Rule 

Implementation (2007$) 

A B C D=A*(B+C)

Community Water Systems (CWSs)

≤100 25.10 $ 4.0 8.0 301.20 $ 

101-500 27.03 $ 4.0 8.0 324.36 $ 

501-1,000 28.96 $ 4.0 8.0 347.52 $ 

1,001-4,100 29.73 $ 4.0 8.0 356.76 $ 

4,101-33,000 36.00 $ 4.0 8.0 432.00 $ 

33,001-96,000 36.39 $ 4.0 8.0 436.68 $ 

96,001-500,000 41.01 $ 4.0 8.0 492.12 $ 

500,001-1 Million 41.01 $ 4.0 8.0 492.12 $ 

> 1 Million 41.01 $ 4.0 8.0 492.12 $ 

Nontransient Noncommunity Water Systems (NTNCWSs)

≤100 25.10 $ 4.0 8.0 301.20 $ 

101-500 27.03 $ 4.0 8.0 324.36 $ 

501-1,000 28.96 $ 4.0 8.0 347.52 $ 

1,001-4,100 29.73 $ 4.0 8.0 356.76 $ 

4,101-33,000 36.00 $ 4.0 8.0 432.00 $ 

33,001-96,000 36.39 $ 4.0 8.0 436.68 $ 

96,001-500,000 41.01 $ 4.0 8.0 492.12 $ 

500,001-1 Million 41.01 $ 4.0 8.0 492.12 $ 

> 1 Million 41.01 $ 4.0 8.0 492.12 $ 

Transient Noncommunity Water Systems (TNCWSs)

≤100 25.10 $ 4.0 8.0 301.20 $ 

101-500 27.03 $ 4.0 8.0 324.36 $ 

501-1,000 28.96 $ 4.0 8.0 347.52 $ 

1,001-4,100 29.73 $ 4.0 8.0 356.76 $ 

4,101-33,000 36.00 $ 4.0 8.0 432.00 $ 

33,001-96,000 36.39 $ 4.0 8.0 436.68 $ 

96,001-500,000 41.01 $ 4.0 8.0 492.12 $ 

500,001-1 Million 41.01 $ 4.0 8.0 492.12 $ 

> 1 Million 41.01 $ 4.0 8.0 492.12 $ 

Notes: 

Sources:

(A) Labor rates for PWSs from Exhibit 7.1.

(B), (C) EPA estimates based on best professional judgement.

Unit Cost

PWS burden and cost estimates for implementation activities are assumed to be identical 

under the AIP and Alternative Option.

PWS Size

(Population

Served)

Labor Cost 

(per hour)

Read and 

Understand Rule 

(hours/system)

Planning and 

Mobilization 

(hours/system)
Economic Analysis for the Proposed RTCR 7-8 June 2010 

States 

 States would incur administrative costs to implement the proposed RTCR. These 

implementation costs are not directly required by specific provisions of the proposed RTCR 

alternatives but are necessary for states to ensure that the provisions of the proposed RTCR are 

properly carried out. States would need to allocate time for their staff to establish and maintain 

the programs necessary to comply with the proposed RTCR, including developing and adopting 

state regulations and modifying data management systems to track new required PWS reports to 

the states. As a one-time burden covered under the 520 hours allocated to modifying data 

management systems, each state would modify their data management system to be able to track 

the changes in monitoring regimes. Note, on average no on-going annual cost is assumed for 

modifying data management because the tracking system would already be in place and 

oversight would be accounted under state review of sampling results, assessments, etc. Time 

requirements for a variety of state agency activities and responses are estimated in this EA. 

Exhibit 7.4 lists the activities required to revise the program following promulgation of the 

proposed RTCR along with their respective costs and burden. Because time requirements for 

implementation and annual administration activities vary among state agencies, EPA recognizes 

that the burden and cost estimates presented in Exhibit 7.4 may be an over- or under-estimate for 

some states. 

Exhibit 7.4 Net Change in State Unit Burden and Cost Estimates for Rule 

Implementation (2007$) 

Labor Cost

(per hour) Hours FTEs Cost

A B C=B/2,080 D=A*B

$ 15 39.22 0.01 588 $ 

$ 260 39.22 0.13 10,197 $ 

$ - 39.22 - - $ 

$ 520 39.22 0.25 20,393 $ 

$ 520 39.22 0.25 20,393 $ 

$ 130 39.22 0.06 5,098 $ 

Per State Total 56,670 1,445 $ 

National Totals (57 States/Primacy Agencies) 3,230,201 82,365 $ 

Notes: Detail may not add due to independent rounding.

Sources: (A) Labor rate for state employee from Section 7.2.1.

(C) Full-time equivalent (FTE) assumes individual w orking 40 hours per w eek, 52 w eeks per year.

Staff Training

State burden and cost estimates for Implementation activities are assumed to be identical under the AIP and 

Alternative Option.

Read and Understand Rule

Compliance Activity

Regulation Adoption and Program Development

Initial Laboratory Certification

Modify Data Management Systems

PWS Training and Technical Assistance

(B) Labor hours for start-up activities are based on GWR estimates. Because the proposed RTCR is a 

revision of the existing TCR, one fourth of the State unit start up burden from GWR is used in the proposed 

RTCR. 

 In addition to these one-time costs, states would use resources to continue 

administrative activities. On an annual basis, states must coordinate with their particular EPA 

regional office to be certain that the state’s program is consistent with federal requirements. 

States would also continue to train state and PWS staffs, maintain laboratories’ certifications, 

and report PWS compliance information to the Safe Drinking Water Information System 

(SDWIS). However, based on discussions with stakeholders, once the initial implementation 

activities are complete, the annual burden (on average) for general administrative tasks for the 
Economic Analysis for the Proposed RTCR 7-9 June 2010 

proposed RTCR would not be any higher than the burden incurred under the current TCR 

requirements. In some cases, the general administrative burden for TCR may actually decrease as 

PWSs experience better performance, and thus require less state interaction, under the proposed 

RTCR. Therefore, no continuing annual administrative costs are estimated for the EA. 

 States would also spend time responding to specific requirements under the proposed 

RTCR (i.e., review assessment reports, consult with PWSs, etc.). In these cases, the state costs 

are estimated under the costing for that particular rule requirement. 

Implementation Net Cost Summary

Because EPA does not anticipate early implementation of the proposed RTCR, EPA 

expects that implementation activities would take place in years 1 through 3 of the 25-year 

compliance period before PWSs begin monitoring activities. Annualized costs estimates for 

PWSs and states to perform implementation activities are estimated by multiplying the number 

of PWSs or states required to comply with the proposed RTCR (i.e., all PWSs) by the unit costs 

presented in Exhibits 7.3 and 7.4. Annualized and net change cost estimates for PWSs and states 

to perform implementation activities under the TCR, AIP, and Alternative option are presented 

in Exhibit 7.5. 

Exhibit 7.5 Annualized Cost Estimates for Rule Implementation ($Millions, 2007$) 

PWSs State Total PWSs State Total

TCR - Total $ - - $ - $ - $ - $ - $ 

AIP - Total $ 0.18 2.77 $ 2.95 $ 4.00 $ 0.26 $ 4.26 $ 

AIP - Net Change 2.77 $ 0.18 $ 2.95 $ 4.00 $ 0.26 $ 4.26 $ 

Alternative Option - Total $ 0.18 2.77 $ 2.95 $ 4.00 $ 0.26 $ 4.26 $ 

Alternative Option - Net Change 2.77 $ 0.18 $ 2.95 $ 4.00 $ 0.26 $ 4.26 $ 

Notes: 

1) Detail may not add due to independent rounding.

2) PWS and state burden and cost estimates for implementation activities are assumed to be identical under the AIP and Alternative Option.

Source: Proposed RTCR Cost Model.

3% Discount Rate 7% Discount Rate

7.4.2 Revising Sampling Plans 

PWSs 

 Under the AIP and Alternative option, all PWSs subject to the proposed RTCR would 

incur one-time costs to revise existing sampling plans to identify sampling locations and 

collection schedules that are representative of water throughout the distribution system. System 

sample siting plans must include routine and repeat sample sites and any sampling points 

necessary to meet GWR requirements. Under the TCR, no additional burden or costs are 

expected to be incurred by PWSs to revise sampling plans, as these PWSs are already collecting 

total coliform samples in accordance with a written sampling plan. The labor rates presented in 

Section 7.2.1 are used along with estimates of labor hours to generate sampling plan costs for all 

PWSs. Based on previous experience, EPA estimates that PWSs would require 2-8 hours for 

revising their sampling plan, depending on PWS size. Estimates of PWS unit costs to revise 

sampling plans are presented in Exhibit 7.6. 
Economic Analysis for the Proposed RTCR 7-10 June 2010 

States 

 Under the AIP and Alternative option, states are expected to incur one-time costs to 

review sampling plans and recommend any revisions to PWSs. Under the TCR, no additional 

burden or costs are incurred by states to review sampling plans, as these PWSs’ sampling plans 

have already been reviewed and approved. State costs are based on the number of PWSs 

submitting revised sampling plans to PWSs each year. The state labor rate presented in Section 

7.2.1, the number of PWSs in each PWS size category required to revise sampling plans, and 

estimates of labor hours are used to generate sampling plan costs incurred by states. Based on 

previous experience, EPA estimates that states would require 1-4 hours to review revised 

sampling plans and provide any necessary revisions to PWSs, depending on PWS size. Estimates 

of state unit costs to revise sampling plans are presented in Exhibit 7.6. 

Exhibit 7.6 Net Change in PWS and State Burden and Cost Estimates for 

Revising Sampling Plans (2007$) 

A B C=A*B D E F=D*E

Community Water Systems (CWSs)

≤100 25.10 $ 2.0 50.20 $ 39.22 $ 1.0 39.22 $ 

101-500 27.03 $ 2.0 54.06 $ 39.22 $ 1.0 39.22 $ 

501-1,000 28.96 $ 4.0 115.84 $ 39.22 $ 2.0 78.44 $ 

1,001-4,100 29.73 $ 4.0 118.92 $ 39.22 $ 2.0 78.44 $ 

4,101-33,000 36.00 $ 6.0 216.00 $ 39.22 $ 3.0 117.65 $ 

33,001-96,000 36.39 $ 8.0 291.12 $ 39.22 $ 4.0 156.87 $ 

96,001-500,000 41.01 $ 8.0 328.08 $ 39.22 $ 4.0 156.87 $ 

500,001-1 Million 41.01 $ 8.0 328.08 $ 39.22 $ 4.0 156.87 $ 

> 1 Million 41.01 $ 8.0 328.08 $ 39.22 $ 4.0 156.87 $ 

Nontransient Noncommunity Water Systems (NTNCWSs)

≤100 25.10 $ 2.0 50.20 $ 39.22 $ 1.0 39.22 $ 

101-500 27.03 $ 2.0 54.06 $ 39.22 $ 1.0 39.22 $ 

501-1,000 28.96 $ 4.0 115.84 $ 39.22 $ 2.0 78.44 $ 

1,001-4,100 29.73 $ 4.0 118.92 $ 39.22 $ 2.0 78.44 $ 

4,101-33,000 36.00 $ 6.0 216.00 $ 39.22 $ 3.0 117.65 $ 

33,001-96,000 36.39 $ 8.0 291.12 $ 39.22 $ 4.0 156.87 $ 

96,001-500,000 41.01 $ 8.0 328.08 $ 39.22 $ 4.0 156.87 $ 

500,001-1 Million 41.01 $ 8.0 328.08 $ 39.22 $ 4.0 156.87 $ 

> 1 Million 41.01 $ 8.0 328.08 $ 39.22 $ 4.0 156.87 $ 

Transient Noncommunity Water Systems (TNCWSs)

≤100 25.10 $ 2.0 50.20 $ 39.22 $ 1.0 39.22 $ 

101-500 27.03 $ 2.0 54.06 $ 39.22 $ 1.0 39.22 $ 

501-1,000 28.96 $ 4.0 115.84 $ 39.22 $ 2.0 78.44 $ 

1,001-4,100 29.73 $ 4.0 118.92 $ 39.22 $ 2.0 78.44 $ 

4,101-33,000 36.00 $ 6.0 216.00 $ 39.22 $ 3.0 117.65 $ 

33,001-96,000 36.39 $ 8.0 291.12 $ 39.22 $ 4.0 156.87 $ 

96,001-500,000 41.01 $ 8.0 328.08 $ 39.22 $ 4.0 156.87 $ 

500,001-1 Million 41.01 $ 8.0 328.08 $ 39.22 $ 4.0 156.87 $ 

> 1 Million 41.01 $ 8.0 328.08 $ 39.22 $ 4.0 156.87 $ 

Notes: 

Sources:

(A) Labor rates for systems from Exhibit 7.1.

(B) PWS labor hours for review ing and revising sampling plan reflect EPA estimate.

(D) Labor rates for state employee from Section 7.2.1.

(E) State labor hours for review ing and revising sampling plan reflect EPA estimate.

PWS and state burden and cost estimates for review ing and revising sampling plans are assumed to be identical under the AIP and

Alternative Option.

Unit Cost

State Labor Cost 

(per hour)

Review and 

Revise 

Sampling Plan 

(hours/system) Unit Cost

PWS Size

(Population

Served)

PWSs States

PWS Labor Cost 

(per hour)

Revise 

Sampling Plan 

(hours/system)
Economic Analysis for the Proposed RTCR 7-11 June 2010 

Sampling Plan Net Cost Summary

 PWSs are expected to revise sampling plans before monitoring begins. For modeling 

purposes costs are split between years 2 and 3 of the 25-year compliance period (monitoring is 

required starting in year 4). Annualized cost estimates for PWSs to revise sampling plans and 

states to review the revised sampling plans (and consult with PWSs if necessary) under the TCR, 

AIP, and Alternative Option are presented in Exhibit 7.7. 

Exhibit 7.7 Annualized Cost Estimates to Revise (PWSs) and Review (States) 

Sampling Plans ($Millions, 2007$) 

PWSs State Total PWSs State Total

TCR - Total $ - - $ - $ - $ - $ - $ 

AIP - Total $ 0.42 0.59 $ 1.01 $ 0.84 $ 0.59 $ 1.42 $ 

AIP - Net Change 0.59 $ 0.42 $ 1.01 $ 0.84 $ 0.59 $ 1.42 $ 

Alternative Option - Total $ 0.42 0.59 $ 1.01 $ 0.84 $ 0.59 $ 1.42 $ 

Alternative Option - Net Change 0.59 $ 0.42 $ 1.01 $ 0.84 $ 0.59 $ 1.42 $ 

Note: Detail may not add due to independent rounding.

Source: Proposed RTCR Cost Model.

3% Discount Rate 7% Discount Rate

7.4.3 Monitoring 

PWSs 

Monitoring costs for PWSs are calculated by multiplying the total numbers of routine, 

additional routine, and repeat samples required under the TCR, AIP, and Alternative Option 

(Exhibit 7.9) by the monitoring costs per sample presented in Exhibit 7.2. Differences in 

monitoring requirements between the TCR and the AIP and Alternative Option as summarized in 

Exhibit 7.8 below drive the differences in monitoring costs between the options. Chapters 4 

(Exhibit 4.4) and 5 (Exhibit 5.14) show the distribution of monitoring frequencies prior to and 

after rule implementation, respectively, that are used to further inform the analysis. The effects 

of the differences in monitoring regimes on net changes in costs are described in further detail 

following the exhibit.
Economic Analysis for the Proposed RTCR 7-12 

Exhibit 7.8 Summary of Monitoring Requirements Under the TCR, AIP, and Alternative 

Monitoring Requirement Current TCR AIP Alterna

Default Routine Monitoring Frequency 

The default TC monitoring frequency for ground water Noncommunity Water Systems (NCWSs) serving ≤1,000 people is 

quarterly The default TC monitoring frequency for all other PWSs is monthly for TC 

The default TC monitoring frequency for nonseasonal ground water NCWSs serving ≤1,000 

people is quarterly The default TC monitoring frequency for all other PWSs is monthly PWSs would be permitted to transition to the proposed RTCR at their current TC monitoring frequencies3

The default TC monitoPWSs is monthly All PWSs would start monitoring 

Reduced/Increased Routine Monitoring Frequency 

Ground water NCWSs serving ≤1,000 

people can reduce to annual monitoring if no sanitary defects and served only by protected GW sources Ground water CWSs serving ≤1,000 can 

reduce to quarterly monitoring if no history of TC+ in current configuration, no sanitary defects, and served only by protected GW sources All other PWSs are ineligible for reduced monitoring PWSs not meeting criteria for reduced monitoring return to default monitoring (no increased monitoring provision under current TCR) 

Ground water NCWSs serving ≤1,000 people 

can reduce to annual monitoring if no sanitary defects, clean TCR compliance history, and annual site visit or Level 2 assessment, and correction of all identified sanitary defects Ground water CWSs serving ≤1,000 people can reduce to quarterly monitoring if no sanitary defects, clean TCR compliance history, and at least one of the following: 1) Annual site visit or Level 2 assessment and correction of all identified sanitary defects; 2) An approved cross connection control program; 3) Continuous disinfection & a residual; 4) 4-log inactivation of viruses daily as per GWR (4 hr exception allowed); or 5) Other equivalent measures as approved by the primacy agency. All other PWSs are ineligible for reduced monitoring 

Ground water NCWS

can reduce to quartersanitary defects, cleahistory, and annual siassessment, and corrsanitary defects. Ground water CWSs 

can reduce to quartersanitary defects, cleahistory, and at least o1) Annual site visit or correction of all identi2) An approved cross program; 3) Continuous disinfe4) 4-log inactivation oGWR (4 hr exception 5) Other equivalent mthe primacy agency. All other PWSs are in

3 In order for PWSs to be able to transition to the proposed RTCR at their current TC monitoring frequencies, an annual site visit or volunta

be needed in the first year for PWSs on annual monitoring, including those transitioning. 
Economic Analysis for the Proposed RTCR 7-13 

Monitoring Requirement Current TCR AIP Alterna

Ground water PWSs serving ≤1,000 people on 

quarterly or annual monitoring that experience any of the following events will be required to begin monthly monitoring: 1) System triggers a Level 2 assessment (or a 2nd Level 1 assessment in a rolling 12 month period); 2) System has an E. coli Maximum Contaminant Level (MCL) violation; 3) System has an RTCR treatment technique 

violation (either Level 1 or 2); or 4) System has two routine monitoring violations in a rolling 12-month period. 

monitoring Ground water PWSs 

quarterly monitoring tfollowing events will bmonthly monitoring (i.monitoring frequency)1) System triggers a L2nd Level 1 assessmperiod); 2) System has an E. c

3) System has an RT

violation (either Level 4) System has two roviolations in a rolling 1

Additional Routine Monitoring Frequency 

All PWSs serving ≤4,100 people must take 

at least 5 samples in the month following a TC+ unless state performs site visit and deems additional sampling unnecessary OR determines the reason for the TC+ and PWS has or will correct problem. Not required for PWSs serving >4,100 people 

Ground water NCWSs serving ≤1,000 people 

and monitoring quarterly or annually must take at least 3 samples in the month following TC+ Ground water CWSs serving ≤1,000 people and monitoring quarterly must take at least 3 samples in the month following TC+ Not required for PWSs monitoring monthly 

Ground water PWSs serving ≤1,000 people quarterly must take at month following TC+ Not required for PWS

Repeat Monitoring Frequency 

All PWSs serving ≤1,000 people must take 

4 repeat TC samples All PWSs serving >1,000 people must take 3 repeat TC samples 

All PWSs must take 3 repeat TC samples All PWSs must take 3 
Economic Analysis for the Proposed RTCR 7-14 June 2010 

Routine Monitoring 

Under the AIP, the increased stringency to qualify for reduced monitoring results in more 

routine samples being taken over time (fewer PWSs are on reduced monitoring) for most PWS 

sizes and types. The only PWSs predicted to have a decrease in routine monitoring under the AIP 

are ground water NTNCWSs serving ≤1,000 people due to a more PWSs monitoring quarterly 

than under the current TCR. For the Alternative option, this effect would be combined with the 

requirement that all PWSs start the implementation period on monthly monitoring, resulting in 

more routine samples being taken for all PWS sizes and types. The Alternative option also 

prohibits annual monitoring for an even greater increase in the number of routine samples. The 

resulting increases in total national costs due to increased monitoring on the national level are 

reflected in the routine monitoring costs shown in Exhibit 7.10. 

Additional Routine Monitoring4

 The overall reductions in additional routine samples required under the AIP and 

Alternative option result in reduced costs (Exhibit 7.10). Under the AIP and Alternative options, 

additional routine monitoring is no longer required for systems that monitor at least monthly, and 

when additional routine monitoring is required, the number of samples required is reduced from 

five to three. Cost reductions are greater under the Alternative option than under the AIP because 

all PWSs start on monthly monitoring and are not required to take additional routine samples 

during that period. 

Repeat Monitoring

 Under the AIP and Alternative option, all PWSs are only required to take three repeat 

samples. However, EPA assumes that ground water PWSs treating to less than 4-log would still 

take an additional source water sample to comply with the GWR (no change in cost). 

Additionally, the number of repeat samples taken is a function of the number of regular and 

additional routine samples taken, which in turn affects the number of TC+ samples found (i.e., 

the more samples taken, the greater chance of finding a TC+). Thus, the overall increase in 

routine sampling under the AIP and Alternative option would result in more repeat samples 

while the decreases in additional routine samples under both of these options would lead to fewer 

repeat samples. 

In most PWS size and type categories, the large reductions in additional routine 

monitoring samples is the major driver, leading to decreases in repeat samples. Under the AIP, 

only groundwater TNCWSs serving ≤100 people are predicted to see an increase repeat sampling 

due to the large increase in routine sampling within this category. Under the Alternative option, 

ground water NTNCWSs and TNCWSs serving ≤1,000 people are predicted to have increased 

repeat monitoring as a function of large increases in routine monitoring. The overall effect on the 

national level is a reduction in the number (and cost) of required repeat samples under the AIP 

and an increase under the Alternative option compared to the current TCR (Exhibit 7.10). 

 

4

 For modeling purposes and discussion throughout the cost chapter, regular routine monitoring samples taken in the 

month following a total coliform-positive are included in the additional routine monitoring sample counts. 
Economic Analysis for the Proposed RTCR 7-15 June 2010 

Cumulative Monitoring Summary

Exhibit 7.9 summarizes the total number of samples taken by PWS size and category for 

routine, additional, and repeat monitoring under the TCR, AIP, and Alternative option over the 

entire 25 year period of analysis. Appendix A presents additional information on samples taken 

for each individual year during the analysis period. 

States 

 Under the current TCR, states are estimated to incur a monthly 15-minute burden to 

review each PWS’s sample results. This estimate reflects the methodology used to calculate 

reporting and recordkeeping burden under the current TCR in the Draft Information Collection 

Request for the Microbial Rules (USEPA, 2008b). Because the existing methodology is 

calculated on a per PWS basis and the total number of PWSs is the same for cost modeling under 

the TCR and both proposed RTCR options, the net change in costs for reviewing monitoring 

results is estimated to be zero for the AIP and Alternative option. Specific actions by states 

related to positive samples are accounted for under the actions required in response to those 

samples. Maintenance of sample results in SDWIS is accounted for under general 

implementation and administrative activities, which are discussed in Section 7.4.1. 

Monitoring Net Cost Summary 

The annualized net present value total and net change cost estimates for PWSs and states 

to perform monitoring under the TCR, AIP, and Alternative option are presented in Exhibit 7.10. 

All monitoring is modeled to begin in year 4 of the 25-year analysis period. 

The overall estimated increase in monitoring costs seen under the AIP is driven by 

increases in routine monitoring due to stricter requirements to qualify for reduced monitoring. 

However, this is mostly offset by reductions in additional routine and repeat monitoring required 

under the revised regulations. For the Alternative option, the requirement for all PWSs to sample 

on a monthly basis at the beginning of rule implementation results in a much large cost 

differential that is only partially offset by reduced costs due to reductions in additional routine 

monitoring requirements. Although not shown in Exhibit 7.10, costs for individual PWS 

categories (size and type) are expected to move in the same direction relative to the numbers of 

samples taken as reflected in Exhibit 7.9. Exceptions to the general trends on the national level 

are discussed in the subsections describing routine, additional routine, and repeat sampling 

above. 
Economic Analysis for the Proposed RTCR 7-16 June 2010 

Exhibit 7.9 Cumulative Number of Samples over 25-Year Period of Analysis 

Routine 

Monitoring 

Samples

Additional 

Routine 

Monitoring 

Samples

Repeat 

Monitoring 

Samples

Routine 

Monitoring 

Samples

Additional 

Routine 

Monitoring 

Samples

Repeat 

Monitoring 

Samples

Routine 

Monitoring 

Samples

Additional 

Routine 

Monitoring 

Samples

Repeat 

Monitoring 

Samples

ABCD EFGH I

Community Water Systems (CWSs) - SW

≤100 304,098 23,747 19,160 308,849 - 12,875 308,849 - 12,875 

101-500 562,214 26,578 21,338 567,486 - 15,333 567,486 - 15,333 

501-1,000 306,733 14,501 11,641 309,610 - 8,366 309,610 - 8,366 

1,001-4,100 1,920,789 55,202 33,730 1,950,717 - 32,222 1,950,717 - 32,222 

4,101-33,000 10,636,296 - 186,781 10,636,296 - 175,689 10,636,296 - 175,689 

33,001-96,000 11,058,960 - 194,204 11,058,960 - 182,671 11,058,960 - 182,671 

96,001-500,000 10,190,400 - 178,951 10,190,400 - 168,324 10,190,400 - 168,324 

500,001-1 Million 2,019,600 - 35,466 2,019,600 - 33,360 2,019,600 - 33,360 

> 1 Million 1,686,960 - 29,624 1,686,960 - 27,865 1,686,960 - 27,865 

Total 38,686,051 120,028 710,896 38,728,879 - 656,704 38,728,879 - 656,704 

≤100 2,815,951 286,073 194,462 2,870,075 8,760 156,897 2,908,469 7,545 158,439 

101-500 3,344,578 243,895 171,252 3,391,200 6,127 136,906 3,428,876 5,264 137,959 

501-1,000 1,072,202 70,803 51,673 1,085,730 1,844 39,659 1,098,488 1,616 39,580 

1,001-4,100 3,997,293 160,710 100,618 4,079,328 - 96,939 4,079,328 - 96,939 

4,101-33,000 9,145,224 - 230,201 9,145,224 - 217,321 9,145,224 - 217,321 

33,001-96,000 4,884,000 - 122,938 4,884,000 - 116,060 4,884,000 - 116,060 

96,001-500,000 1,945,680 - 48,976 1,945,680 - 46,236 1,945,680 - 46,236 

500,001-1 Million 253,440 - 6,380 253,440 - 6,023 253,440 - 6,023 

> 1 Million 269,280 - 6,778 269,280 - 6,399 269,280 - 6,399 

Total 27,727,648 761,481 933,279 27,923,956 16,731 822,439 28,012,784 14,425 824,956 

≤100 65,009 4,918 4,005 65,986 - 2,840 65,986 - 2,840 

101-500 66,038 3,734 3,008 66,766 - 2,073 66,766 - 2,073 

501-1,000 22,970 1,299 1,046 23,223 - 721 23,223 - 721 

1,001-4,100 41,740 2,147 1,351 42,751 - 1,183 42,751 - 1,183 

4,101-33,000 50,424 - 1,632 50,424 - 1,395 50,424 - 1,395 

33,001-96,000 34,320 - 1,111 34,320 - 950 34,320 - 950 

96,001-500,000 31,680 - 1,025 31,680 - 877 31,680 - 877 

500,001-1 Million - - - - - - - - - 

> 1 Million - - - - - - - - - 

Total 312,182 12,097 13,179 315,151 - 10,038 315,151 - 10,038 

≤100 971,538 128,775 84,992 932,025 48,142 68,123 1,281,321 34,581 89,002 

101-500 725,785 66,525 43,597 678,688 25,630 35,860 952,008 18,114 46,996 

501-1,000 190,649 16,037 10,680 180,145 6,166 8,601 247,132 4,674 11,689 

1,001-4,100 460,470 28,214 17,790 473,352 - 15,887 473,352 - 15,887 

4,101-33,000 153,648 - 5,936 153,648 - 5,157 153,648 - 5,157 

33,001-96,000 23,760 - 918 23,760 - 797 23,760 - 797 

96,001-500,000 - - - - - - - - - 

500,001-1 Million - - - - - - - - - 

> 1 Million - - - - - - - - - 

Total 2,525,850 239,551 163,913 2,441,617 79,938 134,426 3,131,221 57,369 169,528 

≤100 345,443 39,654 32,349 353,461 - 20,787 353,461 - 20,787 

101-500 128,109 15,365 12,541 131,149 - 7,816 131,149 - 7,816 

501-1,000 22,683 2,720 2,220 23,222 - 1,384 23,222 - 1,384 

1,001-4,100 39,816 3,990 2,590 42,209 - 2,118 42,209 - 2,118 

4,101-33,000 40,656 - - 40,656 - 2,040 40,656 - 2,040 

33,001-96,000 - - - - - - - - - 

96,001-500,000 - - - - - - - - - 

500,001-1 Million - - - - - - - - - 

> 1 Million 102,960 - - 102,960 - 5,167 102,960 - 5,167 

Total 679,667 61,730 49,700 693,657 - 39,312 693,657 - 39,312 

≤100 4,493,808 905,554 600,315 6,076,163 446,166 631,105 9,100,613 289,563 867,968 

101-500 1,614,924 316,238 210,714 1,940,946 135,822 194,697 2,886,164 91,085 268,893 

501-1,000 177,264 32,730 22,064 206,130 14,078 20,078 295,928 9,578 27,084 

1,001-4,100 335,283 29,957 19,113 348,480 - 16,027 348,480 - 16,027 

4,101-33,000 156,288 - 8,909 156,288 - 7,188 156,288 - 7,188 

33,001-96,000 34,320 - 1,956 34,320 - 1,578 34,320 - 1,578 

96,001-500,000 26,400 - 1,505 26,400 - 1,214 26,400 - 1,214 

500,001-1 Million 63,360 - 3,612 63,360 - 2,914 63,360 - 2,914 

> 1 Million - - - - - - - - - 

Total 6,901,647 1,284,478 868,188 8,852,088 596,065 874,801 12,911,552 390,226 1,192,865 

Grand Total 76,833,044 2,479,366 2,739,154 78,955,347 692,734 2,537,720 83,793,244 462,020 2,893,404 

Community Water Systems (CWSs) - GW

Nontransient Noncommunity Water Systems (NTNCWSs) - SW

Nontransient Noncommunity Water Systems (NTNCWSs) - GW

Transient Noncommunity Water Systems (TNCWSs) - SW

Transient Noncommunity Water Systems (TNCWSs) - GW

Source: Appendix A - Total PWS Counts (A.1z, A.2z, A.3z)

PWS Size

(Population

Served)

TCR AIP Alternative Option

Note: (B), (E), (H) For modeling purposes, additional routine sample counts include regular routine samples taken in the same month.
Economic Analysis for the Proposed RTCR 7-17 June 2010 

Exhibit 7.10 Annualized PWS and State Cost Estimates for Monitoring Costs 

($Millions, 2007$) 

PWSs State Total PWSs State Total

TCR - Total $ - 170.59 $ 170.59 $ 163.94 $ - $ 163.94 $ 

AIP - Total $ - 174.71 $ 174.71 $ 167.74 $ - $ 167.74 $ 

AIP - Net Change 4.12 $ - $ 4.12 $ 3.80 $ - $ 3.80 $ 

AIP - Percent Change 2.42% 0.00% 2.42% 2.32% 0.00% 2.32%

Alternative Option - Total $ - 186.34 $ 186.34 $ 181.49 $ - $ 181.49 $ 

Alternative Option - Net Change 15.75 $ - $ 15.75 $ 17.56 $ - $ 17.56 $ 

Alternative Option - Percent Change 9.23% 0.00% 9.23% 10.71% 0.00% 10.71%

TCR - Total $ - 3.87 $ 3.87 $ 3.72 $ - $ 3.72 $ 

AIP - Total $ - 1.12 $ 1.12 $ 1.09 $ - $ 1.09 $ 

AIP - Net Change (2.75) $ - $ (2.75) $ (2.63) $ - $ (2.63) $ 

AIP - Percent Change -71.09% 0.00% -71.09% -70.74% 0.00% -70.74%

Alternative Option - Total $ - 0.68 $ 0.68 $ 0.58 $ - $ 0.58 $ 

Alternative Option - Net Change (3.18) $ - $ (3.18) $ (3.14) $ - $ (3.14) $ 

Alternative Option - Percent Change -82.31% 0.00% -82.31% -84.35% 0.00% -84.35%

TCR - Total $ - 5.11 $ 5.11 $ 4.91 $ - $ 4.91 $ 

AIP - Total $ - 4.82 $ 4.82 $ 4.64 $ - $ 4.64 $ 

AIP - Net Change (0.29) $ - $ (0.29) $ (0.27) $ - $ (0.27) $ 

AIP - Percent Change -5.66% 0.00% -5.66% -5.57% 0.00% -5.57%

Alternative Option - Total $ - 5.50 $ 5.50 $ 5.45 $ - $ 5.45 $ 

Alternative Option - Net Change 0.39 $ - $ 0.39 $ 0.54 $ - $ 0.54 $ 

Alternative Option - Percent Change 7.68% 0.00% 7.68% 10.99% 0.00% 10.99%

TCR - Total $ - 179.57 $ 179.57 $ 172.57 $ - $ 172.57 $ 

AIP - Total $ - 180.65 $ 180.65 $ 173.46 $ - $ 173.46 $ 

AIP - Net Change 1.08 $ - $ 1.08 $ 0.90 $ - $ 0.90 $ 

AIP - Percent Change 0.60% 0.00% 0.60% 0.52% 0.00% 0.52%

Alternative Option - Total $ - 192.53 $ 192.53 $ 187.53 $ - $ 187.53 $ 

Alternative Option - Net Change 12.96 $ - $ 12.96 $ 14.96 $ - $ 14.96 $ 

Alternative Option - Percent Change 7.22% 0.00% 7.22% 8.67% 0.00% 8.67%

Notes: 

1) Detail may not add due to independent rounding.

2) For modeling purposes, additional routine sample counts include regular routine samples taking in the same month.

Source: Proposed RTCR Cost Model.

3) State costs are premised on a per system basis. State costs for monitoring are expected to be identical under the TCR, AIP, and 

Alternative Option, and are therefore not included in the total costs.

Routine Monitoring

3% Discount Rate 7% Discount Rate

Additional Monitoring

Repeat Monitoring

Total

7.4.4 Annual Site Visits 

 Under the AIP, any PWS on an annual monitoring schedule would be required to also 

have an annual site visit conducted by the state or state-designated third party. A voluntary Level 

2 assessment can also satisfy the annual site visit requirement. In many cases a sanitary survey 

performed during the same year can also be used to satisfy this requirement.5

 Although similar 

 

5

 In some instances, the performance of an assessment (especially a Level 2 assessment) may overlap with a 

scheduled sanitary survey. To the extent that the requirements for performing a sanitary survey may be satisfied as 

part of the assessment process, PWSs and states may realize a cost savings compared to performing a separate 

sanitary survey. This potential for indirect cost savings is not captured in the cost model, resulting in a potential 

overestimate of costs stemming from proposed RTCR implementation. 
Economic Analysis for the Proposed RTCR 7-18 June 2010 

annual site visits are not currently required under the existing TCR, discussions with states 

during the TCRDSAC proceedings revealed that some do, in fact, conduct such inspections for 

PWSs on annual monitoring schedules. Because of the high cost for an annual site visit by a 

state, for this analysis, EPA assumes that no states would choose to conduct annual site visits 

unless they already do so under the current TCR. Therefore, for overall costing purposes, no net 

change in state or PWS costs are assumed for annual monitoring site visits under the AIP or 

Alternative option. 

