United States Office of Water (4503F) EPA 841-D-01-005

Environmental Protection Washington, DC 20460 August 1, 2001

Agency www.epa.gov/ow

 

The National Costs to Implement 

TMDLs (Draft Report):

 Support Document # 2

 for “The National Costs of the Total Maximum Daily Load Program 

 (Draft Report),“ August 2001, USEPA
Support Document #2 

for “The National Costs of the Total Maximum Daily Load Program”

Draft report, July 2001, USEPA

DRAFT

THE NATIONAL COSTS TO IMPLEMENT TMDLS

August 1, 2001

Prepared for:

U.S. Environmental Protection Agency

Office of Wetlands, Oceans and Watersheds

1200 Pennsylvania Ave., NW

Washington, D.C. 20460

John Wilson,

Richard Iovanna

EPA Work Assignment Managers

Prepared by:

Environomics, Inc.

4405 East-West Highway, Suite 307

Bethesda, MD 20814

and

Tetra Tech, Inc.

10306 Eaton Place, Suite 340

Fairfax, VA 22030

under

EPA contract No. 68-C-99-249
1 A 303(d) listed water will not require a TMDL to be developed if no pollutant can be identified that is

responsible for the impairment. Such waters are said to be impaired by “pollution” but not pollutants. 

Causes of impairment for such waters might include flow modification, habitat alteration, and the like.

2 Note that some of these same costs could be incurred in the absence of a TMDL, either before the water

body is listed or during the period between listing and the development of the TMDL. Section

301(b)(1)(c) of the Clean Water Act requires water quality-based effluent limits (WQBELs) for NPDES

permittees if it is determined that these discharges would “cause or contribute to a violation of a water

quality standard.”

ES - 1

EXECUTIVE SUMMARY

A. INTRODUCTION

This analysis estimates the potential costs for point and nonpoint pollutant sources that are likely to

result from implementation of TMDLs nationwide. The States have currently listed nearly 22,000 impaired

waters under Section 303(d) of the Clean Water Act (CWA) as waters that will not meet applicable water

quality standards even after the application of technology-based effluent limitations. Nearly all of these

303(d) listed waters will need to have TMDLs established.1

 TMDL requirements specify that when a

TMDL is developed for an impaired water body, maximum loads must be assigned for the specific point

and nonpoint sources that discharge the impairment pollutant(s) affecting the water body. The assigned

maximum loads must be sufficient to achieve applicable water quality standards with a margin of safety.

In a TMDL, some point or nonpoint sources will be assigned allowable loads that are less than the

loads they currently discharge. These sources will presumably incur some costs to reduce their loads from

current levels to the lower levels assigned by the TMDL. It is these costs to reduce pollutant source loads

that we attribute to the TMDL program and that we estimate in this report.2

More specifically, we estimate the costs that TMDLs will engender for point and nonpoint sources

in order to meet water quality standards for the set of impaired waters included in the States’ 1998 303(d)

lists. For these impaired waters, we attribute to the TMDL program the costs of the additional controls

that pollutant sources will need to implement beyond a baseline that includes: 1) Whatever controls were in

place at point and nonpoint sources as of when the 1998 303(d) lists were developed; and 2) Assumed

compliance with all applicable technology-based requirements. Viewed in another way, the analysis

estimates the incremental costs to pollutant sources of achieving water quality standards relative to a

baseline of their controls in place in 1998, but excluding the costs of whatever amount of this further

progress will be achieved through meeting technology-based requirements that were unmet as of 1998.

B. THREE TMDL PROGRAM SCENARIOS

We estimate the costs for pollutant sources to meet TMDL allocations under each of three broad

scenarios: a “Least Flexible TMDL Program” scenario; a “Moderately Cost-effective TMDL Program”

scenario; and a “More Cost-Effective TMDL Program” scenario.

1. The “Least Flexible TMDL Program” scenario. This scenario explores what costs to pollutant

sources would result if the nation chose to restore the currently impaired waters under a TMDL program in
ES - 2

which every source affecting an impaired water would be required to implement further control measures,

rather than a more calibrated approach. We assume that States would continue the water quality-based

approaches that have commonly been used to date in situations where a TMDL has not been developed. 

Under CWA section 301(b)(1)(c), NPDES permits for point source dischargers must include limits

necessary to meet water quality standards. Similarly, under section 319 of the CWA, States must address

the nonpoint sources that contribute to impairment of water bodies (though not necessarily through

regulatory mechanisms, as are mandated for point sources through the NPDES program). As States carry

out this “Least Flexible TMDL Program” approach for an impaired water body, we assume they would

need to address every point and nonpoint source that appears to contribute to impairment of the water body.

2. The “Moderately Cost-effective TMDL Program” scenario. The “Moderately Cost-effective

TMDL Program” scenario differs from the first scenario in that it presumes (consistent with current

implementing regulations) that the TMDL will: 1) Start with a holistic assessment of the impaired water

body and all the sources that affect it; and 2) Require carefully chosen load reductions from pollutant

sources that together will be just sufficient to achieve water quality standards with a margin of safety. The

TMDL determines how much load from all the sources together can be tolerated, and allocates this

allowable load in some manner among the responsible sources. Without this more flexible TMDL, every

source that discharges the impairment pollutant will presumably need to implement measures to abate its

discharge (the previous “Least Flexible TMDL Program” scenario). With a more moderately cost-effective

TMDL, a much finer calculation is made, and often not every source will need to abate its discharge. The

TMDL determines exactly which sources will need to reduce their loads, and by how much. Depending on

the severity of the impairment, with a moderately cost-effective TMDL somewhere between a few and

many of the sources discharging the impairment pollutant may not have to reduce their discharge at all. In

addressing each source in isolation and requiring further controls from all of them individually, the previous

“Least Flexible TMDL Program” scenario is likely to substantially overshoot the load reduction needed to

attain water quality standards. Under this second scenario, the number of pollutant sources that have to

take any action, should, in most cases, be reduced.

3. The “More Cost-Effective TMDL Program” scenario. Neither the Clean Water Act nor EPA’s

implementing regulations prescribe how a total maximum daily load is to be allocated among the sources

that discharge the impairment pollutant. The State may assign responsibilities among sources for load

reductions as the state wishes. Different allocations will result in different total costs of achieving the

desired total load reduction, as a function of the differing costs per pound for the various pollutant sources

to reduce their loads. In general, the total costs of achieving the target load reduction will be lower if the

sources with lower per unit control costs are assigned responsibility for achieving the bulk of the desired

total load reduction. We use the term “cost-effective wasteload allocation” to denote a situation in which

the state attempts to reduce aggregate costs by assigning responsibility for achieving most of the total

desired load reduction to sources that have relatively low costs of achieving load reductions. Alternatively,

the same economically efficient result (achieving a desired total load reduction in a lower cost manner) can

be achieved, in theory, given any initial allocation of control responsibilities, if “trading” is allowed. With

trading, any source that is assigned responsibility for a load reduction is free to achieve that load reduction

itself, or to buy the equivalent load reduction from another source that might be able to provide it at lesser

cost. Whatever the initial allocation, trading will tend ultimately to elicit load reductions from the lowest

cost sources.

The “More Cost-Effective TMDL Program” scenario recognizes the possibility of reducing TMDL

costs to dischargers through either “cost-effective wasteload allocations” or through trading, or both. 
3 For the final report, costs will also be estimated assuming a real discount rate of 3% per year.

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Either of these approaches would reduce the eventual costs to dischargers well below what they would be if

TMDLs assigned load reductions on a cost-neutral basis (e.g., if load reductions were determined on a

simple proportional rollback basis).

C. COSTS FOR POLLUTANT SOURCES UNDER THE THREE SCENARIOS

For each of the three scenarios, we estimate the costs for controlling the point and nonpoint sources

that affect each of the currently listed 303(d) waters. These cost estimates are for the incremental controls

– relative to those that existed in 1998 or so when the impaired waters were listed – that will be needed to

achieve water quality standards in the listed waters. To the extent that some of the needed progress will be

achieved through compliance with as-yet-unmet technology-based standards, we do not count such costs, as

they are attributable to sections of the Clean Water Act other than §303. To the extent that some of these

costs have already been incurred since the waters were listed, the cost estimates we present here overstate

the costs that remain for dischargers.

We estimate the costs to pollutant sources in first quarter 2000 dollars. All costs include capital

and operating and maintenance costs, combined into a single annualized cost figure. The cost estimates

that we present represent levelized annual amounts beginning in the year 2000 that will continue each year,

forever. TMDLs are assumed to be developed at an even pace over the 15 years from now through 2015,

consistent with the deadline for TMDL development established by the new regulations. The average

source is assumed to begin incurring its costs to implement TMDL allocations five years after the TMDL

affecting that source is developed. The timing of compliance investments by sources is assumed to be

identical under each of the three TMDL program scenarios. A real discount rate of 7 % is used.3

Under a least flexible TMDL program, pollutant sources will incur costs estimated at $1.9 - $4.3

billion per year to implement controls for the nearly 20,000 waters for which TMDLs will be developed

(among the nearly 22,000 impaired waters). This is equivalent to approximately $95,000 - $215,000

annually in implementation costs per water body. In addition to these costs, nonpoint sources may realize

cost savings of up to perhaps $1 billion per year from the management measures we project that they are

likely to adopt.

In contrast, to achieve the same results in the same time frame, but with a moderately cost-effective

TMDL program, pollutant sources will need to spend only $1.0 - $3.4 billion per year. This is a cost

reduction of 21 - 44 %. A moderately cost-effective TMDL program saves pollutant sources money

because TMDLs will involve careful calculations to determine the load reduction that will be sufficient to

achieve water quality standards. In the absence of a moderately cost-effective TMDL, though, a State is

likely to require further controls from all sources that discharge the impairment pollutant.

Under the “More Cost-Effective TMDL Program” scenario, costs to dischargers may decline by

roughly 7 to 13 % ($140 - $235 million annually) from those that would occur under the second scenario if

each TMDL were to require equivalent control efforts from all sources needing to implement controls. 

These savings that we estimate from cost-effective WLAs or trading represent only the savings available

from shifting some point source control responsibilities to nonpoint sources (i.e., “point/nonpoint trading”). 
ES - 4

We have not been able to estimate additional savings that might occur from other sorts of trading (e.g.,

“point/point” trading, pretreatment trading, trading among nonpoint sources).

Exhibit ES - 1

Estimated Costs for Pollutant Sources to Implement TMDLs

Type of Source

Annual Costs

(2000 $ in millions)

Least Flexible

TMDL Program

Moderately Costeffective TMDL

Program

More CostEffective TMDL

Program

Point sources 1,082 - 2,178 812 - 1,634 625 - 1,321

Nonpoint sources 783 - 2,162 234 - 1,791 281 - 1,869

Total implementation costs 1,865 - 4,340 1,046 - 3,425 906 - 3,190

Potential savings for nonpoint sources undetermined undetermined undetermined

1. Costs for point source dischargers

Under the first two scenarios, half or more of the costs will be incurred by point sources. This is

despite the fact that point sources affect only about 1/4 of the impaired waters while nonpoint sources

affect more than 90 % of them. Under the third scenario, some point source control responsibilities are

presumed to be shifted to nonpoint sources because of the expected ability of nonpoint sources to abate

loads at lower costs per pound. Even so, point sources may still incur the majority of the implementation

costs.

Exhibit ES - 2

Estimated Costs for Point Sources -- Least Flexible TMDLs

Type of Source

Annual Costs

(2000 $ in millions) Number of Affected Facilities

Low Est. High Est. Low Est. High Est.

Industrial dischargers 676 1,465 3052 8557

Indirect dischargers (metals) 10 16 at 148 POTWs at 312 POTWs

POTWs 396 697 1094 3335

Total 1,082 2,178 4,146 11,893
ES - 5

Exhibit ES - 3

Estimated Costs for Point Sources for

Moderately Cost-effective and More Cost-Effective TMDL Programs

Type of Source

Annual Costs

(2000 $ in millions) Number of Affected Facilities

Low Est. High Est. Low Est. High Est.

Industrial dischargers 507 1,099 2289 6418

Indirect dischargers (metals) 8 12 at 111

POTWs at 234 POTWs

POTWs 297 523 821 2502

Total 812 1,634 3,110 8,919

Potential savings from costeffective wasteload allocations (187) (313) 1,251 2,066

The low and the high estimates shown above reflect differing judgments about how far upstream of

an impaired water can there typically be point sources that contribute to the water body’s impairment. The

lower estimate assumes that only point sources discharging the impairment pollutant directly into the

impaired water contribute to impairment. The upper estimate assumes that point sources can contribute to

impairment from as far away as 25 miles upstream (if the impairment pollutant is BOD, ammonia or toxic

organic chemicals) or 50 miles upstream (if the impairment pollutant is nutrients or metals). We believe

these two estimates provide reasonable lower and upper estimates for the geographic extent of point

sources that will be judged as relevant in TMDLs.

There are roughly 70,000 individually permitted point source dischargers in the nation. 

Somewhere between 6 and 17 percent of them appear to contribute to the impairment of a 303(d) water,

and would likely be addressed by efforts to restore the nation’s impaired waters under a least flexible

TMDL program. Based on the experience from a sample of recently developed TMDLs, only about 3/4 of

these sources (about 3,000 - 9,000 point source dischargers) will likely incur costs under a moderately

cost-effective TMDL program. Of these point sources likely to be affected by the TMDL program,

perhaps 20 to 40 percent of them will incur no or reduced costs if the TMDL program proceeds in more a

cost-effective manner.

2. Costs for nonpoint source pollutant sources

Costs were estimated for four types of nonpoint sources: agricultural land (including crop, pasture

and range land), animal feeding operations (AFOs), silviculture, and on-site wastewater treatment systems

(septic tanks, etc.). Some of the measures that nonpoint sources are likely to implement to achieve TMDLmandated load reductions will yield partly offsetting cost savings (e.g., agricultural nutrient management

planning implemented pursuant to a TMDL can reduce farmers’ costs for chemical fertilizers). Exhibit ES

- 4 shows only the costs and not the cost savings from the management measures that may be implemented

by the four types of nonpoint sources that we analyze.
ES - 6

Exhibit ES - 4

Estimated Costs for Nonpoint Sources

Type

Annual Costs (2000 $ in millions)

Least Flexible

TMDL Program

Moderately Costeffective TMDL

Program

More CostEffective TMDL

Program

Agricultural land

 crop land

 pasture land

 range land

 Potential savings

645 - 1,956

5 - 11

2 - 16

(not estimated)

183- 1,632

5 - 11

2 - 16

(not estimated)

Additional costs of

47 - 78 relative to

those incurred under

moderately costeffective TMDL

program. (Note that

in the “more costeffective” scenario,

point sources control

less and nonpoint

sources control more

by an equivalent

amount)

AFOs

 Potential savings

76 - 110

(not estimated)

13 - 73

(not estimated)

Silviculture 30 - 42 7 - 31

On-site wastewater treatment systems 24 - 28 24 - 28

Total

 Potential savings

783 - 2,162

(not estimated)

234 - 1,791

(not estimated)

There is a very wide range of uncertainty regarding the estimates of potential savings. They could

range up to perhaps a billion dollars per year. Additional work is being conducted to narrow this range.

In the limited time available for this study, costs were not estimated for the further controls that

may be needed for several other potentially important categories of nonpoint sources, including abandoned

mines, contaminated sediments, air deposition, and more.

D. ANALYTICAL METHODOLOGY

The task of projecting the costs for pollutant sources to meet the requirements of TMDLs for

nearly 22,000 impaired waters is particularly difficult because the background information necessary for

developing TMDLs has been generated for only a very few of these waters. We do not know, at this point,

how far out of attainment most of the impaired waters will be found to be, what sources will be found to be

responsible for each impairment, and what degree of load reduction will be required of each responsible

source. In this analysis we must estimate each of these elements now, before the background studies and

actual TMDLs have been developed. Our analysis necessarily involves many assumptions that we apply to

the relatively limited data that now exists on these impaired waters and the sources that may contribute to

their impairment.