7.4.5 Assessments 

PWSs 

Level 1 Assessments

 Under the AIP and Alternative option, all PWSs experiencing a Level 1 trigger must 

complete a Level 1 assessment of the PWS. A Level 1 trigger under the AIP and Alternative 

Option is defined as: 

• For PWSs taking ≥40 samples per month, TC+ exceeds 5.0% for a given month; 

• For PWSs taking <40 samples per month, two or more TC+ in a month; or 

• Failure to take all required repeat samples after a single TC+ sample. 

 The current TCR does not require a specific assessment to be performed in response to 

events comparable to the Level 1 triggers described above (i.e., non-acute violations). However, 

PWSs do perform some level of activity similar to a Level 1 assessment in response to 

violations. This effort is taken into account in the cost model to accurately assess the net cost of 

changes attributable to the proposed RTCR. 

 A Level 1 assessment (or comparable assessment under the current TCR) includes a 

simple examination of the PWS and relevant operational practices. The Level 1 assessment 

would be intended as a self-assessment (EPA anticipates that these would be completed by the 

PWS and reviewed by the state). If the state determines the completed assessment form 

insufficient, it would consult with the PWS. Additionally, as part of the Level 1 assessment, 

PWSs would be required to submit to the state a form identifying sanitary defects detected, 

corrective actions completed, and a timetable for any corrective actions not already completed. 

Additional detail on the requirements of a Level 1 assessment and the derivation of associated 

unit burden (labor hours) for performance of the assessment is provided in the Technology and 

Cost Document for the Proposed Revised Total Coliform Rule (USEPA, 2010d). 
Economic Analysis for the Proposed RTCR 7-19 June 2010 

Level 2 Assessments

 Under the AIP and Alternative option, all PWSs experiencing a Level 2 trigger must 

complete a Level 2 assessment of the PWS. A Level 2 trigger under the AIP and Alternative 

Option is defined as: 

• An E. coli MCL violation; 

• An E. coli monitoring violation; or 

• A second Level 1 trigger, within a rolling 12 month period, unless the primary agency 

has determined a likely reason that the initial Level 1 samples were TC+ and 

establishes that the PWS has corrected the problem. 

• For PWSs with approved reduced annual monitoring, a Level 1 trigger in two 

consecutive years. 

 

 As with Level 1 assessments, the current TCR does not require a specific assessment to 

be performed in response to events comparable to the Level 2 triggers described above (i.e., 

acute violations), but PWSs do currently perform some level of activity similar to a Level 2 

assessment in response to acute violations. These actions are taken into account in the cost model 

to properly assess the net cost of changes attributable to the proposed RTCR regulatory 

alternatives. 

 A Level 2 assessment (or comparable assessment under the current TCR) would be more 

involved than a Level 1 assessment. A Level 2 assessment would be a more detailed examination 

of the PWS, its monitoring program and results, and its operational practices. It would comprise 

essentially the same elements as a Level 1 assessment, but each element would be investigated in 

greater detail. The level of effort and resources required to implement the Level 2 assessments 

would be commensurate with a more comprehensive investigation, a higher level review of 

available information, and may involve the engagement of additional parties and expertise. 

Additionally, as part of the Level 2 assessment, PWSs must submit to the state a form identifying 

sanitary defects detected, corrective actions completed, and a timetable for completion of any 

corrective actions that not already completed. Additional detail on the derivation of associated 

unit burden (labor hours) for performance of the assessment is provided in the Technology and 

Cost Document for the Proposed Revised Total Coliform Rule (USEPA, 2010d). 

The labor rates presented in Section 7.2.1 are used along with estimates of labor hours as 

presented in the Technology and Cost Document for the Proposed Revised Total Coliform Rule

(USEPA, 2010d) to generate Level 1 and Level 2 assessment unit costs by PWS size and type. 

Labor hours provided are assumed to include time for reporting and recordkeeping activities. 

Estimates of PWS unit costs for Level 1 and Level 2 assessments are presented in Exhibits 7.11 

and 7.12. Additionally, the numbers of Level 1 and level 2 assessments over the 25-year 

compliance period (used to calculate total costs) are presented in Exhibit 7.13. 
Economic Analysis for the Proposed RTCR 7-20 June 2010 

Exhibit 7.11 PWS Unit Costs Estimates for Assessment Activities under Current 

TCR (2007$) 

A B C=A*B D E=A*D F G=A*F

≤100 25.10 $ 11.0 276.10 $ 14.0 351.40 $ 14.0 351.40 $ 

101-500 27.03 $ 11.0 297.33 $ 14.0 378.42 $ 14.0 378.42 $ 

501-1,000 28.96 $ 13.0 376.48 $ 15.0 434.40 $ 15.0 434.40 $ 

1,001-4,100 29.73 $ 22.0 654.06 $ 29.0 862.17 $ 29.0 862.17 $ 

4,101-33,000 36.00 $ 30.0 1,080.00 $ 36.0 1,296.00 $ 36.0 1,296.00 $ 

33,001-96,000 36.39 $ 59.0 2,147.01 $ 75.0 2,729.25 $ 75.0 2,729.25 $ 

96,001-500,000 41.01 $ 108.0 4,429.08 $ 117.0 4,798.17 $ 117.0 4,798.17 $ 

500,001-1 Million 41.01 $ 108.0 4,429.08 $ 117.0 4,798.17 $ 117.0 4,798.17 $ 

> 1 Million 41.01 $ 108.0 4,429.08 $ 117.0 4,798.17 $ 117.0 4,798.17 $ 

≤100 25.10 $ 11.0 276.10 $ 14.0 351.40 $ 14.0 351.40 $ 

101-500 27.03 $ 11.0 297.33 $ 14.0 378.42 $ 14.0 378.42 $ 

501-1,000 28.96 $ 13.0 376.48 $ 15.0 434.40 $ 15.0 434.40 $ 

1,001-4,100 29.73 $ 22.0 654.06 $ 29.0 862.17 $ 29.0 862.17 $ 

4,101-33,000 36.00 $ 30.0 1,080.00 $ 36.0 1,296.00 $ 36.0 1,296.00 $ 

33,001-96,000 36.39 $ 59.0 2,147.01 $ 75.0 2,729.25 $ 75.0 2,729.25 $ 

96,001-500,000 41.01 $ 108.0 4,429.08 $ 117.0 4,798.17 $ 117.0 4,798.17 $ 

500,001-1 Million 41.01 $ 108.0 4,429.08 $ 117.0 4,798.17 $ 117.0 4,798.17 $ 

> 1 Million 41.01 $ 108.0 4,429.08 $ 117.0 4,798.17 $ 117.0 4,798.17 $ 

≤100 25.10 $ 4.0 100.40 $ 6.0 150.60 $ 6.0 150.60 $ 

101-500 27.03 $ 4.0 108.12 $ 6.0 162.18 $ 6.0 162.18 $ 

501-1,000 28.96 $ 4.0 115.84 $ 6.0 173.76 $ 6.0 173.76 $ 

1,001-4,100 29.73 $ 4.0 118.92 $ 6.0 178.38 $ 6.0 178.38 $ 

4,101-33,000 36.00 $ 30.0 1,080.00 $ 36.0 1,296.00 $ 36.0 1,296.00 $ 

33,001-96,000 36.39 $ 59.0 2,147.01 $ 75.0 2,729.25 $ 75.0 2,729.25 $ 

96,001-500,000 41.01 $ 108.0 4,429.08 $ 117.0 4,798.17 $ 117.0 4,798.17 $ 

500,001-1 Million 41.01 $ 108.0 4,429.08 $ 117.0 4,798.17 $ 117.0 4,798.17 $ 

> 1 Million 41.01 $ 108.0 4,429.08 $ 117.0 4,798.17 $ 117.0 4,798.17 $ 

≤100 25.10 $ 4.0 100.40 $ 6.0 150.60 $ 6.0 150.60 $ 

101-500 27.03 $ 4.0 108.12 $ 6.0 162.18 $ 6.0 162.18 $ 

501-1,000 28.96 $ 4.0 115.84 $ 6.0 173.76 $ 6.0 173.76 $ 

1,001-4,100 29.73 $ 4.0 118.92 $ 6.0 178.38 $ 6.0 178.38 $ 

4,101-33,000 36.00 $ 30.0 1,080.00 $ 36.0 1,296.00 $ 36.0 1,296.00 $ 

33,001-96,000 36.39 $ 59.0 2,147.01 $ 75.0 2,729.25 $ 75.0 2,729.25 $ 

96,001-500,000 41.01 $ 108.0 4,429.08 $ 117.0 4,798.17 $ 117.0 4,798.17 $ 

500,001-1 Million 41.01 $ 108.0 4,429.08 $ 117.0 4,798.17 $ 117.0 4,798.17 $ 

> 1 Million 41.01 $ 108.0 4,429.08 $ 117.0 4,798.17 $ 117.0 4,798.17 $ 

≤100 25.10 $ 4.0 100.40 $ 6.0 150.60 $ 6.0 150.60 $ 

101-500 27.03 $ 4.0 108.12 $ 6.0 162.18 $ 6.0 162.18 $ 

501-1,000 28.96 $ 4.0 115.84 $ 6.0 173.76 $ 6.0 173.76 $ 

1,001-4,100 29.73 $ 4.0 118.92 $ 6.0 178.38 $ 6.0 178.38 $ 

4,101-33,000 36.00 $ 30.0 1,080.00 $ 36.0 1,296.00 $ 36.0 1,296.00 $ 

33,001-96,000 36.39 $ 59.0 2,147.01 $ 75.0 2,729.25 $ 75.0 2,729.25 $ 

96,001-500,000 41.01 $ 108.0 4,429.08 $ 117.0 4,798.17 $ 117.0 4,798.17 $ 

500,001-1 Million 41.01 $ 108.0 4,429.08 $ 117.0 4,798.17 $ 117.0 4,798.17 $ 

> 1 Million 41.01 $ 108.0 4,429.08 $ 117.0 4,798.17 $ 117.0 4,798.17 $ 

≤100 25.10 $ 4.0 100.40 $ 6.0 150.60 $ 6.0 150.60 $ 

101-500 27.03 $ 4.0 108.12 $ 6.0 162.18 $ 6.0 162.18 $ 

501-1,000 28.96 $ 4.0 115.84 $ 6.0 173.76 $ 6.0 173.76 $ 

1,001-4,100 29.73 $ 4.0 118.92 $ 6.0 178.38 $ 6.0 178.38 $ 

4,101-33,000 36.00 $ 30.0 1,080.00 $ 36.0 1,296.00 $ 36.0 1,296.00 $ 

33,001-96,000 36.39 $ 59.0 2,147.01 $ 75.0 2,729.25 $ 75.0 2,729.25 $ 

96,001-500,000 41.01 $ 108.0 4,429.08 $ 117.0 4,798.17 $ 117.0 4,798.17 $ 

500,001-1 Million 41.01 $ 108.0 4,429.08 $ 117.0 4,798.17 $ 117.0 4,798.17 $ 

> 1 Million 41.01 $ 108.0 4,429.08 $ 117.0 4,798.17 $ 117.0 4,798.17 $ 

Note:

Sources:

(A) Labor rates for PWSs from Exhibit 7.1.

(B), (D), (F) Proposed RTCR T&C Document.

Nontransient Noncommunity Water Systems (NTNCWSs) - GW

Unit Cost

Non-Acute 

Violations 

(multiple 

violations) (hours) Unit Cost

Community Water Systems (CWSs) - SW

PWS Size 

(Population 

Served)

Labor Cost 

(per hour)

(F) EPA assumes that the burden incurred by operators to assess their PWSs follow ing a second non-acute violation is equal to the burden incurred 

by an assessment follow ing an acute violation.

Transient Noncommunity Water Systems (TNCWSs) - GW

Transient Noncommunity Water Systems (TNCWSs) - SW

Non-Acute 

Violations 

(single 

violation) Unit Cost

Acute 

Violations 

(hours)

Community Water Systems (CWSs) - GW

Nontransient Noncommunity Water Systems (NTNCWSs) - SW
Economic Analysis for the Proposed RTCR 7-21 June 2010 

Exhibit 7.12 PWS Unit Costs Estimates for Level 1 and Level 2 Assessments (AIP 

and Alternative Option) (2007$) 

A B C=A*B D E=A*D F G=A*F

≤100 25.10 $ 19.0 476.90 $ 23.0 577.30 $ 22.0 552.20 $ 

101-500 27.03 $ 19.0 513.57 $ 23.0 621.69 $ 22.0 594.66 $ 

501-1,000 28.96 $ 20.0 579.20 $ 24.0 695.04 $ 23.0 666.08 $ 

1,001-4,100 29.73 $ 31.0 921.63 $ 48.0 1,427.04 $ 46.0 1,367.58 $ 

4,101-33,000 36.00 $ 41.0 1,476.00 $ 71.0 2,556.00 $ 69.0 2,484.00 $ 

33,001-96,000 36.39 $ 68.0 2,474.52 $ 121.0 4,403.19 $ 116.0 4,221.24 $ 

96,001-500,000 41.01 $ 159.0 6,520.59 $ 252.0 10,334.52 $ 238.0 9,760.38 $ 

500,001-1 Million 41.01 $ 159.0 6,520.59 $ 252.0 10,334.52 $ 238.0 9,760.38 $ 

> 1 Million 41.01 $ 159.0 6,520.59 $ 252.0 10,334.52 $ 238.0 9,760.38 $ 

≤100 25.10 $ 19.0 476.90 $ 23.0 577.30 $ 22.0 552.20 $ 

101-500 27.03 $ 19.0 513.57 $ 23.0 621.69 $ 22.0 594.66 $ 

501-1,000 28.96 $ 20.0 579.20 $ 24.0 695.04 $ 23.0 666.08 $ 

1,001-4,100 29.73 $ 31.0 921.63 $ 48.0 1,427.04 $ 46.0 1,367.58 $ 

4,101-33,000 36.00 $ 41.0 1,476.00 $ 71.0 2,556.00 $ 69.0 2,484.00 $ 

33,001-96,000 36.39 $ 68.0 2,474.52 $ 121.0 4,403.19 $ 116.0 4,221.24 $ 

96,001-500,000 41.01 $ 159.0 6,520.59 $ 252.0 10,334.52 $ 238.0 9,760.38 $ 

500,001-1 Million 41.01 $ 159.0 6,520.59 $ 252.0 10,334.52 $ 238.0 9,760.38 $ 

> 1 Million 41.01 $ 159.0 6,520.59 $ 252.0 10,334.52 $ 238.0 9,760.38 $ 

≤100 25.10 $ 7.0 175.70 $ 21.0 527.10 $ 9.0 225.90 $ 

101-500 27.03 $ 7.0 189.21 $ 21.0 567.63 $ 9.0 243.27 $ 

501-1,000 28.96 $ 7.0 202.72 $ 21.0 608.16 $ 9.0 260.64 $ 

1,001-4,100 29.73 $ 8.0 237.84 $ 29.0 862.17 $ 10.0 297.30 $ 

4,101-33,000 36.00 $ 41.0 1,476.00 $ 71.0 2,556.00 $ 69.0 2,484.00 $ 

33,001-96,000 36.39 $ 68.0 2,474.52 $ 121.0 4,403.19 $ 116.0 4,221.24 $ 

96,001-500,000 41.01 $ 159.0 6,520.59 $ 252.0 10,334.52 $ 238.0 9,760.38 $ 

500,001-1 Million 41.01 $ 159.0 6,520.59 $ 252.0 10,334.52 $ 238.0 9,760.38 $ 

> 1 Million 41.01 $ 159.0 6,520.59 $ 252.0 10,334.52 $ 238.0 9,760.38 $ 

≤100 25.10 $ 7.0 175.70 $ 21.0 527.10 $ 9.0 225.90 $ 

101-500 27.03 $ 7.0 189.21 $ 21.0 567.63 $ 9.0 243.27 $ 

501-1,000 28.96 $ 7.0 202.72 $ 21.0 608.16 $ 9.0 260.64 $ 

1,001-4,100 29.73 $ 8.0 237.84 $ 29.0 862.17 $ 10.0 297.30 $ 

4,101-33,000 36.00 $ 41.0 1,476.00 $ 71.0 2,556.00 $ 69.0 2,484.00 $ 

33,001-96,000 36.39 $ 68.0 2,474.52 $ 121.0 4,403.19 $ 116.0 4,221.24 $ 

96,001-500,000 41.01 $ 159.0 6,520.59 $ 252.0 10,334.52 $ 238.0 9,760.38 $ 

500,001-1 Million 41.01 $ 159.0 6,520.59 $ 252.0 10,334.52 $ 238.0 9,760.38 $ 

> 1 Million 41.01 $ 159.0 6,520.59 $ 252.0 10,334.52 $ 238.0 9,760.38 $ 

≤100 25.10 $ 7.0 175.70 $ 21.0 527.10 $ 9.0 225.90 $ 

101-500 27.03 $ 7.0 189.21 $ 21.0 567.63 $ 9.0 243.27 $ 

501-1,000 28.96 $ 7.0 202.72 $ 21.0 608.16 $ 9.0 260.64 $ 

1,001-4,100 29.73 $ 8.0 237.84 $ 29.0 862.17 $ 10.0 297.30 $ 

4,101-33,000 36.00 $ 41.0 1,476.00 $ 71.0 2,556.00 $ 69.0 2,484.00 $ 

33,001-96,000 36.39 $ 68.0 2,474.52 $ 121.0 4,403.19 $ 116.0 4,221.24 $ 

96,001-500,000 41.01 $ 159.0 6,520.59 $ 252.0 10,334.52 $ 238.0 9,760.38 $ 

500,001-1 Million 41.01 $ 159.0 6,520.59 $ 252.0 10,334.52 $ 238.0 9,760.38 $ 

> 1 Million 41.01 $ 159.0 6,520.59 $ 252.0 10,334.52 $ 238.0 9,760.38 $ 

≤100 25.10 $ 7.0 175.70 $ 21.0 527.10 $ 9.0 225.90 $ 

101-500 27.03 $ 7.0 189.21 $ 21.0 567.63 $ 9.0 243.27 $ 

501-1,000 28.96 $ 7.0 202.72 $ 21.0 608.16 $ 9.0 260.64 $ 

1,001-4,100 29.73 $ 8.0 237.84 $ 29.0 862.17 $ 10.0 297.30 $ 

4,101-33,000 36.00 $ 41.0 1,476.00 $ 71.0 2,556.00 $ 69.0 2,484.00 $ 

33,001-96,000 36.39 $ 68.0 2,474.52 $ 121.0 4,403.19 $ 116.0 4,221.24 $ 

96,001-500,000 41.01 $ 159.0 6,520.59 $ 252.0 10,334.52 $ 238.0 9,760.38 $ 

500,001-1 Million 41.01 $ 159.0 6,520.59 $ 252.0 10,334.52 $ 238.0 9,760.38 $ 

> 1 Million 41.01 $ 159.0 6,520.59 $ 252.0 10,334.52 $ 238.0 9,760.38 $ 

Sources:

(A) Labor rates for PWSs from Exhibit 7.1.

(B), (D), (F) Proposed RTCR T&C Document.

Nontransient Noncommunity Water Systems (NTNCWSs) - SW

Nontransient Noncommunity Water Systems (NTNCWSs) - GW

Level 2 Triggers 

(triggered by 

multiple Level 1s) 

(hours) Unit Cost

Community Water Systems (CWSs) - SW

Community Water Systems (CWSs) - GW

Transient Noncommunity Water Systems (TNCWSs) - GW

Transient Noncommunity Water Systems (TNCWSs) - SW

Labor Cost 

(per hour)

PWS Size

(Population

Served)

Level 1 Assessments Level 2 Assessments

Non-Acute 

Trigger 

(single trigger) 

(hours) Unit Cost

Acute 

Violations 

(hours) Unit Cost
Economic Analysis for the Proposed RTCR 7-22 June 2010 

Exhibit 7.13 Number of Level 1 and Level 2 Assessments over the 25-Year 

Compliance Period 

Level 1 

Assessments

Level 1 

Assessments

Level 1 

Assessments

A B C D E F G H I

Community Water Systems (CWSs) - SW

≤100 541 156 168 363 112 73 363 112 73 

101-500 621 181 112 465 135 55 465 135 55 

501-1,000 339 99 61 254 74 30 254 74 30 

1,001-4,100 931 149 123 846 161 96 846 161 96 

4,101-33,000 2,152 197 - 2,152 197 - 2,152 197 - 

33,001-96,000 534 56 - 534 56 - 534 56 - 

96,001-500,000 233 24 - 233 24 - 233 24 - 

500,001-1 Million 22 - - 22 - - 22 - - 

> 1 Million - - - - - - - - - 

Total 5,373 861 463 4,869 758 253 4,869 758 253 

≤100 9,772 1,141 5,383 8,004 853 3,523 7,871 926 3,272 

101-500 8,169 1,025 4,214 6,502 696 2,399 6,495 747 2,543 

501-1,000 2,250 284 1,050 1,780 188 626 1,772 203 607 

1,001-4,100 3,545 477 2,808 3,208 342 1,705 3,208 342 1,705 

4,101-33,000 4,545 263 - 4,545 263 - 4,545 263 - 

33,001-96,000 656 53 - 656 53 - 656 53 - 

96,001-500,000 129 10 - 129 10 - 129 10 - 

500,001-1 Million - - - - - - - - - 

> 1 Million - - - - - - - - - 

Total 29,066 3,253 13,455 24,824 2,405 8,253 24,675 2,544 8,127 

≤100 93 38 67 69 27 33 69 27 33 

101-500 80 29 39 66 24 21 66 24 21 

501-1,000 28 10 14 23 8 7 23 8 7 

1,001-4,100 43 16 33 38 12 18 38 12 18 

4,101-33,000 5 - - 5 - - 5 - - 

33,001-96,000 - - - - - - - - - 

96,001-500,000 - - - - - - - - - 

500,001-1 Million - - - - - - - - - 

> 1 Million - - - - - - - - - 

Total 248 92 153 201 72 79 201 72 79 

≤100 5,581 856 3,829 4,797 559 2,010 5,506 703 3,314 

101-500 3,130 447 1,273 2,794 315 757 3,450 435 1,307 

501-1,000 744 95 298 675 79 168 804 98 295 

1,001-4,100 818 169 974 690 114 530 690 114 530 

4,101-33,000 123 9 - 123 9 - 123 9 - 

33,001-96,000 4 - - 4 - - 4 - - 

96,001-500,000 - - - - - - - - - 

500,001-1 Million - - - - - - - - - 

> 1 Million - - - - - - - - - 

Total 10,400 1,577 6,373 9,084 1,077 3,466 10,578 1,359 5,447 

≤100 1,277 508 943 1,004 336 426 1,004 336 426 

101-500 487 202 372 372 125 165 372 125 165 

501-1,000 86 36 66 66 22 29 66 22 29 

1,001-4,100 102 52 122 90 32 62 90 32 62 

4,101-33,000 8 - - 8 - - 8 - - 

33,001-96,000 - - - - - - - - - 

96,001-500,000 - - - - - - - - - 

500,001-1 Million - - - - - - - - - 

> 1 Million - - - - - - - - - 

Total 1,960 797 1,504 1,541 515 682 1,541 515 682 

≤100 44,730 6,649 25,425 47,190 5,477 20,628 54,441 7,386 35,932 

101-500 14,530 2,089 8,864 13,780 1,608 5,694 16,390 2,313 10,467 

501-1,000 1,477 221 896 1,396 177 585 1,602 224 989 

1,001-4,100 927 186 1,138 773 117 638 773 117 638 

4,101-33,000 116 4 - 116 4 - 116 4 - 

33,001-96,000 - - - - - - - - - 

96,001-500,000 - - - - - - - - - 

500,001-1 Million - - - - - - - - - 

> 1 Million - - - - - - - - - 

Total 61,780 9,149 36,324 63,256 7,383 27,546 73,323 10,043 48,026 

Grand Total 108,828 15,728 58,272 103,775 12,210 40,278 115,187 15,291 62,614 

Note: Detail may not add due to rounding.

Sources:

(A), (B), (C) - A.1.z

(D), (E), (F) - A.2.z

(G), (H), (I) - A.3.z

PWS Size

(Population

Served)

Transient Noncommunity Water Systems (TNCWSs) - GW

Community Water Systems (CWSs) - GW

Nontransient Noncommunity Water Systems (NTNCWSs) - SW

Nontransient Noncommunity Water Systems (NTNCWSs) - GW

Transient Noncommunity Water Systems (TNCWSs) - SW

Level 2 

Triggers 

(triggered by 

multiple 

Level 1s)

Acute 

Violations

TCR

Non-Acute 

Trigger 

(single trigger)

Level 2 

Assessments

AIP Alternative Option

Non-Acute 

Violations 

(multiple 

violations)

Acute 

Violations

Level 2 

Triggers 

(triggered by 

multiple 

Level 1s)

Level 2 

Assessments

Non-Acute 

Violations (single 

violation)

Non-Acute 

Trigger 

(single trigger)

Acute 

Violations

Level 2 

Assessments
Economic Analysis for the Proposed RTCR 7-23 June 2010 

States 

Level 1 and Level 2 Assessments

 Under the TCR, AIP and Alternative option, states would incur burden to review 

completed assessment forms required to be filed by PWSs (or similar reports required by states 

under the current TCR). Although some states may choose to conduct assessments for their 

PWSs, EPA does not quantify these costs. State costs are based on the number of PWSs 

submitting assessment reports. The state labor rate presented in Section 7.2.1 and estimates of 

labor hours are used to generate state Level 1 and Level 2 assessment unit costs. EPA estimates 

that state burden to review PWS assessment forms would range from one to eight hours 

depending on PWS size and type, as well as the level of the assessment. This burden includes 

any time required to consult with the PWS about the assessment report. Estimates of state unit 

costs for Level 1 and Level 2 assessments are presented in Exhibit 7.14. 

Assessment Net Cost Summary 

Annualized cost estimates for Level 1 and Level 2 assessments under the TCR, AIP, and 

Alternative Option are calculated by multiplying the number of assessments estimated by the 

predictive modeling (summarized in Exhibit 7.13) by the unit costs presented in Exhibits 7.11, 

7.12, and 7.14. Exhibit 7.13 presents the estimated totals of non-acute and acute MCL violations 

(current TCR) and Level 1 and Level 2 assessments (AIP and Alternative options). The model 

predicts a total of approximately 109,000 single non-acute MCL violations, 58,000 cases of a 

second non-acute MCL violation, and 16,000 acute MCL violations for the current TCR under 

which some PWSs do currently engage in assessment activity which may or may not meet the 

proposed RTCR criteria (see section 7.4.5). For the AIP option, the model predicts 

approximately 104,000 Level 1 assessments and 52,000 Level 2 assessments. For the Alternative 

option, the model predicts approximately 115,000 Level 1 assessments and 78,000 Level 2 

assessments. (Appendix A provides a detailed breakout of the number of Level 1 and Level 2 

assessments estimated by the occurrence model.) Annualized cost estimates are presented in 

Exhibit 7.15 below. 

Under the proposed RTCR, all PWSs are required to conduct assessments of their 

systems when they exceed Level 1 or Level 2 treatment technique triggers. While PWSs are not 

required to conduct assessments under the current TCR, some PWSs do currently engage in 

assessment activity (which may or may not meet the proposed RTCR criteria) following 

nonacute and acute MCL violations. EPA estimates both the costs to PWSs to conduct 

assessments under the proposed RTCR as well as the level of effort that PWSs already put 

towards assessment activities under the current TCR; these estimates are based on the work of 

the stakeholders in the TWG during the proceedings of the TCRDSAC. These estimates allowed 

EPA to determine the average net costs to conduct assessments under the proposed RTCR. EPA 

assumes that the numbers of nonacute and acute MCL violations would remain steady under a 

continuation of the current TCR (based on review of SDWIS/FED violation data). Under the 

proposed RTCR, EPA assumes that the numbers of assessments decreases from the steady state 

level seen under the current TCR over time to a new steady state level as a function of reduced 

fecal indicator occurrence associated with the effects of requiring assessments and corrective 

action. 
Economic Analysis for the Proposed RTCR 7-24 June 2010 

The overall number of assessments increases for under the Alternative option. This is a 

result of the initial monthly monitoring requirements for all PWSs under this analysis. The 

modeling results indicate that the much higher sampling early in the implementation period, 

results in more positive samples and associated assessments despite the predicted long term 

reductions in occurrence. This increase in total assessments performed, combined with the higher 

unit cost of performing assessments compared to existing practices under the TCR, results in a 

higher net cost increase than under the AIP. For states, the increase in the number of assessments 

is estimated to translate directly to a cost increase. The total net change in cost for the Alternative 

option is estimated to be positive, and greater than under the AIP. 
Economic Analysis for the Proposed RTCR 7-25 June 2010 

Exhibit 7.14 State Unit Cost Estimates for Review of Level 1 and Level 2 

Assessments under TCR, AIP, and Alternative Options (2007$) 

A B C=A*B D E=A*D F G=A*F

≤100 39.22 $ 1.0 39.22 $ 2.0 78.44 $ 2.0 78.44 $ 

101-500 39.22 $ 1.0 39.22 $ 2.0 78.44 $ 2.0 78.44 $ 

501-1,000 39.22 $ 2.0 78.44 $ 4.0 156.87 $ 4.0 156.87 $ 

1,001-4,100 39.22 $ 2.0 78.44 $ 4.0 156.87 $ 4.0 156.87 $ 

4,101-33,000 39.22 $ 3.0 117.65 $ 6.0 235.31 $ 6.0 235.31 $ 

33,001-96,000 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

96,001-500,000 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

500,001-1 Million 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

> 1 Million 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

≤100 39.22 $ 1.0 39.22 $ 2.0 78.44 $ 2.0 78.44 $ 

101-500 39.22 $ 1.0 39.22 $ 2.0 78.44 $ 2.0 78.44 $ 

501-1,000 39.22 $ 2.0 78.44 $ 4.0 156.87 $ 4.0 156.87 $ 

1,001-4,100 39.22 $ 2.0 78.44 $ 4.0 156.87 $ 4.0 156.87 $ 

4,101-33,000 39.22 $ 3.0 117.65 $ 6.0 235.31 $ 6.0 235.31 $ 

33,001-96,000 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

96,001-500,000 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

500,001-1 Million 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

> 1 Million 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

≤100 39.22 $ 1.0 39.22 $ 2.0 78.44 $ 2.0 78.44 $ 

101-500 39.22 $ 1.0 39.22 $ 2.0 78.44 $ 2.0 78.44 $ 

501-1,000 39.22 $ 2.0 78.44 $ 4.0 156.87 $ 4.0 156.87 $ 

1,001-4,100 39.22 $ 2.0 78.44 $ 4.0 156.87 $ 4.0 156.87 $ 

4,101-33,000 39.22 $ 3.0 117.65 $ 6.0 235.31 $ 6.0 235.31 $ 

33,001-96,000 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

96,001-500,000 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

500,001-1 Million 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

> 1 Million 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

≤100 39.22 $ 1.0 39.22 $ 2.0 78.44 $ 2.0 78.44 $ 

101-500 39.22 $ 1.0 39.22 $ 2.0 78.44 $ 2.0 78.44 $ 

501-1,000 39.22 $ 2.0 78.44 $ 4.0 156.87 $ 4.0 156.87 $ 

1,001-4,100 39.22 $ 2.0 78.44 $ 4.0 156.87 $ 4.0 156.87 $ 

4,101-33,000 39.22 $ 3.0 117.65 $ 6.0 235.31 $ 6.0 235.31 $ 

33,001-96,000 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

96,001-500,000 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

500,001-1 Million 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

> 1 Million 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

≤100 39.22 $ 1.0 39.22 $ 2.0 78.44 $ 2.0 78.44 $ 

101-500 39.22 $ 1.0 39.22 $ 2.0 78.44 $ 2.0 78.44 $ 

501-1,000 39.22 $ 2.0 78.44 $ 4.0 156.87 $ 4.0 156.87 $ 

1,001-4,100 39.22 $ 2.0 78.44 $ 4.0 156.87 $ 4.0 156.87 $ 

4,101-33,000 39.22 $ 3.0 117.65 $ 6.0 235.31 $ 6.0 235.31 $ 

33,001-96,000 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

96,001-500,000 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

500,001-1 Million 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

> 1 Million 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

≤100 39.22 $ 1.0 39.22 $ 2.0 78.44 $ 2.0 78.44 $ 

101-500 39.22 $ 1.0 39.22 $ 2.0 78.44 $ 2.0 78.44 $ 

501-1,000 39.22 $ 2.0 78.44 $ 4.0 156.87 $ 4.0 156.87 $ 

1,001-4,100 39.22 $ 2.0 78.44 $ 4.0 156.87 $ 4.0 156.87 $ 

4,101-33,000 39.22 $ 3.0 117.65 $ 6.0 235.31 $ 6.0 235.31 $ 

33,001-96,000 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

96,001-500,000 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

500,001-1 Million 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

> 1 Million 39.22 $ 4.0 156.87 $ 8.0 313.74 $ 8.0 313.74 $ 

Sources:

(A) Labor rates for state employee from Section 7.2.1.

(B), (D), (E) Labor hour assumptions based on best professional judgement.

Community Water Systems (CWSs) - GW

Nontransient Noncommunity Water Systems (NTNCWSs) - SW

Nontransient Noncommunity Water Systems (NTNCWSs) - GW

Unit Cost

Level 2 Triggers 

(triggered by 

multiple Level 1s) 

(hours) Unit Cost

Community Water Systems (CWSs) - SW

Transient Noncommunity Water Systems (TNCWSs) - GW

Transient Noncommunity Water Systems (TNCWSs) - SW

Labor Cost 

(per hour)

PWS Size

(Population

Served)

Level 1 Assessments Level 2 Assessments

Non-Acute 

Trigger 

(single trigger) 

(hours) Unit Cost

Acute 

Violations 

(hours)
Economic Analysis for the Proposed RTCR 7-26 June 2010 

Exhibit 7.15 Annualized PWS and State Cost Estimates for Level 1 and Level 2 

Assessments ($Millions, 2007$) 

PWSs State Total PWSs State Total

TCR - Total $ 0.21 1.13 $ 1.34 $ 1.08 $ 0.21 $ 1.29 $ 

AIP - Total $ 0.20 1.63 $ 1.84 $ 1.57 $ 0.20 $ 1.77 $ 

AIP - Net Change 0.50 $ (0.01) $ 0.49 $ 0.49 $ (0.01) $ 0.48 $ 

Alternative Option - Total $ 0.23 1.73 $ 1.95 $ 1.69 $ 0.22 $ 1.91 $ 

Alternative Option - Net Change 0.60 $ 0.01 $ 0.61 $ 0.60 $ 0.02 $ 0.62 $ 

TCR - Total $ 0.26 0.70 $ 0.96 $ 0.68 $ 0.25 $ 0.93 $ 

AIP - Total $ 0.19 0.90 $ 1.09 $ 0.88 $ 0.18 $ 1.06 $ 

AIP - Net Change 0.20 $ (0.07) $ 0.12 $ 0.20 $ (0.07) $ 0.13 $ 

Alternative Option - Total $ 0.28 1.23 $ 1.51 $ 1.27 $ 0.30 $ 1.57 $ 

Alternative Option - Net Change 0.52 $ 0.02 $ 0.55 $ 0.60 $ 0.05 $ 0.65 $ 

Note: Detail may not add due to independent rounding.