The analysis is further complicated by our interest in estimating costs under each of the three

scenarios. In addition to a series of technical assumptions involving the likely content of the eventual
ES - 7

TMDLs for the impaired water bodies, we also make assumptions about what will happen differently under

each of the three scenarios.

In general, our analysis proceeds by first estimating the costs if all pollutant sources contributing to

impairment of an impaired water body were required to implement reasonable measures to reduce their

discharge of the impairment pollutant(s). We assume that this reflects the most that might be required

under a TMDL -- Scenario 1, the “Least Flexible TMDL Program”. We then estimate the costs for

Scenario 2 by adjusting downward the costs estimated for Scenario 1, assuming that TMDLs in practice

will result in a more precise calculation of how much load reduction is needed from pollutant sources in

order to meet water quality standards. The total load reduction required of pollutant sources under

Scenario 2 is less than that which would be obtained if all pollutant sources contributing to impairment

were to implement abatement measures, as under Scenario 1. The costs of Scenario 3 are then estimated

by estimating the savings compared with Scenario 2 that more cost-effective waste load allocations might

provide relative to the costs under a cost-neutral TMDL program.

We began by identifying the universe of point and nonpoint sources potentially contributing to

impairment(s) of each of the 303(d)-listed water bodies in the nation. For many listed water bodies, States

identify whether the sources contributing to impairment are point sources, nonpoint sources, or both. For

each water body cited as impaired by point sources (as well as perhaps other source types), we identified

the specific point sources that might potentially be contributing to the impairment. Similarly, for each

water body cited as impaired by nonpoint sources, we identified the potentially responsible specific

nonpoint sources. For 303(d) waters for which States have not provided information on the sources of

impairment (e.g., when States cite “unknown” sources of impairment, or simply do not report any source of

impairment), we identified all potentially relevant point and nonpoint sources and then extrapolated cost

information to them based on relationships we established for waters for which impairment sources were

reported.

We assumed that the set of point sources affecting a point-source impaired water is somewhere

between two cases:

 Case 1, “within and upstream”. We assume that a point source contributes to impairment

if it discharges the pollutant of concern within 25 miles upstream of a water body impaired

by BOD, ammonia or toxic organic chemicals, and within 50 miles upstream of a water

body impaired by nutrients or metals.

 Case 2, “within only”. We assume that a point source contributes to impairment if it

discharges the pollutant of concern directly into the impaired water body.

The “within and upstream” case thus identifies a larger set of point sources as contributing to impairment

than does the “within only” case. We use these two cases to establish upper and lower estimates for point

source costs for each of the three scenarios. For the “Least Flexible TMDL Program” scenario, we assume

that States will require further control of all the point sources that contribute to impairment, under the

within and upstream case as an upper estimate and under the within-only case as a lower estimate. For the

other two scenarios, we use data from a sample of recently completed TMDLs to estimate the fraction of

the point sources contributing to impairment that are typically required to reduce their loads in actual

TMDLs. In fact, some impaired waters are only moderately impaired, and for these waters TMDLs will

require load reductions from only some of all the point sources that discharge the impairment pollutant. 
4 We made two further important assumptions for POTWs. First, we assumed that TMDLs will require no

further controls for those POTWs that already provide advanced secondary treatment or better. Second,

we assumed that any costs for POTW treatment upgrades that have progressed sufficiently in planning to

be included in the 1996 Clean Water Needs Survey (CWNS) should not be viewed as incrementally

attributable to the TMDL program. In essence, we consider POTW upgrade projects that were already far

along in planning as of 1996 as predating and not deriving from the programs we analyze in this report. 

Later, we discuss the impact of these two particular assumptions for POTWs on the cost estimates.

ES - 8

The likelihood that many TMDLs will not require load reductions from all point sources contributing to

impairment makes the costs for the “Moderately Cost-effective TMDL Program” scenario less than for the

“Least Flexible” scenario. Again, we use the two cases to establish upper and lower estimates for both the

“Moderately Cost-effective TMDL Program” scenario and the “More Cost-Effective TMDL Program”

scenario.

For nonpoint sources, we assumed that States under the “Least Flexible” scenario would require

further controls of all the nonpoint source activity of the relevant variety that occurs within the same county

or counties as the impaired water body. For example, if a State identifies a 303(d) water body as impaired

by animal feeding operations (AFOs) and silviculture, we assumed that the State would require further

controls for all AFOs and all silviculture within the county(s) in which the impaired water body is located. 

For the “Moderately Cost-effective TMDL Program” and “More Cost-Effective TMDL Program”

scenarios, again based on the results from a sample of actual TMDLs, we assumed that the State would

make a finer calculation regarding the geographic extent of nonpoint source activity from which load

reductions must be obtained. In the great majority of cases, actual TMDLs have required nonpoint source

controls from watershed areas much smaller than the entire county(s) surrounding the impaired water body.

As a baseline for cost analysis, we assumed that all these identified affected point and nonpoint

sources have control measures in place equal to the greater of: 1) Their current controls in place; and 2)

Controls necessary to meet applicable technology-based standards. We assumed that the load allocations

established under TMDLs would require all relevant sources to implement the “next treatment step” beyond

their assumed baseline controls in place:

 For industrial point sources: The next treatment step consisted of a further treatment

technology, depending on the specific pollutant, beyond the technologies assumed to be in

place to meet effluent guideline requirements.

 For POTWs: The next treatment step for most pollutants was assumed to be advanced

secondary treatment, the next increment beyond secondary treatment assumed to be in

place to meet secondary treatment requirements. When a POTW appeared to need further

controls specifically for metals, the next treatment step was assumed to be an enhanced

local pretreatment program, requiring further controls of the POTW’s indirect dischargers

beyond applicable pretreatment standards in effluent guidelines.4

 For agricultural, AFO, silvicultural, and on-site wastewater system nonpoint sources: We

assumed there were no Federal technology-based requirements applicable in the baseline

for these sources. The next treatment step beyond this baseline of no controls was

assumed to be implementation of a basic set of best management practices (BMPs) for the

particular nonpoint source type as suggested in EPA guidance documents. In estimating
ES - 9

the costs of implementing the set of BMPs representing the next treatment step we did,

where data were available, reflect the fact that some nonpoint sources have already (in the

baseline) adopted some of the BMPs.

 For urban wet weather sources: We did not project any further controls to be needed for

urban wet weather sources beyond existing technology-based requirements addressing

CSOs, SSOs and storm water phase I and II. To the extent that TMDLs do ultimately

require further controls for some urban wet weather sources, we have not estimated these

costs.

Our estimates for the costs to pollutant sources under the three scenarios consist of the aggregated

costs for these “next treatment steps” for all the point and nonpoint sources identified as affecting 303(d)

waters. The two sets of key assumptions underlying the analysis include:

1. The assumptions made in identifying the specific point and nonpoint sources that will need

further controls beyond current levels and technology-based standards in order to achieve

water quality standards; and

2. The assumption that the further control needed from every identified source is the “next

treatment step” beyond applicable technology-based requirements.

For many water bodies and many TMDLs, these assumptions may be substantially inaccurate. For any

given water body, the sources a State might identify as needing further controls may be more or less than

the point sources within the water body and/or 25 or 50 miles upstream and the surrounding county’s worth

of nonpoint sources. For any given water body, the additional control efforts needed from the affected

sources may also be more or less than the assumed next treatment step.

In projecting what future TMDLs are likely to require for the impaired water bodies, we based

several key assumptions on our findings from reviewing the content of a sample of fifteen recently

completed TMDLs. This review is summarized in Appendix A -- “Ground-Truthing the Implementation

Cost Analysis Assumptions”. This sample of fifteen is smaller than we would like, and it will be increased

for the final version of this report. The major findings from this review of sample TMDLs are:

 TMDLs commonly, but not always, address upstream point sources in addition to those

point sources discharging the impairment pollutant directly into the impaired water. The

average situation seems somewhere between the “within only” and the “upstream and

within” cases;

 The aggregate load reduction needed from point sources is often obtained without requiring

further controls from all of the point sources discharging the impairment pollutant;

 The geographic extent of nonpoint sources from which further controls are required is

typically much less than the entire county(s) surrounding the impaired water;

 For both point and nonpoint sources, the degree of load reduction that is required is very

often less than that which would be achieved if all relevant point and nonpoint sources

were to implement “the next treatment step”.
ES - 10

More specifically, in estimating the costs of the “Moderately Cost-effective TMDL Program” and

“Cost-Effective TMDL Program” scenarios, we drew the following quantitative relationships from the

results of the fifteen TMDLs:

 For point sources. In about half the TMDLs, the aggregate load reduction actually

required of point sources was roughly equivalent to what would be achieved if all point

sources contributing to impairment of the water body were to implement “the next

treatment step”. In the other half of the TMDLs, “the next treatment step” for all point

sources would result in about twice as much aggregate load reduction as was actually

needed.

 For nonpoint sources. The size of the watershed from which most TMDLs required

nonpoint source load reductions was far smaller than the size of a typical county. The

acreage of most nonpoint source TMDL watersheds ranged from about 5% to about 40%

as large as the acreage of the county(s) within which the impaired water body was located.

These quantitative relationships should be regarded as tentative pending the evaluation of more completed

TMDLs.
TABLE OF CONTENTS

EXECUTIVE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ES - 1

A. INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ES - 1

B. THREE TMDL PROGRAM SCENARIOS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ES - 1

C. COSTS FOR POLLUTANT SOURCES UNDER THE THREE SCENARIOS . . . . . . ES - 3

D. ANALYTICAL METHODOLOGY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ES - 6

I. METHODOLOGY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I - 1

A. THREE TMDL PROGRAM SCENARIOS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I - 1

B. OVERVIEW OF THE ANALYTICAL APPROACH . . . . . . . . . . . . . . . . . . . . . . . . . . . . I - 3

C. COSTS THAT ARE NOT ESTIMATED . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I - 8

D. CROSS-CUTTING ANALYTICAL ISSUES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I - 10

II. IMPLEMENTATION COSTS FOR POINT SOURCES . . . . . . . . . . . . . . . . . . . . . . . . . . . II - 1

A. OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II - 1

B. POLLUTANTS FOR ANALYSIS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II - 2

C. NEARBY FACILITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II - 2

D. FACILITIES THAT NEED TO REDUCE LOADS . . . . . . . . . . . . . . . . . . . . . . . . . . . . II - 4

E. COST FUNCTIONS FOR THE “NEXT TREATMENT STEP” . . . . . . . . . . . . . . . . . . II - 8

F. FLOW DATA FOR USE IN COST FUNCTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . II - 11

G. COSTS FOR SOURCES AFFECTING WATERS IMPAIRED BY NONPOINT 

SOURCES ONLY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II - 12

H. COSTS FOR SCENARIO 2 (Moderately Cost-effective TMDL PROGRAM) . . . . . . . II - 15

I. SAVINGS WITH “COST-EFFECTIVE WASTE LOAD ALLOCATIONS” . . . . . . . . . II - 17

J. SUMMARY COST ESTIMATES FOR POINT SOURCES . . . . . . . . . . . . . . . . . . . . . II - 23

III. IMPLEMENTATION COSTS FOR NONPOINT SOURCES ...................... III - 1

A. COVERAGE OF THE NONPOINT SOURCE ANALYSIS ..................... III - 1

B. WATERS IMPAIRED BY AGRICULTURE, AFOS, SILVICULTURE AND 

ON-SITE SYSTEMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III - 4

C. THE AMOUNT OF NONPOINT SOURCE ACTIVITY NEEDING FURTHER 

CONTROL FOR AN IMPAIRED WATER BODY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III - 7

D. BMPS FOR REDUCING NONPOINT SOURCE LOADS ..................... III - 11

E. UNIT COSTS FOR THESE BMPS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III - 14

F. SUMMARY COST ESTIMATES FOR NONPOINT SOURCES ................ III - 17

IV. MAJOR ASSUMPTIONS, BIASES, AND UNCERTAINTIES . . . . . . . . . . . . . . . . . . . . . IV - 1

APPENDICES

APPENDIX A: GROUNDTRUTHING THE ASSUMPTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1

APPENDIX B: TMDL PACE AND TIME LAG SCALE FACTOR . . . . . . . . . . . . . . . . . . . . . . . . . B-1

APPENDIX C: POLLUTANTS FOR ANALYSIS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C-1

APPENDIX D: APPROACHES FOR DETERMINING WHETHER A POINT SOURCE IS 

LIKELY TO BE CONSIDERED FOR FURTHER CONTROLS . . . . . . . . . . . . . . . . . . . . . D-1

APPENDIX E: DETAIL ON COST FUNCTIONS FOR POINT SOURCES . . . . . . . . . . . . . . . . . . . E-1

APPENDIX F: PROCEDURES FOR ESTIMATING FLOW NEEDING TREATMENT . . . . . . . . . F-1
APPENDIX G: EXCLUDING COSTS FOR POINT SOURCES AFFECTING 

WATERS THAT ARE IMPAIRED BY NONPOINT SOURCES ONLY . . . . . . . . . . . . . . . G-1

APPENDIX H: DETAIL ON SIMULATING “COST-EFFECTIVE WASTE LOAD 

ALLOCATIONS” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . H-1

APPENDIX I: DETAIL ON ESTIMATED COSTS FOR NONPOINT SOURCES . . . . . . . . . . . . . . . I-1
5 Some observers have postulated a different scenario in the absence of TMDLs. These observers

emphasize that point sources are subject to regulatory controls under the NPDES program, while nonpoint

sources are generally not subject to federal regulatory controls. If achieving water quality standards were

to depend solely on federal regulatory authorities available under the Clean Water Act, states or EPA

would be able to require further control efforts only from point sources. NPDES permit limits for point

sources would be progressively tightened as necessary to make up for uncontrolled nonpoint sources. 

Under this least flexible scenario for point sources, many point sources would ultimately need to meet

exceedingly costly “zero discharge” limits in an attempt to compensate for growing nonpoint source loads.

We regard this scenario as unrealistic and will not analyze it. For many impaired water bodies, the

contribution from point sources is minimal or non-existent. Any realistic program to achieve water

quality standards in all impaired waters must seriously address nonpoint sources as well as point sources.

I - 1

I. METHODOLOGY

A. THREE TMDL PROGRAM SCENARIOS

We estimate the costs for pollutant sources to achieve the load reductions to be required by

TMDLs under each of three broad scenarios: a “Least Flexible TMDL Program” scenario; a “Moderately

Cost-effective TMDL Program” scenario; and a “More Cost-Effective TMDL Program” scenario.

1. The “Least Flexible TMDL Program” scenario. This scenario explores what costs to

pollutant sources would result if the nation chose to to restore the currently impaired waters under a TMDL

program in which every source affecting an impaired water would be required to implement further control

measures, rather than a more calibrated approach. We see two possibilities for how the nation might meet

the Clean Water Act goal of restoring impaired waters under this scenario:

- Progressively tighten the nationally uniform technology-based requirements for relevant

classes of dischargers until all water bodies eventually meet standards. Although a

theoretical possibility, this approach would be unreasonably inefficient. A relatively small

fraction of all point and nonpoint sources affect impaired water bodies. It would be

exceedingly costly to require further controls from the entire nation’s worth of some

category of point or nonpoint sources (e.g., all POTWs in the country, or every

silvicultural operation) in order to reduce loads from only the fraction of such sources

affecting impaired waters.