Source: Proposed RTCR Cost Model.

Level 2 Assessment

3% Discount Rate 7% Discount Rate

Level 1 Assessment

7.4.6 Corrective Actions 

PWSs 

Under the AIP and Alternative option, all PWSs would be required to correct sanitary 

defects found through the performance of Level 1 or Level 2 assessments. For modeling 

purposes, EPA estimated only the net change in the number of corrective actions performed 

under the AIP and Alternative option6

 compared to the current TCR. Based on discussions with 

state representatives, EPA estimates that additional corrective actions (on top of those already 

being performed under the existing TCR) would be performed for only 10% of the assessments 

undertaken as a result of the proposed RTCR. Because only the net change in costs is estimated, 

no additional costs for corrective actions are modeled for the existing TCR (it is assumed that 

PWSs are already performing corrective actions under the existing TCR). 

 

To estimate the costs incurred for the correction of sanitary defects, EPA estimated the 

percent distribution of PWSs that would perform different types of corrective actions as 

presented in the compliance forecast below (Exhibit 7.16a). The compliance forecast presented 

below focuses on the higher level categorization of corrective actions anticipated. The categories 

of anticipated corrective actions were informed by both EPA judgment and discussions of the 

TCRDSAC TWG and are essentially the same as those presented to the advisory committee. For 

each of the categories listed, a PWS is assumed to take a specific action that falls under that 

general category. Exhibit 7.16b lists the specific corrective actions that fall under the higher level 

categorization, along with the percent of PWSs estimated to perform that corrective action based 

on level 1 and level 2 assessments. Detailed compliance forecasts showing the specific corrective 

actions used in the cost analysis are provided in Appendix D, along with summary tables of the 

unit costs used in the analysis. Each corrective action in the detailed compliance forecast is also 

assigned a representative unit cost. Detailed descriptions of the derivation of unit costs are 

 

6

 Any corrective actions based on a positive source water sample are assumed to be accounted for under the GWR 

and not under the proposed RTCR. 
Economic Analysis for the Proposed RTCR 7-27 June 2010 

provided in Exhibits 5-1 through 5-47 of the Technology and Cost Document for the Proposed 

Revised Total Coliform Rule (USEPA, 2010d). 

As shown in the compliance forecast in Exhibit 7.16a, EPA estimates that corrective 

actions found through Level 1 assessments would result in corrective actions that focus more on 

actions by PWS staff such as flushing or training (columns A and B) than on permanent fixes to 

the PWS. This reflects the assumption that Level 1 assessments would generally be less involved 

than Level 2 assessments and may not result in finding more complex problems. Corrective 

actions taken as a result of Level 2 assessments are expected to find a higher proportion of 

structural/technical issues (columns C-K) resulting in material fixes to the PWSs and distribution 

system. Consistent with the discussions of the TCRDSAC regarding major structural fixes or 

replacements, EPA did not include these major costs in the analysis. Distribution system 

appurtenances such as storage tanks generally have a useful life that is accounted for in water 

system capital planning and the assessments conducted in response to RTCR triggers could 

identify when that useful life has ended but are not solely responsible for the need to correct the 

defect.7

 

It is not anticipated that the overall effectiveness of corrective actions will differ 

significantly by the type of corrective action. Some activities, such as spot flushing, may have a 

shorter, transient impact on water quality. However, most PWSs are expected to institute 

ongoing flushing programs that will have a continuing impact on water quality. Other corrective 

actions in the compliance forecast are expected to have ongoing benefits, though the exact 

duration may be highly variable depending on the exact conditions at the PWS. The overall 

duration of reduced occurrence modeled as a result of corrective actions initiated in response to 

either a Level 1 or Level 2 assessment is intended to reflect an average effectiveness of 

corrective actions. Uncertainties and associated sensitivity analyses that inform the effect of the 

reduced occurrence predicted from corrective actions are discussed further in Section 7.7. 

PWSs would also incur reporting and recordkeeping burden to notify the state upon 

completion of each corrective action. PWSs may also consult with the state or with outside 

parties to determine the appropriate corrective action to be implemented. PWS reporting and 

recordkeeping costs (including consultations) are derived by multiplying PWSs labor rates 

(Section 7.2.1) by an EPA-estimated labor burden. Exhibit 7.17 presents the estimated unit costs 

for this reporting and recordkeeping burden. 

States 

For each corrective action performed under AIP and Alternative option, states would 

incur recordkeeping and reporting burden to review and coordinate with PWSs. This includes 

burden incurred from any optional consultations states may conduct with PWSs or outside 

parties to determine the appropriate corrective action to be implemented. The state labor rate 

presented in Section 7.2.1 and estimates of labor hours are used to generate state unit corrective 

 

7

 Additionally, EPA ran two sensitivity analyses to assess the potential impacts of different distributions within the 

compliance forecast. Results of the sensitivity analyses are presented in Section 7.7, and indicate that the low bound 

estimates of annualized net change in costs at three percent discount rate are approximately $3M for the AIP option 

and $15M for the Alternative option, and the high bound estimates are approximately $25M for the AIP option and 

$40M for the Alternative option. Varying the assumptions about the percentage of corrective actions identified and 

the effectiveness of those actions had less than a linear effect on outcomes, and the AIP option continues to be less 

costly than the Alternative option under all scenarios modeled. 
Economic Analysis for the Proposed RTCR 7-28 June 2010 

action costs. Exhibit 7.17 presents the estimated PWS and state reporting and recordkeeping unit 

costs (including consultations) by PWS size. 

Exhibit 7.16a Compliance Forecast for Corrective Actions based on Level 1 and 

Level 2 Assessments 

AB C D E F GH IJ K

≤100 39% 15% 12% 9% 8% 6% 4% 1% 3% 1% 2%

101-500 39% 15% 12% 9% 8% 6% 4% 1% 3% 1% 2%

501-1,000 39% 15% 12% 9% 8% 6% 4% 1% 3% 1% 2%

1,001-4,100 39% 15% 12% 9% 8% 6% 4% 1% 3% 1% 2%

4,101-33,000 39% 15% 12% 9% 8% 6% 4% 1% 3% 1% 2%

33,001-96,000 39% 15% 12% 9% 8% 6% 4% 1% 3% 1% 2%

96,001-500,000 39% 15% 12% 9% 8% 6% 4% 1% 3% 1% 2%

500,001-1 Million 39% 15% 12% 9% 8% 6% 4% 1% 3% 1% 2%

> 1 Million 39% 15% 12% 9% 8% 6% 4% 1% 3% 1% 2%

≤100 15% 4% 18% 15% 15% 11% 8% 2% 6% 2% 4%

101-500 15% 4% 18% 15% 15% 11% 8% 2% 6% 2% 4%

501-1,000 15% 4% 18% 15% 15% 11% 8% 2% 6% 2% 4%

1,001-4,100 15% 4% 18% 15% 15% 11% 8% 2% 6% 2% 4%

4,101-33,000 15% 4% 18% 15% 15% 11% 8% 2% 6% 2% 4%

33,001-96,000 15% 4% 18% 15% 15% 11% 8% 2% 6% 2% 4%

96,001-500,000 15% 4% 18% 15% 15% 11% 8% 2% 6% 2% 4%

500,001-1 Million 15% 4% 18% 15% 15% 11% 8% 2% 6% 2% 4%

> 1 Million 15% 4% 18% 15% 15% 11% 8% 2% 6% 2% 4%

Source: (A) - (K) Percent of PWSs performing corrective actions based on Level 1 and Level 2 assessments reflect EPA estimate.

Maintenance 

of Adequate 

Pressure

Maintenance 

of appropriate 

Hydraulic 

Residence 

Time

Addition or 

Upgrade of 

On-line 

Monitoring 

and Control

Addition 

of Security 

Measures

Level 2 Compliance Forecast

PWS Size

(Population

Served)

Crossconnection 

Control and 

Backflow 

Prevention 

Development 

and 

Implementation 

of an 

Operations Plan

Level 1 Compliance Forecast

Replace/Repair 

of Distribution 

System 

Components

PWS 

Flushing

Sampler 

Training

Storage 

Facility 

Maintenance

Booster 

Disinfection
Economic Analysis for the Proposed RTCR 7-29 June 2010 

Exhibit 7.16b Detailed PWS Compliance Forecast for Corrective Actions based 

on Level 1 and Level 2 Assessments 

Specific Corrective Action

Level 1 

Compliance 

Forecast

Level 2 

Compliance 

Forecast

Routine Flushing 30% 10%

Spot Flushing 9% 5%

Operator Training/Certification 15% 4%

Replace Valve 2% 3%

Installing a Dedicated Sampling Tap 2% 3%

Replace Iron Pipe 2% 3%

Replace Fittings 2% 3%

Replace Hydrant 2% 3%

Replace Meter 2% 3%

New Booster Pump Station 2% 3%

Modify/Replace Existing Pumps 2% 3%

Install Variable Frequency Drives 2% 3%

New Elevated Storage Tank 0% 0%

Install Surge Relief valve 2% 3%

Install Surge Control Tank 1% 3%

Install Auto Flushing Devices 2% 3%

Modify Inlet/Outlet Piping 1% 2%

Install Mixing Devices 1% 2%

Loop Dead Ends 1% 2%

Install Appropriate Main Sizes 1% 2%

Modify Storage Operation 1% 2%

Decommission Storage 1% 2%

Inspect & Clean Storage Tanks 2% 3%

Line Storage Tanks 1% 2%

Vent Repair/Replace Vent Screen 1% 2%

Repair/Replace Tank Hatch 1% 2%

Repair Storage Tank 1% 2%

Install Permanant Cl Booster Station 1% 2%

Install Temp Cl Booster Station 1% 2%

Install Permanant NH2Cl Booster Station 1% 2%

Install Temp NH2Cl Booster Station 1% 2%

Backflow Prevention Assembly 1% 2%

Online Cl Monitoring & Programming 1% 2%

Online NH2Cl Monitoring & Programming 1% 2%

Online Pressure Monitoring & Programming 1% 2%

Installation of Additional Security Measures 1% 2%

Develop/Implement/Maintain Operations 

Plan 1% 2%

Operator Training/Certification 1% 2%

Replace/Repair of Distribution 

System Components

Maintenance of Adequate 

Pressure

Maintenance of Adequate 

Pressure

Maintenance of appropriate 

Hydraulic Residence Time

Development and 

Implementation of an 

Operations Plan

General Corrective Action 

Category

Storage Facility Maintenance

Storage Facility Maintenance

Booster Disinfection

Cross-connection Control and 

Addition or Upgrade of On-line 

Monitoring and Control

Addition of Security Measures

PWS Flushing

Sampler Training
Economic Analysis for the Proposed RTCR 7-30 June 2010 

Exhibit 7.17 Net Change in PWS and State Unit Costs Estimates for Reporting 

and Recordkeeping for Corrective Actions (2007$) 

A B C=A*B D E F=D*E

≤100 25.10 $ 0.5 12.55 $ 39.22 $ 0.5 19.61 $ 

101-500 27.03 $ 0.5 13.52 $ 39.22 $ 0.5 19.61 $ 

501-1,000 28.96 $ 0.5 14.48 $ 39.22 $ 0.5 19.61 $ 

1,001-4,100 29.73 $ 0.5 14.87 $ 39.22 $ 0.5 19.61 $ 

4,101-33,000 36.00 $ 0.5 18.00 $ 39.22 $ 0.5 19.61 $ 

33,001-96,000 36.39 $ 0.5 18.20 $ 39.22 $ 0.5 19.61 $ 

96,001-500,000 41.01 $ 0.5 20.51 $ 39.22 $ 0.5 19.61 $ 

500,001-1 Million 41.01 $ 0.5 20.51 $ 39.22 $ 0.5 19.61 $ 

> 1 Million 41.01 $ 0.5 20.51 $ 39.22 $ 0.5 19.61 $ 

Notes: 

Sources:

(A) Labor rates for PWSs from Exhibit 7.1.

(B) PWS labor hours for corrective action recordkeeping/reporting reflect EPA estimate.

(D) Labor rates for state employee from Section 7.2.1.

(E) State labor hours for corrective action recordkeeping/reporting reflect EPA estimate.

PWS and state burden estimates identical for all PWS types under TCR, AIP, and Alternative Option.

Systems States

Labor Cost (per 

hour)

Corrective Action Burden 

(hours/corrective action) Unit Cost

Labor Cost 

(per hour)

Corrective Action Burden 

(hours/corrective action) Unit Cost

PWS Size

(Population

Served)

Corrective Action Net Cost Summary 

 Annualized net cost estimates for PWSs and states to perform corrective actions are 

estimated by multiplying the number of Level 1 and Level 2 corrective actions estimated by the 

predictive model (i.e., 10 percent of Level 1 and Level 2 assessments representing the net 

increase in corrective actions found), by the percentages in the compliance forecast and unit 

costs of corrective actions and associated reporting and recordkeeping. The incremental and net 

change costs of corrective actions are shown in Exhibit 7.18. 

 Because only the net change in corrective actions taken is modeled, no costs are 

estimated under the TCR. The differences in the net change in corrective action costs between 

the AIP and Alternative Option are a function different number of assessments estimated to be 

performed in the predictive model as discussed in Section 7.4.5 above. 
Economic Analysis for the Proposed RTCR 7-31 June 2010 

Exhibit 7.18 Annualized PWS and State Cost Estimates for Corrective Actions 

based on Level 1 and Level 2 Assessments ($Millions, 2007$) 

PWSs State Total PWSs State Total

TCR - Incremental $ - - $ - $ - $ - $ - $ 

AIP - Incremental $ 0.01 9.17 $ 9.18 $ 7.77 $ 0.01 $ 7.77 $ 

AIP - Net Change 9.17 $ 0.01 $ 9.18 $ 7.77 $ 0.01 $ 7.77 $ 

Alternative Option - Incremental $ 0.01 9.39 $ 9.40 $ 8.01 $ 0.01 $ 8.02 $ 

Alternative Option - Net Change 9.39 $ 0.01 $ 9.40 $ 8.01 $ 0.01 $ 8.02 $ 

TCR - Incremental $ - - $ - $ - $ - $ - $ 

AIP - Incremental $ 0.00 2.72 $ 2.72 $ 2.41 $ 0.00 $ 2.41 $ 

AIP - Net Change 2.72 $ 0.00 $ 2.72 $ 2.41 $ 0.00 $ 2.41 $ 

Alternative Option - Incremental $ 0.01 3.53 $ 3.53 $ 3.36 $ 0.01 $ 3.37 $ 

Alternative Option - Net Change 3.53 $ 0.01 $ 3.53 $ 3.36 $ 0.01 $ 3.37 $ 

Note: Detail may not add due to independent rounding.

Source: Proposed RTCR Cost Model.

Corrective Actions based on Level 2 Assessments

3% Discount Rate 7% Discount Rate

Corrective Actions based on Level 1 Assessments

7.4.7 Public Notification 

PWSs 

Tier 1 Public Notification

Acute violations (E.coli MCL violations) would require Tier 1 public notification under 

all regulatory scenarios (TCR, AIP, and Alternative option). PWSs with acute violations must 

report the violation to the state by the end of the business day after the PWS learns of the 

violation and must notify the public within 24 hours. 

Tier 2 Public Notification

PWSs with non-acute violations under the current TCR must report the violation to the 

state by the end of the business day after the PWS learns of the violation, and must provide Tier 

2 public notification within 30 days. PWSs with similar violations under the AIP and Alternative 

option are not required to perform Public Notification (PN). These PWSs are required to perform 

Tier 2 notification for a treatment technique violation (failure to perform Level 1 or 2 assessment 

if triggered; failure to correct all sanitary defects), but because the cost model assumes full 

compliance with proposed RTCR requirements, no cost is estimated for these violations. Overall, 

costs decrease significantly for Tier 2 public notification under the proposed RTCR for both the 

AIP and Alternative option. 

Tier 3 Public Notification

Under the TCR, AIP, and Alternative option, Tier 3 public notification for monitoring 

and reporting violations are assumed to be reported once per year as part of the Consumer 

Confidence Report (CCR). Because of the use of the CCR to communicate Tier 3 public 

notification on a yearly basis, no cost differential between the current TCR and the AIP and 

Alternative option is estimated in the cost model. However, although they are not quantitatively 

evaluated as part of the EA, the TCRDSAC concluded that significant reductions in monitoring 
Economic Analysis for the Proposed RTCR 7-32 June 2010 

and reporting violations may be realized through the revised regulatory framework of the 

proposed RTCR. Resources used to process monitoring violation notices for the Consumer 

Confidence Report (CCR) (as well as the time spent responding to customer inquiries about the 

notices) may be reduced if significant reductions are realized. Exclusion of this potential cost 

savings may lead to an underestimate of the PN cost savings under both the AIP and Alternative 

option. 

Estimates of PWS unit costs for PN are derived by multiplying PWS labor rates from 

Section 7.2.1 and burden hour estimates derived from the Draft Information Collection Request 

for the Public Water System Supervision Program (USEPA, 2008c). PWS PN unit cost estimates 

are presented in Exhibit 7.19. 
Economic Analysis for the Proposed RTCR 7-33 June 2010 

Exhibit 7.19 PWS Unit Cost Estimates for Public Notification (2007$) 

Labor Cost 

(per hour)

Average Number 

of Service 

Connections per 

System

Preparation 

(labor) (hours/

violation)

Distribution 

(labor)

(hours/

violation)

Distribution

(O&M Cost/

notice)

($/service

connection) Unit Cost

Preparation 

(labor) 

(hours/

violation)

Distribution 

(labor) (hours/

violation)

Distribution

(O&M Cost/notice) 

($/service

connection) Unit Cost

A B C D E F=A*(C+D)+(B*E) G H I J=A*(G+H)+(B*I)

≤100 25.10 $ 440 8.5 12.0 0.05 $ 536.55 $ 3.5 9.0 0.05 $ 335.75 $ 

101-500 27.03 $ 387 8.5 12.0 0.05 $ 573.44 $ 3.5 9.0 0.05 $ 357.20 $ 

501-1,000 28.96 $ 303 8.5 12.0 - $ 593.68 $ 3.5 30.0 0.26 $ 1,049.05 $ 

1,001-4,100 29.73 $ 850 8.5 12.0 - $ 609.47 $ 3.5 30.0 0.26 $ 1,216.99 $ 

4,101-33,000 36.00 $ 4,288 9.2 12.0 - $ 763.66 $ 3.5 30.0 0.25 $ 2,259.65 $ 

33,001-96,000 36.39 $ 17,273 10.0 12.0 - $ 800.58 $ 3.5 30.0 0.23 $ 5,191.88 $ 

96,001-500,000 41.01 $ 56,465 10.0 12.0 - $ 902.22 $ 3.5 30.0 0.23 $ 14,360.67 $ 

500,001-1 Million 41.01 $ 205,609 10.0 12.0 - $ 902.22 $ 3.5 30.0 0.23 $ 48,663.97 $ 

> 1 Million 41.01 $ 448,564 10.0 12.0 - $ 902.22 $ 3.5 30.0 0.23 $ 104,543.57 $ 

Community Water Systems (CWSs) - GW

≤100 25.10 $ 41 8.5 12.0 0.05 $ 516.62 $ 3.5 9.0 0.05 $ 315.82 $ 

101-500 27.03 $ 99 8.5 12.0 0.05 $ 559.05 $ 3.5 9.0 0.05 $ 342.81 $ 

501-1,000 28.96 $ 315 8.5 12.0 - $ 593.68 $ 3.5 30.0 0.26 $ 1,052.07 $ 

1,001-4,100 29.73 $ 756 8.5 12.0 - $ 609.47 $ 3.5 30.0 0.26 $ 1,192.61 $ 

4,101-33,000 36.00 $ 3,495 9.0 12.0 - $ 757.48 $ 3.5 30.0 0.25 $ 2,076.93 $ 

33,001-96,000 36.39 $ 16,366 10.0 12.0 - $ 800.58 $ 3.5 30.0 0.23 $ 4,983.17 $ 

96,001-500,000 41.01 $ 50,564 10.0 12.0 - $ 902.22 $ 3.5 30.0 0.23 $ 13,003.50 $ 

500,001-1 Million 41.01 $ 209,220 10.0 12.0 - $ 902.22 $ 3.5 30.0 0.23 $ 49,494.49 $ 

> 1 Million 41.01 $ 473,641 10.0 12.0 - $ 902.22 $ 3.5 30.0 0.23 $ 110,311.34 $ 

Nontransient Noncommunity Water Systems (NTNCWSs) - SW

≤100 25.10 $ 128 8.5 12.0 0.05 $ 520.94 $ 3.5 9.0 0.05 $ 320.14 $ 

101-500 27.03 $ 21 8.5 12.0 0.05 $ 555.16 $ 3.5 9.0 0.05 $ 338.92 $ 

501-1,000 28.96 $ 46 8.5 12.0 - $ 593.68 $ 3.5 9.0 0.05 $ 364.29 $ 

1,001-4,100 29.73 $ 47 8.5 12.0 - $ 609.47 $ 3.5 9.0 0.05 $ 373.97 $ 

4,101-33,000 36.00 $ 176 8.7 12.0 - $ 745.36 $ 3.5 9.0 0.05 $ 458.08 $ 

33,001-96,000 36.39 $ 94 10.0 12.0 - $ 800.58 $ 3.5 9.0 0.02 $ 456.75 $ 

96,001-500,000 41.01 $ 2,181 10.0 12.0 - $ 902.22 $ 3.5 9.0 0.02 $ 556.25 $ 

500,001-1 Million 41.01 $ - 10.0 12.0 - $ 902.22 $ 3.5 9.0 0.02 $ 512.63 $ 

> 1 Million 41.01 $ - 10.0 12.0 - $ 902.22 $ 3.5 9.0 0.02 $ 512.63 $ 

Nontransient Noncommunity Water Systems (NTNCWSs) - GW

≤100 25.10 $ 4 8.5 12.0 0.05 $ 514.76 $ 3.5 9.0 0.05 $ 313.96 $ 

101-500 27.03 $ 8 8.5 12.0 0.05 $ 554.52 $ 3.5 9.0 0.05 $ 338.28 $ 

501-1,000 28.96 $ 11 8.5 12.0 - $ 593.68 $ 3.5 9.0 0.05 $ 362.56 $ 

1,001-4,100 29.73 $ 42 8.5 12.0 - $ 609.47 $ 3.5 9.0 0.05 $ 373.71 $ 

4,101-33,000 36.00 $ 130 8.7 12.0 - $ 744.94 $ 3.5 9.0 0.05 $ 456.02 $ 

33,001-96,000 36.39 $ 75 10.0 12.0 - $ 800.58 $ 3.5 9.0 0.02 $ 456.38 $ 

96,001-500,000 41.01 $ - 10.0 12.0 - $ 902.22 $ 3.5 9.0 0.02 $ 512.63 $ 

500,001-1 Million 41.01 $ - 10.0 12.0 - $ 902.22 $ 3.5 9.0 0.02 $ 512.63 $ 

> 1 Million 41.01 $ - 10.0 12.0 - $ 902.22 $ 3.5 9.0 0.02 $ 512.63 $ 

Transient Noncommunity Water Systems (TNCWSs) - SW

≤100 25.10 $ 9 8.5 12.0 0.05 $ 514.99 $ 3.5 9.0 0.05 $ 314.19 $ 

101-500 27.03 $ 30 8.5 12.0 0.05 $ 555.62 $ 3.5 9.0 0.05 $ 339.38 $ 

501-1,000 28.96 $ 49 8.5 12.0 - $ 593.68 $ 3.5 9.0 0.05 $ 364.45 $ 

1,001-4,100 29.73 $ 58 8.5 12.0 - $ 609.47 $ 3.5 9.0 0.05 $ 374.50 $ 

4,101-33,000 36.00 $ 57 8.8 12.0 - $ 747.00 $ 3.5 9.0 0.05 $ 452.55 $ 

33,001-96,000 36.39 $ - 10.0 12.0 - $ 800.58 $ 3.5 9.0 0.02 $ 454.88 $ 

96,001-500,000 41.01 $ - 10.0 12.0 - $ 902.22 $ 3.5 9.0 0.02 $ 512.63 $ 

500,001-1 Million 41.01 $ - 10.0 12.0 - $ 902.22 $ 3.5 9.0 0.02 $ 512.63 $ 

> 1 Million 41.01 $ 2 10.0 12.0 - $ 902.22 $ 3.5 9.0 0.02 $ 512.67 $ 

Transient Noncommunity Water Systems (TNCWSs) - GW

≤100 25.10 $ 5 8.5 12.0 0.05 $ 514.82 $ 3.5 9.0 0.05 $ 314.02 $ 

101-500 27.03 $ 15 8.5 12.0 0.05 $ 554.87 $ 3.5 9.0 0.05 $ 338.63 $ 

501-1,000 28.96 $ 30 8.5 12.0 - $ 593.68 $ 3.5 9.0 0.05 $ 363.51 $ 

1,001-4,100 29.73 $ 43 8.5 12.0 - $ 609.47 $ 3.5 9.0 0.05 $ 373.77 $ 

4,101-33,000 36.00 $ 39 8.7 12.0 - $ 746.87 $ 3.5 9.0 0.05 $ 451.77 $ 

33,001-96,000 36.39 $ 14 10.0 12.0 - $ 800.58 $ 3.5 9.0 0.02 $ 455.15 $ 

96,001-500,000 41.01 $ 9 10.0 12.0 - $ 902.22 $ 3.5 9.0 0.02 $ 512.81 $ 

500,001-1 Million 41.01 $ 1 10.0 12.0 - $ 902.22 $ 3.5 9.0 0.02 $ 512.65 $ 

> 1 Million 41.01 $ - 10.0 12.0 - $ 902.22 $ 3.5 9.0 0.02 $ 512.63 $ 

(F), (J) used to derived TCR PN costs; (F) used to derive AIP and Alternative Option PN costs. 

Sources:

(A) Labor rates for PWSs from Exhibit 7.1.

(B) SDWIS 2007 4th Quarter Freeze.

(E), (I) Distribution cost assumptions based on best professional judgement as carried forw ard from the original PN ICR.

Tier 1 (acute) Tier 2 (non-acute)

Community Water Systems (CWSs) - SW

PWS Size

(Population

Served)

Notes: 

(B) Service connections per system is consistent w ith SDWIS 2007 4th Quarter Freeze data. Data for certain size categories (e.g., <100, 101-500, 501-1,000) may seem counterintuitive. EPA 

is investigating the SDWIS database for any data discrepancies.

(C), (D), (G), (H) Labor hour assumptions based on best professional judgement as carried forw ard from the Draft Information Collection Request for the Public Water System Supervision 

Program (USEPA, 2008x).
Economic Analysis for the Proposed RTCR 7-34 June 2010 

States 

Under the TCR, AIP, and Alternative option, states would incur recordkeeping and 

reporting burden to provide consultation, review the public notification certification, and file the 

report of the violation. State unit PN costs are based on the state labor rate presented in Section 

7.2.1 and burden hour estimates derived from the Draft Information Collection Request for the 

Public Water System Supervision Program (USEPA, 2008c). Estimates of state unit costs for PN 

are presented in Exhibit 7.20. 

Exhibit 7.20 State Unit Costs Estimates for Public Notification (TCR, AIP, 

Alternative Options) 

Labor Cost

(per hour)

Tier 1 

Consultation 

(labor) 

(hours/violation)

Tier 2 

Consultation 

(labor) 

(hours/violation)

Receive/Review PN 

Certification

(labor)

(hours/violation)

File Reports

(labor)

(hours/violation)

Tier 1

Unit Cost

Tier 2

Unit Cost

A B C D E F=A*(B+D+E) G=A*(C+D+E)

$ 3.0 39.22 1.1 0.20 $ 0.10 $ 129.42 $ 54.91 $ 

Sources:

(A) Labor rate for state employee from Section 7.2.1.

(B), (C), (D), (E) Labor hour assumptions based on best professional judgement as carried forw ard from the Draft Information Collection 

Request for the Public Water System Supervision Program (USEPA, 2008x).

Public Notification Net Cost Summary 

 Total and net change in annualized net present value costs for PN are estimated by 

multiplying the model estimates of PWSs with acute (Tier 1 public notification) and non-acute 

(Tier 2 public notification) violations by the PWS and state unit costs for performing PN 

activities. The proposed RTCR Cost Model assumes that all violations are addressed following 

initial PN, and no burden would be incurred by PWSs or states for repeat notification. Exhibit 

7.21 summarizes the total number of Tier 1 and Tier 2 public notifications that would be 

prepared by PWS size and category for under the TCR, AIP, and Alternative Option over the 

entire 25 year period of analysis. Annualized total and net cost estimates for PWSs and states to 

perform public notification under the TCR, AIP, and Alternative Option are presented in Exhibit 

7.22. 

 A significant reduction in costs is estimated due to the elimination of Tier 2 public 

notification under the AIP and Alternative option. Because state costs are calculated on a perviolation basis, state costs decline. Under the Alternative option, some of this cost decrease is 

offset by additional Tier 1 public notification. 
Economic Analysis for the Proposed RTCR 7-35 June 2010 

Exhibit 7.21 Number of Tier 1 and Tier 2 Public Notifications over the 25-Year 

Compliance Period

AIP

Alternative 

Option

ABCD

Community Water Systems (CWSs) - SW

≤100 156 708 112 112 

101-500 181 733 135 135 

501-1,000 99 400 74 74 

1,001-4,100 149 1,055 161 161 

4,101-33,000 197 2,152 197 197 

33,001-96,000 56 534 56 56 

96,001-500,000 24 233 24 24 

500,001-1 Million - 22 - - 

> 1 Million - - - - 

Total 861 5,836 758 758 

≤100 1,141 15,155 853 926 

101-500 1,025 12,383 696 747 

501-1,000 284 3,300 188 203 

1,001-4,100 477 6,354 342 342 

4,101-33,000 263 4,545 263 263 

33,001-96,000 53 656 53 53 

96,001-500,000 10 129 10 10 

500,001-1 Million - - - - 

> 1 Million - - - - 

Total 3,253 42,521 2,405 2,544 

≤100 38 160 27 27 

101-500 29 120 24 24 

501-1,000 10 42 8 8 

1,001-4,100 16 75 12 12 

4,101-33,000 - 5 - - 

33,001-96,000 - - - - 

96,001-500,000 - - - - 

500,001-1 Million - - - - 

> 1 Million - - - - 

Total 92 401 72 72 

≤100 856 9,411 559 703 

101-500 447 4,402 315 435 

501-1,000 95 1,042 79 98 

1,001-4,100 169 1,792 114 114 

4,101-33,000 9 123 9 9 

33,001-96,000 - 4 - - 

96,001-500,000 - - - - 

500,001-1 Million - - - - 

> 1 Million - - - - 

Total 1,577 16,774 1,077 1,359 

≤100 508 2,220 336 336 

101-500 202 859 125 125 

501-1,000 36 152 22 22 

1,001-4,100 52 225 32 32 

4,101-33,000 - 8 - - 

33,001-96,000 - - - - 

96,001-500,000 - - - - 

500,001-1 Million - - - - 

> 1 Million - - - - 

Total 797 3,464 515 515 

≤100 6,649 70,156 5,477 7,386 

101-500 2,089 23,394 1,608 2,313 

501-1,000 221 2,373 177 224 

1,001-4,100 186 2,065 117 117 

4,101-33,000 4 116 4 4 

33,001-96,000 - - - - 

96,001-500,000 - - - - 

500,001-1 Million - - - - 

> 1 Million - - - - 

Total 9,149 98,104 7,383 10,043 

Grand Total 15,728 167,100 12,210 15,291 

Note: Detail may not add due to rounding.

Sources:

(A), (B) - A.1.z

(C) - A.2.z

(D) - A.3.z

Tier 2 PN

Transient Noncommunity Water Systems (TNCWSs) - GW

Nontransient Noncommunity Water Systems (NTNCWSs) - SW

Nontransient Noncommunity Water Systems (NTNCWSs) - GW

Transient Noncommunity Water Systems (TNCWSs) - SW

TCR

PWS Size

(Population

Served)

Tier 1 PN

Community Water Systems (CWSs) - GW

Tier 1 PN Tier 1 PN
Economic Analysis for the Proposed RTCR 7-36 June 2010 

Exhibit 7.22 Annualized PWS and State Cost Estimates for Public Notification 

($Millions, 2007$) 

PWSs State Total PWSs State Total

TCR - Total $ 0.44 3.75 $ 4.19 $ 3.60 $ 0.42 $ 4.03 $ 

AIP - Total $ 0.06 0.26 $ 0.33 $ 0.26 $ 0.06 $ 0.32 $ 

AIP - Net Change (3.49) $ (0.38) $ (3.87) $ (3.35) $ (0.36) $ (3.71) $ 

AIP - Percent Change -93% -86% -92% -93% -86% -92%

Alternative Option - Total $ 0.08 0.34 $ 0.42 $ 0.35 $ 0.08 $ 0.43 $ 

Alternative Option - Net Change (3.41) $ (0.36) $ (3.77) $ (3.26) $ (0.34) $ (3.60) $ 

Alternative Option - Percent Change -91% -82% -90% -90% -80% -89%

Note: Detail may not add due to independent rounding.

Source: Proposed RTCR Cost Model.

3% Discount Rate 7% Discount Rate

7.4.8 Uncertainty in Unit Costs 

As stated in Section 7.2.5, EPA recognizes that there are both variability and uncertainty 

in unit cost estimates used to develop national costs for the proposed RTCR. Variability is 

expected in the actual costs that would be experienced by different PWSs of similar size 

conducting the same corrective action. Otherwise similar PWSs may experience different capital 

and/or O&M costs due to site-specific factors. Inputs to unit costs such as water quality 

conditions, labor rates, and land costs can be highly variable and increase the system-to-system 

variability in unit costs. In developing the unit cost estimates, there is insufficient information to 

fully characterize what the distribution of this variability would be on a national scale; therefore, 

EPA uses mean values for these input parameters. 

The unit costs used in this EA are developed as average or representative estimates of 

what these unit costs would be nationally, and are not the unit costs of any particular PWS. Some 

components of monitoring costs, such as the purchase and wear-and-tear of vehicles, are not 

quantified because of either limited data or inability to attribute these costs directly to the 

proposed RTCR. Additionally, the PWS and state labor hours for each rule component 

(specifically for Level 1 and Level 2 assessments) are meant to capture national averages for the 

purposes of developing national cost estimates and making comparisons between regulatory 

alternatives. Thus, the unit costs presented in this document may over- or under-estimate the unit 

costs of any particular PWS. Detailed information on the derivation of unit costs for each rule 

component is provided in the Technology and Cost Document for the Proposed Revised Total 

Coliform Rule (USEPA, 2010d). 

7.5 Household Costs 

 The household cost analysis considers the impact that the costs incurred by CWSs have 

on the households they serve. This analysis considers the potential increase in a household’s 

annual water bill if a CWS passed the entire cost increase resulting from the proposed rule on to 

their customers. This analysis is a tool to gauge potential impacts and should not be construed as 

a precise estimate of potential changes to household water bills. State costs and costs to 

TNCWSs and NTNCWSs are not included in this analysis since their costs are not typically 

passed through directly to households. 

 
Economic Analysis for the Proposed RTCR 7-37 June 2010 

 To calculate household costs (which are in the units of $ per household per year), the 

CWS population subject to the proposed RTCR by PWS size is divided by the average number 

of people per household, estimated as 2.56 for the year 2007 (United States Census Bureau, 

2008), to calculate the number of households subject to the proposed RTCR by PWS size. The 

cost of the rule, by size category, is then divided by that number of households to determine a 

per-household cost. 

The first section of Exhibit 7.23 presents net costs per household under the AIP and 

Alternative option for all rule components spread across all CWSs. In this scenario, comparison 

to the current TCR shows a cost savings for households in the largest size category. For those 

households that are expected to see a cost increase, the average annual water bill would be 

expected to increase by less than ten cents on average. Although this average cost per household 

is very low, customers served by PWSs that incur greater costs to comply with the proposed 

RTCR would be higher. 

 

While the average increase in annual household water bills to implement the AIP option 

is less than a dollar, customers served by a small CWS that have to take corrective actions as a 

result of the proposed rule would incur slightly larger increases in their water bills. The 

subsequent sections of the exhibit present net costs per household for different subsections of 

CWSs (e.g., CWSs that perform assessments but no corrective actions, CWSs that do perform 

corrective actions, and CWSs that do not perform assessments or corrective actions). As shown 

in the second section of Exhibit 7.23, approximately 67% of households belong to CWSs that 

would perform assessments but would not perform corrective actions (because no sanitary 

defects are found). These households would experience a slight cost savings on an annual basis. 

The 9% of households belonging to CWSs that would perform corrective actions would 

experience an increase in annual net household costs of less than $1 to approximately $23 on an 

annual basis. The final section of the exhibit presents the 24% of households belonging to CWSs 

that would not perform assessments or corrective actions. Households of this category would 

experience an increase in cost savings comparable to those performing corrective actions, and a 

decrease in cost savings compared to those performing assessments but no corrective actions. 

This decrease in costs savings is because no PN costs are associated with systems not performing 

assessments. Overall, the main driver of additional household costs under the proposed RTCR is 

whether or not additional corrective actions are performed. 

 

 
Economic Analysis for the Proposed RTCR 7-38 June 2010 

Exhibit 7.23 Summary of Net Annual Per-Household Costs for the Proposed 

RTCR (2007$) 

AIP Net

AIP Net Cost per 

Houshold

Alternative 

Option Net

Alternative 

Option Net 

Cost per 

Household AIP Net

AIP Net 

Cost per 

Houshold

Alternative 

Option Net

Alternative 

Option Net 

Cost per 

Household

A B C D=C/A E F=E/B G H=G/A I J=I/B

≤100 307,243 307,243 68,433 $ 0.223 $ 180,905 $ 0.589 $ 170,417 $ 0.555 $ 310,914 $ 1.012 $ 

101-500 1,589,510 1,589,510 323,373 $ 0.203 $ 417,352 $ 0.263 $ 430,801 $ 0.271 $ 557,863 $ 0.351 $ 

501-1,000 1,624,853 1,624,853 35,455 $ 0.022 $ 75,901 $ 0.047 $ 86,936 $ 0.054 $ 138,624 $ 0.085 $ 

1,001-4,100 7,816,592 7,816,592 335,846 $ 0.043 $ 335,846 $ 0.043 $ 390,122 $ 0.050 $ 390,122 $ 0.050 $ 

4,101-33,000 27,997,647 27,997,647 2,295,169 $ 0.082 $ 2,295,169 $ 0.082 $ 2,007,071 $ 0.072 $ 2,007,071 $ 0.072 $ 

33,001-96,000 21,933,438 21,933,438 1,547,791 $ 0.071 $ 1,547,791 $ 0.071 $ 1,284,124 $ 0.059 $ 1,284,124 $ 0.059 $ 

96,001-500,000 26,770,609 26,770,609 1,463,800 $ 0.055 $ 1,463,800 $ 0.055 $ 1,199,384 $ 0.045 $ 1,199,384 $ 0.045 $ 

500,001-1 Million 9,764,979 9,764,979 153,975 $ 0.016 $ 153,975 $ 0.016 $ 122,635 $ 0.013 $ 122,635 $ 0.013 $ 

> 1 Million 16,309,853 16,309,853 (4,876) $ (0.000) $ (4,876) $ (0.000) $ (4,023) $ (0.000) $ (4,023) $ (0.000) $ 

Total 114,114,724 114,114,724 6,218,966 $ 0.054 $ 6,465,863 $ 0.057 $ 5,687,467 $ 0.050 $ 6,006,714 $ 0.053 $ 

≤100 125,340 124,920 (187,747) $ (1.498) $ (151,107) $ (1.210) $ (126,913) $ (1.013) $ (77,760) $ (0.622) $ 

101-500 460,577 464,568 (138,181) $ (0.300) $ (104,157) $ (0.224) $ (83,851) $ (0.182) $ (41,251) $ (0.089) $ 

501-1,000 394,643 401,009 (132,431) $ (0.336) $ (122,868) $ (0.306) $ (110,140) $ (0.279) $ (97,592) $ (0.243) $ 

1,001-4,100 2,341,578 2,341,578 (261,760) $ (0.112) $ (261,760) $ (0.112) $ (212,565) $ (0.091) $ (212,565) $ (0.091) $ 

4,101-33,000 24,827,588 24,827,588 (207,674) $ (0.008) $ (207,674) $ (0.008) $ (88,472) $ (0.004) $ (88,472) $ (0.004) $ 

33,001-96,000 19,232,570 19,232,570 (187,918) $ (0.010) $ (187,918) $ (0.010) $ (156,652) $ (0.008) $ (156,652) $ (0.008) $ 

96,001-500,000 23,912,325 23,912,325 (162,082) $ (0.007) $ (162,082) $ (0.007) $ (146,737) $ (0.006) $ (146,737) $ (0.006) $ 

500,001-1 Million 5,524,188 5,524,188 (45,790) $ (0.008) $ (45,790) $ (0.008) $ (42,392) $ (0.008) $ (42,392) $ (0.008) $ 

> 1 Million - - - $ - $ - $ - $ - $ - $ - $ - $ 

Total 76,818,809 76,828,746 (1,323,584) $ (0.017) $ (1,243,356) $ (0.016) $ (967,721) $ (0.013) $ (863,420) $ (0.011) $ 

≤100 13,927 13,880 325,679 $ 23.385 $ 347,280 $ 25.020 $ 296,928 $ 21.321 $ 318,549 $ 22.950 $ 

101-500 51,175 51,619 469,264 $ 9.170 $ 462,084 $ 8.952 $ 412,574 $ 8.062 $ 410,784 $ 7.958 $ 

501-1,000 43,849 44,557 164,754 $ 3.757 $ 167,578 $ 3.761 $ 143,922 $ 3.282 $ 146,752 $ 3.294 $ 

1,001-4,100 260,175 260,175 556,364 $ 2.138 $ 556,364 $ 2.138 $ 484,508 $ 1.862 $ 484,508 $ 1.862 $ 

4,101-33,000 3,170,059 3,170,059 2,526,599 $ 0.797 $ 2,526,599 $ 0.797 $ 2,132,792 $ 0.673 $ 2,132,792 $ 0.673 $ 

33,001-96,000 2,700,868 2,700,868 1,736,797 $ 0.643 $ 1,736,797 $ 0.643 $ 1,446,819 $ 0.536 $ 1,446,819 $ 0.536 $ 

96,001-500,000 2,858,284 2,858,284 1,624,577 $ 0.568 $ 1,624,577 $ 0.568 $ 1,345,503 $ 0.471 $ 1,345,503 $ 0.471 $ 

500,001-1 Million 613,799 613,799 194,889 $ 0.318 $ 194,889 $ 0.318 $ 161,003 $ 0.262 $ 161,003 $ 0.262 $ 

> 1 Million - - - $ - $ - $ - $ - $ - $ - $ - $ 

Total 9,712,136 9,713,240 7,598,924 $ 0.782 $ 7,616,167 $ 0.784 $ 6,424,050 $ 0.661 $ 6,446,711 $ 0.664 $ 

≤100 167,976 168,442 (69,499) (0.414) $ (15,268) (0.091) $ 402 0.002 $ 70,124 0.416 $ 

101-500 1,077,758 1,073,324 (7,710) (0.007) $ 59,425 0.055 $ 102,079 0.095 $ 188,331 0.175 $ 

501-1,000 1,186,361 1,179,288 3,132 0.003 $ 31,191 0.026 $ 53,154 0.045 $ 89,464 0.076 $ 

1,001-4,100 5,214,839 5,214,839 41,242 0.008 $ 41,242 0.008 $ 118,178 0.023 $ 118,178 0.023 $ 

4,101-33,000 - - - - $ - - $ - - $ - - $ 

33,001-96,000 - - - - $ - - $ - - $ - - $ 

96,001-500,000 - - - - $ - - $ - - $ - - $ 

500,001-1 Million 3,626,992 3,626,992 - - $ - - $ - - $ - - $ 

> 1 Million 16,309,853 16,309,853 - - $ - - $ - - $ - - $ 

Total 27,583,779 27,572,738 (32,836) $ (0.001) $ 116,591 $ 0.004 $ 273,813 $ 0.010 $ 466,097 $ 0.017 $ 

Source:

(C), (E), (G), (I) Exhibit 7.28.

Community Water Systems (CWSs) not performing Level 1/Level 2 Assessments, or Corrective Actions

Number of 

Households 

(Alternative 

Option)

Community Water Systems (CWSs) performing Level 1/Level 2 Assessments (and no Corrective Actions)

Community Water Systems (CWSs) performing Corrective Actions

7% Discount Rate

PWS Size

(Population

Served)

3% Discount Rate

Number of 

Households 

(AIP)

All Community Water Systems (CWSs)

7.6 Nonquantified Costs 

EPA believes that all of the rule elements that are the major drivers of the net changes in 

costs of the current TCR have been quantified to the greatest degree possible. However, cost 

reductions related to fewer monitoring and reporting violations are not specifically accounted for 

in the cost analysis, and their exclusion from consideration may result in an overestimate of net 

change in cost between the TCR and the AIP or Alternative option. 
Economic Analysis for the Proposed RTCR 7-39 June 2010 

In addition, under the TCR, AIP, and Alternative option, Tier 3 public notification for 

monitoring and reporting violations are assumed to be reported once per year as part of the CCR. 

Because of the use of the CCR to communicate Tier 3 public notification on a yearly basis, no 

cost differential between the current TCR and the AIP and Alternative option is estimated in the 

cost model. However, the advisory committee concluded that significant reductions in 

monitoring and reporting violations may be realized through the revised regulatory framework of 

the proposed RTCR. These possible reductions have not been quantified. System resources used 

to process monitoring violation notices for the CCR and respond to customer inquiries about the 

notices as well as state resources to remind systems to take samples, may be reduced if 

significant reductions are realized. Exclusion of this potential cost savings may lead to an 

underestimate of the PN cost savings under both the AIP and Alternative option. Such costs 

savings to states may be significant given the high occurrence of monitoring and reporting 

violations under the current TCR. 

Additionally, as an underlying assumption to the costing methodology, EPA has assumed 

that all PWSs subject to the proposed RTCR requirements are already complying with the 

current TCR. There may be some PWSs that are not in full compliance with the current TCR, 

and if so, additional costs would be incurred. 

7.7 Uncertainty Analysis 

There are two primary sources of uncertainty in the proposed RTCR cost modeling. The 

first is related to the underlying estimates of events resulting from the rule revisions as generated 

from the occurrence and predictive modeling. The occurrence and predictive modeling 

(discussed in detail in Chapter 5) does not explicitly consider uncertainty, and therefore does not 

generate “confidence intervals” on the predicted outcomes. However, EPA evaluated the model 

inputs to determine which of the inputs were likely to have a significant effect on the results and 

subjected those to further review through sensitivity analyses. In particular, EPA evaluated the 

impacts of alternative estimates of the net change percentage of PWSs predicted to take 

corrective actions in response to an assessment (10 percent in the model) and the associated 

effectiveness of those corrective actions (Section 5.3.3.1 discusses these analyses in detail). The 

results of these analyses suggest that changes in the major assumptions about the net change 

percentage of corrective actions identified and the effectiveness of those actions have a less than 

linear effect on predicted outcomes. When applied to costs estimates they would have even less 

impact. 

In the case where PWSs increase the percentage of corrective actions taken in response to 

an assessment, costs are expected to increase corresponding to the greater number of corrective 

actions taken. Using the increases predicted for the small subset of PWSs analyzed in the 

analysis, it is estimated that corrective actions (and related costs) would increase by 65% for 

Level 1 corrective actions and 7% for Level 2 corrective actions. This is in response to a 

doubling of the net change percentage of corrective actions taken in response to an assessment. 

However, the increased effectiveness of more corrective actions has a dampening effect on other 

costs that would offset the increased corrective action costs. For instance, although the numbers 

of corrective actions increase due to the higher percentages found during assessments, the actual 

number of assessments decreases (-16% Level 1 and -43% Level 2) because fewer positive 

samples (ranging from -13% routine TC+ to -28% repeat TC+) are predicted to be found. The 
Economic Analysis for the Proposed RTCR 7-40 June 2010 

overall effect of the cost increases and decreases in response to the major predictive occurrence 

model uncertainties is expected to be minimal. 

The other major area of uncertainty that may affect the resulting cost calculations is the 

distribution of corrective actions taken by PWSs (the compliance forecast) in response to finding 

a problem during a Level 1 or Level 2 assessment. The compliance forecast presented in Exhibit 

7.16 represents EPA’s best estimate of a distribution of corrective actions that may be taken by 

PWSs to respond to problems identified under the proposed RTCR. Because there is a wide 

variation in the unit costs of the actual corrective actions underlying the compliance forecast (see 

Appendix D for unit cost detail), EPA ran two sensitivity analyses to assess the potential impacts 

of different distributions within the compliance forecast. These two sensitivity runs attempt to 

bound the analysis of corrective action costs by generating a low and high cost bound to the 

estimates. 

Low Bound Estimate 

 During discussions in the TCRDSAC meetings, several stakeholders suggested that 

almost all additional corrective actions taken in response to the proposed RTCR would be in 

response to transient contamination events or poor sampling techniques. These are also the least 

expensive corrective actions. To examine the effects of greater emphasis on these types of 

corrective actions, EPA reran the cost model to reflect 90% selection of either spot flushing or 

sampler training as corrective actions. The remaining 10% of costs were distributed across the 

least costly corrective actions under each of the other compliance forecast categories. This results 

in an approximate 80 percent decrease in total net costs for the AIP and an approximate 44 

percent decrease in total net costs for the Alternative option. Exhibit 7.24 shows the change in 

the overall costs with this change. 

High Bound Estimate 

 PWSs may also take actions that result in higher corrective action costs than those 

predicted by the current compliance forecast, although this would be a less likely scenario based 

on stakeholder discussions. Purely economic considerations also suggest that, given the option, 

PWSs would opt for the least costly option to address any issues identified. However, to test a 

potential high end of corrective action costs, EPA ran the cost model with the compliance 

forecast set to take the highest cost corrective action in each compliance forecast category. In this 

scenario, only 5% of corrective actions were predicted for flushing and sampler training, and 

10% were estimated for each of the other compliance categories, and unit costs were assigned for 

the highest unit cost corrective action in each. This results in an increase in total net costs for the 

AIP by approximately a factor of 1.8, and an increase in total net costs by approximately a factor 

of 1.5 for the Alternative option. Exhibit 7.24 shows the annualized total and net change cost 

estimates for PWSs and states to comply with proposed RTCR under the TCR, AIP, and 

Alternative options based on low bound and high bound estimates in the compliance forecast. 
Economic Analysis for the Proposed RTCR 7-41 June 2010 

Exhibit 7.24 Sensitivity Analysis – Annualized Net Change in Costs based on 

Changes in Compliance Forecast ($Millions, 2007$) 

PWSs State Total PWSs State Total

AIP Net Change $ 0.15 13.54 $ 13.69 $ 13.24 $ 0.42 $ 13.66 $ 

AIP Low Bound Net Change $ 0.15 2.54 $ 2.68 $ 3.84 $ 0.42 $ 4.26 $ 

AIP High Bound Net Change $ 0.15 24.82 $ 24.96 $ 23.38 $ 0.42 $ 23.80 $ 

Alternative Option Net Change $ 0.29 26.95 $ 27.24 $ 29.10 $ 0.59 $ 29.69 $ 

Alternative Option Low Bound Net Change $ 0.29 15.03 $ 15.31 $ 18.64 $ 0.59 $ 19.23 $ 

Alternative Option High Bound Net Change $ 0.29 40.11 $ 40.40 $ 41.46 $ 0.59 $ 42.05 $ 

Note: Detail may not add due to independent rounding.

Source: Proposed RTCR Cost Model.

3% Discount Rate 7% Discount Rate

 Overall, EPA recognizes that there is uncertainty in various parts of its estimates that 

could result in either an over- or underestimate of the costs as presented in this chapter. Exhibit 

7.25 presents a summary of these issues, references the location in the EA where the information 

is introduced, and estimates the effects that each may have on national costs. All of the 

assumptions influencing the EA baseline (current TCR) do so in the same way for the AIP and 

Alternative option. Therefore, EPA does not expect the net results of the analyses presented in 

this EA to be significantly influenced by the uncertainty in the assumptions applied in 

developing the RTCR cost analysis. EPA has been careful to use the best available data, to 

account for uncertainty quantitatively when possible, and to avoid any consistent biases in 

assumptions and the use of data. 
Economic Analysis for the Proposed RTCR 7-42 June 2010 

Exhibit 7.25 Cost Uncertainty Summary 

Uncertainty 

Section with Full 

Discussion of 

Uncertainty 

Most Likely Effect of Current Assumptions on Estimate 

of National Costs 

Underestimate Overestimate Unknown Impact 

Labor Rate 7.2.1 X 

Labor Burden 

Estimates 

7.4.1 – 7.4.8 X 

Unit Costs 7.4.1 – 7.4.8 X [note 1] 

Percentage of 

systems on monthly, 

quarterly, and annual 

monitoring 

frequencies 

7.4.3 X 

Number of acute 

violations 

7.4.5 X 

Number of systems 

performing level 1 

and level 2 

assessments 

7.4.5 X 

Compliance 

forecasts for 

corrective actions 

based on level 1 and 

level 2 assessments 

7.4.6 and 7.7 X [note 2] 

Corrective Actions 

based on level 1 and 

level 2 Assessments 

7.4.6 X 

Notes: 

1) All unit costs (with the exception of those for corrective actions, which are not applied to the current TCR) 

were used in the proposed RTCR cost code in the same way for the current TCR, AIP, and Alternative 

option. Therefore, EPA expects that any under- or over-estimation would affect the baseline and other 

options similarly, resulting in no significant net effect on the results of the analysis. 

2) The compliance forecast represents EPA’s best estimate of a distribution of corrective actions that may be 

taken by PWSs to respond to problems identified under the proposed RTCR. EPA ran two sensitivity 

analyses to assess the potential impacts of different distributions within the compliance forecast (see 

Section 7.7). These two sensitivity runs showed that under the low bound and high bound estimates, the net 

change costs for the AIP were smaller than those for the Alternative Option. 

7.8 Comparison of Total and Net Annualized Costs for All Regulatory 

Alternatives 

Based on information presented previously in this chapter, EPA developed national cost 

estimates for the TCR, AIP, and Alternative option. Exhibit 7.26 presents the total8

 and net 

change in annualized costs to PWSs and states at 3 and 7 percent discount rates. Exhibit 7.27 

presents the total and net change in annualized costs for the TCR, AIP, and Alternative option by 

rule component at 3 and 7 percent discount rates. Exhibit 7.28 presents the total and net change 

in annualized costs for the TCR, AIP, and Alternative Option by PWS size and type at 3 and 7 

 

8

 Because only the incremental costs of some rule components are considered as part of the cost analysis, references 

to “total” costs in this section do not refer to the complete costs for regulatory implementation, but only to the 

specific costs considered to calculate net changes in costs. 
Economic Analysis for the Proposed RTCR 7-43 June 2010 

percent discount rates. Exhibit 7.29 presents the costs shown in Exhibit 7.28 on a per-PWS basis. 

Further discussion of the results follows these exhibits. 

Exhibit 7.26 Comparison of Total and Net Change from Current TCR in 

Annualized Present Value Costs ($Millions, 2007$) 

PWSs State Total PWSs State Total

TCR - Total $ 0.9 185 $ 186 $ 178 $ 0.9 $ 179 $ 

AIP - Total $ 1.1 199 $ 200 $ 191 $ 1.3 $ 192 $ 

AIP - Net Change 14 $ 0.1 $ 14 $ 13 $ 0.4 $ 14 $ 

AIP - Percent Change 7% 16% 7% 7% 48% 8%

Alternative Option - Total $ 1.2 212 $ 213 $ 207 $ 1.5 $ 209 $ 

Alternative Option - Net Change 27 $ 0.3 $ 27 $ 29 $ 0.6 $ 30 $ 

Alternative Option - Percent Change 15% 32% 15% 16% 67% 17%

3% Discount Rate 7% Discount Rate

Note: Detail may not add due to independent rounding. Because only the incremental costs of some rule components 

are considered as part of the cost analysis, references to “total” costs in this exhibit do not refer to the complete costs 

for regulatory implementation, but only to the specific costs considered to calculate net changes in costs. 

Source: Proposed RTCR Cost Model. 
Economic Analysis for the Proposed RTCR 7-44 June 2010 

Exhibit 7.27 Comparison of Total and Net Change in Annualized Present Value 

Costs by Rule Component ($Millions, 2007$) 

PWSs State Total PWSs State Total

TCR - Total $ - - $ - $ - $ - $ - $ 

AIP - Total $ 0.18 2.77 $ 2.95 $ 4.00 $ 0.26 $ 4.26 $ 

AIP - Net Change $ 0.18 2.77 $ 2.95 $ 4.00 $ 0.26 $ 4.26 $ 

Alternative Option - Total $ 0.18 2.77 $ 2.95 $ 4.00 $ 0.26 $ 4.26 $ 

Alternative Option - Net Change $ 0.18 2.77 $ 2.95 $ 4.00 $ 0.26 $ 4.26 $ 

TCR - Total $ - - $ - $ - $ - $ - $ 

AIP - Total $ 0.42 0.59 $ 1.01 $ 0.84 $ 0.59 $ 1.42 $ 

AIP - Net Change $ 0.42 0.59 $ 1.01 $ 0.84 $ 0.59 $ 1.42 $ 

Alternative Option - Total $ 0.42 0.59 $ 1.01 $ 0.84 $ 0.59 $ 1.42 $ 

Alternative Option - Net Change $ 0.42 0.59 $ 1.01 $ 0.84 $ 0.59 $ 1.42 $ 

TCR - Total $ - 170.59 $ 170.59 $ 163.94 $ - $ 163.94 $ 

AIP - Total $ - 174.71 $ 174.71 $ 167.74 $ - $ 167.74 $ 

AIP - Net Change $ - 4.12 $ 4.12 $ 3.80 $ - $ 3.80 $ 

Alternative Option - Total $ - 186.34 $ 186.34 $ 181.49 $ - $ 181.49 $ 

Alternative Option - Net Change $ - 15.75 $ 15.75 $ 17.56 $ - $ 17.56 $ 

TCR - Total $ - 3.87 $ 3.87 $ 3.72 $ - $ 3.72 $ 

AIP - Total $ - 1.12 $ 1.12 $ 1.09 $ - $ 1.09 $ 

AIP - Net Change $ - (2.75) $ (2.75) $ (2.63) $ - $ (2.63) $ 

Alternative Option - Total $ - 0.68 $ 0.68 $ 0.58 $ - $ 0.58 $ 

Alternative Option - Net Change $ - (3.19) $ (3.19) $ (3.14) $ - $ (3.14) $ 

TCR - Total $ - 5.11 $ 5.11 $ 4.92 $ - $ 4.92 $ 

AIP - Total $ - 4.82 $ 4.82 $ 4.64 $ - $ 4.64 $ 

AIP - Net Change $ - (0.29) $ (0.29) $ (0.28) $ - $ (0.28) $ 

Alternative Option - Total $ - 5.50 $ 5.50 $ 5.45 $ - $ 5.45 $ 

Alternative Option - Net Change $ - 0.39 $ 0.39 $ 0.54 $ - $ 0.54 $ 

TCR - Total $ - - $ - $ - $ - $ - $ 

AIP - Total $ - - $ - $ - $ - $ - $ 

AIP - Net Change $ - - $ - $ - $ - $ - $ 

Alternative Option - Total $ - - $ - $ - $ - $ - $ 

Alternative Option - Net Change $ - - $ - $ - $ - $ - $ 

TCR - Total $ 0.21 1.13 $ 1.34 $ 1.08 $ 0.20 $ 1.29 $ 

AIP - Total $ 0.20 1.63 $ 1.84 $ 1.57 $ 0.20 $ 1.77 $ 

AIP - Net Change $ (0.01) 0.50 $ 0.49 $ 0.49 $ (0.01) $ 0.48 $ 

Alternative Option - Total $ 0.23 1.73 $ 1.95 $ 1.69 $ 0.22 $ 1.91 $ 

Alternative Option - Net Change $ 0.01 0.60 $ 0.61 $ 0.60 $ 0.02 $ 0.62 $ 

TCR - Total $ 0.26 0.70 $ 0.96 $ 0.68 $ 0.25 $ 0.92 $ 

AIP - Total $ 0.19 0.90 $ 1.09 $ 0.88 $ 0.18 $ 1.06 $ 

AIP - Net Change $ (0.07) 0.20 $ 0.12 $ 0.20 $ (0.07) $ 0.13 $ 

Alternative Option - Total $ 0.28 1.23 $ 1.51 $ 1.27 $ 0.30 $ 1.57 $ 

Alternative Option - Net Change $ 0.02 0.52 $ 0.55 $ 0.60 $ 0.05 $ 0.65 $ 

TCR - Total $ - - $ - $ - $ - $ - $ 

AIP - Total $ 0.01 9.17 $ 9.18 $ 7.77 $ 0.01 $ 7.77 $ 

AIP - Net Change $ 0.01 9.17 $ 9.18 $ 7.77 $ 0.01 $ 7.77 $ 

Alternative Option - Total $ 0.01 9.39 $ 9.40 $ 8.01 $ 0.01 $ 8.02 $ 

Alternative Option - Net Change $ 0.01 9.39 $ 9.40 $ 8.01 $ 0.01 $ 8.02 $ 

TCR - Total $ - - $ - $ - $ - $ - $ 

AIP - Total $ 0.00 2.72 $ 2.72 $ 2.41 $ 0.00 $ 2.41 $ 

AIP - Net Change $ 0.00 2.72 $ 2.72 $ 2.41 $ 0.00 $ 2.41 $ 

Alternative Option - Total $ 0.01 3.53 $ 3.53 $ 3.36 $ 0.01 $ 3.37 $ 

Alternative Option - Net Change $ 0.01 3.53 $ 3.53 $ 3.36 $ 0.01 $ 3.37 $ 

TCR - Total $ 0.44 3.75 $ 4.19 $ 3.60 $ 0.42 $ 4.02 $ 

AIP - Total $ 0.06 0.26 $ 0.33 $ 0.26 $ 0.06 $ 0.32 $ 

AIP - Net Change $ (0.38) (3.48) $ (3.86) $ (3.34) $ (0.36) $ (3.70) $ 

Alternative Option - Total $ 0.08 0.34 $ 0.42 $ 0.35 $ 0.08 $ 0.43 $ 

Alternative Option - Net Change $ (0.36) (3.41) $ (3.77) $ (3.25) $ (0.34) $ (3.59) $ 

Notes: 

2) For modeling purposes, additional routine sample counts include regular routine samples taken in the same month.

Source: Proposed RTCR cost model.

3% Discount Rate 7% Discount Rate

Routine Monitoring

Corrective Actions based on Level 2 Assessments

Level 2 Assessment

Repeat Monitoring

Annual Site Visits

Level 1 Assessment

Corrective Actions based on Level 1 Assessments

Additional Routine Monitoring

Revising Sampling Plans

Rule Implementation

Public Notification

1) Detail may not add due to independent rounding. Because only the incremental costs of some rule components are considered as

part of the cost analysis, references to “total” costs in this exhibit do not refer to the complete costs for regulatory implementation, 

but only to the specific costs considered to calculate net changes in costs. 
Economic Analysis for the Proposed RTCR 7-45 June 2010 

Exhibit 7.28 Total and Net Change in Annualized Costs to PWSs by PWS Size and 

Type ($Millions, 2007$) 

TCR - Total AIP - Total AIP - Net

Alternative 

Option - Total

Alternative 

Option - Net TCR - Total AIP - Total AIP - Net

Alternative 

Option - 

Total

Alternative 

Option - Net

A B C=B-A D E=D-A F G H=G-F I J=I-F

≤100 $7.4 $7.5 $0.1 $7.6 $0.2 $7.1 $7.3 $0.2 $7.4 $0.3

101-500 $9.0 $9.3 $0.3 $9.4 $0.4 $8.6 $9.1 $0.4 $9.2 $0.6

501-1,000 $3.7 $3.8 $0.0 $3.8 $0.1 $3.6 $3.7 $0.1 $3.7 $0.1

1,001-4,100 $13.2 $13.6 $0.3 $13.6 $0.3 $12.7 $13.1 $0.4 $13.1 $0.4

4,101-33,000 $42.4 $44.7 $2.3 $44.7 $2.3 $40.7 $42.7 $2.0 $42.7 $2.0

33,001-96,000 $34.9 $36.4 $1.5 $36.4 $1.5 $33.5 $34.8 $1.3 $34.8 $1.3

96,001-500,000 $34.7 $36.2 $1.5 $36.2 $1.5 $33.4 $34.6 $1.2 $34.6 $1.2

500,001-1 Million $6.5 $6.7 $0.2 $6.7 $0.2 $6.2 $6.4 $0.1 $6.4 $0.1

> 1 Million $5.6 $5.5 ($0.0) $5.5 ($0.0) $5.3 $5.3 ($0.0) $5.3 ($0.0)

Total $157.4 $163.6 $6.2 $163.9 $6.5 $151.3 $157.0 $5.7 $157.3 $6.0

≤100 $2.6 $2.6 $0.1 $3.6 $1.0 $2.5 $2.6 $0.2 $3.8 $1.3

101-500 $1.9 $2.0 $0.1 $2.7 $0.9 $1.8 $2.0 $0.2 $2.9 $1.1

501-1,000 $0.6 $0.6 $0.0 $0.8 $0.3 $0.6 $0.6 $0.1 $0.9 $0.3

1,001-4,100 $1.2 $1.3 $0.1 $1.3 $0.1 $1.1 $1.2 $0.1 $1.2 $0.1

4,101-33,000 $0.4 $0.5 $0.1 $0.5 $0.1 $0.4 $0.5 $0.0 $0.5 $0.0

33,001-96,000 $0.1 $0.1 $0.0 $0.1 $0.0 $0.1 $0.1 $0.0 $0.1 $0.0

96,001-500,000 $0.1 $0.1 ($0.0) $0.1 ($0.0) $0.1 $0.1 ($0.0) $0.1 ($0.0)

500,001-1 Million $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0

> 1 Million $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0

Total $6.9 $7.2 $0.4 $9.1 $2.3 $6.6 $7.2 $0.6 $9.4 $2.8

≤100 $13.4 $18.5 $5.1 $26.7 $13.4 $12.8 $18.0 $5.1 $27.8 $14.9

101-500 $4.9 $6.4 $1.5 $9.1 $4.2 $4.7 $6.2 $1.5 $9.4 $4.7

501-1,000 $0.6 $0.8 $0.2 $1.1 $0.5 $0.6 $0.8 $0.2 $1.2 $0.5

1,001-4,100 $0.9 $1.0 $0.1 $1.0 $0.1 $0.9 $1.0 $0.1 $1.0 $0.1

4,101-33,000 $0.4 $0.5 $0.1 $0.5 $0.1 $0.4 $0.5 $0.0 $0.5 $0.0

33,001-96,000 $0.1 $0.1 ($0.0) $0.1 ($0.0) $0.1 $0.1 ($0.0) $0.1 ($0.0)

96,001-500,000 $0.1 $0.1 ($0.0) $0.1 ($0.0) $0.1 $0.1 ($0.0) $0.1 ($0.0)

500,001-1 Million $0.2 $0.2 ($0.0) $0.2 ($0.0) $0.2 $0.2 ($0.0) $0.2 ($0.0)

> 1 Million $0.3 $0.3 $0.0 $0.3 $0.0 $0.3 $0.3 $0.0 $0.3 $0.0

Total $20.9 $27.8 $6.9 $39.1 $18.2 $20.1 $27.1 $7.0 $40.4 $20.3

Grand Total $185.2 $198.7 $13.5 $212.1 $26.9 $177.9 $191.2 $13.2 $207.0 $29.1

Source: Proposed RTCR cost model.

Note: Detail may not add due to independent rounding. Because only the incremental costs of some rule components are considered as part of the cost analysis, references to “total” costs 

in this exhibit do not refer to the complete costs for regulatory implementation, but only to the specific costs considered to calculate net changes in costs. 