- Continue the water quality-based approaches that have commonly been used to date in

situations where a TMDL has not been developed. Under CWA § 301(b)(1)(c), all

NPDES permits for point source dischargers must include limits necessary to meet water

quality standards. Similarly, under § 319 of the CWA, states must address the nonpoint

sources that contribute to impairment of water bodies (though not necessarily through

regulatory mechanisms, as are mandated for point sources through the NPDES program).5

The second approach to the “Least Flexible TMDL Program” scenario is far more realistic, and we

assume this is what would occur if more flexible TMDLs were not developed.
I - 2

Our Methodology for Estimating Costs to Pollutant Sources – the”Worst- Case TMDL Program” Scenario

We follow three steps:

1. Identify all the point and nonpoint sources in the nation that appear to discharge an impairment pollutant to one of the

impaired waters on the 1998 303(d) lists.

2. Assume that every such relevant source will be required under the NPDES program or somehow induced under the 319

program to implement additional measures (beyond those assumed to be in place already to meet existing technologybased standards) to abate this discharge.

3. Estimate the costs for each source to implement an appropriate “next treatment step” that will presumably sufficiently

reduce the source’s discharge.

Our Methodology for Estimating Costs to Pollutant Sources – the “Moderately Cost-effective TMDL Program”

Scenario

We start with the steps for the “Least Flexible TMDL Program” scenario: a) Identify all sources responsible for impairments;

2) Estimate costs for all of them to implement an appropriate “next treatment step”. We then:

 Scale these costs down to reflect the average percentage load reduction identified in typical TMDLs relative to the

load reduction that would be obtained if all sources were to implement the “next treatment step”.

2. The “Moderately Cost-effective TMDL Program” scenario. The “Moderately Cost-effective

TMDL Program” scenario differs from the first scenario in that it presumes (consistent with current

implementing regulations) that the TMDL will: 1) Start with a holistic assessment of the impaired water

body and all the sources that affect it; and 2) Require carefully chosen load reductions from pollutant

sources that together will be just sufficient to achieve water quality standards with a margin of safety. The

TMDL determines how much load from all the sources together can be tolerated, and allocates this

allowable load in some manner among the responsible sources. Without this more flexible TMDL, every

source that discharges the impairment pollutant will presumably need to implement measures to abate its

discharge (the previous “Least Flexible TMDL Program” scenario). With a more moderately cost-effective

TMDL, a much finer calculation is made, and often not every source will need to abate its discharge. The

TMDL determines exactly which sources will need to reduce their loads, and by how much. Depending on

the severity of the impairment, with a moderately cost-effective TMDL somewhere between a few and

many of the sources discharging the impairment pollutant may not have to reduce their discharge at all. In

addressing each source in isolation and requiring further controls from all of them individually, the previous

“Least Flexible TMDL Program” scenario is likely to substantially overshoot the load reduction needed to

attain water quality standards. Under this second scenario, the number of pollutant sources that have to

take any action, should, in most cases, be reduced.

3. The “More Cost-Effective TMDL Program” scenario. Neither the Clean Water Act nor EPA’s

implementing regulations prescribe how a total maximum daily load is to be allocated among the sources

that discharge the impairment pollutant. The state may assign responsibilities among sources for load

reductions as the state wishes. Different allocations will result in different total costs of achieving the
I - 3

Our Methodology for Estimating Costs to Pollutant Sources – the “More Cost-Effective TMDL Program” Scenario

We start by estimating the costs for the “Moderately Cost-effective TMDL Program” scenario. We then:

 Scale these costs down to reflect the typical percentage cost savings that might be realized through additional

“cost-effective wasteload allocations” or trading.

desired total load reduction, as a function of the differing costs per pound for the various pollutant sources

to reduce their loads. In general, the total costs of achieving the target load reduction will be lower if the

sources with lower per unit control costs are assigned responsibility for achieving the bulk of the desired

total load reduction. We use the term “more cost-effective wasteload allocation” to denote a situation in

which the state attempts to reduce aggregate costs by assigning responsibility for achieving most of the

total desired load reduction to sources that have relatively low costs of achieving load reductions. 

Alternatively, the same economically efficient result (achieving a desired total load reduction in a lower

cost manner) can be achieved, in theory, given any initial allocation of control responsibilities, if “trading”

is allowed. With trading, any source that is assigned responsibility for a load reduction is free to achieve

that load reduction itself, or to buy the equivalent load reduction from another source that might be able to

provide it at lesser cost. Whatever the initial allocation, trading will tend ultimately to elicit load reductions

from the lowest cost sources.

The “More Cost-Effective TMDL Program” scenario recognizes the possibility of reducing TMDL

costs to dischargers through either “more cost-effective wasteload allocations” or through trading, or both. 

Either of these approaches would reduce the eventual costs to dischargers well below what they would be if

TMDLs assigned load reductions on a cost-neutral basis (e.g., if load reductions were determined on a

simple proportional rollback basis). We expect that pressure to adopt cost-minimizing approaches will

build, and more TMDLs will tend toward this “more cost-effective” model. Note, though, that there may

be some instances where other concerns (e.g., equity, concern about implementation and enforcement

complexities attendant to trading) prevent use of these cost-minimizing approaches.

B. OVERVIEW OF THE ANALYTICAL APPROACH

In this analysis, we estimate the costs as of the spring of 2000 for pollutant sources to reduce their

loads as necessary to meet water quality standards for all waters on States’ approved 1998 303(d) lists 

(21,845 listed waters and 41,318 causes of impairment cited for these waters). We estimate these costs

under each of the three scenarios we have described. Implementation costs are estimated for each of the

listed water bodies and then aggregated nationally. Limited site-specific information was available and

could be processed for all these water bodies and the sources that affect them. It was not possible to

perform what would in effect be an initial TMDL for each of these water bodies -- determine how far each

water body was from attainment, estimate the amount of load reductions necessary to achieve attainment,

and estimate the costs for the relevant pollutant sources to accomplish these load reductions. Instead, we

made several broad assumptions that limited the amount of site-specific information we needed to obtain

and analyze.

In general, our analysis proceeds by first estimating the costs if all pollutant sources contributing to

impairment of an impaired water body were required to implement reasonable measures to reduce their
I - 4

discharge of the impairment pollutant(s). We assume that this reflects what would happen under an

inefficient or “Least Flexible TMDL Program”. This is our Scenario 1. We then estimate the costs for

Scenario 2 by adjusting downward the costs estimated for Scenario 1, assuming that moderately costeffective TMDLs will result in a more precise calculation of how much load reduction is needed from

pollutant sources in order to meet water quality standards. The total load reduction required of pollutant

sources under Scenario 2 is less than that which would be obtained if all pollutant sources contributing to

impairment were to implement abatement measures. The costs of Scenario 3 are then estimated by

estimating the savings that cost-effective waste load allocations might provide relative to the costs of a

cost-neutral TMDL program.

We began by identifying the universe of point and nonpoint sources potentially contributing to

impairment(s) of each of the 303(d) listed water bodies in the nation. For many listed water bodies, states

identify whether the sources contributing to impairment are point sources, nonpoint sources, or both. For

each water body cited as impaired by point sources (as well as perhaps other source types), we identified

the specific point sources that might potentially be contributing to the impairment. Similarly, for each

water body cited as impaired by nonpoint sources, we identified the potentially responsible specific

nonpoint sources. For 303(d) waters for which States have not provided information on the sources of

impairment (e.g., when States cite “unknown” sources of impairment, or simply do not report any source of

impairment), we identified all potentially relevant point and nonpoint sources and then extrapolated cost

information to them based on relationships we established for waters for which impairment sources were

reported.

We assumed that the set of point sources affecting a point-source impaired water is somewhere

between two cases:

 Case 1, “within and upstream”. We assume that a point source contributes to impairment

if it discharges the pollutant of concern within 25 miles upstream of a water body impaired

by BOD, ammonia or toxic organic chemicals, and within 50 miles upstream of a water

body impaired by nutrients or metals.

 Case 2, “within only”. We assume that a point source contributes to impairment if it

discharges the pollutant of concern directly into the impaired water body.