PWS Size

(Population

Served)

3% Discount Rate 7% Discount Rate

Community Water Systems (CWSs)

Nontransient Noncommunity Water Systems (NTNCWSs)

Transient Noncommunity Water Systems (TNCWSs)
Economic Analysis for the Proposed RTCR 7-46 June 2010 

Exhibit 7.29 Total and Net Change in Annualized Per PWS Costs by PWS Size 

and Type (2007$) 

TCR - Total AIP - Total AIP - Net

Alternative 

Option - 

Total

Alternative 

Option - Net TCR - Total AIP - Total AIP - Net

Alternative 

Option - 

Total

Alternative 

Option - Net

A B C=B-A D E=D-A F G H=G-F I J=I-F

≤100 $564 $570 $5 $578 $14 $542 $555 $13 $566 $24

101-500 $561 $581 $20 $587 $26 $539 $566 $27 $574 $35

501-1,000 $662 $669 $6 $676 $13 $637 $652 $15 $661 $25

1,001-4,100 $1,411 $1,447 $36 $1,447 $36 $1,356 $1,397 $42 $1,397 $42

4,101-33,000 $6,707 $7,070 $363 $7,070 $363 $6,445 $6,763 $318 $6,763 $318

33,001-96,000 $33,053 $34,520 $1,467 $34,520 $1,467 $31,764 $32,981 $1,217 $32,981 $1,217

96,001-500,000 $93,619 $97,565 $3,946 $97,565 $3,946 $89,968 $93,201 $3,233 $93,201 $3,233

500,001-1 Million $185,678 $190,077 $4,399 $190,077 $4,399 $178,435 $181,939 $3,504 $181,939 $3,504

> 1 Million $277,732 $277,488 ($244) $277,488 ($244) $266,900 $266,698 ($201) $266,698 ($201)

Total $3,029 $3,148 $120 $3,153 $124 $2,911 $3,020 $109 $3,026 $116

≤100 $284 $292 $8 $394 $111 $273 $291 $18 $413 $141

101-500 $273 $289 $16 $397 $124 $263 $289 $26 $416 $153

501-1,000 $321 $347 $26 $465 $144 $308 $346 $38 $486 $178

1,001-4,100 $1,325 $1,436 $111 $1,436 $111 $1,273 $1,380 $106 $1,380 $106

4,101-33,000 $4,819 $5,365 $546 $5,365 $546 $4,631 $5,110 $478 $5,110 $478

33,001-96,000 $32,004 $33,310 $1,305 $33,310 $1,305 $30,757 $31,853 $1,096 $31,853 $1,096

96,001-500,000 $91,171 $90,807 ($364) $90,807 ($364) $87,617 $87,298 ($319) $87,298 ($319)

500,001-1 Million $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

> 1 Million $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total $366 $387 $20 $488 $121 $352 $382 $30 $501 $149

≤100 $217 $300 $83 $434 $217 $209 $292 $83 $451 $243

101-500 $247 $323 $76 $459 $212 $237 $314 $77 $474 $237

501-1,000 $311 $405 $94 $548 $237 $299 $393 $94 $564 $265

1,001-4,100 $1,363 $1,524 $161 $1,524 $161 $1,310 $1,457 $147 $1,457 $147

4,101-33,000 $5,068 $5,658 $589 $5,658 $589 $4,871 $5,390 $519 $5,390 $519

33,001-96,000 $38,507 $38,155 ($352) $38,155 ($352) $37,008 $36,701 ($307) $36,701 ($307)

96,001-500,000 $77,791 $77,043 ($748) $77,043 ($748) $74,762 $74,090 ($672) $74,090 ($672)

500,001-1 Million $186,699 $184,841 ($1,858) $184,841 ($1,858) $179,429 $177,725 ($1,704) $177,725 ($1,704)

> 1 Million $287,010 $301,525 $14,515 $301,525 $14,515 $275,817 $289,883 $14,066 $289,883 $14,066

Total $248 $331 $83 $465 $216 $238 $322 $83 $480 $241

Grand Total $1,196 $1,283 $87 $1,370 $174 $1,149 $1,235 $39 $1,337 $141

Source: Proposed RTCR cost model.

Note: Detail may not add due to independent rounding. Because only the incremental costs of some rule components are considered as part of the cost analysis, 

references to “total” costs in this exhibit do not refer to the complete costs for regulatory implementation, but only to the specific costs considered to calculate net 

changes in costs. 

Transient Noncommunity Water Systems (TNCWSs)

3% Discount Rate 7% Discount Rate

Community Water Systems (CWSs)

Nontransient Noncommunity Water Systems (NTNCWSs)

PWS Size

(Population

Served)

Evaluation of Regulatory Options 

Exhibit 7.26 summarizes the comparison of total and annualized present value of the net 

change difference in cost from the baseline for each of the three regulatory scenarios (existing 

TCR, AIP Option, and Alternative option). A continuation of the existing TCR would result in 

no net change in costs. The net change in mean annualized present value national costs of the 

AIP Option is estimated to be approximately $14M. The net change in mean annualized present 

value national costs for the Alternative option are estimated to be approximately $27M using a 

3% discount rate and $30M using a 7% discount rate. 

The total net change in national annualized present value costs for PWSs serving >4,100 

people (approximately $5M) are the same under the AIP and Alternative option. This is expected 

because the provisions for PWSs serving >4,100 are the same under both the AIP and Alternative 

option. Monitoring requirements for PWSs serving >4,100 people would remain essentially 
Economic Analysis for the Proposed RTCR 7-47 June 2010 

unchanged under either the AIP or Alternative option. The observed overall net increase in costs 

for PWSs serving >4,100 people is driven primarily by the requirements to conduct assessments 

and to correct any sanitary defects that are found. 

Under the AIP, PWSs are estimated to incur approximately 97% to 99% of the net 

annualized present value costs. States are expected to incur the remaining costs. EPA recognizes 

that state labor may be more expensive than PWS labor, and that for some states, state costs may 

be passed onto PWSs. However, state costs are only a very small percentage of the total net 

change costs for the RTCR. 

Exhibit 7.27 presents the comparison of total and net change in annualized present value 

costs by rule component. The exhibit shows that, for the AIP and Alternative option, corrective 

action costs are the most significant contributor to the net increase in costs for PWSs. Under the 

AIP, state costs to review revised sampling plans contribute most to the cost increase. For both 

PWSs and states, a net decrease in costs associated with PN requirements helps to offset the total 

net cost increase. 

The large difference in net cost increases between the AIP and the Alternative option is 

primarily driven by the increased number of routine samples taken under the Alternative option 

in comparison to the AIP. A larger number of samples are also estimated to result more in Level 

1 and Level 2 triggers and to subsequently require corrective actions based on Level 1 and Level 

2 assessments. Overall, the total net costs of the AIP are estimated at 50% of the net costs of the 

Alternative option. This cost difference is an important consideration in the selection of the AIP 

option over the Alternative option as the preferred proposed RTCR option. 

Exhibit 7.28 presents the total and net change in annualized costs to PWSs by size and 

type for the three regulatory options. No net change in costs would result from a continuation of 

the current TCR. Among PWSs serving ≤4,100 people, the largest increase in net costs would be 

incurred by the TNCWSs serving ≤100 people under either the AIP ($5.1M) or Alternative 

option ($13.4M). As shown in Exhibit 7.29, on a per system basis, this translates to a net 

annualized present value increase of approximately $83 per system under the AIP and $217 per 

system under the Alternative option for the TNCWSs serving ≤100 people. Significant impacts 

are also estimated for CWSs serving greater than 4,101 people, driven by the relatively high 

number of CWSs in this category, combined with relatively high unit costs for implementing 

corrective actions for PWSs of this size. However, PWSs of this size (and CWSs in general) are 

expected to be better able to absorb cost increases by passing costs through to a larger base of 

customers. Overall, the most important drivers of total net costs are the numbers of PWSs and 

the underlying baseline occurrence estimates in a given size category. Taken together, these 

influence the numbers of samples and ultimately the numbers of corrective actions taken, which 

drive the cost estimates. 

Exhibit 7.29 shows the costs from Exhibit 7.28 on a per-PWS basis. On this basis, the 

annual impact of the proposed RTCR generally increases with PWS size and the magnitude of 

the annual per-PWS net costs do not appear to be prohibitive, even for the most heavily impacted 

PWS categories. However, the range of per-PWS costs is expected to be fairly wide and some 

individual PWSs may be more heavily impacted. 
Economic Analysis for the Proposed RTCR 8-1 June 2010

8. Economic Impact Analysis 

8.1. Introduction 

As part of the rulemaking process, the United States Environmental Protection Agency 

(EPA) is required to address the direct and indirect burdens that the Revised Total Coliform Rule 

(RTCR) may place on certain types of governments, businesses, and populations. This chapter 

presents analyses performed by the EPA in accordance with the following 12 federal mandates 

and statutory reviews: 

1. Executive Order 12866: Regulatory Planning and Review. 

2. Paperwork Reduction Act (the Information Collection Request (ICR) document 

for the proposed RTCR contains the complete analysis (USEPA, 2010b)). 

3. The Regulatory Flexibility Act (RFA) of 1980, as amended by the Small Business 

Regulatory Enforcement Fairness Act (SBREFA) of 1996. 

4. Unfunded Mandates Reform Act (UMRA) of 1995. 

5. Executive Order 13132: Federalism. 

6. Executive Order 13175: Consultation and Coordination with Indian Tribal 

Governments. 

7. Executive Order 13045: Protection of Children from Environmental Health Risks 

and Safety Risks. 

8. Executive Order 13211: Action Concerning Regulations That Significantly Affect 

Energy Supply, Distribution, or Use. 

9. National Technology Transfer and Advancement Act (NTTAA). 

10. Executive Order 12898: Federal Action to Address Environmental Justice in 

Minority Populations and Low-Income Populations. 

11. Consultations with the Science Advisory Board (SAB), National Drinking Water 

Advisory Council (NDWAC), and the Secretary of Health and Human Services as 

Required by Section 1412 (d) and (e) of the Safe Drinking Water Act (SDWA). 

12. Impacts on Sensitive Subpopulations as Required by Section 1412(b)(3)(c)(i) of 

the 1996 Amendments to the SDWA. 

13. Plain Language as Required by Executive Order 12866. 

 Many of the requirements and executive orders listed above call for an explanation of 

why the rule is necessary, the statutory authority for the rule, and the primary objectives that the 

rule is intended to achieve (refer to Chapter 2 for more information regarding the objectives of 

the rule). Others are designed to assess the financial and health effects of the rule on sensitive, 

low-income, and tribal populations as well as on small Public Water Systems (PWSs). 
Economic Analysis for the Proposed RTCR 8-2 June 2010

8.2. Executive Order 12866: Regulatory Planning and Review 

 Under Executive Order 12866 (58 Federal Register (FR) 51735, October 4, 1993), the 

Agency must determine whether the regulatory action is “significant” and therefore subject to 

Office of Management and Budget (OMB) review and the requirements of the Executive Order. 

The Order defines “significant regulatory action” as one that is likely to result in a rule that may: 

• Have an annual effect on the economy of $100 million or more or adversely affect 

in a material way the economy, a sector of the economy, productivity, 

competition, jobs, the environment, public health or safety, or state, local, or tribal 

governments or communities; 

• Create a serious inconsistency or otherwise interfere with an action taken or 

planned by another agency; 

• Materially alter the budgetary impact of entitlement, grants, user fees, or loan 

programs or the rights and obligations of recipients thereof; or 

• Raise novel legal or policy issues arising out of legal mandates, the President’s 

priorities, or the principles set forth in the Executive Order. 

 Under Executive Order 12866, this action is a “significant regulatory action.” 

Accordingly, EPA submitted this action to the OMB for review under Executive Order 12866 

and any changes made in response to OMB recommendations have been documented in the 

docket for this action. 

In addition, EPA prepared an analysis of the potential costs and benefits associated with 

this action. EPA estimates that the proposed RTCR will have an overall impact on PWSs of $14 

M and that the impact on small entities (PWSs serving 10,000 people or fewer) will be $9.4 M - 

$9.8 M annualized at 3 and 7 percent discount rates, respectively. These impacts are described in 

Section 8.4 as well as sections VI and VII.C of the proposed RTCR preamble (USEPA 2010c), 

respectively. 

8.3. Paperwork Reduction Act 

The information collection requirements for the proposed RTCR have been submitted for 

approval to the OMB under the Paperwork Reduction Act (PRA), 44 U.S.C. 3501 et seq. The 

ICR document prepared by EPA has been assigned EPA ICR number 1895.06. 

The PRA requires EPA to estimate the burden on PWSs and state/primacy agencies of 

complying with the rule. The information collected as a result of EPA’s efforts toward proposing 

the proposed RTCR should allow states/primacy agencies and EPA to determine appropriate 

requirements for specific systems and evaluate compliance with the proposed RTCR. Burden is 

defined at 5 CFR 1320.3(b) and means the total time, effort, and financial resources required to 

generate, maintain, retain, disclose, or provide information to or for a federal agency. The burden 

includes the time needed to conduct the following state and PWS activities: 
Economic Analysis for the Proposed RTCR 8-3 June 2010

 State activities: 

• Read and understand the rule; 

• Mobilize (including primacy application), plan, and implement; 

• Train PWS and consultant staff; 

• Track compliance; 

• Analyze and review PWS data; 

• Review sampling plans and recommend any revisions to PWSs; 

• Make determinations concerning PWS monitoring requirements; 

• Respond to PWSs with positive samples; 

• Recordkeeping; 

• Review completed assessment forms and consult with the PWS about the 

assessment report; 

• Review and coordinate with PWSs to determine optimal corrective actions to be 

implemented; and 

• Provide consultation, review public notification certifications, and file reports of 

violations. 

 PWS activities: 

• Read and understand the rule; 

• Planning and mobilization activities; 

• Revise existing sampling plans to identify sampling locations and collection 

schedules that are representative of water throughout the distribution system; 

• Conduct routine, additional routine, and repeat monitoring; 

• Complete a Level 1 Assessment if the PWS experiences a Level 1 trigger, and 

submit a timetable to the state to identify sanitary defects detected, corrective 

actions completed, and a timetable for any corrective actions not already 

completed; 

• Complete a Level 2 Assessment if the PWS experiences a Level 2 trigger, and 

submit a timetable for any corrective actions not already completed; 
Economic Analysis for the Proposed RTCR 8-4 June 2010

• Correct sanitary defects found through the performance of Level 1 or Level 2 

assessments; 

• Develop and distribute Tier 1 public notices when E. coli MCL violations occur; 

• Develop and distribute Tier 2 public notices when the PWSs failed to take 

corrective action; and 

• Develop and distribute Tier 3 public notices when the PWSs failed to comply 

with the monitoring requirements or with mandatory reporting of required 

information within the specified timeframe. 

 For the first three years after publication of the final rule in the Federal Register, the 

major information requirements apply to 154,894 respondents. The total incremental burden 

associated with the change in moving from the information requirements of the current TCR to 

those in the proposed RTCR over the three years covered by the ICR is 2,518,878 hours, for an 

average of 839,526 hours per year. The total incremental cost over the three year clearance 

period is $71.3 million, for an average of $23.8 million per year (simple average over three 

years). (The ICR estimate is higher than what is presented in the Economic Analysis (EA) for the 

proposed rule because in the EA, the up-front costs that occur in the first three years, as well as 

future costs, are annualized over a 25-year time horizon.) The average burden per response (i.e., 

the amount of time needed for each activity that requires a collection of information) is 5.4 

hours; the average cost per response is $153.4. The collection requirements are mandatory under 

SDWA (42 U.S.C. 300h et seq.). Detail on the calculation of the proposed rule information 

collection burden and costs can be found in the ICR for the Proposed RTCR and Chapter 7 of 

this EA. A summary of the burdens and costs of the proposed collection is presented in Exhibit 

8.1 below. 

Exhibit 8.1 Average Annual Net Change Burden and Costs for the Proposed RTCR 

Information Collection Request 

Annual Labor 

Cost

Annual O&M 

Cost

Annual Capital 

Cost

Total Annual 

Cost

PWSs 747,848 $ 20,171,639 $ - $ - $ 20,171,639 103,225

States and 

Territories 91,678 $ 3,595,421 $ - $ - $ 3,595,421 51,669

TOTAL 839,526 $ 23,767,060 $ - $ - $ 23,767,060 154,894

Respondent Type

Annual Burden 

Hours

Cost

Annual 

Responses

Notes: Detail may not add exactly to total due to independent rounding. 

“Annual Burden Hours” reflects an annual average for all system sizes over the 3-year ICR period. 

 Source: ICR for the proposed RTCR (USEPA 2010b).

An agency may not conduct or sponsor, and a person is not required to respond to, a 

collection of information unless it displays a currently valid OMB control number. The OMB 

control numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9. 
Economic Analysis for the Proposed RTCR 8-5 June 2010

To comment on EPA’s need for this information, the accuracy of the provided burden 

estimates, and any suggested methods for minimizing respondent burden, EPA has established a 

public docket for this proposed rule, which includes this ICR, under Docket ID number EPAHQ-OW-2008-0878. Submit any comments related to the ICR to EPA and OMB. See 

ADDRESSES section at the beginning of this notice for where to submit comments to EPA. 

Send comments to OMB at the Office of Information and Regulatory Affairs, Office of 

Management and Budget, 725 17th Street, NW, Washington, DC 20503, Attention: Desk Officer 

for EPA. Since OMB is required to make a decision concerning the ICR between 30 and 60 days 

after [INSERT DATE OF PUBLICATION IN THE FEDERAL REGISTER], a comment to 

OMB is best assured of having its full effect if OMB receives it by [INSERT DATE 30 DAYS 

AFTER PUBLICATION IN THE FEDERAL REGISTER]. The final rule will respond to 

any OMB or public comments on the information collection requirements contained in this 

proposal. 

8.4. The Regulatory Flexibility Act 

 The RFA generally requires an agency to prepare a regulatory flexibility analysis of any 

rule subject to notice and comment rulemaking requirements under the Administrative Procedure 

Act or any other statute unless the agency certifies that the rule will not have a significant 

economic impact on a substantial number of small entities. Small entities include small 

businesses, small organizations, and small governmental jurisdictions. 

 The RFA provides default definitions for each type of small entity. Small entities are 

defined as: (1) a small business as defined by the Small Business Administration’s (SBA) 

regulations at 13 CFR 121.201; (2) a small governmental jurisdiction that is a government of a 

city, county, town, school district, or special district with a population of less than 50,000; and 

(3) a small organization that is any "not-for-profit enterprise which is independently owned and 

operated and is not dominant in its field." However, the RFA also authorizes an agency to use 

alternative definitions for each category of small entity, “which are appropriate to the activities 

of the agency” after proposing the alternative definition(s) in the Federal Register and taking 

comment. 5 USC 601(3) - (5). In addition, to establish an alternative small business definition, 

agencies must consult with SBA’s Chief Counsel for Advocacy. 

 For purposes of assessing the impacts of the proposed RTCR on small entities, EPA 

considered small entities to be PWSs serving fewer than 10,000 people. This is the cut-off level 

specified by Congress in the 1996 Amendments to the SDWA for small system flexibility 

provisions. As required by the RFA, EPA proposed using this alternative definition in the 

Federal Register (63 FR 7620, February 13, 1998), requested public comment, consulted with 

the SBA, and finalized the alternative definition in the Consumer Confidence Reports regulation 

(63 FR 44524, August 19, 1998). As stated in that Final Rule, the alternative definition would be 

applied for all future drinking water regulations. 

After considering the economic impacts of today’s proposed rule on small entities, I 

certify that this action will not have a significant economic impact on a substantial number of 

small entities. The small entities directly regulated by this proposed rule are small PWSs serving 

fewer than 10,000 people. These include small community water systems (CWSs), non-transient 

noncommunity water systems (NTNCWSs), and transient noncommunity water systems 

(TNCWSs), entities such as municipal water systems (publicly and privately owned), and 
Economic Analysis for the Proposed RTCR 8-6 June 2010

privately-owned PWSs and for profit businesses where provision of water may be ancillary, such 

as mobile home parks, day care centers, churches, schools and homeowner associations. We 

have determined that only 61 of 150,672 small systems (0.04 percent) will experience an impact 

of more than one percent of revenues, and that none of the small systems will experience an 

impact of three percent or greater of revenue. Exhibit 8.2 provides a summary of the numbers 

and percentages of small systems for which costs exceed one percent of revenues, by size 

category and system type using a three percent discount rate. Exhibit 8.3 provides a summary of 

the average costs to average revenues on a per system basis. 

Exhibit 8.2 Average Annualized Revenue by System Size and Percent of Systems 

with Costs Exceeding One Percent and Three Percent of Revenue (Three Percent 

Discount Rate) 

Total

Systems

Average

Revenue/

System

1% of

Revenue

Systems

Exceeding

1% of

Revenue

Percent of

Systems

Exceeding

1% of

Revenue

3% of

Revenue

Systems

Exceeding

3% of

Revenue

Percent of

Systems

Exceeding

3% of

Revenue

A B C=B*0.01 D E=D/A F=B*0.03 G H=G/A

<500         29,150 $            199,000 $          2,000 60 0.21% 6,000 $            0 0.00%

501 ‐ 4,100 15,021          $        1,114,000 $        11,000 0 0.00% 33,000 $         0 0.00%

4,101 ‐ 10,000 3,672            $        4,432,000 $        44,000 1 0.03% 133,000 $       0 0.00%

<500         15,942 $        3,075,000 $       31,000 0 0.00% 92,000 $        0 0.00%

501 ‐ 4,100 2,690            $      11,793,000 $      118,000 0 0.00% 354,000 $       0 0.00%

4,101 ‐ 10,000 80                  $      61,663,000 $      617,000 0 0.00% 1,850,000 $   0 0.00%

<500         81,311 $        1,811,000 $       18,000 0 0.00% 54,000 $        0 0.00%

501 ‐ 4,100 2,735            $        3,192,000 $        32,000 0 0.00% 96,000 $         0 0.00%

4,101 ‐ 10,000 71                  $      11,280,000 $      113,000 0 0.00% 338,000 $       0 0.00%

All <10,000 150,672       N/A N/A 61 0.04% N/A 0 0.00%

System

Type

System

Size

CWS

NTNCWS

TNCWS

Sources: (A) SDWIS 2007 (B) Average CWS revenues from 2006 CWSS survey. Average NTNCWS and TNCWS 

revenues calculated based on representative revenues for specific business categorizations (Appendix I provides 

additional detail.) 

(D, G) Number of systems with costs exceeding one percent and three percent of revenue calculated based on 

distributions of costs for each rule component by system size compared to the average revenues. As a function of 

calculations in the cost model, fractional system counts may be generated. Analyses in the exhibit are based only on 

whole system counts. (Appendix I provides additional detail.) Consistent with the rest of the EA, the population break 

is at 4,100 people rather than 3,300. This population break was based on TCRDSAC deliberations and consideration 

that concluded that breaking out the analysis at the 4,100 point would be most informative because of changes in the 

rule provisions at the 4,100 people point. (Chapter 4 provides further detail on data selection and size break outs.) 
Economic Analysis for the Proposed RTCR 8-7 June 2010

Exhibit 8.3 Average Costs per System and as Percentage of Revenue (2007$) 

Number

of

Systems

Average

Annual

Net Cost/

System

Average

Revenue/

System1

Average Annual

Net Costs as a

Percentage of

Revenue

A B C D=(B/C)*100

<500      126,403 $                        57 $            1,599,000 0.004%

501 ‐ 4,100 20,446         $                         43 $             2,797,000 0.002%

4,101 ‐ 10,000 3,823            $                       262 $             5,757,000 0.005%

All PWSs

<10,000 150,672       $                         60 $             1,867,000 0.003%

System

Size

1 Includes water revenues and non‐water revenues (e.g., revenues related to the primary

entities that operate a water system to support their business or municipal general revenue

for publicly owned and operated systems).  

Although this proposed rule will not have a significant economic impact on a substantial 

number of small entities, EPA nonetheless has tried to reduce the impact of this rule on small 

PWSs. Provisions in the proposed RTCR that result in reduced costs for many small entities 

include: 

• Reduced routine monitoring for qualifying PWS serving 1,000 or fewer people. 

• Reduced number of repeat samples required. 

• Reduced additional routine monitoring for PWS serving 4,100 or fewer people. 

• Reduced public notification requirements for all systems, including small 

systems. 

For some PWSs, cost savings may be offset in whole or in part by increased costs of 

more stringent assessment requirements, stricter rules for qualifying for reduced monitoring, or 

performing specific corrective actions. Additionally, seasonal PWSs are subject to increased 

monitoring. 

A description of activities that small systems perform under the proposed RTCR for each 

rule component is provided in Section 7.4 of this EA along with the associated change in cost. 

Exhibit 8.4 below provides the distribution of total costs to small entities by rule component. 

Underlying these estimates are EPA’s assumptions regarding the types of corrective actions that 

will be implemented and the number of small PWSs predicted to implement each type. These 

assumptions are detailed in Appendix D of this EA. 
Economic Analysis for the Proposed RTCR 8-8 June 2010

Exhibit 8.4 Annualized Net Rule Costs Predicted for Small Entities (PWSs serving 

≤10,000) by Rule Component Using Three Percent and Seven Percent Discount 

Rates (2007$) 

Rule Component Net Costs at 3% Net Costs at 7%

Rule Implementation 2,673,000 $ 3,849,000 $ 

Revising Sampling Plans 535,000 $ 755,000 $ 

Routine Monitoring 4,120,000 $ 3,799,000 $ 

Additional Routine Monitoring (2,750,000) $ (2,631,000) $ 

Repeat Monitoring (193,000) $ (186,000) $ 

Site Inspections - $ - $ 

Level 1 Assessment 414,000 $ 401,000 $ 

Level 2 Assessment 172,000 $ 179,000 $ 

Correction Actions based on Level 1 

Assessments 4,712,000 $ 4,055,000 $ 

Correction Actions based on Level 2 

Assessments 2,542,000 $ 2,255,000 $ 

Public Notification (2,789,000) $ (2,675,000) $ 

Total 9,435,000 $ 9,801,000 $ 

Source: Derived from cost model outputs (Appendix C). 

EPA also conducted outreach to small entities and convened a Small Business Advocacy 

Review (SBAR) Panel to obtain advice and recommendations of representatives of the small 

entities that potentially would be subject to the proposed rule's requirements. EPA consulted with 

small entity representatives before and during the review by the Panel. These small entity 

representatives included representatives from small water systems of various types and sizes, 

representatives from associations that assist and /or advocate for small systems, and federal 

agencies that operate small systems. Panel members included representatives from OMB, SBA, 

and the EPA Office of Ground Water and Drinking Water. The consultation led to the 

development of a report providing recommendations to EPA on how to revise the TCR to 

address small system concerns, which EPA considered in drafting this proposed RTCR (SBAR 

Panel 2008). EPA also made presentations to the advisory committee on the recommendations of 

the Panel so the advisory committee could consider their recommendations in developing the 

Agreement in Principle (AIP). 

Consistent with the RFA/SBREFA requirements, the Panel evaluated the assembled 

materials and small-entity comments on issues and prepared a final report to the EPA 

Administrator. A copy of the Panel report is included in the docket for this proposed rule. The 

proposed rule is consistent with the Panel recommendations to use total coliforms as a trigger for 

investigation and/or corrective action, to balance monitoring requirements and costs with risk, to 

further differentiate requirements based on differences in water systems, to coordinate 

requirements with other related rules, and to consider reporting and recordkeeping costs in 

estimating burden. Consistent with the Panel recommendation to evaluate which parameters are 

most appropriate for routine monitoring and as potential triggers for investigative and corrective 

actions, EPA is conducting a review of existing methods for total coliform and E. coli analysis 

and is evaluating its Alternative Test Procedure protocol for approving new methods as 

described in section III.9 of the proposed RTCR preamble. EPA is also one of the founding 
Economic Analysis for the Proposed RTCR 8-9 June 2010

members of a Research and Information Collection Partnership, described in section V of the 

proposed RTCR preamble, which is considering research and information needs to evaluate the 

magnitude of risks and potential risk mitigation options related to potential distribution system 

contamination. 

 EPA further reviewed the potential impacts of the AIP option on small entities in terms 

of the assumption incorporated into SDWA major rulemakings that households or residential 

water users are most vulnerable to cost increases1

 (SBAR Panel 2008). In an Assessment of the 

Vulnerability of Noncommunity Water Systems to SDWA Cost Increases (USEPA, 2008d), EPA 

considered the burden of SDWA rule costs in comparison to the average revenues of various 

categories of noncommunity water systems. All of the NCWS categories reviewed were found 

to be less vulnerable to SDWA-related increases than a typical household. The report notes that 

in some categories of businesses, costs are more easily passed on to the customer base than in 

others. However, in each NCWS category, expenditures on water were found to be a relatively 

small percentage of total revenues. In nearly all cases, water expenditures (including 

expenditures for sewer service and miscellaneous other utilities) totaled less than one percent of 

total revenues, and were not more than 1.3 percent of total revenues for any category. Several 

caveats were put forth in this report, including one that considered the potential for 

underestimating the impact to golf courses, which were grouped in with other recreational 

entities whose use of water was less significant to the core business than the golf courses. 

Despite the significant caveats listed, the report strongly suggests that TNCWS and NTNCWS 

should not be considered particularly vulnerable to operating cost increases resulting from 

SDWA rulemakings. 

 The consistency of many of the aspects of the AIP option with the recommendations of 

the SBAR Panel further support that the formulation of the proposed RTCR EA is conducive to 

minimizing net impacts on small entities that will be affected by the rule. Overall, the economic 

analysis summarized in Exhibit 8.2 shows that net cost increases from the AIP option over time 

are low relative to revenue. Based on this result, EPA certifies that there will not be a significant 

impact on a substantial number of small entities under the AIP option. 

8.5. Unfunded Mandates Reform Act 

The UMRA seeks to protect state, local, and tribal governments from the imposition of 

unfunded federal mandates. In addition, the Act seeks to strengthen the partnership between the 

federal government and state, local, and tribal governments and ensure that the federal 

government covers the costs incurred during compliance with federal mandates. 

 

 Title II of the UMRA of 1995, Public Law 104-4, establishes requirements for federal 

agencies to assess the effects of their regulatory actions on state, local, and tribal governments 

and the private sector. Under section 202 of UMRA, EPA generally must prepare a written 

statement, including a cost-benefit analysis, for proposed and final rules with “federal mandates” 

that may result in expenditures to state, local, and tribal governments, in the aggregate, or to the 

private sector, of $100 million or more in any one year. 

 

1

 Major SDWA rulemakings generally include a section in the Economic Analysis that presents an analysis of costs 

of the rule per household. 
Economic Analysis for the Proposed RTCR 8-10 June 2010

 Before promulgating an EPA rule for which a written statement is needed, section 205 of 

UMRA generally requires EPA to identify and consider a reasonable number of regulatory 

options and adopt the least costly, most cost-effective or least burdensome option that achieves 

the objectives of the rule. The provisions of section 205 do not apply when they are inconsistent 

with applicable law. Moreover, section 205 allows EPA to adopt an option other that the least 

costly, most cost-effective or least burdensome option if the Administrator publishes with the 

final rule and explanation why that option was not adopted. 

 Before EPA establishes any regulatory requirements that may significantly or uniquely 

affect small governments, including tribal governments, it must have developed under section 

203 of UMRA a small government agency plan. The plan must provide for notifying potentially 

affected small governments, enabling officials of affected small governments to have meaningful 

and timely input in the development of EPA regulatory proposals with significant federal 

intergovernmental mandates, and informing, educating, and advising small governments on 

compliance with the regulatory requirements. 

 This proposed rule does not contain a federal mandate that may result in expenditures to 

state, local, and tribal governments, in the aggregate, or to the private sector, of $100 million or 

more in any one year. Expenditures associated with compliance, defined as the incremental costs 

beyond the current TCR, will not surpass $100 million in the aggregate in any year. Thus, this 

proposed rule is not subject to the requirements of sections 202 and 205 of UMRA. 

 This proposed rule is also not subject to the requirements of section 203 of UMRA 

because it contains no regulatory requirements that might significantly or uniquely affect small 

governments. Costs to small entities are generally not significant, as described previously in 

Section 8.3 and in section VII.C of the proposed RTCR preamble. The regulatory requirements 

of the proposed RTCR are not unique to small governments, as they apply to all PWSs regardless 

of size. 

8.6. Executive Order 13132: Federalism 

 Executive Order 13132, entitled “Federalism” (64 FR 43255, August 10, 1999), requires 

EPA to develop an accountable process to ensure “meaningful and timely input by state and local 

officials in the development of regulatory policies that have federalism implications.” “Policies 

that have federalism implications” is defined in the Executive Order to include regulations that 

have “substantial direct effects on the states, on the relationship between the national government 

and the states, or on the distribution of power and responsibilities among the various levels of 

government.” 

 This action does not have federalism implications. It will not have substantial direct 

effects on the states, on the relationship between the national government and the states, or on 

the distribution of power and responsibilities among the various levels of government as 

specified in Executive Order 13132. The net change in cost for state, local, and tribal 

governments in the aggregate is estimated to be approximately $0.1M and $0.4M at three percent 

and seven percent discount rates, respectively. Thus, Executive Order 13132 does not apply to 

this proposed rule. 

 
Economic Analysis for the Proposed RTCR 8-11 June 2010

 Although section 6 of Executive Order 13132 does not apply to the proposed RTCR, 

EPA conducted a federalism consultation, consistent with Executive Order 13132, in July 2008. 

The consultation included a stakeholder meeting where EPA requested comments on the impacts 

of the potential revisions to the TCR with respect to state, county and local governments. EPA 

did not receive any comments in response to this consultation. In addition, the advisory 

committee included representatives of state, local and tribal governments, and through this 

process EPA consulted with state, local, and tribal government representatives to ensure that 

their views were considered when the AIP recommendations for the RTCR were developed. 

 

 In the spirit of Executive Order 13132, and consistent with EPA policy to promote 

communications between EPA and state and local governments, EPA specifically solicits 

comment on this proposed action from state and local officials. 

8.7. Executive Order 13175: Consultation and Coordination with Indian Tribal 

 Governments 

 Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal 

Governments” (65 FR 67249, November 9, 2000), requires EPA to develop an accountable 

process to ensure “meaningful and timely input by tribal officials in the development of 

regulatory policies that have tribal implications.” The Executive Order defines “policies that 

have tribal implications: to include regulations that have “substantial direct effects on one or 

more Indian tribes, on the relationship between the federal government and the Indian tribes, or 

on the distribution of power and responsibilities between the federal government and Indian 

tribes.” 

 Under Executive Order 13175, EPA may not issue a regulation that has tribal 

implications, that imposes substantial direct compliance costs, and that is not required by statute, 

unless the federal government provides the funds necessary to pay the direct compliance costs 

incurred by tribal governments, or EPA consults with tribal officials early in the process of 

developing the proposed regulation and develops a tribal summary impact statement. 

 This action does not have tribal implications, as specified in Executive Order 13175. 

Because the requirements of the proposed RTCR as defined by the AIP option are estimated to 

result in low net cost increases (or in many cases, net cost savings) compared to the existing TCR 

requirements, the AIP option is not anticipated to have a negative impact on tribal PWSs. Thus, 

Executive Order 13175 does not apply to this action. 

Although Executive Order 13175 does not apply to this action, EPA consulted with tribal 

officials in developing this action. EPA has consulted with tribal governments through the EPA 

American Indian Environmental Office, included a representative of the Native American Water 

Association on the advisory committee which developed recommendations regarding the 

proposed rule and signed the AIP, and has addressed tribal concerns throughout the regulatory 

development process, as appropriate. The consultation included participation in three tribal 

conference calls (EPA regional tribal call (February 2008), National Indian Workgroup call 

(March 2008), and National Tribal Water Conference (March 2008)). EPA requested comments 

on the current TCR, requested suggestions for current TCR revisions (March 2008), and 

presented possible revisions to the current TCR to the National Tribal Council (April 2008). In 

addition, the advisory committee included entities representing tribal governments, and through 
Economic Analysis for the Proposed RTCR 8-12 June 2010

this process EPA ensured that their views were considered when the AIP recommendations for 

the RTCR were developed. None of these consultations identified issues that were particular to 

tribal entities. As a result of the tribal consultations and other tribal outreach, EPA has 

determined that the proposed RTCR is not anticipated to have a negative impact on tribal 

systems. Thus, Executive Order 13175 does not apply to this action. 

EPA specifically solicits additional comment on this proposed action from tribal officials. 

8.8. Executive Order 13045: Protection of Children from Environmental Health 

 Risks and Safety Risks 

Executive Order 13045 (62 FR 19885; April 23, 1997) applies to any rule initiated after 

April 21, 1998, that (1) is determined to be “economically significant” as defined under 

Executive Order 12866; and (2) concerns an environmental, health, or safety risk that EPA has 

reason to believe may have a disproportionate effect on children. If the regulatory action meets 

both criteria, EPA must evaluate the environmental, health, or safety effects of the planned rule 

on children, and explain why the planned regulation is preferable to other potentially effective 

and reasonably feasible options considered by EPA. 