The “within and upstream” case thus identifies a larger set of point sources as contributing to impairment

than does the “within only” case. We use these two cases to establish upper and lower estimates for point

source costs for each of the three scenarios. For the ”Least Flexible TMDL Program” scenario, we assume

that States will require further control of all the point sources that contribute to impairment, under the

within and upstream case as an upper estimate and under the within only case as a lower estimate. For the

other two scenarios, we use data from a sample of recently completed TMDLs to estimate the fraction of

the point sources contributing to impairment that are typically required to reduce their loads in actual

TMDLs. In fact, some impaired waters are only moderately impaired, and for these waters TMDLs will

require load reductions from only some of all the point sources that discharge the impairment pollutant. 

The likelihood that many TMDLs will not require load reductions from all point sources contributing to

impairment makes the costs for the “Moderately Cost-effective TMDL Program” scenario less than for

the”Least Flexible TMDL Program” scenario. Again, we use the two cases to establish upper and lower

estimates for both the “Moderately Cost-effective TMDL Program” scenario and the “More Cost-Effective

TMDL Program” scenario.
6 We made two further important assumptions for POTWs. First, we assumed that TMDLs will require no

further controls for those POTWs that already provide advanced secondary treatment or better. Second,

we assumed that any costs for POTW treatment upgrades that have progressed sufficiently in planning to

be included in the 1996 Clean Water Needs Survey (CWNS) should not be viewed as incrementally

attributable to the TMDL program . In essence, we consider POTW upgrade projects that were already far

along in planning as of 1996 as predating and not deriving from the TMDL program. Later, we discuss

the impact of these two particular assumptions for POTWs on the cost estimates.

I - 5

For nonpoint sources, we assumed that States under the ”Least Flexible TMDL Program” scenario

would require further controls of all the nonpoint source activity of the relevant variety that occurs within

the same county as the impaired water body. For example, if a State identifies a 303(d) water body as

impaired by animal feeding operations (AFOs) and silviculture, we assumed that the State would require

further controls for all AFOs and all silviculture within the county(s) in which the impaired water body is

located. For the “Moderately Cost-effective TMDL Program” and “More Cost-Effective TMDL Program”

scenarios, again based on the results from a sample of actual TMDLs, we assumed that the State would

make a finer calculation regarding the geographic extent of nonpoint source activity from which load

reductions must be obtained. In the great majority of cases, actual TMDLs have required nonpoint source

controls from watershed areas that are much smaller than the area of the entire county(s) surrounding the

impaired water body.

As a baseline for cost analysis, we assumed that all these identified affected point and nonpoint

sources have control measures in place equal to the greater of: 1) Their current controls in place; and 2)

Controls necessary to meet applicable technology-based standards. We assumed that the load allocations

established under TMDLs would require some or all of these sources to implement a “next treatment step”

beyond their assumed baseline controls in place:

 For industrial point sources: The next treatment step consisted of a further treatment

technology, depending on the specific pollutant, beyond the technologies assumed to be in

place to meet effluent guideline requirements.

 For POTWs: The next treatment step for most pollutants was assumed to be advanced

secondary treatment, the next increment beyond secondary treatment assumed to be in

place to meet secondary treatment requirements. When a POTW appeared to need further

controls specifically for metals, the next treatment step was assumed to be an enhanced

local pretreatment program, requiring further controls of the POTW’s indirect dischargers

beyond applicable pretreatment standards in effluent guidelines.6

 For agricultural, AFO, silvicultural, and on-site wastewater system nonpoint sources: We

assumed there were no Federal technology-based requirements applicable in the baseline

for these sources. The next treatment step beyond this baseline of no controls was

assumed to be implementation of a basic set of best management practices (BMPs) for the

particular nonpoint source type as suggested in relevant EPA guidance documents. In

estimating the costs of implementing the set of BMPs representing the next treatment step

we did, where data were available, reflect the fact that some nonpoint sources have already

(in the baseline) adopted some of the BMPs.
I - 6

 For urban wet weather sources: We did not project any further controls to be needed for

urban wet weather sources beyond existing technology-based requirements addressing

CSOs, SSOs and storm water phase I and II. To the extent that TMDLs do ultimately

require further controls for some urban wet weather sources, we have not estimated these

costs.

Our estimates for the costs to pollutant sources under the three scenarios consist of the aggregated

costs for these “next treatment steps” for all the point and nonpoint sources identified as affecting 303(d)

waters. The two sets of key assumptions underlying the analysis include:

1. The assumptions made in identifying the specific point and nonpoint sources that will need

further controls beyond current levels and technology-based standards in order to achieve

water quality standards; and

2. The assumption that the further control needed from every identified source is the “next

treatment step” beyond applicable technology-based requirements.

For many water bodies and many TMDLs, these assumptions may be substantially inaccurate. For any

given water body, the sources a State might identify as needing further controls may be more or less than

the point sources within the water body and/or 25 or 50 miles upstream and the surrounding county’s worth

of nonpoint sources. For any given water body, the additional control efforts needed from the affected

sources may also be more or less than the next treatment step we have assumed.

In projecting what future TMDLs are likely to require for the impaired water bodies, we based

several key assumptions on our findings from reviewing the content of a sample of fifteen recently

completed TMDLs. This review is summarized in Appendix A -- “Ground-Truthing the Implementation

Cost Analysis Assumptions”. This sample of fifteen is smaller than we would like, and it will be increased

for the final version of this report. The major findings from this review are:

 TMDLs commonly, but not always, address upstream point sources in addition to those

point sources discharging the impairment pollutant directly into the impaired water. The

average situation seems somewhere between the “within only” and the “upstream and

within” cases;

 The aggregate load reduction needed from point sources is often obtained without requiring

further controls from all of the point sources discharging the impairment pollutant;

 The geographic extent of nonpoint sources from which further controls are required is

typically much less than the entire county(s) surrounding the impaired water;

 For both point and nonpoint sources, the degree of load reduction that is required is very

often less than that which would be achieved if all relevant point and nonpoint sources

were to implement “the next treatment step”.

More specifically, in estimating the costs of the “Moderately Cost-effective TMDL Program” and

“More Cost-Effective TMDL Program” scenarios, we drew the following quantitative relationships from

the results of the fifteen TMDLs:
7 Note that we are not presuming to use this small sample of 15 cases as a basis for projecting the national

costs of TMDLs. We have not estimated implementation costs for sources in each of the 15 cases and

then extrapolated or scaled up from these cases to the nation as a whole. In fact, early in the history of

this project to estimate TMDL implementation costs, we considered such an approach. We decided

quickly, though, that it would not be possible to select a set of 15, or 50, or 100, or perhaps even 200

TMDLs that could serve as a representative sample from which to extrapolate to the nation. There is so

much diversity across TMDLs -- in the size and type of impaired waterbodies, the degree to which they

are impaired, in the pollutants and source types involved, in the geographic settings, etc. -- that we

believed any sample of less than several hundred TMDLs would likely misrepresent in some important

ways the universe of all of them. We decided then that a “sample and extrapolate” approach for

estimating national implementation costs was infeasible. A substantial effort would be required to

perform a mini-TMDL in advance for a single sample impaired water body and then estimate the costs for

sources to implement this TMDL: determining how far the water body is from attainment, modeling the

load reduction needed, identifying relevant sources, developing a load allocation, and estimating how

much if would cost each source to achieve its load reduction. We could not afford to do such analysis for

several hundred sample impaired water bodies.

Instead, we adopted the approach described here of estimating the implementation costs for all of the

impaired water bodies in the nation by employing a series of simplifying assumptions about what typical 

TMDLs will require of relevant sources. Under this approach, we use the 15 case studies not as the

fundamental basis from which to extrapolate, but instead in a more limited way to shed light on the

reasonableness of our assumptions. The case studies suggest that actual TMDLs only very rarely require

load reductions as large as those presumed under our Scenario 1 (all relevant point sources implement the

next treatment step, and all relevant nonpoint sources in the entire county implement the next treatment

step). The case studies thus suggest that Scenario 1 really is something like a worst case. The case

studies also suggest what some assumptions more typical of most TMDLs might be. We use some rough

averages drawn from the case studies in defining our more cost-effective Scenarios 2 and 3.