The proposed RTCR is not subject to Executive Order 13045 because it is not 

economically significant as defined in Executive Order 12866. This action’s health and risk 

assessments are contained in section VI.K.1 of the proposed RTCR preamble and Chapter 6 of 

the EA. This EA uses a qualitative approach in assessing the changes in risk anticipated for each 

regulatory option relative the baseline (current TCR). EPA expects that the proposed RTCR 

would provide additional protection, through the additional assessments and corrective action 

required, to both children and adults who consume drinking water supplied from PWSs. EPA 

also assumes that the benefits of the proposed rule, including reduced health risk, will 

disproportionally accrue more to children because young children are more susceptible than 

adults to some waterborne illnesses and are more likely to experience more serious effects from 

infection. For example, the risk of mortality resulting from diarrhea is often greatest in the very 

young and elderly (Rose 1997; Gerba et al. 1996), and viral and bacterial illnesses often 

disproportionately affect children. Any overall benefits of the rule would reduce this mortality 

risk for children. 

The public is invited to submit comments or identify peer-reviewed studies and data that 

assess effects of early life exposure to drinking water that contains fecal contaminants.

8.9. Executive Order 13211: Action Concerning Regulations That Significantly 

 Affect Energy Supply, Distribution, or Use 

 Executive Order 13211, “Actions Concerning Regulations That Significantly Affect 

Energy Supply Distribution, or Use” (66 FR 28355; May 22, 2001), provides that agencies shall 

prepare and submit to the Administrator of the Office of Information and Regulatory Affairs, 

OMB, a Statement of Energy Effects for certain actions identified as “significant energy 

actions.” Section 4(b) of Executive Order 13211 defines “significant energy actions” as “any 

action by an agency (normally published in the Federal Register) that promulgates or is expected 

to lead to the promulgation of a final rule or regulation, including notices of inquiry, advance 
Economic Analysis for the Proposed RTCR 8-13 June 2010

notices of proposed rulemaking, and notices of proposed rulemaking: (1)(i) that is a significant 

regulatory action under Executive Order 12866 or any successor order, and (ii) is likely to have a 

significant adverse effect on the supply, distribution, or use of energy; or (2) that is designated by 

the Administrator of the Office of Information and Regulatory Affairs as a significant energy 

action.” 

 The proposed RTCR is not a “significant energy action” as defined in Executive Order 

13211, because it is not likely to have a significant adverse effect on the supply, distribution, or 

use of energy. This proposed rule is not a significant regulatory action under Executive Order 

12866, and has not been designated by the Administrator of the Office of Information and 

Regulatory Affairs as a significant energy action, for the reasons described as follows. 

Energy Supply 

 The proposed RTCR does not regulate power generation, either directly or indirectly, and 

public and private PWSs that the proposed RTCR applies to do not, as a rule, generate power. 

Further, the energy cost increases borne by customers of PWSs as a result of the AIP option are a 

low percentage of the total cost of water. Therefore, power generation utilities that purchase 

water as part of their operations are unlikely to face any significant effects as a result of the AIP 

option. 

Energy Distribution 

The proposed RTCR does not regulate any aspect of energy distribution and PWSs that 

are regulated by the proposed RTCR already have electrical service. The rule is not expected to 

increase peak electricity demand at PWSs. Therefore, EPA assumes that the existing 

connections are adequate and that the AIP option has no discernable adverse effect on energy 

distribution. 

Energy Use 

Because the proposed RTCR modifies existing regulations, very few PWSs are expected 

to make modifications or changes that will alter energy use patterns. Therefore, EPA does not 

expect any noticeable effect on the national levels of power generation in terms of average and 

peak loads. 

 

8.10. National Technology Transfer and Advancement Act 

 Section 12(d) of the NTTAA of 1995, Public Law No. 104-113, 12(d) (15 U.S.C. 272 

note) directs EPA to use voluntary consensus standards in its regulatory activities unless to do so 

would be inconsistent with applicable law or otherwise impractical. Voluntary consensus 

standards are technical standards (e.g., materials specifications, test methods, sampling 

procedures, and business practices) that are developed or adopted by voluntary consensus 

standards bodies. NTTAA directs EPA to provide Congress, through OMB, explanations when 

EPA decides not to use available and applicable voluntary consensus standards. 

 

 The proposed RTCR involves technical voluntary consensus standards. EPA proposes to 

use several analytical methods to monitor for total coliforms and/or E. coli as they are described 
Economic Analysis for the Proposed RTCR 8-14 June 2010

in Standard Methods for the Examination of Water and Wastewater, 20th and 21st editions 

(Clesceri et al. 1998; Eaton et al. 2005). Methods included in Standard Methods are voluntary 

consensus standards. The proposed rule includes 11 methods that can be used to test for total 

coliform, four of which are described in Standard Methods. 

 EPA welcomes comments on this aspect of the proposed rulemaking and, specifically, 

invites the public to identify potentially-applicable voluntary consensus standards and to explain 

why such standards should be used in this regulation. 

8.11. Executive Order 12898: Federal Actions to Address Environmental Justice in 

 Minority Populations and Low-Income Populations 

 Executive Order 12898 (59 FR 7629, February 16, 1994) establishes federal executive 

policy on environmental justice. Its main provision directs federal agencies, to the greatest extent 

practicable and permitted by law, to make environmental justice part of their mission. Agencies 

must do this by identifying and addressing as appropriate any disproportionately high and 

adverse human health or environmental effects of their programs, policies, and activities on 

minority populations and low-income populations in the United States. 

 

 EPA has determined that this proposed rule will not have disproportionately high and 

adverse human health or environmental effects on minority or low-income populations because it 

increases the level of environmental protection for all affected populations without having any 

disproportionately high and adverse human health or environmental effects on any population, 

including any minority or low-income population. The proposed RTCR applies uniformly to all 

PWSs. Consequently, the proposed RTCR provides health protection equally to all income and 

minority groups served by PWSs. The proposed RTCR and other drinking water regulations are 

expected to have a positive effect on human health regardless of the social or economic status of 

a specific population. To the extent that contaminants in drinking water might be 

disproportionately high among minority or low-income populations (which is unknown), the 

proposed RTCR contributes toward removing those differences by assuring that all PWSs meet 

drinking water standards and take appropriate corrective action whenever appropriate. Thus, the 

proposed RTCR meets the intent of the federal policy requiring incorporation of environmental 

justice into federal agency missions. 

8.12. Consultations with the Science Advisory Board, National Drinking Water 

Advisory Council, and the Secretary of Health and Human Services as 

Required by Section 1412 (d) and (e) of the SDWA 

In accordance with section 1412 (d) and (e) of the SDWA, EPA consulted with the 

Science Advisory Board (SAB), National Drinking Water Advisory Council (NDWAC), and the 

Secretary of the US Department of Health and Human Services on the proposed RTCR. 

EPA met with the SAB Drinking Water Committee (DWC) and considered their 

recommendations in developing data requirements to better understand the impacts of the RTCR. 

In response to the SAB DWC recommendations, EPA also conducted sensitivity analyses, to 

explore a wider range of assumptions regarding the percentage of assessments leading to 

corrective actions and to demonstrate that using an annual average for occurrence provided 
Economic Analysis for the Proposed RTCR 8-15 June 2010

results comparable to varying the occurrence based on the season. In addition, EPA added an 

exhibit in the EA that summarizes all significant model parameters and assumptions, their 

influence on variability and uncertainty, and their most likely effect on benefits or costs. A copy 

of the SAB report (SAB 2010) is available in the docket for the proposed RTCR. 

 

EPA also consulted with NDWAC and considered their recommendations in developing 

the public notification requirements for the proposed rule. 

EPA completed its consultation with the US Department of Health and Human Services, 

as required by SDWA section 1412(d). In addition, EPA provided an informational briefing to 

the Food and Safety Group of the Food and Drug Administration. 

Details about EPA’s consultations with SAB, NDWAC, and the US Department of 

Health and Human Services can be found at Section VII.K of the proposed RTCR preamble. 

8.13. Impacts on Sensitive Subpopulations as Required by Section 1412(b)(3)(c)(i) 

 of the 1996 Amendments to the Safe Drinking Water Act (SDWA) 

EPA is required to seek public comment regarding the effects of contamination 

associated with the proposed RTCR on the general population and sensitive subpopulations. 

Sensitive subpopulations include “infants, children, pregnant women, the elderly, individuals 

with a history of serious illness, or other subpopulations that are identified as likely to be at 

greater risk of adverse health effects due to exposure to contaminants in drinking water than the 

general population” (SDWA section 1412(b)(3)(C)(i)(V), 42 U.S.C 300g-1(b)(3)(C)(i)(V)). 

Pregnant and lactating women may be at an increased risk from pathogens as well as act 

as a source of infection for newborns. Infection during pregnancy may also result in the 

transmission of infection from the mother to the child in utero, during birth, or shortly thereafter. 

Since very young children do not have fully developed immune systems, they are at increased 

risk and are particularly difficult to treat. 

Infectious diseases are also a major problem for the elderly because immune function 

declines with age. As a result, outbreaks of waterborne diseases can be devastating on the elderly 

community (e.g., nursing homes) and may increase the possibility of significantly higher 

mortality rates in the elderly than in the general population. 

Immunocompromised individuals are a growing proportion of the population with the 

continued increase in HIV/AIDS, the aging population, and the escalation in organ and tissue 

transplantations. Immunocompromised individuals are more susceptible to severe and invasive 

infection. These infections are particularly difficult to treat and can result in a significantly 

higher mortality than in immunocompetent persons. 

 It is anticipated that the requirements of the proposed RTCR will help reduce pathways of 

entry for fecal contamination and/or waterborne pathogens into the distribution system, thereby 

reducing exposure and risk from these contaminants in drinking water to the entire general 

population. The proposed RTCR seeks to provide a similar level of drinking water protection to 

all groups including sensitive subpopulations, thus meeting the intent of this federal policy. 
Economic Analysis for the Proposed RTCR 8-16 June 2010

8.14. Plain Language as Required by Executive Order 12866 

 Executive Order 12866 requires each agency to write its rules in plain language. 

Readable regulations help the public find requirements quickly and understand them easily. 

Readable regulations may also increase compliance, strengthen enforcement, and decrease 

mistakes, frustration, phone calls, appeals, and distrust of government. EPA has made every 

effort to write this preamble to the proposed rule in as clear, concise, and unambiguous manner 

as possible. EPA requests comments on how to improve rule language to enhance readability and 

make it easier to understand. 
Economic Analysis for the Proposed RTCR 9-1 June 2010 

9. Comparison of Benefits and Costs 

9.1 National Benefits and Costs of the AIP Option Considered in Comparison to 

the Current Total Coliform Rule and Alternative Option 

The Environmental Protection Agency (EPA) is proposing a regulatory option consistent 

with the Total Coliform Rule/Distribution System Advisory Committee (TCRDSAC) Agreement 

in Principle (AIP) for the Revised Total Coliform Rule (RTCR) (the AIP option). The primary 

discussion of costs and benefits in this chapter focuses on the requirements of the AIP option in 

comparison to the current Total Coliform Rule (TCR) and the Alternative option considered. 

The primary benefit of the AIP option is to further reduce the risk of fecal contamination 

of public drinking water from the current baseline risk under the existing TCR. The indicator of 

this benefit that is most feasible to predict is the reduction in E. coli occurrence in Public Water 

Systems (PWSs). As a fecal contamination indicator, E. coli can also co-occur with other 

pathogenic organisms shed in feces, such as viruses, bacteria, and pathogenic protozoa at a rate 

that is not quantified.1

 EPA believes that a reduction in E. coli occurrence, together with other 

AIP option actions, will result in reduced PWS fecal contamination and may facilitate a 

consequent reduction in endemic and epidemic waterborne disease in the United States. 

The current TCR mandates sampling for total coliforms (TC) and E. coli in PWSs in the 

U.S. However, under the current TCR, PWSs that encounter samples testing positive for E. coli

have the option to implement an effective long-term corrective action, a short-term corrective 

action, or they can choose not to implement any corrective action. This wide variability in 

effectiveness of corrective actions increases the potential for exposure to fecally-contaminated 

drinking water when the response to E. coli occurrence is inadequate or ineffective. 

EPA proposes to augment the current TCR with, among other components, the 

requirement for systems to implement mandatory assessments and corrective actions. PWSs 

would be required to conduct either a Level 1 or Level 2 assessment, depending on the severity 

of a trigger (based on TC vs. E. coli and the number of triggers). As described in Chapter 3, the 

Level 1 and 2 assessments require a PWS to more formally pursue the cause of a non-acute or 

acute violation, and to address the problem with an appropriate corrective action. It is the 

combination of these two requirements (assessments and corrective actions) from which most of 

the net benefits and costs of the AIP option would derive. 

 A significant amount of the costs of the additional activities required under the AIP 

option would be offset by the reduced costs from some decreases in monitoring (additional 

routine and repeat) and Public Notification (PN). The decreases in monitoring may limit the 

ability of PWSs to identify E. coli positive samples at the levels found under the current TCR 

when using the same monitoring techniques. However, predictive modeling results show that 

significantly more contamination events will be prevented by assessments that lead to additional 

corrective actions under the AIP option than would be missed by reduced additional routine and 

 

1

 Chapter 2 of this EA provides examples of waterborne pathogens that can occur in PWSs. Also, Edberg, R. (2000) 

discusses the use of E. coli as an indicator of drinking water quality. 
Economic Analysis for the Proposed RTCR 9-2 June 2010 

repeat monitoring for systems serving 4,100 or fewer people.2 Some of this reduction in both 

monitoring and costs would be offset by the increase in routine monitoring predicted for systems 

serving 1,000 or fewer people because fewer systems are likely to qualify for reduced monitoring 

based on the more stringent requirements under the AIP option3

. 

Further cost reductions may be achieved by the requirement for a mandatory sampling plan 

under the AIP option, which would increase monitoring efficiency by having the operator submit 

a planned approach, including regular sampling sites that are representative of the water 

throughout the distribution system. The plan may also specify repeat sample locations that may, 

if approved by the State, satisfy source water sampling requirements as well; this benefit would 

likely apply to some of the PWSs with limited or no distribution systems. 

These increases in routine monitoring,along with more efficient monitoring based on 

approved monitoring plans, are expected to increase the ability of PWSs to detect EC a larger 

percentage of the time when it is present. This increase in detection will be partially offset by 

reductions in additional routine and repeat monitoring. For the reasons discussed this chapter and 

in analyses and discussion presented throughout this Economic Analysis (EA), EPA concludes 

that the AIP option will improve public health protection compared to the current TCR. 

The Alternative option considered in this EA would provide benefits equal to or greater 

than the AIP option in terms of decreased risk of PWSs delivering contaminated water to the 

public and subsequent decreases in potential health risks. However, monitoring costs under the 

Alternative option would increase significantly, particularly for small systems, causing a 

significant challenge to the effective implementation of the Alternative option. 

The remainder of this chapter provides further detail on the costs and benefits and how 

they compare under the AIP and Alternative options: 

y National benefits (Section 9.1.1) 

y National costs (Section 9.1.2) 

y Uncertainty and nonquantified benefits (Section 9.2) 

y Comparison of regulatory alternatives in cost/benefit terms (Section 9.3) 

 

2

 Chapter 6 of this EA explores the trade-off in a stepwise analysis of the risk benefit resulting from implementation 

of assessments resulting in corrective actions vs. the potential increase in risk due to decreased sampling frequency. 

That analysis concludes that for each type of system and size category, the AIP would avoid a larger number of 

acute events than it would fail to diagnose. 

3

 Chapter 5 (Section 5.3) includes a description of the determination of PWS sampling frequencies that are 

applicable beginning in year 6 following RTCR promulgation. 
Economic Analysis for the Proposed RTCR 9-3 June 2010 

9.1.1. National Benefits of the Regulatory Options Considered 

The benefit analyses performed in this EA and summarized in this section consider the 

net changes in TC and E. coli occurrence under the AIP option as compared to the current TCR4

. 

In promulgating the RTCR as defined by the AIP option, EPA expects to further reduce the risk 

of contamination of public drinking water from the current baseline risk under the existing TCR. 

The options considered during development of this proposed rule and analyzed as part of this EA 

are designed to achieve this reduction while maintaining public health protection in a costeffective manner. 

This section examines the benefits in terms of trade-offs between compliance with the 

current TCR and the AIP and Alternative options. Based on limitations in available data 

(described further in Chapter 6, Section 6.3), EPA determined that benefits could not be 

calculated in terms of avoided cases of (or costs related to) morbidity or mortality. EPA used 

several methods to qualitatively evaluate the benefits of the AIP option. The qualitative 

evaluation uses both the judgment of EPA as informed by the TCRDSAC deliberations as well 

as quantitative estimates of changes in TC occurrence and counts of systems implementing 

corrective actions. The evaluation characterizes, in relative terms, the reduction in risk for each 

regulatory scenario as compared to baseline conditions. 

Since E. coli is an indicator of fecal contamination, EPA assumed that a decrease in E. 

coli occurrence in the distribution system would be associated with a decrease in fecal 

contamination in the distribution system. In general, this decrease in fecal contamination should 

reduce the potential risk to human health for PWS customers. Thus, any reduction in E. coli

occurrence is considered a benefit of the proposed RTCR. Also, since fecal contamination may 

contain waterborne pathogens including bacteria, viruses, and parasitic protozoa, in general, a 

reduction in fecal contamination should also reduce the risk from these other contaminants. 

As presented in Exhibit 4.9, the percentages of samples that are positive for TC and E. 

coli are generally higher for PWSs serving 4,100 or fewer people than those serving more than 

4,100 people. PWSs with higher TC and E. coli occurrence are more likely to be triggered into 

assessments and corrective action. As discussed previously, EPA believes that the assessments 

and corrective action will lead to a decrease in TC and E. coli occurrence. Because the PWSs 

serving 4,100 people or fewer have a higher initial E. coli occurrence and will be triggered into 

more assessments and corrective actions than larger PWSs, the increase in benefits for these 

small systems will be more evident as compared to the larger systems. In particular, model 

results suggest that customers of small ground water Transient Noncommunity Water Systems 

(TNCWSs), which constitute approximately 30% of PWSs, would experience the most obvious 

benefit under the AIP option. That is, the occurrence of E. coli is predicted to decrease more for 

TNCWSs than for other systems types. 

As discussed above, because there was insufficient data on the co-occurrence of E. coli

and waterborne pathogens, it was not possible to quantify the adverse health effects in the human 

population served by PWSs. Thus, EPA employed a qualitative approach as the primary method 

for analyzing the expected change in exposure to fecal contamination based on each individual 

 

4

 The “current TCR” is the baseline used in the RTCR EA, and consists of the rule components and resulting 

activities of the 1989 TCR with effects of the Ground Water Rule (GWR) implementation in 2010 incorporated. 

Chapter 4 of this EA presents information used to develop this baseline, and Chapter 5 (Section 5.3.1) describes how 

the occurrence and predictive model incorporates the GWR effects. 
Economic Analysis for the Proposed RTCR 9-4 June 2010 

rule component. The qualitative analysis considers the anticipated changes in sampling and 

corrective action regimens and estimates the corresponding anticipated reduction or increase in 

exposure to fecal contamination. Because the reduced exposure to fecal contamination conveys 

inadequate information about pathogen exposure, the analysis in this section is a hazard analysis 

rather than a risk analysis. Nevertheless, because the intent is to reduce risk by reducing hazard 

(potential exposure to fecal contamination and/or waterborne pathogens), risk is used as the 

discussion endpoint. Section 9.1.1.1 below summarizes the results of the qualitative analysis, and 

Chapter 6 (Section 6.2) presents this information in more detail. 

 

 Although a qualitative analysis was the primary method employed for analyzing 

potential changes in risk, quantitative measures were used to support the qualitative conclusions, 

providing additional perspective on potential changes in risk. In particular, EPA considered 

modeled predictions of the reductions in the numbers of violations/assessment triggers and of the 

number of corrective actions to be performed as they may relate to risk. Section 9.1.1.2 below 

discusses the predicted changes in these outcomes. More detailed discussions of the predictive 

model and analyses results are presented in Chapters 5 and 6. 

9.1.1.1. Qualitative Comparison – Relative Risks of the AIP and Alternative Options 

Compared to Baseline 

When revising an existing drinking water regulation, one of the main concerns is to 

ensure that backsliding on water quality and public health protection does not occur. Risk 

reduction for the AIP option is characterized by the activities performed that are presumed to 

reduce risk of exposing the public to contaminated water. These activities are considered under 

each rule component presented in Exhibit 9.1b. Under repeat and additional routine monitoring 

provisions for both rule options, there is a potential to contribute to increased risk for PWS 

customers because TC monitoring frequency may be reduced for some PWSs. However, this 

increase in risk is expected to be more than offset by potential decreases in risk from increased 

routine monitoring and the addition of the assessments and corrective action provisions that will 

find and fix problems identified by monitoring. 

Exhibit 9.1a illustrates the predicted reduced frequency at which TC-positives occur 

subsequent to the implementation of the AIP and Alternative options. TC occurrence is used as a 

surrogate for indicating the existence of potential pathways through which waterborne pathogens 

may enter a PWS. Exhibit 9.1a illustrates the combined effects on TC occurrence resulting from 

changes in monitoring and the effects of assessments and corrective actions for the different rule 

options illustrated. The relative trends evident in Exhibit 9.1a for TNCWSs also pertain to other 

PWS categories as illustrated in Chapter 5 of proposed RTCR EA. EPA chose to include the 

characterization for TNCWSs because they represent the system category of largest influence on 

the national impacts. 
Economic Analysis for the Proposed RTCR 9-5 June 2010 

Exhibit 9.1a Ground Water (GW) Transient Noncommunity Water System TC 

Occurrence 

0

0.005

0.01

0.015

0.02

0.025

0.03

0.035

0.04

0.045

0 5 10 15 20 25 30 35

Annual TC Positive Assays Rate

Years

TCR No GWR

TCR

AIP

Alt

Note: 1) Six Year 2005 TC-positive occurrence is representative of all GW TNCWS. The rate presented may 

underestimate the occurrence for systems serving 25-4,100 individuals. 2) Graph shows the 30-year modeled period 

discussed in Ch. 5. Model years 3 – 27 represent the 25-year period of analysis for this EA. Model year 11 begins 

the steady state, during which systems that qualified for reduced monitoring are now sampling on their reduced 

schedules. The criteria and timing of this monitoring adjustment is discussed in Section 5.3.2.2 of this EA. 3) The 

results represented by the curves for TCR, AIP, and Alt all incorporate the effects of the GWR. 

The effect that the proposed changes to public notification requirements for monthly/nonacute MCL violations have on risk is difficult to predict. Some factors, such as reduction in 

available public information and possible PWS complacency, lead to a potential increase in risk 

and other factors, such as less confusion (PN more in line with potential health risks) and PWSs 

resources used more efficiently, lead to a potential decrease, as discussed in Exhibit 9.1b. This 

change to PN is addressing a key concern expressed by various stakeholders in the advisory 

committee and during the Six-Year Review 1 comment solicitation process. By eliminating the 

requirement and replacing it with assessment and corrective action requirements, the Agency 

expects less public confusion, more effective use of resources, and increased transparency. Other 

proposed rule components are expected to have a negligible effect on risk. However, the overall 

effect of the proposed RTCR is expected to be a further reduction in risk from the current 

baseline risk under the current TCR. Chapter 6 presents a detailed discussion of the potential 

influence on health risk for each proposed rule component. 
Economic Analysis for the Proposed RTCR 9-6 

Exhibit 9.1b Potential Changes in Risk under the AIP and Alternative Options Relative to th

Proposed Rule 

Component 

Factors Leading to a Potential 

Increase in Risk 

Factors Leading to a Potential Decrease in 

Risk 

Overall 

AIP option 

Alternative 

option AIP option 

Alternative 

option AIP op

Implementation Activities None None None None No chaRoutine Monitoring (Including Reduced Monitoring) 

None None 

Increased stringency in requirements to qualify for reduced monitoring along with requirement to return to baseline monitoring upon loss of these criteria is expected to result in decreased risk (i.e., fewer PWSs will qualify and therefore more will monitor more frequently). 

PWSs all monitor monthly in the first few years of implementation of the RTCR, which is an increase in sampling frequency for systems that monitor quarterly or annually under the current TCR. After the first few years, systems may reduce to quarterly, but none may reduce to annual monitoring, creating a decrease in risk for systems on annual monitoring under the current TCR. 

Decrea
Economic Analysis for the Proposed RTCR 9-7 

Proposed Rule 

Component 

Factors Leading to a Potential 

Increase in Risk 

Factors Leading to a Potential Decrease in 

Risk 

Overall 

Repeat Monitoring 

Required repeat samples reduced from 4 to 3 for systems serving <1,000 people 

Required repeat samples reduced from 4 to 3 for systems serving <1,000 people 

None None Increa

Additional Routine Monitoring 

Additional routine samples are no longer required for PWSs monitoring monthly. Ground water PWSs serving ≤1,000 people would reduce additional routine samples from 5 to 3. 

Additional routine samples are no longer required for PWSs monitoring monthly. Ground water PWSs serving ≤1,000 people would reduce additional routine samples from 5 to 3. 

None None Increa

Annual Inspections 

None (only states 

currently performing annual inspections are expected to continue) 

Based on discussions with stakeholders, 

state s that 

currently conduct annual site assessments under the current TCR may no longer have the 

None (only state s 

currently performing annual inspections are expected to continue) 

None No cha
Economic Analysis for the Proposed RTCR 9-8 

Proposed Rule 

Component 

Factors Leading to a Potential 

Increase in Risk 

Factors Leading to a Potential Decrease in 

Risk 

Overall 

resources to continue the inspections and conduct quarterly monitoring under the Alternative option. 

Assessments None None 

Mandatory assessments are a new requirement. 

Mandatory assessments are a new requirement. Decrea

Corrective Actions None None 

Mandatory corrective actions are a new requirement. 

Mandatory corrective actions are a new requirement. 

Decrea

Public Notification – Monthly/NonAcute MCL Violations 

Reduction in available public information Possible PWS complacency 

Reduction in available public information Possible PWS complacency 

Less confusion (PN more in line with potential health risks) PWS resources used more efficiently 

Less confusion (PN more in line with potential health risks) PWS resources used more efficiently 

Unkno
Economic Analysis for the Proposed RTCR 9-9 

Proposed Rule 

Component 

Factors Leading to a Potential 

Increase in Risk 

Factors Leading to a Potential Decrease in 

Risk 

Overall 

Public Notification – Monitoring and Reporting Violations 

None None 

Increased stringency of PNs motivates PWSs to conduct required sampling. 

Increased stringency of PNs motivates PWSs to conduct required sampling. 

Decrea

Overall Decrea

Note: Detailed discussion of the rationale for determinations of potential risk for each rule component is presented in Ch. 6 (Section 6.2) oactivities consist of administrative activities by PWSs and states to implement the rule. Assessment of potential changes in risk for monitoring components is an overall assessment. Potential changes (or static state) of risk for 

and types differ according to individual regulatory requirements and are discussed in Section 6.2. Chapter 3 provides a detailed descriptio

components for all three regulatory scenarios, and the preamble to the RTCR provides additional discussion of the TCRDSAC process anthe structure of the regulatory options considered. 
Economic Analysis for the Proposed RTCR 9-10 June 2010 

9.1.1.2. Comparison of Quantified Benefits between Baseline and AIP and 

Alternative Options 

The quantified portion of the benefits analysis focuses on several measures that contribute to 

the changes in risk expected under the AIP option. Specifically, EPA modeled the predicted 

outcomes based on each regulatory option considered – baseline (current TCR), the AIP option, 

and the Alternative option – in the form of estimates of non-acute violations for the current TCR 

and assessment triggers for the AIP and Alternative options; E. coli violations; and the number of 

corrective actions implemented under each option. 

 This section presents a summary of the estimated impacts of both regulatory options 

considered in comparison to the current TCR. Evaluation of each of these endpoints informed 

EPA’s understanding of potential changes to the underlying quality of drinking water. In 

particular, the number of corrective actions performed has a strong relationship to potential 

improvements in water quality and public health. For a given level of TC and E. coli occurrence, 

an increase in the number of corrective actions implemented would lead to improved water 

quality. However, a reduction in sampling leads to a reduction in TC and E. coli positives being 

found, which in turn leads to a reduction in assessments and corrective actions being 

implemented. The number of TC and E. coli positives that are prevented, missed, or found under 

each regulatory option considered in comparison to those predicted under the current TCR 

results in estimates of annual non-acute and acute violations (current TCR) and assessment 

triggers (AIP and Alternative options). Section 6.4 of this EA presents a step-wise uncertainty 

analysis of the competing effects of additional protective activity (assessments and corrective 

actions) and decreased additional routine and repeat sampling of the regulatory alternatives 

compared to the current TCR. The results of this uncertainty analysis showed that for all 

categories of systems, more TC and E. coli positives would be prevented than missed. 

For each of the graphs presented in Exhibit 9.2 through Exhibit 9.7 there are two main 

model drivers that impact the endpoints depicted; the total number of samples taken over time 

(including routine, additional routine, and repeat) and corrective actions taken. When looking at 

the comparisons between the TCR with the AIP option across all PWSs, the overall impact of the 

total numbers of samples taken is negligible because the total number of samples predicted to be 

taken throughout the period of analysis is almost the same (approximately 82 million samples) 

under both the TCR and AIP option, as shown in Exhibits 6.2 – 6.4 of this EA. For the 

Alternative option, the analysis predicts that almost 87 million total samples will be taken over 

the period of analysis. Based on the relationships of total samples taken between the TCR, AIP 

option, and Alternative option, the best way to interpret the graphs presented in this section is in 

a step-wise manner. 

The first comparison is between the TCR and proposed RTCR as defined by the AIP option. 

Because similar total numbers of samples are taken under each, the major effect seen in the 

graphs can be isolated to the effects that implementation of corrective actions will have on 

underlying occurrence and how that occurrence influences the endpoint in question. In each 

graph, this is depicted by a marked reduction in the endpoint under the AIP option compared to 

the TCR and is a reflection of overall better water quality. The second comparison can then be 

made of the Alternative option against the AIP option. In each graph, the endpoints for the 
Economic Analysis for the Proposed RTCR 9-11 June 2010 

Alternative option are above those for the AIP option and represent an additional benefit over the 

AIP option. This additional benefit is a primarily a function of the additional diagnostic abilities 

gained through increased monitoring under the Alternative option, and is especially prominent in 

the early years of the analysis when all systems are required to monitor at least monthly. 

More detailed descriptions of each endpoint considered in terms of the evaluation process 

described previously are provided in this section as they apply to the individual graphs in 

Exhibits 9.2 through 9.7. The graphs shown in this section are presented first in nondiscounted 

terms and then based on a discount rate of 3% to reflect the reduced valuation of potential 

benefits over time, consistent with the presentation of costs in the section that follows. Graphs of 

benefits discounted using 7% discount rates are presented in Appendix B to this EA. 

Exhibit 9.2 shows the effect (on average across all PWSs) of the AIP and the Alternative 

options on the annual number of non-acute violations (assessment triggers under the AIP and 

Alternative options) over time. The estimated reduction of approximately 1,000 trigger events in 

moving from the current TCR option to the AIP option is a net result from the following effects 

described previously in this section: improved water quality (events prevented); retained 

diagnostic power (events found), which in turn leads to prevention of some future events; and 

reduced diagnostic power (missed events). The amount of this reduction would be some amount 

lower if the analysis could account for events where contamination was present but not 

diagnosed (“missed” events). This is why a similar, but smaller, reduction from the current TCR 

is seen under the Alternative option. During the first 9 years of sampling under the AIP option 

and Alternative option sampling regimens, diagnostic power under the Alternative option is at a 

maximum based on the “All-monthly” sampling requirement. In year 9, following a 5-year 

period of assessment5

, all systems that qualified for reduced monitoring begin sampling 

according to their new regimens. This is the start of the relatively steady state of the period of 

analysis, driven by the static nature of the percentages of systems following monthly, quarterly, 

or annual sampling regimens throughout the remainder of the analysis (years 9 through 25). 

Trigger events under the Alternative option remain at a higher steady state than under the AIP 

option based on the increased diagnostic ability provided by more frequent sampling under the 

Alternative option. The additional number of triggers identified by increased sampling under the 

Alternative option translate into greater potential benefits than those under the AIP option. 

Exhibit 9.3 shows the effect (on average across all PWSs) of the AIP option and the 

Alternative option with respect to acute (E. coli) violations found over the 25-year period of 

analysis in comparison to the current TCR. The overall reduction in annual acute violations 

under the AIP option of more than 100 events is a measure that should correlate more closely 

with expected benefits (i.e., reductions in adverse health outcomes) than non-acute violations 

because acute violations are a direct result of measurement of E. coli in water. Again a similar, 

but smaller, reduction is seen under the Alternative option after steady state is achieved. This is 

the result of two off-setting effects. The “true” number of steady state violations under the 

Alternative option is lower, because there is a greater likelihood that violations will be found and 

fixed. However, the additional monitoring leads to a higher percentage of violations being 

detected. This second effect outweighs the first, so that the total number of detected violations in 

 

5

 The assessment period is 3 years for CWSs, and CWSs begin sampling on their reduced regimens in year 7 after 

promulgation. 
Economic Analysis for the Proposed RTCR 9-12 June 2010 

the steady state is higher than for the AIP, even though the underlying “true” number of 

violations is lower. This lower number of “true” violations means that the Alternate option is 

more protective of public health, even though more violations are detected. 

Exhibit 9.4 presents estimates over the 25-year period of analysis of the increase in 

corrective actions (on average across all PWSs) attributable to the regulatory options considered. 

The performance of these additional corrective actions is expected to result in the most direct 

benefits under the AIP option. Because only the numbers of corrective actions estimated under 

the AIP option and Alternative option net of those estimated under the current TCR were 

modeled, the reference point for comparison to the current TCR is the base (zero) line in the 

graph. The RTCR EA assumes that corrective actions are being performed under the current 

TCR. These are taken into account by assuming only a modest net increase in effective 

corrective actions implemented, calculated as 10% of assessments performed under each 

regulatory alternative that are net of those performed under the current TCR. 

Exhibit 9.4 indicates that more corrective actions would be implemented under the 

Alternative option than under the AIP option. This is driven, again, by the increased diagnostic 

power of more sampling and reflects additional potential benefits beyond those gained under the 

AIP option. However, not quantified are the numbers of corrective actions that would be 

identified by the annual inspections required to qualify for annual monitoring under the AIP 

option but not under the Alternative option. Inclusion of the additional corrective actions taken 

under the AIP option due to the annual inspection requirement could narrow the difference 

between the potential benefits of the Alternative option and AIP option. 

Taken together, Exhibits 9.2 – 9.4 indicate that the modeled endpoints for the AIP option 

and Alternative option predict positive benefits in comparison to the current TCR; in particular, 

the Alternative option would capture more benefits than the AIP option. These outcomes are 

consistent with the qualitative assessment of the benefits summarized in Section 9.1.1.1 above. 

The assessment based on Exhibits 9.5 – 9.7 is also consistent with the qualitative analysis 

in Section 9.1.1.1: For each of the discounted endpoints presented over time in Exhibits 9.5 – 

9.7, the graphs show that (on average across all PWSs) the Alternative option would provide 

more benefits than the AIP option, and both provide more benefits than the current TCR. The 

major difference between the AIP option and Alternative option is the increased monitoring that 

would be required under the Alternative option. The increased diagnostic ability of the extra 

samples taken under the Alternative option is seen in the large difference in the endpoint counts 

through the first several years in the graphs below. Absent this effect, the Alternative option 

would mirror the AIP option in the graphs. Thus, even though the predicted endpoints are greater 

than the current TCR at first, it is due to initially finding more problems through monitoring. 

This would reflect a frontloading of benefits under the Alternative option at the beginning of the 

implementation period. The benefits, however, would tend to even out over time between the 

AIP option and Alternative option as eligible systems qualify for less frequent (quarterly) 

monitoring under the Alternative option. 
Economic Analysis for the Proposed RTCR 9-13 June 2010 

Exhibit 9.2 Estimates of Non-Acute Violations (TCR) and Level 1 Assessment 

Triggers (AIP and Alternative Options) 

5,000 

6,000 

7,000 

8,000 

9,000 

10,000 

11,000 

12,000 

13,000 

14,000 

4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

Non-Acute Violations (TCR) and Level 1 Assessment Triggers (AIP 

and Alt Options) (Nondiscounted Values)

Time (Years)

TCR - Non-Acute Violations

AIP Option - Level 1 Assessment Triggers

Alt Option - Level 1 Assessment Triggers

Source: Proposed RTCR occurrence model output. 

 

Notes: 

1) The X-axis begins at Year 4 after rule promulgation, which is the first year under full implementation of the AIP or 

Alternative options. 

2) The annual rates of non-acute violations (TCR) and Level 1 assessment triggers (AIP and Alternative options) as 

predicted by the model reach a steady state beginning in approximately Year 9, by which time PWSs that would be 

expected to meet the criteria for reduced monitoring would have begun it. 

3) Non-acute violations/Level 1 assessment triggers are predicted to be lower under the AIP option because, 

although both options are preventing contamination events as discussed in Section 6.4 of this EA, the Alternative 

option is finding more because of its increased sampling and correspondingly higher diagnostic power. 
Economic Analysis for the Proposed RTCR 9-14 June 2010 

Exhibit 9.3 Estimates of Acute Violations (TCR) and E. coli MCL Violations (AIP 

and Alternative Options) 

400 

500 

600 

700 

800 

900 

1,000 

1,100 

1,200 

1,300 

4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

Acute Violations (TCR) and E. coli MCL Violations (AIP and Alt 

Options) (Nondiscounted Values)

Time (Years)

TCR - Acute Violations

AIP Option - E. coli MCL Violations

Alt Option - E. coli MCL Violations

AIPOption ‐ E. coli MCL Violations

AltOption ‐ E. coli MCL Violations

Source: Proposed RTCR occurrence model output. 

Notes: 

1) X-axis begins at Year 4 after rule promulgation, which is the first year under full implementation of the AIP or 

Alternative options. 

2) The annual rates of acute violations (TCR) and EC violations (AIP and Alternative options) as predicted by the 

model reach steady state in approximately Year 9, by which time PWSs that would be expected to meet the criteria 

for a reduced monitoring schedule would have begun it. Estimates represent the annual number of acute violations 

found by each option and the TCR. 

3) Acute violations are predicted to be lower under the AIP option because, although both options are preventing 

contamination events as discussed in Section 6.4 of this EA, the Alternative option is finding more because of its 

increased sampling and correspondingly higher diagnostic power. 
Economic Analysis for the Proposed RTCR 9-15 June 2010 

Exhibit 9.4 Estimates of Corrective Actions 

500 

600 

700 

800 

900 

1,000 

1,100 

1,200 

1,300 

1,400 

1,500 

1,600 

4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

Corrective Acitons (Nondiscounted Values)

Time (Years)

AIP Option - Corrective Actions

Alt Option - Corrective Actions

Source: Proposed RTCR occurrence model output. 

Notes: 

1) X-axis begins at Year 4 after rule promulgation, which is the first year under full implementation of the AIP option or 

Alternative option. The annual rates of corrective actions as predicted by the model reach a steady state beginning 

approximately in Year 9, by which time PWSs that would be expected to meet the criteria for reduced monitoring 

would have begun it. 

2) Includes L1 and L2 corrective actions. All corrective actions performed are in addition to activity under the current 

TCR, which does not require corrective actions. Therefore the current TCR is not included in this graph. 

3) Corrective actions are predicted to be higher under the Alternative option because, although both options are 

preventing contamination events as discussed in Section 6.4 of this EA, the Alternative option is finding more 

because of its increased sampling and correspondingly higher diagnostic power. 
Economic Analysis for the Proposed RTCR 9-16 June 2010 

Exhibit 9.5 Discounted Estimates of Non-Acute Violations (TCR) and Level 1 

Assessment Triggers (AIP and Alternative Options) (3% Discount Rate) 

0 

1,000 

2,000 

3,000 

4,000 

5,000 

6,000 

7,000 

8,000 

9,000 

10,000 

11,000 

12,000 

13,000 

4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

Non-Acute Violations (TCR) and Level 1 Assessment Triggers (AIP 

Option and Alt Option) (Present Value, 3% Discount Rate)

Time (Years)

TCR - Non-Acute Violations

AIP Option - Level 1 Assessment 

Triggers

Alt Option - Level 1 Assessment 

Triggers

Source: Proposed RTCR occurrence model output. 

Notes: 

1) X-axis begins at Year 4 after rule promulgation, which is the first year under full implementation of the AIP option or 

Alternative option. 

2)The annual rates of non-acute violations (TCR) and Level 1 assessment triggers (AIP and Alternative options) as 

predicted by the model reach a steady state beginning in approximately Year 9, by which time PWSs that would be 

expected to meet the criteria for reduced monitoring would have begun it. 

3) Non-acute violations/Level 1 assessment triggers are predicted to be lower under the AIP option because, 

although both options are preventing contamination events as discussed in Section 6.4 of this EA, the Alternative 

option is finding more because of its increased sampling and correspondingly higher diagnostic power. 
Economic Analysis for the Proposed RTCR 9-17 June 2010 

Exhibit 9.6 Discounted Estimates of Acute Violations (TCR) and E. coli MCL 

Violations (AIP and Alternative Options) (3% Discount Rate) 

0 

100 

200 

300 

400 

500 

600 

700 

800 

900 

1,000 

1,100 

1,200 

4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

Acute Violations (TCR) and E. coli MCL Violations (AIP Option and 

Alt Option) (Present Value, 3% Discount Rate)

Time (Years)

TCR - Acute Violations

AIP Option - E. coli MCL Violations

Alt Option - E. coli MCL Violations

Source: Proposed RTCR occurrence model output. 

Notes: 

1) X-axis begins at Year 4 after rule promulgation, which is the first year under full implementation of the AIP option or 

Alternative option. 

2) The annual rates of acute violations (TCR) and EC violations (AIP and Alternative options) as predicted by the 

model reach steady state in approximately Year 9, by which time PWSs that would be expected to meet the criteria 

for reduced monitoring would have begun it. 

3) Acute violations are predicted to be lower under the AIP option because, although both options are preventing 

contamination events as discussed in Section 6.4 of this EA, the Alternative option is finding more because of its 

increased sampling and correspondingly higher diagnostic power. 
Economic Analysis for the Proposed RTCR 9-18 June 2010 

Exhibit 9.7 Discounted Estimates of Corrective Actions 

(3% Discount Rate) 

0 

100 

200 

300 

400 

500 

600 

700 

800 

900 

1,000 

1,100 

1,200 

1,300 

1,400 

4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

Corrective Acitons (Present Value, 3% Discount Rate)

Time (Years)

AIP Option - Corrective Actions

Alt Option - Corrective Actions

Source: Proposed RTCR occurrence model output. 

Notes: 

1) X-axis begins at Year 4, which is the first year under full implementation of the AIP or Alternative options. 

2) Includes L1 and L2 corrective actions. The annual rates of corrective actions as predicted by the model reach a 

steady state beginning in approximately Year 9, by which time PWSs that would be expected to meet the criteria for 

reduced monitoring would have begun it. All corrective actions performed are in addition to activity under the current 

TCR, which does not require corrective actions. Therefore the current TCR is not included in this graph. 

3) Corrective actions are predicted to be higher under the Alternative option because, although both options are 

preventing contamination events as discussed in Section 6.4 of this EA, the Alternative option is finding more 

because of its increased sampling and correspondingly higher diagnostic power. 
Economic Analysis for the Proposed RTCR 9-19 June 2010 

9.1.2 National Cost Summary 

To understand the net impacts of the AIP option on public water systems and states, EPA 

first used available data, information, and best professional judgment to characterize how PWSs 

and states are currently implementing the current TCR. Then, EPA considered the net change in 

costs that would result from implementing the AIP option or Alternative option as compared to 

the costs of continuing with the current TCR. The objective was to provide the net change in 

costs resulting from revisions to the current TCR rather than absolute totals. The exhibits below 

present this net change in costs several different ways to help analyze the impacts of the AIP 

option. 

Costs are estimated for different PWS types and size categories (eight size categories are 

used based on population served) using unit costs developed in the Technology and Cost 

Document for the Proposed Revised Total Coliform Rule (USEPA, 2010d). Cost analyses for 

PWSs include estimates to implement the rule; to revise sampling plans; to conduct routine 

monitoring, additional routine monitoring, and repeat monitoring; to perform Level 1 and Level 

2 assessments and implement corrective actions; and to provide public notification in the case of 

violations. State cost analyses include estimates of the labor burdens that states would incur, 

including staff training on RTCR requirements and conducting annual administration, reviewing 

monitoring reports, reviewing and approving corrective action plans, and for recordkeeping. 

Chapter 7 of this EA provides detailed discussion on the underlying cost-buildup for each rule 

component analyzed within the cost model. 

Considering costs over time, Exhibits 9.8 through 9.10 show that most of the cost 

difference between the AIP option and Alternative option will be experienced in the first 8 years 

after promulgation. Nevertheless, the costs of the AIP option remain lower than those of the 

Alternative option throughout the period of analysis. The lower costs of the AIP option are 

driven by the monitoring requirements of the respective options (e.g., AIP option allows annual 

monitoring for qualifying PWSs while the Alternative option requires at least quarterly 

monitoring for all PWSs). 

Exhibit 9.11 presents the total and net change in costs for the TCR and the regulatory 

options considered for both systems and states. The estimated net change in costs is relatively 

small for PWSs and states on a national level; for the AIP option, total costs would increase from 

the current TCR by approximately 7%, or $14 million (using a 3 percent discount rate). The 

Alternative option, based on the increased sampling regimen, increases total costs from baseline 

by approximately 15%, or about $27 million (using a 3 percent discount rate). Given these 

relatively low net costs, both options are below the threshold of a “significant regulatory action” 

under Executive Order 12866. The approximate $13 million difference between the two options, 

and the net cost of each option, are not particularly large in absolute terms compared to a 

threshold for economic significance of $100 million annually. 

As shown in Exhibit 9.11, the largest portion of the net cost increase is borne by PWSs, 

which incur approximately 99% of the proposed revised rule’s net annualized present value costs 

(using a 3 percent discount rate). States are expected to incur the remaining costs. PWS costs 

represent only a 7% and 15% increase, respectively, for the AIP option and Alternative option, in 
Economic Analysis for the Proposed RTCR 9-20 June 2010 

costs over those estimated for the current TCR. By comparison, state costs are expected to 

increase by 16% and 32% of the TCR costs under the AIP and Alternative options, respectively; 

however, state costs remain relatively low in absolute terms. The higher net change in PWS costs 

reflects the potential impact on the subsets of PWSs (primarily small TNCWSs) that would be 

most affected by the RTCR under either regulatory option. Exhibit 9.13 shows that the greatest 

cost impact is on the smallest subset of TNCWSs, for whom the net change is more than double 

under the Alternative option as compared to the AIP option. The front loading of costs (shown in 

Exhibits 9.8 through 9.10) would further amplify the impacts on small TNCWSs during this 

period. 

Comparison of Costs of the Regulatory Options Considered 

EPA estimated the net change in costs of the AIP and Alternative options as compared to 

the baseline (current TCR). 

Exhibit 9.12 presents the total and net change in costs to PWSs and states by rule 

component for each of the regulatory alternatives considered. For PWSs, the main driver of 

additional costs under the alternatives would be additional corrective actions and increases in 

routine monitoring. Offsetting the cost increase are reductions in costs for additional routine and 

repeat monitoring and PN. 

For states, the main drivers of net cost increases are reviews of revised sampling plans. 

states are expected to see a reduction in costs for assessment activities and PN, although they 

would experience an overall estimated increase in net costs of $0.1 million and $0.3 million, 

respectively, for the AIP and Alternative options. The additional costs associated with the 

Alternative option would result from the increased sampling (and reporting) frequency under that 

option, and the resulting increase in assessments and corrective actions. 

Exhibit 9.13 presents the total and net change in costs to PWSs by system size and type. 

For PWSs, the most significant total net cost impact is for the smallest category of TNCWSs 

(serving ≤100 people). Approximately 38% of the net cost increase under the AIP option is 

estimated to fall on these systems. This is an important factor in evaluation of potential impacts 

when comparing regulatory options. 
Economic Analysis for the Proposed RTCR 9-21 June 2010 

Exhibit 9.8 Net Costs to PWSs (2007$) 

$210.00 

$220.00 

$230.00 

$240.00 

$250.00 

$260.00 

$270.00 

4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

Nondiscounted Costs ($Millions, 2007$)

Time (Years)

TCR

AIP Option

Alternative Option

Source: Proposed RTCR occurrence model output. 

Note: X-axis begins at Year 4, which is the first year of implementation of the AIP or Alternative options. Steady state 

begins in approximately Year 9, by which time PWSs that would be expected to meet the criteria would have qualified 

for and would begin reduced monitoring. 
Economic Analysis for the Proposed RTCR 9-22 June 2010 

Exhibit 9.9 Discounted Net Costs to PWSs Over Time (3% Discount Rate) (2007$) 

$100.00 

$110.00 

$120.00 

$130.00 

$140.00 

$150.00 

$160.00 

$170.00 

$180.00 

$190.00 

$200.00 

$210.00 

$220.00 

$230.00 

$240.00 

$250.00 

4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

Costs ($Millions, 2007$, Present Value, 3% Discount Rate)

Time (Years)

TCR

AIP

Alternative Option

Source: Proposed RTCR cost model. 

Note: X-axis begins at Year 4, which is the first year of implementation of the AIP or Alternative options. Steady state 

begins in approximately Year 9, by which time PWSs that would be expected to meet the criteria would have qualified 

for and would begin reduced monitoring. 
Economic Analysis for the Proposed RTCR 9-23 June 2010 

Exhibit 9.10 Discounted Net Costs to PWSs (7% Discount Rate) (2007$) 

$30.00 

$55.00 

$80.00 

$105.00 

$130.00 

$155.00 

$180.00 

$205.00 

$230.00 

4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

Costs ($Millions, 2007$, Present Value, 7% Discount Rate)

Time (Years)

TCR

AIP

Alternative Option

Source: Proposed RTCR cost model. 

Note: X-axis begins at Year 4, which is the first year of implementation of the AIP or Alternative options. Steady state 

begins in approximately Year 9, by which time PWSs that would be expected to meet the criteria would have qualified 

for and would begin reduced monitoring. 
Economic Analysis for the Proposed RTCR 9-24 June 2010 

Exhibit 9.11 Comparison of Total and Net Change in Annualized Present Value 

Costs ($Millions, 2007$) 

PWSs State Total PWSs State Total

TCR - Total $ 0.9 185 $ 186 $ 178 $ 0.9 $ 179 $ 

AIP - Total $ 1.1 199 $ 200 $ 191 $ 1.3 $ 192 $ 

AIP - Net Change 14 $ 0.1 $ 14 $ 13 $ 0.4 $ 14 $ 

AIP - Percent Change 7% 16% 7% 7% 48% 8%

Alternative Option - Total $ 1.2 212 $ 213 $ 207 $ 1.5 $ 209 $ 

Alternative Option - Net Change 27 $ 0.3 $ 27 $ 29 $ 0.6 $ 30 $ 

Alternative Option - Percent Change 15% 32% 15% 16% 67% 17%

3% Discount Rate 7% Discount Rate

Source: Proposed RTCR cost model. 

Note: 

1) Detail may not add due to independent rounding. 

2) Annualized costs are greater using the 7% than 3% discount rate for the Alternative option. This occurs because 

the costs under the Alternative option are front-loaded in the 25-year time period due to the all-monthly sampling 

requirement (which doesn’t occur under the AIP option). Discounting a given stream using 3% and 7% will always 

result in a higher present value using 3%; annualization of an identical value (any value) using 3% and 7% would 

result in a higher value under 7%. Depending on how costs accrue over the period, and how long the period is, one 

effect will be stronger than the other. Generally, the discounting effect is stronger, resulting in the pattern commonly 

seen where the 3% annualized amount is greater than the 7% one. However, in cases like the Alternative option 

where the costs accrue faster early in the time period, the annualization effect can more than compensate for the 

discounting effect, resulting in a higher annualized value under 7% compared to 3%. 
Economic Analysis for the Proposed RTCR 9-25 June 2010 

Exhibit 9.12 Comparison of Total and Net Change in Annualized Present 

Value Costs by Rule Component ($Millions, 2007$) 

PWSs State Total PWSs State Total

TCR - Total $ - - $ - $ - $ - $ - $ 

AIP - Total $ 0.18 2.77 $ 2.95 $ 4.00 $ 0.26 $ 4.26 $ 

AIP - Net Change $ 0.18 2.77 $ 2.95 $ 4.00 $ 0.26 $ 4.26 $ 

Alternative Option - Total $ 0.18 2.77 $ 2.95 $ 4.00 $ 0.26 $ 4.26 $ 

Alternative Option - Net Change $ 0.18 2.77 $ 2.95 $ 4.00 $ 0.26 $ 4.26 $ 

TCR - Total $ - - $ - $ - $ - $ - $ 

AIP - Total $ 0.42 0.59 $ 1.01 $ 0.84 $ 0.59 $ 1.42 $ 

AIP - Net Change $ 0.42 0.59 $ 1.01 $ 0.84 $ 0.59 $ 1.42 $ 

Alternative Option - Total $ 0.42 0.59 $ 1.01 $ 0.84 $ 0.59 $ 1.42 $ 

Alternative Option - Net Change $ 0.42 0.59 $ 1.01 $ 0.84 $ 0.59 $ 1.42 $ 

TCR - Total $ - 170.59 $ 170.59 $ 163.94 $ - $ 163.94 $ 

AIP - Total $ - 174.71 $ 174.71 $ 167.74 $ - $ 167.74 $ 

AIP - Net Change $ - 4.12 $ 4.12 $ 3.80 $ - $ 3.80 $ 

Alternative Option - Total $ - 186.34 $ 186.34 $ 181.49 $ - $ 181.49 $ 

Alternative Option - Net Change $ - 15.75 $ 15.75 $ 17.56 $ - $ 17.56 $ 

TCR - Total $ - 3.87 $ 3.87 $ 3.72 $ - $ 3.72 $ 

AIP - Total $ - 1.12 $ 1.12 $ 1.09 $ - $ 1.09 $ 

AIP - Net Change $ - (2.75) $ (2.75) $ (2.63) $ - $ (2.63) $ 

Alternative Option - Total $ - 0.68 $ 0.68 $ 0.58 $ - $ 0.58 $ 

Alternative Option - Net Change $ - (3.18) $ (3.18) $ (3.14) $ - $ (3.14) $ 

TCR - Total $ - 5.11 $ 5.11 $ 4.91 $ - $ 4.91 $ 

AIP - Total $ - 4.82 $ 4.82 $ 4.64 $ - $ 4.64 $ 

AIP - Net Change $ - (0.29) $ (0.29) $ (0.27) $ - $ (0.27) $ 

Alternative Option - Total $ - 5.50 $ 5.50 $ 5.45 $ - $ 5.45 $ 

Alternative Option - Net Change $ - 0.39 $ 0.39 $ 0.54 $ - $ 0.54 $ 

TCR - Total $ - - $ - $ - $ - $ - $ 

AIP - Total $ - - $ - $ - $ - $ - $ 

AIP - Net Change $ - - $ - $ - $ - $ - $ 

Alternative Option - Total $ - - $ - $ - $ - $ - $ 

Alternative Option - Net Change $ - - $ - $ - $ - $ - $ 

TCR - Total $ 0.21 1.13 $ 1.34 $ 1.08 $ 0.21 $ 1.29 $ 

AIP - Total $ 0.20 1.63 $ 1.84 $ 1.57 $ 0.20 $ 1.77 $ 

AIP - Net Change $ (0.01) 0.50 $ 0.49 $ 0.49 $ (0.01) $ 0.48 $ 

Alternative Option - Total $ 0.23 1.73 $ 1.95 $ 1.69 $ 0.22 $ 1.91 $ 

Alternative Option - Net Change $ 0.01 0.60 $ 0.61 $ 0.60 $ 0.02 $ 0.62 $ 

TCR - Total $ 0.26 0.70 $ 0.96 $ 0.68 $ 0.25 $ 0.93 $ 

AIP - Total $ 0.19 0.90 $ 1.09 $ 0.88 $ 0.18 $ 1.06 $ 

AIP - Net Change $ (0.07) 0.20 $ 0.12 $ 0.20 $ (0.07) $ 0.13 $ 

Alternative Option - Total $ 0.28 1.23 $ 1.51 $ 1.27 $ 0.30 $ 1.57 $ 

Alternative Option - Net Change $ 0.02 0.52 $ 0.55 $ 0.60 $ 0.05 $ 0.65 $ 

TCR - Total $ - - $ - $ - $ - $ - $ 

AIP - Total $ 0.01 9.17 $ 9.18 $ 7.77 $ 0.01 $ 7.77 $ 

AIP - Net Change $ 0.01 9.17 $ 9.18 $ 7.77 $ 0.01 $ 7.77 $ 

Alternative Option - Total $ 0.01 9.39 $ 9.40 $ 8.01 $ 0.01 $ 8.02 $ 

Alternative Option - Net Change $ 0.01 9.39 $ 9.40 $ 8.01 $ 0.01 $ 8.02 $ 

TCR - Total $ - - $ - $ - $ - $ - $ 

AIP - Total $ 0.00 2.72 $ 2.72 $ 2.41 $ 0.00 $ 2.41 $ 

AIP - Net Change $ 0.00 2.72 $ 2.72 $ 2.41 $ 0.00 $ 2.41 $ 

Alternative Option - Total $ 0.01 3.53 $ 3.53 $ 3.36 $ 0.01 $ 3.37 $ 

Alternative Option - Net Change $ 0.01 3.53 $ 3.53 $ 3.36 $ 0.01 $ 3.37 $ 

TCR - Total $ 0.44 3.75 $ 4.19 $ 3.60 $ 0.42 $ 4.03 $ 

AIP - Total $ 0.06 0.26 $ 0.33 $ 0.26 $ 0.06 $ 0.32 $ 

AIP - Net Change $ (0.38) (3.49) $ (3.87) $ (3.35) $ (0.36) $ (3.71) $ 

Alternative Option - Total $ 0.08 0.34 $ 0.42 $ 0.35 $ 0.08 $ 0.43 $ 

Alternative Option - Net Change $ (0.36) (3.41) $ (3.77) $ (3.26) $ (0.34) $ (3.60) $ 

Repeat Monitoring

Site Inspections

Level 1 Assessment

Corrective Actions based on Level 1 Assessments

3% Discount Rate 7% Discount Rate

Routine Monitoring

Corrective Actions based on Level 2 Assessments

Level 2 Assessment

Additional Routine Monitoring

Revising Sampling Plans

Rule Implementation

Public Notification

Notes: 

 1) Detail may not add due to independent rounding. 

2) For modeling purposes, additional routine sample counts include 

regular routine samples taken in the same month. 

3) The “Site Inspections” component has $0 cost because it’s not 

required by the rule. A PWS may request a site visit by the state as part 

of the process of moving towards qualifying for reduced monitoring. 
Economic Analysis for the Proposed RTCR 9-26 June 2010 

4) Not all TCR components are quantified. For components not 

quantified for the TCR, the AIP and Alternative option totals include only 

an estimate of the net increase for those same rule components (e.g., 

corrective action costs). 

Source: Proposed RTCR cost model. 

Exhibit 9.13 Total and Net Change in Annualized Costs to PWSs by PWS Size and 

Type ($Millions, 2007$) 

TCR - Total AIP - Total AIP - Net

Alternative 

Option - Total

Alternative 

Option - Net TCR - Total AIP - Total AIP - Net

Alternative 

Option - 

Total

Alternative 

Option - Net

A B C=B-A D E=D-A F G H=G-F I J=I-F

≤100 $7.4 $7.5 $0.1 $7.6 $0.2 $7.1 $7.3 $0.2 $7.4 $0.3

101-500 $9.0 $9.3 $0.3 $9.4 $0.4 $8.6 $9.1 $0.4 $9.2 $0.6

501-1,000 $3.7 $3.8 $0.0 $3.8 $0.1 $3.6 $3.7 $0.1 $3.7 $0.1

1,001-4,100 $13.2 $13.6 $0.3 $13.6 $0.3 $12.7 $13.1 $0.4 $13.1 $0.4

4,101-33,000 $42.4 $44.7 $2.3 $44.7 $2.3 $40.7 $42.7 $2.0 $42.7 $2.0

33,001-96,000 $34.9 $36.4 $1.5 $36.4 $1.5 $33.5 $34.8 $1.3 $34.8 $1.3

96,001-500,000 $34.7 $36.2 $1.5 $36.2 $1.5 $33.4 $34.6 $1.2 $34.6 $1.2

500,001-1 Million $6.5 $6.7 $0.2 $6.7 $0.2 $6.2 $6.4 $0.1 $6.4 $0.1

> 1 Million $5.6 $5.5 ($0.0) $5.5 ($0.0) $5.3 $5.3 ($0.0) $5.3 ($0.0)

Total $157.4 $163.6 $6.2 $163.9 $6.5 $151.3 $157.0 $5.7 $157.3 $6.0

≤100 $2.6 $2.6 $0.1 $3.6 $1.0 $2.5 $2.6 $0.2 $3.8 $1.3

101-500 $1.9 $2.0 $0.1 $2.7 $0.9 $1.8 $2.0 $0.2 $2.9 $1.1

501-1,000 $0.6 $0.6 $0.0 $0.8 $0.3 $0.6 $0.6 $0.1 $0.9 $0.3

1,001-4,100 $1.2 $1.3 $0.1 $1.3 $0.1 $1.1 $1.2 $0.1 $1.2 $0.1

4,101-33,000 $0.4 $0.5 $0.1 $0.5 $0.1 $0.4 $0.5 $0.0 $0.5 $0.0

33,001-96,000 $0.1 $0.1 $0.0 $0.1 $0.0 $0.1 $0.1 $0.0 $0.1 $0.0

96,001-500,000 $0.1 $0.1 ($0.0) $0.1 ($0.0) $0.1 $0.1 ($0.0) $0.1 ($0.0)

500,001-1 Million $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0

> 1 Million $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0

Total $6.9 $7.2 $0.4 $9.1 $2.3 $6.6 $7.2 $0.6 $9.4 $2.8

≤100 $13.4 $18.5 $5.1 $26.7 $13.4 $12.8 $18.0 $5.1 $27.8 $14.9

101-500 $4.9 $6.4 $1.5 $9.1 $4.2 $4.7 $6.2 $1.5 $9.4 $4.7

501-1,000 $0.6 $0.8 $0.2 $1.1 $0.5 $0.6 $0.8 $0.2 $1.2 $0.5

1,001-4,100 $0.9 $1.0 $0.1 $1.0 $0.1 $0.9 $1.0 $0.1 $1.0 $0.1

4,101-33,000 $0.4 $0.5 $0.1 $0.5 $0.1 $0.4 $0.5 $0.0 $0.5 $0.0

33,001-96,000 $0.1 $0.1 ($0.0) $0.1 ($0.0) $0.1 $0.1 ($0.0) $0.1 ($0.0)

96,001-500,000 $0.1 $0.1 ($0.0) $0.1 ($0.0) $0.1 $0.1 ($0.0) $0.1 ($0.0)

500,001-1 Million $0.2 $0.2 ($0.0) $0.2 ($0.0) $0.2 $0.2 ($0.0) $0.2 ($0.0)

> 1 Million $0.3 $0.3 $0.0 $0.3 $0.0 $0.3 $0.3 $0.0 $0.3 $0.0

Total $20.9 $27.8 $6.9 $39.1 $18.2 $20.1 $27.1 $7.0 $40.4 $20.3

Grand Total $185.2 $198.7 $13.5 $212.1 $26.9 $177.9 $191.2 $13.2 $207.0 $29.1

PWS Size

(Population

Served)

3% Discount Rate 7% Discount Rate

Community Water Systems (CWSs)

Nontransient Noncommunity Water Systems (NTNCWSs)

Transient Noncommunity Water Systems (TNCWSs)

Source: Proposed RTCR cost model.

Note: Detail may not add due to independent rounding. Because only the incremental costs of some rule components are considered as part of the cost analysis, 

references to “total” costs in this exhibit do not refer to the complete costs for regulatory implementation, but only to the specific costs considered to calculate net 

changes in costs. 
Economic Analysis for the Proposed RTCR 9-27 June 2010 

9.1.3 Comparison of National Benefits and Costs of the Regulatory Options Considered 

Because the potential benefits of the AIP and Alternative options have not been 

monetized, direct questions of how benefits compare to costs cannot be quantitatively answered 

(i.e., whether monetary benefits exceed costs and by how much). However, EPA’s collective 

evaluation of the results presented in this EA lead to the conclusion that the benefits of the AIP 

option will, in fact, exceed costs. Further evaluation of the cost effectiveness of the AIP option in 

comparison to the Alternative option considered is provided in Section 9.3 below. The breakeven analysis described in Section 9.3.2 entails determining how many cases of morbidity and/or 

mortality would need to be avoided in order for the benefit of those avoided cases to equal the 

cost of the rule option. It does not predict cases of illness avoided as a result of the rule. Instead, 

it is included to help provide some context for considering the magnitude of cases of waterborne 

illness that would need to be avoided to breakeven with rule costs. 

9.2 Effect of Uncertainties and Nonquantified Benefit/Cost Estimates on the 

Estimation of National Benefits and Costs 

 Throughout the development of the analyses in this EA, EPA closely evaluated 

uncertainties in data used. EPA presents a discussion and comprehensive list of assumptions that 

introduce uncertainty into the analysis in Sections 4.5 and 5.3.3.1 (Exhibits 4.13 and 5.22a-b, 

respectively). Certain assumptions are incorporated into the predictive model for all three 

regulatory scenarios in a similar fashion (current TCR as well as the AIP and Alternative 

options). Because the analysis is based on net changes from the current TCR to the AIP and 

Alternative options, incorporating these uncertainties into the current TCR and the options 

results in no significant net effect on the analysis results. As discussed in Chapters 4 and 5, 

although GWR assumptions are considered by EPA to be conservative estimates of the 

effectiveness of the GWR, they are incorporated into the model in similar fashion for all three 

regulatory options considered, and therefore are not expected to significantly affect net results of 

the EA. However, assumptions for certain variables identified as key drivers in producing the net 

results of this EA (the frequency and effectiveness of CA’s) affect the AIP and Alternative 

options but not the current TCR. These assumptions are further evaluated in a sensitivity analysis 

in Ch. 5, which is summarized in Section 9.2.1 below. 

EPA also assessed nonquantified costs and benefits to estimate how they would affect the 

overall conclusions of the analyses performed. Potential impacts of nonquantified costs and 

benefits are discussed in Chapter 7 and Chapter 6, respectively, of the EA. Section 9.2.2 

summarizes the major nonquantified costs and benefits evaluated. 

9.2.1 Summary of Major Uncertainties in EA Analyses 

The primary sources of uncertainty in the AIP option are introduced into the analysis in 

the occurrence model and cost models. In the occurrence model, uncertainty is introduced in two 

types of information. First, data on TC/ E. coli occurrence and acute and non-acute violations 

data are adapted from the Six-Year Review and Safe Drinking Water Information SystemFederal Version (SDWIS/FED). Second, EPA used best professional judgment in choosing the 
Economic Analysis for the Proposed RTCR 9-28 June 2010 

values of model inputs to represent the net increase in effective corrective actions to be 

implemented under the AIP option, and the resulting period of reduced occurrence (both in 

length of time and percent reduction). The data limitations are discussed in Chapter 4 of this EA. 

The influence of selected inputs on the model output was tested in a sensitivity analysis, using 

substitute values that were factors of 0.5 and 2.0 of the original values. Model runs based on the 

0.5 decrease in original inputs yielded results that decreased by a factor less than 0.5 (i.e., the 

results were between 0.5 and 1.0 of the original value). Similarly, model runs based on inputs 

that were 2X the value of the original inputs yielded results that were less than a multiple of 2X 

the original output. These results, showing that input variable selection has less than a one-to-one 

influence on model output, indicate that the model output is not highly sensitive to changes in 

these input variables. 

Additionally, uncertainty in the analysis results stemmed from the complexity of 

interactions between the effects of the various rule components. The occurrence model produced 

outputs that showed a decrease in acute violations under the AIP option and an increase under 

the Alternative option. Given that the Alternative option incorporated the same risk reducing 

features (assessments and corrective actions) as the AIP option, EPA considered that the 

additional sampling under the Alternative option was having a larger upwards effect (increase) 

on occurrence compared to the downward effect of the additional corrective actions. EPA 

developed a stepwise sensitivity analysis to test the relative importance of the following 

competing effects under the AIP option relative to the current TCR: 

y New assessments and corresponding corrective actions 

y Reduced repeat and additional routine monitoring. 

The results (Section 6.4) revealed that acute violations under the AIP option as compared 

to the current TCR differed as follows: 

y Many acute violations were prevented from occurring by implementation of 

assessments and corresponding corrective actions. 

y Some acute violations were missed by the reduction in repeat and additional routine 

sampling. 

From these results (described in Section 6.4), EPA concluded that under the AIP option and the 

Alternative option, more acute violations are prevented than are missed. Additionally, the 

increase in routine monitoring under the AIP option finds additional acute violations as 

compared to the current TCR, which explains the net increase in the acute violations found as 

compared to the current TCR. Exhibits 9.2 – 9.7 show the larger net difference (between the 

alternative and baseline) seen in levels of acute violations, non-acute violations, and corrective 

actions implemented under the AIP option as compared to the Alternative option. 

The sources of uncertainty embedded within the results of the occurrence model are also 

incorporated into the cost model. As described in reference to the occurrence model, EPA used 

best professional judgment in choosing 10% as the factor of net increase over corrective actions 
Economic Analysis for the Proposed RTCR 9-29 June 2010 

implemented under the current TCR. A sensitivity analysis of the effect of an increase in this 

factor on costs revealed that as the number of corrective actions increase, a portion of the 

corresponding cost is offset by the reduced number of assessments required as water quality 

improves (Section 7.7 of this EA). 