This rather lengthy discussion is intended as a reply to potential reviewers of this draft to the effect that

the 15 case studies are unrepresentative in one or another way. EPA recognizes that 15 case studies

cannot be representative of all conditions that may be found in potential TMDLs. For instance, none of

the 15 is a water body impaired by agricultural chemicals or sediment in a major crop producing area. We

believe this is acceptable because we use the case studies in a manner such that this sort of

representativeness is not critical. We use the case studies primarily to elucidate several much broader

I - 7

 For point sources. In about half the TMDLs, the aggregate load reduction actually

required of point sources was roughly equivalent to what would be achieved if all point

sources contributing to impairment of the water body were to implement “the next

treatment step”. In the other half of the TMDLs, “the next treatment step” for all point

sources would result in about twice as much aggregate load reduction as was actually

needed.

 For nonpoint sources. The size of the watershed from which most TMDLs required

nonpoint source load reductions was far smaller than the size of a typical county. The

acreage of most nonpoint source TMDL watersheds ranged from about 5 % to about 40 %

as large as the acreage of the county(s) within which the impaired water body was located.

These quantitative relationships should be regarded as tentative pending the evaluation of more completed

TMDLs.7
questions: Is Scenario 1 really something like a worst case? For a moderately cost-effective Scenario 2,

how much less should we assume than “the next treatment step will be implemented by all relevant point

sources within a relevant distance and all relevant nonpoint sources in the entire county”? For questions

at this greater level of generality, we believe that our sample of 15 is reasonably representative. 

Nevertheless, we agree that the sample to be used for “groundtruthing” our assumptions should be

expanded, and we will do so for the final version of this report.

8 Environomics and Tetra Tech, Inc., National Costs to Develop TMDLs, prepared for the U.S. EPA, Office

of Wetlands, Oceans and Watersheds, draft, July 2001.

9 We attempt to estimate the costs of the measures and practices that sources will need to implement to meet

TMDL load reduction requirements, whoever pays these costs. In some cases, Federal and State

governments contribute substantially in paying the costs for sources to implement these measures. For

example, USDA and other agencies provide: 1) Cost-share funds to assist farmers in implementing BMPs;

and 2) Technical assistance contributing to the planning and design tasks involved in implementing the

BMPs. With respect to agricultural nonpoint source load reductions, then, we attempt to estimate the total

costs of planning, designing and implementing the needed farm BMPs, whether the costs are paid for by

the farmers, by USDA, or by others.

I - 8

C. COSTS THAT ARE NOT ESTIMATED

This study attempts comprehensively to estimate the costs that pollutant sources will incur to

achieve the load reductions that will likely be required by the eventual TMDLs for waters listed on the

States’ 1998 303(d) lists. Given this objective, we want to be clear that the study explicitly does not

estimate several sorts of costs:

 Costs for activities other than abating loads from pollutant sources. We do not estimate

the costs to develop TMDLs. These costs, which will be borne by States and EPA (and

perhaps also by local governments and other Federal agencies) are estimated in the

companion report titled “The National Costs to Develop TMDLs”.8

 Nor do we estimate

the costs that States, EPA, and other government agencies will incur to implement

TMDLs. Thus we do not estimate the costs that State permit authorities will incur in

reissuing NPDES permits for point sources to incorporate the load reductions required by

TMDLs, nor the costs that USDA and other agencies might incur in providing information

and technical assistance to farmers who need to reduce their loads.9

 However, to the extent

that Federal, State or other agencies themselves are the owners of facilities or lands that

are pollutant sources (e.g., military bases, Federal forest and range lands), we do estimate

these costs.

 Broader social consequences that might occur as pollutant sources meet TMDL

requirements. We estimate the costs for sources to reduce their loads to meet TMDL

requirements, but these costs may have further consequences for society. We have not

attempted to describe the social consequences of these actions or to assigne monetary

values to these changes. For example, higher water and sewer rates as a result of

increased costs for POTW treatment may increase the number of households facing high

rates and place greater economic stress on these households. In addition, increased

production costs for farmers implementing agricultural BMPs will likely result in reduced
10 On the other side of the coin, some of the currently listed 303(d) waters will eventually achieve standards

without a TMDL having been established for them. The 1998 303(d) lists represent water quality as of

perhaps 1997 or so when the lists were compiled. Since then there has been substantial progress in water

pollution control (e.g., POTW upgrades, new effluent guidelines, wet weather requirements, voluntary and

cost-shared nonpoint source programs) as well as shifts in population and economic activity also. These

processes will continue, and many of the 1998 303(d) waters will be found to have attained standards

before their TMDLs are developed. Some of the currently listed waters may also be removed from the list

for various reasons without a TMDL having been established for them.

I - 9

agricultural output and/or higher agricultural commodity prices. We also do not estimate

the distributional impacts of the costs to pollutant sources. If pollutant sources are

particularly concentrated geographically, there may be economic dislocations in the local

or regional areas surrounding the concentrations. On the other hand, farming economies in

other areas not affected by TMDLs will likely see increased activity triggered by reduced

production in the areas affected by TMDLs and resulting higher commodity prices. These

sorts of secondary and ultimate impacts cannot be assessed without broad economic

modeling of the sectors within which the TMDL-affected pollutant sources operate. This

sort of modeling is beyond the scope of this analysis. However, we expect that these

broader consequences of TMDL costs will not be large, as TMDL costs represent only a

small fractional increase in the current costs of the activities the pollutant sources conduct.

 Costs for pollutant sources affecting waters that will be found in the future to need

TMDLs developed for them. This analysis addresses costs relating to currently impaired

waters on States’ 1998 303(d) lists. More waters may be listed in the future as needing

TMDLs. This might be because monitoring at some time in the future finds a currently

unassessed water to be impaired, or because economic growth or something else causes a

currently unimpaired water to become impaired. In either case, though, we have no basis

for projecting where these as-yet-unlisted waters will be found and which pollutant sources

might need to be addressed because of them.10

Other sorts of costs are omitted from this analysis not because we define them as outside of our

analytical scope, but because we have been unsuccessful in finding a way to estimate them within the time

and data constraints for this study. The major sorts of costs that we have omitted because of analytical

resource limitations include:

 Costs for achieving load reductions from several difficult-to-analyze nonpoint source

types. We estimate the costs for TMDL-prompted load reductions from agriculture,

confined livestock, silviculture and on-site wastewater treatment systems (septic tanks,

etc.). Likely important but omitted nonpoint source types include resource extraction

(mines and oil and gas development), atmospheric deposition, contaminated in-stream

sediments, natural sources (e.g., salt springs, natural mineral deposits) and land disposal

(both formal and informal sites). We estimate that these omitted source types account for

about 14 % of all 303(d) river miles and 22% of all 303(d) lake acres. Some of these

omitted source types can entail high costs for mitigation (e.g., some instances involving

dredging and disposing of contaminated in-stream sediments). On the other hand, if

impairment from one of these source types cannot be remedied or will involve “widespread

social and economic impacts”, then the water quality standard giving rise to the TMDL
11 Figures as of 10/2000. See: http://cfpub1.epa.gov/npdes/permitissuance/statistics.cfm?program_id=1

12 Some sorts of discharges that are often covered by non-stormwater general permits include: non-contact

cooling water, oil and gas production facilities, pipelines, drinking water treatment facilities, aquaculture,

mines, and lagoons. Most of these discharges are expected to be infrequent, and/or low volume and/or

low impact.

13 See U.S. EPA, Office of Water. “General Permit Program Guidance”. February, 1988. 

Www.epa.gov/npdes/pubs/owm0465.pdf. Also, “Water Permitting 101", at

www.epa.gov/npdes/pubs/101pcpe.htm.

I - 10

may be revised through a use attainability analysis. In general, we have not estimated

costs for these source types because one or the other of the following sorts of information

is not available: 1) Information at a relatively fine geographic level on the extent of the

source activity that is occurring and that might need to be controlled in order to resolve

local water quality problems; and 2) Information on the unit costs of broadly applicable

measures to abate pollutant loads from the source.