A potentially significant additional source of uncertainty in costs is introduced in the 

distribution of correction actions selected (i.e., the number of each type implemented) for the 

10% additional corrective actions. Because there is a wide variation in the unit costs of the actual 

corrective actions underlying the compliance forecast (see Appendix D for unit cost detail), EPA 

ran two sensitivity analyses to assess the potential impacts of a high and low cost distribution in 

the compliance forecast. The results provide a low bound and a high bound on the original 

analysis results: approximately $1million/$19 million for the AIP option and $16 million/$39 

million for the Alternative option. This indicates that although the estimates of the number of 

systems that would choose each type of corrective action has a significant impact on costs of the 

rule, the rule remains a relatively low cost rule under the most conservative (costly) assumptions. 

9.2.2 Summary of Nonquantified Costs and Benefits 

EPA believes that all of the rule elements that are the major drivers of the net change in 

costs from the current TCR have been quantified to the greatest degree possible. However, cost 

reductions related to fewer monitoring and reporting violations are not specifically accounted for 

in the cost analysis, and their exclusion from consideration may result in an overestimate of net 

change in cost between the TCR and the AIP option or Alternative option. Using E. coli as the 

endpoint, benefits have been estimated and predictions made about the reduced hazard associated 

with reduced exposure to fecal contamination and the potential benefits from corrective actions 

that, if effective, will reduce exposure. No attempt was made to monetize these benefits by 

predicting infections, illnesses or deaths and to compare these values directly with the monetized 

costs because of lack of data. 

Because the cost analyses in this EA focus on net changes in costs, consideration of 

nonquantified costs can result in either an under- or over-estimate of the net costs for the AIP 

option, as described in Section 7.7 of this EA. Overall, the nonquantified costs identified would 

potentially lower the net cost of the AIP option, and include the following: 

y Reduced costs due to overlap between sanitary surveys and required assessments; and 

y Reductions in costs related to less frequent PN for reporting and monitoring 

violations. 

Additionally, EPA identified a potential cost and benefit increase for the AIP option and 

Alternative option related to the baseline assumption that all PWSs are currently meeting 

requirements of the TCR. To the degree that PWSs are not currently meeting TCR requirements, 

the current TCR costs and benefits are overstated in the RTCR EA, resulting in an underestimate 

of costs and benefits under the AIP option. 
Economic Analysis for the Proposed RTCR 9-30 June 2010 

EPA identified five additional potential areas of nonquantified benefits: 

y Reductions in primary and secondary endemic disease burden, both acute and 

chronic, associated with consuming PWS drinking water; 

y Reductions in risk of outbreak and associated illness and costs; 

y Benefits from increased systems knowledge (including more consistent water 

quality); 

y Accelerated infrastructure repair/replacement; and 

y Reductions in averting behavior (due to higher consumer confidence in water quality). 

Taken together, these items represent a potential for significant additional health benefits. For the 

first four items listed above, benefits may be realized directly through the elimination, reduction, 

and/or prevention of pathogen occurrence. Reductions in averting behavior may lead to benefits 

related to a more efficient use of resources (i.e., using tap water instead of more expensive, yet 

not necessarily safer, alternatives). 

9.3 Comparison of the Regulatory Options Considered 

The following subsections present further analysis of the AIP option in comparison to the 

Alternative option. Comparisons based on incremental costs and benefits and several 

effectiveness measures are presented to inform the selection of the AIP option over the 

Alternative option, 

9.3.1 Incremental Costs and Benefits 

Incremental costs and benefits are those that are incurred or realized to reduce pathogen 

illnesses and deaths from one alternative to the next more stringent alternative. Estimates of 

incremental costs and benefits are useful when considering the economic efficiency of different 

regulatory alternatives considered by EPA. One goal of an incremental analysis is to identify the 

regulatory alternatives where net social benefits are maximized. Incremental net benefits analysis 

is not possible when benefits are not monetized as in the case with the RTCR. However, 

incremental analysis can still provide information on relative cost-effectiveness of different 

regulatory options. 

For the RTCR only costs were monetized. An indirect proxy for benefits was quantified. 

To compare the additional net cost increases and associated incremental benefits of the AIP and 

Alternative options, benefits are presented in terms of corrective actions performed since 

performance of corrective actions is expected to have an impact that is most directly translatable 

into potential health benefits. 
Economic Analysis for the Proposed RTCR 9-31 June 2010 

To compare the additional net cost increases and associated benefits of the AIP and 

Alternative options (shown as numbers of corrective actions performed), analyses of both 

incremental costs and benefits are presented in Exhibit 9.14. The results represent that portion of 

costs for each rule alternative that are an addition to the cost of the next least stringent rule 

option. Benefits are also incrementally presented in terms of corrective actions performed, since 

performance of corrective actions is expected to have an impact that is most directly translatable 

into potential health benefits. 

Exhibit 9.14 shows that the Alternative option is incrementally approximately the same 

annualized cost as the AIP option using a 3 discount rate ($13.5 million vs. $13.7 million, 

respectively). Consistent with the lower incremental costs, the incremental benefits in terms of 

corrective actions performed are fewer under the Alternative option than under the AIP. The new 

requirement under both the AIP and Alternative options for PWSs to implement assessments and 

corrective actions will capture the bulk of improvements to be made in comparison to the current 

TCR option. The additional sampling required under the Alternative option relative to the AIP 

option is providing an approximately equal incremental increase in costs but a lower incremental 

effectiveness relative to the portion of costs that occurs under both the AIP and Alternative 

options. This suggests that beyond a certain level of corrective action implementation, PWSs 

would experience diminishing net marginal returns for their investment in correction actions. 

The relationship between the incremental costs and benefits is examined further with respect to 

cost effectiveness in Section 9.3.2 below. 

Exhibit 9.14 Incremental Net Change in Annualized Present Value Costs 

($Millions, 2007$) and Benefits (Number of Corrective Actions) 

3% 7% 3% 7%

Current TCR $ 178.8 186.1 $ No change3 No change3

AIP $ 192.5 199.8 $ 202 189

Incremental AIP1 $ 13.7 13.7 $ 202 189

Alternative Option $ 208.5 213.3 $ 326 331

Incremental Alternative Option2 $ 16.0 13.5 $ 124 143

Benefits

Regulatory Option (L2 Corrective Actions) Costs

1

 Represents the incremental net change of the AIP option over the current TCR option. 2

 Represents the incremental net change of the Alternative option over the AIP option. Add incremental 

net change for Alternative option to incremental net change for AIP option to calculate the total net 

change of the Alternative option over the current TCR option. Note: The RTCR occurrence model yields 

the number of corrective actions that are expected to be implemented in addition to (net of) those already 

implemented under the current TCR. The model does not incorporate an estimate of the number of 

corrective actions implemented per year under the current TCR and does not yield a total for the AIP and 

Alternative option that includes the current TCR corrective actions. Benefits shown include corrective 

actions based on L2 assessments. Detailed benefits and cost information is provided in Appendices A 

and C, respectively, of the Proposed RTCR EA (USEPA 2009a). 3

 As explained in section VI.F.2.f of the preamble, for modeling purposes, EPA estimates the net change 

only in the number of corrective actions performed under the AIP and Alternative options compared to the 

current TCR and thus did not quantify the (non-zero) baseline number of corrective actions performed 

under the Current TCR.
Economic Analysis for the Proposed RTCR 9-32 June 2010 

9.3.2 Cost Effectiveness Measures 

To further differentiate between the AIP option and Alternative option results, EPA 

performed analyses to assess the cost effectiveness of each regulatory scenario. In this section, 

EPA provides an estimate of the cost per corrective action performed under the regulatory 

alternatives, which is a measure of the cost effectiveness of each proposed rule option. As noted 

elsewhere in this chapter, corrective actions are considered a clear enhancement to the efforts to 

reduce E. coli (and co-occurring pathogen) occurrence in PWSs, and the most direct benefit in 

this EA. Corrective actions are also a main driver of the net increases in costs for both rule 

options considered. In addition, the modeling of corrective actions is done only on a net basis 

relative to the level performed under the current TCR, thus providing a clear dividing line 

between impacts under the current TCR and each rule option. The results (Exhibit 9.15) of this 

EA show that, on average, the annual net cost of the rule per corrective action performed beyond 

baseline is approximately $23,000 and $35,000, respectively, for the AIP and Alternative options 

(using a 3 percent discount rate). 

Exhibit 9.15 Total Net Annual Cost Per Corrective Action Implemented under AIP 

Option and Alternative Options, Annualized Using 3% and 7% Discount Rates 

($2007) 

Regulatory Scenario 3% Discount Rate 7% Discount Rate

AIP Net Cost $ 13.7 13.7 $ 

AIP Net Corrective Actions (L1 & L2) 598 555

AIP Cost Effectiveness Analysis (CEA )(net rule cost/CA) 22,902 $ 24,613 $ 

Alternative Option Net Cost 27.2 $ 29.7 $ 

Alternative Option Net Corrective Actions (L1 & L2) 785 765

Alternative Option CEA (net rule cost/CA) 34,721 $ 38,815 $ 

Note: Corrective actions include those conducted as a result either Level 1 or Level 2 assessments. Total rule costs 

are shown in Exhibit 9.14. Detailed benefits and cost information is provided in Appendices A and C, respectively, of 

this EA.

EPA also considered the incremental cost effectiveness of the AIP as compared to the 

Alternative option to determine the additional benefit associated with that portion of Alternative 

option cost beyond the cost of the AIP option. Exhibit 9.16 shows that the AIP option has a far 

lower marginal cost per corrective action than the Alternative option ($23,000 for the AIP option 

vs. $73,000 for the Alternative option). This indicates that the additional corrective actions 

performed under the Alternative option are much more costly on a unit basis than those 

performed under the AIP option. 

EPA further considered the issue of additional costs under the Alternative option as 

compared to the AIP option in terms of the effect on small TNCWSs using GW (serving ≤100). 

The additional net cost increases under the Alternative option could cause substantial additional 

burden on small TNCWSs, which incur the largest portion of costs of the rule among all 

categories of systems. However, these same TNCWSs would also receive the most benefits from 

the RTCR (increased assessments and corrective actions following a trigger). EPA considered 

the group of 60,200 TNCWSs using GW (serving ≤100), which are the largest subset of systems 

by size/type, and which are expected to bear the highest burden of all system categories under 
Economic Analysis for the Proposed RTCR 9-33 June 2010 

the AIP option. Exhibit 9.17 shows that in incremental terms, the cost effectiveness of the AIP 

option is significantly greater than of the Alternative option (a cost per corrective action of 

$18,000 vs. $65,000, respectively) and both options are more cost effective for this subset 

(TNCWSs using GW serving ≤100) than for the entire population of PWSs taken as a whole. 

The two incremental analyses (Exhibits 9.16 and 9.17) together indicate that, using a 3 percent 

discount rate to compare incremental benefits and costs, the AIP option is significantly more cost 

effective (by a factor of approximately 3.5) than the Alternative option for the most burdened 

subset of systems, and is significantly more cost effective (by a factor of approximately 3.2) than 

the Alternative option when considering all PWSs together. 

Exhibit 9.16 Incremental Rule Cost Per Corrective Action (CA) Implemented for 

All PWSs under AIP and Alternative Options, Annualized Using 3% and 7% 

Discount Rates ($2007) 

Regulatory Scenario 3% Discount Rate 7% Discount Rate

AIP Incremental Net Costs ($ millions)1 $ 13.7 13.7 $ 

AIP Incremental Net Corrective Actions (L1 & L2)1 598 555

AIP Incremental Cost per CA ($) $ 24,613 22,902 $ 

Alternative Option Incremental Net Costs ($ millions)2 $ 16.0 13.5 $ 

Alternative Option Incremental Net Corrective Actions (L1 & L2)2 187 210

Alternative Option Incremental Cost per CA ($) $ 76,299 72,582 $ 

Note: Exhibit includes only the number of corrective actions predicted by the RTCR occurrence model to be 

implemented in addition to those implemented under the current TCR. Includes both L1 & L2 corrective actions. Total 

net costs for each option and total CAs (not incremental) are shown in Exhibit 9.15. Detailed benefits and cost 

information is provided in Appendices A and C, respectively, of this EA. 

1 Represents the incremental increase of the AIP option over the current TCR. 2 Represents the incremental increase of the Alternative option over AIP option. Add incremental net values for 

Alternative option to incremental net values for AIP option to calculate total net values of Alternative option over 

current TCR. 

Exhibit 9.17 Incremental Rule Cost Per CA Implemented for GW TNCWSs under 

AIP and Alternative Options, Annualized Using 3% and 7% Discount Rates ($2007) 

Regulatory Scenario 3% Discount Rate 7% Discount Rate

AIP Incremental Net Costs ($ millions)1 $ 5.1 5.1 $ 

AIP Incremental Corrective Actions (L1 & L2) (TNCWS <101 only)1 279 257

AIP Incremental Cost per CA ($) $ 19,965 18,219 $ 

Alternative Option Incremental Net Costs ($ millions)2 $ 9.8 8.3 $ 

Alternative Option Incremental Corrective Actions (L1 & L2) (TNCWS <101 only)2 128 145

Alternative Option Incremental Cost per CA ($) $ 67,762 64,731 $ 

Note: Incremental Net Costs are based on TNCWS serving <101 people. Detailed benefits and cost information is 

provided in Appendices A and C, respectively, of this EA. 

1

 Represents the incremental increase of the AIP option over the current TCR. 2

 Represents the incremental increase of the Alternative option over AIP option. Add incremental net values for 

Alternative option to incremental net values for AIP option to calculate total net values of Alternative option over 

current TCR.
Economic Analysis for the Proposed RTCR 9-34 June 2010 

9.3.3 Break-Even Analysis 

As described in Chapter 6 of this EA, this analysis does not include a fully quantified risk 

assessment because there are insufficient data on the co-occurrence in PWSs of fecal indicator E. 

coli and pathogenic strains of E. coli or other bacteria, viruses, and parasitic protozoa that can 

cause waterborne disease. Given the absence of E. coli and waterborne pathogen co-occurrence 

data to predict health effects in PWSs, EPA developed a break-even analysis to inform the 

discussion of whether the benefits justify the costs of the regulation. A break-even analysis 

typically compares the rule cost with the estimated value of the medical cases (and related costs 

such as time off from work) that would be avoided annually by the rule to determine if the rule 

benefits “break even” with avoided costs. In the case of the EA, where cases avoided cannot be 

estimated, the break-even analysis informs the benefit/cost discussion by providing estimates of 

the number of fatal and non-fatal cases that the rule would need to avoid in order to break even 

with rule costs. 

The underlying question this analysis seeks to inform is whether corrective actions 

performed under the AIP option will sufficiently reduce potential exposure to fecal 

contamination and/or waterborne pathogens to compensate for the net costs of the rule. One 

result of the implementation of the RTCR predicted by the model and presented in Exhibit 6.5 is 

that some number of acute events will be prevented.6

 As discussed in Chapter 6, sufficient data 

are not available to quantify the numbers of illnesses and deaths potentially avoided by 

preventing such acute events. However, the presence of E. coli in a water system is an indicator 

of the presence of fecal contamination;7

 it suggests that a pathway for the introduction of 

waterborne pathogens may exist. The total numbers of acute events and potentially affected 

people are small (most events are predicted in small NCWSs), but nonetheless there will be a 

positive impact on public health by avoiding these events. The magnitude of this impact will 

depend heavily on the specific elements underlying any acute event avoided: who and how 

many in the population are affected, and the etiologic agent to which exposure is avoided. An 

event can be endemic to a single person or small group of persons, or it may reach the level of an 

outbreak. The cause of an event may be one or more of a range of bacterial, viral, or parasitic 

organisms, as described in Chapter 2 of this EA. Although there may be a range of waterborne 

pathogens mitigated by implementation of the proposed RTCR, two potential waterborne 

pathogens are considered in this analysis to provide input for developing the break even analysis: 

shiga toxin-producing E. coli O157:H7 (STEC O157) 8 and Salmonella.

9

 

 

6

Results presented in Exhibit 6.5 of this EA indicate that fewer EC positive events would occur under the AIP option 

than under the current TCR. These results are consistent with the net improvement in PWS water quality (as 

indicated by a decrease in fecal indicator EC) suggested by the step-wise analysis presented in Section 6.4 of this 

EA. Chapter 6 of the EA presents this information in further detail. 

7

 Standridge, J. (2008) discusses the use of E.coli as an indicator of drinking water quality. 8

 According to the website of the American Academy of Family Physicians 

(http://www.aafp.org/afp/20000401/tips/11.html), “Shiga toxin-producing Escherichia coli is a group of bacteria 

strains capable of causing significant human disease. The pathogen is transmitted primarily by food and has become 

an important pathogen in industrialized North America. The subgroup enterohemorrhagic E. coli includes the 

relatively important serotype O157:H7, and more than 100 other non-O157 strains.” 

9 Salmonella, according to the CDC website, is actually a group of bacteria that can cause diarrheal illness in 

humans. They are microscopic living creatures that pass from the feces of people or animals to other people or other 

animals. Salmonella serotype Typhimurium, which caused the 2008 Alamosa, CO outbreak, and Salmonella

serotype Enteritidis are the most common in the United States. Every year, approximately 40,000 cases of 
Economic Analysis for the Proposed RTCR 9-35 June 2010 

The Centers for Disease Control and Prevention (CDC) estimates that STEC O157 

pathogens from all sources are responsible for approximately 73,000 illnesses in the United 

States annually. The CDC has found that 15% of outbreak cases of STEC 0157 are waterborne 

(Rangel et al., 2005); if that rate applies as well to endemic cases, then approximately 11,000 

cases of STEC 0157 infection would be due to waterborne exposure. For Salmonella infections, 

the Economic Research Service (ERS) uses an estimate of 1,397,187 cases annually based on 

1999 estimates from the CDC that included an estimate of non-reported illnesses. The 1999 

estimate stated that the share of cases due to consumption of contaminated food was 95 percent, 

indicating that approximately 70,000 cases were due to other sources. While the portion of these 

cases due to waterborne exposure is unknown, some public systems have documented cases of 

waterborne Salmonellosis. In March of 2008, Salmonella in the water system of Alamosa, 

Colorado caused an outbreak in which hundreds of the 10,000 residents were sickened and one 

person died. The deep mountain aquifer from which the water was drawn was confirmed not to 

be the source of the bacteria10, but two storage tanks had several inches of sediment and 

breaches, and one tank had breaches large enough for birds and animals to enter (CDPHE, 2009). 

For the break-even analysis, medical cases are classified as non-fatal or fatal, and 

analyses are presented for these two classifications.11 The valuations for medical cases used in 

the break-even analysis are developed using the ERS Foodborne Illness Calculator12 (ERS 

calculator), as described in Appendix E of the RTCR, for the two example pathogens considered: 

STEC O157 and Salmonella. For most ERS calculator inputs, default or suggested alternative 

values are used to estimate costs. However, for the valuation of fatal cases within the model, 

EPA used a Value of a Statistical Life (VSL)13 estimate of $8.8 million14 to be consistent with 

EPA methodology for calculating the value of this measure.15

 salmonellosis are reported in the United States; most of these are foodborne, but some, as in the case of Alamosa, 

are waterborne. (http://www.cdc.gov/nczved/dfbmd/disease_listing/salmonellosis_gi.html#2, downloaded 10-6-09) 

10 Berg, Rebecca. 2008. The Alamosa Salmonella Outbreak: A Gumshoe Investigation. Journal of Environmental 

Health. 71(2):54-55. 11 Evaluation of fatal cases in this analysis includes consideration of the underlying non-fatal component of the 

illness prior to death. 

12 A full detailed description of the ERS Foodborne Illness Calculator, including detailed discussion of the items 

discussed above and derivation of the underlying values used in calculations can be found online at: 

http://www.ers.usda.gov/Data/FoodborneIllness/ecoli_Intro.asp. 

13 The VSL represents an estimate of the monetary value of reducing risks of premature death. The VSL, therefore, 

is not an estimate of the value of saving a particular individual’s life. The value of a “statistical” life represents the 

sum of the values placed on small individual risk reductions across an exposed population. For example, if a 

regulation were to reduce the risk of premature death by 1/1,000,000 for one million exposed individuals, the 

regulation would “save” one statistical life (1,000,000 X 1/1,000,000). If each of the 1,000,000 people were willing 

to pay $5 to achieve the risk reduction anticipated from the regulation, the VSL would be $5 million ($5 X 

1,000,000). Appendix E of this EA provides further detail of the derivation of the updated VSL estimate. 

14 An EPA study characterized the range of possible VSL values as a Weibull distribution with a 

mean of $4.8 million (1990 price level) based on 26 individual study estimates (USEPA 1997b). This 

represents the value recommended for use in benefits analyses in EPA’s Guidelines for Preparing 

Economic Analyses (USEPA 2000c) and endorsed by the Science Advisory Board (SAB) Arsenic review 

panel (USEPA 2001b). For use in the break-even analysis, adjustments to the base value from the EPA study were 

made to account for income and price level changes over time. The mean VSL, after all adjustments were made, was 

$8.8 million in year 2007 dollars. These adjustments are explained further in Appendix E of this EA. 

15 Use of different VSL estimates corresponding to different government agency policy and methodologies is 

specifically suggested by ERS, and EPA’s methodology is given as a specific example of an alternate value that may 

be used. 
Economic Analysis for the Proposed RTCR 9-36 June 2010 

To represent a range of estimates, EPA used the ERS calculator to calculate break-even 

thresholds for a low- and high-end valuation of cases avoided corresponding to “traditional” and 

“enhanced” methodologies for estimating Cost of Illness (COI) values. For the traditional COI 

valuation, EPA used the ERS calculator default values for STEC O157, with the exception of the 

VSL applied to fatalities, which EPA updated as shown in Appendix E of the RTCR EA. To 

estimate an enhanced COI valuation, EPA applied the basic settings used for the traditional COI 

valuation (including the EPA-updated VSL value) but with alternative values for estimated 

productivity and disutility losses. The traditional COI, as developed in this analysis based on the 

default setting in the ERS calculator, places no value on lost nonmarket work time, while the 

enhanced COI method values nonmarket work time based on opportunity costs (equivalent to 

market work time lost). The alternative valuation used (a suggested option within the calculator) 

is to apply the productivity losses to all lost time for market and non-market work (e.g., for 

individuals who stay home to raise children or care for the elderly). The ERS calculator default 

value is zero for other forms of disutility caused by the illness16, including pain and suffering, 

inconvenience, and lost non-work time; this setting is used for the traditional approach in this 

analysis. The alternative valuation, used for the enhanced approach in this analysis (also a 

suggested option within the calculator), is based on values (greater than zero) used by the Food 

and Drug Administration. 

 Exhibits 9.18 and 9.19 show the values calculated for avoided cases using the ERS 

Foodborne Illness Calculator for STEC O157 and Salmonella, as summarized above and 

described in Appendix E of this EA. In addition to separate calculations based on traditional and 

enhanced COI valuation methodologies, estimates are presented separately for non-fatal and fatal 

cases. 

Exhibit 9.18 Average Estimated Value Per STEC O157 Case Avoided (2007$) 

Traditional COI Enhanced COI

Non‐fatal cases only 1,756 $                     $                     5,269

Fatal cases only1 $            8,820,401 $            8,821,911

Case Description

Value Per Case

1

 Calculations for fatal cases include the COI component for the underlying 

illness prior to death. 

Notes: Estimates for a weighted average estimate of the cost of “all cases” 

that includes both fatal and non-fatal cases is shown in Appendix E. COI 

estimates derived using USDA ERS Foodborne Illness Cost Calculator: 

STEC O157. Traditional COI estimates are based on ERS default values for 

all inputs except for the VSL estimate, for which EPA substituted its own 

estimate of approximately $8.8 million. Enhanced COI estimates are based 

on the same values except for the following changes: productivity losses are 

applied to all cases rather than just those employed in the formal market, and 

FDA disutility values are applied rather than the ERS default value of 0. 

 

16 Disutility is a specific category defined in the ERS calculator, as mentioned above, to include: pain and suffering, 

inconvenience, and lost non-work time. 
Economic Analysis for the Proposed RTCR 9-37 June 2010 

Exhibit 9.19 Average Estimated Value Per Salmonella Case Avoided (2007$) 

Traditional COI Enhanced COI

Non‐fatal cases only 210 $                              $                         1,397

Fatal cases only1 $                 8,802,998 $                 8,803,551

Value Per Case

Case Description

1

 Calculations for fatal cases include the COI component for the 

underlying illness prior to death. 

Notes: Estimates for a weighted average estimate of the cost of “all 

cases” that includes both fatal and non-fatal cases is shown in 

Appendix E. COI estimates derived using USDA ERS Foodborne 

Illness Cost Calculator: Salmonella. Traditional COI estimates are 

based on ERS default values for all inputs except for the VSL 

estimate, for which EPA substituted its own estimate of approximately 

$8.8 million. Enhanced COI estimates are based on the same values 

except for the following changes: productivity losses are applied to all 

cases rather than just those employed in the formal market, and FDA 

disutility values are applied rather than the ERS default value of 0. 

Using the valuations per case described above, EPA estimated the numbers of cases 

needed to break even by dividing the total net cost of the AIP option by the values from Exhibits 

9.18 and 9.19. The resulting estimates of break-even thresholds are presented in Exhibit 9.20 and 

9.21 separately for non-fatal and fatal cases for STEC O157 and Salmonella, respectively. 

Estimates are presented using both three and seven percent discount rates. 

Exhibit 9.20 Estimated Annual Break-Even Threshold for Avoided Cases of 

STEC O157 

Non‐fatal

cases only

Fatal cases

only1

Non‐fatal

cases only

Fatal cases

only1

3% 8,000                1.6 16,000         3.1

7% 8,000                1.5 17,000         3.4

3% 3,000                1.6 5,000           3.1

7% 3,000                1.5 6,000           3.4

COI

Methodology

Discount

Rate

AIP Option Alternative Option

Traditional

COI

Enhanced COI

1 Calculations for fatal cases include the non-fatal COI component for the underlying 

illness prior to death. 

Notes: The number of cases needed to reach break-even threshold calculated by dividing 

the net change in costs for the RTCR (Exhibit 9.5) by the average estimated value of 

avoided cases (Exhibit 9.18). Threshold estimates based on a weighted average of the 

cost of “all cases” that includes both fatal and non-fatal cases is shown in Appendix E. 

STEC O157 is only an example of a pathogenic endpoint that could have been used for 

this analysis. Use of additional pathogenic contaminants in addition to this single endpoint 

would result in lower threshold values. Detail may not add due to independent rounding. 

The break-even threshold is higher using a 7% discount rate than a 3% discount rate 

under the Alternative option. This result is consistent with the annualized costs of the 

Alternative option being higher using the 7% discount rate, which is caused by the 

frontloading of costs in the period of analysis, as explained further in Chapter 7 of the EA. 
Economic Analysis for the Proposed RTCR 9-38 June 2010 

Exhibit 9.21 Estimated Annual Break-Even Threshold for Avoided Cases of 

Salmonella 

Non‐fatal

cases only

Fatal cases

only1

Non‐fatal

cases only

Fatal cases

only1

3% 65,000             1.6 130,000       3.1

7% 65,000             1.6 141,000       3.4

3% 10,000             1.6 20,000         3.1

7% 10,000             1.6 21,000         3.4

AIP Option Alternative Option

Traditional

COI

Enhanced COI

COI

Methodology

Discount

Rate

1

Note: Calculations for fatal cases include the non-fatal COI component for the 

underlying illness prior to death. 

Note: The number of cases needed to reach break-even threshold calculated by 

dividing the net change in costs for the RTCR (Exhibit 9.5) by the average estimated 

value of avoided cases (Exhibit 9.19). Threshold estimates based on a weighted 

average of the cost of “all cases” that includes both fatal and non-fatal cases is shown 

in Appendix E. Salmonella is only an example of a pathogenic endpoint that could have 

been used for this analysis. Use of additional pathogenic contaminants in addition to 

this single endpoint would result in lower threshold values. Detail may not add due to 

independent rounding. 

The break-even threshold is higher using a 7% discount rate than a 3% discount rate 

under the Alternative option. This result is consistent with the annualized costs of the 

Alternative option being higher using the 7% discount rate, which is caused by the 

frontloading of costs in the period of analysis, as explained further in Chapter 7 of the 

EA.

The estimates shown in Exhibits 9.20 and 9.21 for STEC O157 and Salmonella, 

respectively, represent the number of fatal cases that would need to be avoided annually by the 

rule for its benefits and costs to society to be equal, or break even, with rule costs. Based on 

either example pathogen considered in this break-even analysis, the results show that both the 

AIP and Alternative options would need to avoid a relatively small number of fatal cases 

annually. 

Under the AIP option, just two deaths would need to be avoided annually using a 3% 

discount rate based on consideration of the bacterial pathogen STEC O157. Alternatively, 

approximately 3,000 or 8,000 non-fatal cases, using the enhanced or traditional benefits 

valuations approaches17,, respectively, would need to be avoided to break even with rule costs. 

As expected based on its costs, the Alternative option would require that a higher number of 

 

17 Both traditional and enhanced COI approaches count the value of the direct medical costs and of time lost that 

would been spent working for a wage, but differ in their assessment of the value of time lost that would be spent in 

nonmarket work (e.g. housework, yardwork, and raising children) and leisure (e.g. recreation, family time, and 

sleep). They also differ in their valuation of (other) disutility, which encompasses a range of factors of well being, 

including both inconvenience and any pain and suffering. A complete discussion of the traditional and enhanced 

COI approaches can be found in Appendix E. 
Economic Analysis for the Proposed RTCR 9-39 June 2010 

cases be avoided annually for that option to break even (approximately 60% to 100% more than 

the AIP option under the traditional and enhanced approaches, respectively). 

As Exhibit 9.21 shows, approximately 2 deaths would need to be avoided from a 

Salmonella infection for the rule to break even. The estimated number of non-fatal Salmonella

cases that would need to be avoided to break even is approximately 10,000 or 65,000 cases under 

the enhanced and traditional benefits valuations approaches, respectively. 

As the discussion presented in Chapter 2 of this EA describes, disease and deaths are 

attributable to drinking water contamination across the country. The CDC has found that 15% of 

outbreak cases of STEC 0157:H7 are waterborne (Rangel et al., 2005); if that rate applies as well 

to endemic cases, then approximately 11,000 cases would be due to waterborne exposure to 

STEC 0157:H7. The revised rule could mitigate pathways of contamination into PWSs and 

prevent some of these endemic cases. For just this one contaminant, if just 3,000 non-fatal cases 

under the enhanced COI approach, 8,000 cases under the traditional COI approach, or 

approximately 2 fatal cases of STEC 0157:H7 are avoided by the proposed RTCR, the rule 

would break even. If more than one contaminant was reduced or prevented from occurring in 

PWSs, the rule would be that much more likely to break even. Avoided illness and death from 

secondary transmission of infection could also be significant, and would increase the likelihood 

that total avoided cases reach a break-even threshold. An additional consideration is that a larger 

number of avoided cases would be predicted if all the benefits of the rule as described in Chapter 

6 could be quantified in the analysis. If increased assessments and corrective actions result in a 

level of system knowledge that enables earlier mitigation of potential pathways of 

contamination, then additional illnesses or deaths may be avoided beyond those suggested by the 

decrease in acute events that the model predicts. In the case of the outbreak of Salmonella

infections in Alamosa, Colorado, as described previously in this section of the EA, some of the 

key factors that contributed to the outbreak include significant levels of sediment and the 

presence of breaches to the integrity of the storage tank. 

9.3.4 Summary of Conclusions 

The preferred option for this rulemaking is the AIP option. The analyses performed as 

part of this EA support the collective judgment and consensus of the advisory committee that the 

proposed RTCR requirements, as defined by the AIP, provide for effective and efficient 

revisions to current TCR regulatory requirements. The following is a summary of points that 

must be considered when weighing the benefits and costs of the rule options: 

• The estimated net annual cost of the AIP option is small (approximately $14 million) 

compared to the Alternative option ($27 million) (exhibit 9.11). This cost differential is 

especially important considering the potential concentration of impacts on the smallest 

TNCWSs (exhibit 9.13) and the potential front loading of costs under the Alternative 

option (exhibits 9.8 - 9.10). 

• The benefits are expected to be positive under the AIP option and no backsliding in 

overall risk is predicted (Section 9.1.1.1) from the current TCR. The total benefits under 
Economic Analysis for the Proposed RTCR 9-40 June 2010 

the Alternative option would be greater than under the AIP option (Section 9.1.1.2), but 

the AIP option is more cost effective both on an average basis and an incremental basis 

(Exhibits 9.15 – 9.17). 

- Of the various outputs of the occurrence and cost models developed in this EA, the 

estimate of corrective actions to be implemented has the clearest connection to 

potential benefits. Based on this metric, the AIP option is more cost effective on 

average (i.e., costs less per corrective action achieved) than the Alternative option 

(exhibit 9.15) by a factor of approximately 1.5. 

- EPA conducted an incremental cost effectiveness analysis based on the increasing 

stringency of the options from the current TCR to the AIP option to the Alternative 

option. In comparing the ratio of additional costs and benefits associated with the 

AIP option compared to the current TCR and of the Alternative option compared 

to the AIP option, EPA found the following results: 

 Exhibit 9.16 shows that the incremental cost effectiveness of the AIP 

option far exceeds that of the Alternative option, by a factor of 

approximately 3.2. 

 Exhibit 9.17 shows that for TNCWSs the cost effectiveness of the AIP 

option far exceeds that of the Alternative option, by a factor of 

approximately 3.5. 

• Although data limitations precluded estimating the number of fatal or non-fatal illnesses 

that would be avoided by implementation of the regulatory alternatives considered, the 

break-even analysis (Section 9.3.3) shows that just over 2 deaths would need to be 

avoided annually for the rule to break even based on estimated net costs (exhibit 9.19) 

using a three percent discount rate. Considering the average costs of non-fatal illnesses 

resulting from STEC O157 infection, the AIP would break even if it avoided 3,000 or 

8,000 such cases annually based on the enhanced or traditional cost of illness approach, 

respectively. These thresholds under the Alternative option are approximately 60% and 

100% more than under the AIP option using the enhanced and traditional approaches, 

respectively. Under the AIP, the estimated break-even threshold for non-fatal Salmonella

cases is 10,000 or 65,000 for the enhanced and traditional approaches, respectively, and 

approximately 50% more (using both enhance and traditional approaches) for the 

Alternative option. These break-even thresholds would be reduced if more than one type 

of pathogen is avoided through implementation of the RTCR, or if cases of secondary 

transmission are avoided. Given the large variety of pathogens that may occur in PWS 

source water and the relatively low net costs of the AIP option, EPA believes the AIP 

option is likely to break even. 

• There are several items that are not quantified in the EA that represent a potential for 

significant additional benefits (Section 9.2.2). These additional benefits may be realized 

due to reductions in co-occurring contaminants, increased systems knowledge (including 

more consistent water quality), reductions in outbreak risks, accelerated infrastructure 
Economic Analysis for the Proposed RTCR 9-41 June 2010 

repair/replacement, and reductions in averting behavior (due to higher consumer 

confidence in water quality). 

As a result of these considerations, EPA believes that the estimated benefits of the 

proposed RTCR as defined by the AIP option will likely exceed the modest increases in 

annualized national costs and will be effective in reducing risk to consumers from exposure to 

fecal contamination in drinking water. 
Economic Analysis for the Proposed RTCR 10-1 June 2010 

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