 Costs for achieving any needed load reductions from point sources covered by general

permits. Our analysis of TMDL-related costs for point source dischargers covers all point

sources for which individual NPDES permits have been issued. However, in addition to

the roughly 60,000 active NPDES point source dischargers with individual permits,

however, there are potentially 385,000 sources to be covered by stormwater general

permits and approximately 52,000 point sources that are covered by non-stormwater

NPDES general permits.11 To the extent that TMDLs will require load reductions below

currently allowed levels for these general permittees, we do not estimate these costs. We

assume broadly that TMDLs are unlikely to require stormwater abatement beyond what is

required under recent stormwater and construction regulations. We also believe that nonstormwater NPDES general permittees12 are typically much less environmentally

significant than individual NPDES permittees, and that TMDLs will rarely require further

controls of them beyond what is already in their permits. Issuance of general permits has

been discouraged for any sources that discharge to impaired waters and may need water

quality-based effluent limits;13 such sources have preferentially been addressed by

individual permits even if they otherwise meet criteria for general permits. In sum, we

believe that TMDLs will rarely require further load reductions from point sources that are

currently covered by general permits, and that our omission of these sources from the cost

analysis results in only modestly underestimating costs.

D. CROSS-CUTTING ANALYTICAL ISSUES

A subsequent chapter describes in detail the methodology we use to estimate costs for point

sources, and another chapter addresses nonpoint sources. This section discusses several general analytical

issues that pertain to the methodologies for both point and nonpoint sources.
14 EPA does not have full information on the fraction of all NPDES permittees who have permit limits

reflecting only the minimum technology-based requirements and the fraction that have more stringent

water quality-based limits. A recent analysis for POTWs specifically suggests that perhaps 68 % of major

POTWs and 59 % of minor POTWs currently appear to have WQBELs. No data is available on industrial

point sources. It is clear, though, that extensive water quality-based permitting has already occurred, and

the nation has a substantial head start on the task of achieving water quality standards in impaired waters.

I - 11

1. The baseline for the analysis

We estimate the costs that TMDLs will engender for point and nonpoint sources in order to meet

water quality standards for the set of impaired waters included in the States’ 1998 303(d) lists. For these

impaired waters, we attribute to the TMDL program the costs of the additional controls that pollutant

sources will need to implement beyond a baseline that includes: 1) Whatever controls were in place at point

and nonpoint sources as of when the 1998 303(d) lists were developed; and 2) Assumed compliance with

all applicable technology-based requirements. Viewed in another way, the analysis estimates the

incremental costs to pollutant sources of achieving water quality standards relative to a baseline of their

controls in place in 1998, but excluding the costs of whatever amount of this further progress will be

achieved through meeting technology-based requirements that were unmet as of 1998. Several aspects of

how we define the baseline and costs for pollutant sources deserve more explanation:

 As of when the 1998 lists were developed, many pollutant sources had implemented

control measures or BMPs beyond those required by technology-based standards. Many

point sources had implemented advanced treatment measures as required by water qualitybased effluent limits (WQBELs) in their NPDES permits. Many nonpoint sources had

implemented BMPs voluntarily or because of incentive programs or State requirements. 

Because of this progress beyond technology-based standards, our analysis thus does not

estimate the costs of achieving water quality standards over and above the costs of meeting

technology-based standards. A substantial amount of the progress beyond meeting

technology-based standards that will be needed in order to attain water quality standards

had already occurred by the time the 1998 lists were developed.

 By the same token, some of the progress needed to meet water quality standards for the

1998 303(d)-listed waters has already occurred since they were listed. Since 1998 or so,

many more point sources have installed advanced treatment measures as required by

WQBELs,14 and many more nonpoint sources have implemented desirable BMPs. Some

of the costs that we estimate in this report will need to be spent to meet water quality

standards have already been spent. We estimate costs to meet water quality standards

relative to a circa 1998 baseline. These costs that we estimate are therefore greater than

would be necessary if we were to measure them relative to a current 2001 baseline.

 We do not count as costs of the TMDL program those costs to dischargers that have yet to

be incurred to meet existing technology-based standards. Some of progress needed to meet

water quality standards will come as sources meet as-yet-unmet technology-based

requirements, most notably the requirements pertaining to storm water, CSOs and SSOs.

The costs of meeting these technology-based standards will be substantial, and for many

waters these additional control efforts will be critical to attaining water quality standards. 
15 Since the spring of 2000, the 303(d) data base has been updated several times to reflect new changes to

States’ lists, revised procedures for estimating the length of some impaired water bodies, and other

developments. Because we “froze” the data base as of the spring of 2000 for this analysis, information on

impaired waters that is now available at the Agency reflects newer numbers and is slightly different from

what is portrayed in this analysis. As of XXXX, 2001, the 303(d) data base includes XXXX waters and

XXXX causes, a small change since last year.

I - 12

However, technology-based requirements and their associated costs are pursuant to 

sections of the CWA other than §303 (TMDLs). Dischargers are and will be required to

meet these technology-based standards regardless of whether a TMDL is established or

not. Consequently, we do not include these baseline costs in our study.

2. Important data bases

For this analysis, we use data that is available at the national level on impaired waters and on the

point and nonpoint sources that may affect them.

The set of 303(d) waters for which TMDLs must be developed is revised frequently as States

submit their new lists, EPA reviews them, and changes are made. Extensive information on the listed

waters (e.g., causes, pollutants, lengths, use impairments) is compiled and entered into a 303(d) data base

that is updated as the lists and associated information change. For this analysis, we used information in the

303(d) data base as of the spring of 2000.15 At that time, the 303(d) data base included some version of the

1998 303(d) list for every State; for most States the data base included their fully approved 1998 303(d)

lists. As of then, the 303(d) data base included 21,845 waters and 41,318 listed causes of impairment for

these waters.

For point source dischargers, the key data base that we used is the Permit Compliance System

(PCS). PCS includes information on every point source holding a NPDES permit, including data that we

used on each discharger’s location, SIC code, flow, and monitoring results. Similarly as for the 303(d)

data base, we “froze” the information from PCS as of mid-summer, 2000. At that time, there were

approximately 63,000 point source dischargers listed in PCS for the U.S. and territories, of which 58,977

were active. For POTWs, we also used the 1996 Clean Water Needs Survey to obtain more detailed

information on flow, industrial flow, and treatment equipment in place.

The key nonpoint source data bases we used for this analysis included:

 For agricultural land (crop, pasture and range), the 1997 National Resources Inventory

(NRI) (USDA) as it existed prior to very recently released corrections;

 For silviculture, the 1996 Timber Product Output Data File (U.S. Forest Service);

 For AFOs, the 1997 Census of Agriculture (USDA); and

 For on-site wastewater treatment systems, the 1992 Census of Housing (USDOC).

Each of these nonpoint source data bases are the most recent versions available.
I - 13

3. Scaling to adjust for limited geographic coverage

The data used to estimate the implementation costs for point sources and for nonpoint sources do

not completely cover the United States. Various sorts of desired data are unavailable for some States and

for some sources. In general, we estimate implementation costs for the subset of States and sources for

which we have data, and then extrapolate the results to the remainder of the nation using a scaling factor

reflecting the portion of the nation for which we do have data. We assume that the portion of the nation for

which we do not have data has impairments and will incur compliance costs at the same rate as the portion

of the nation for which we do have data. The scaling procedures we employ are different for point sources

and for nonpoint sources.

a. Scaling in the point source analysis

The point source analysis in effect depends on comparing the locations of georeferenced 303(d)

waters with the locations of georeferenced point sources. We begin with an impaired water that we have

located geographically. We then search within that water body and upstream an appropriate distance along

a comprehensive network of linked water reaches to identify any point source dischargers that are

discharging the relevant impairment pollutant. We then simulate controls for these identified point sources

as necessary to address the point source contribution to impairment of the water body. We repeat this

process for all impaired waters. There are three reasons why, as we implement this analysis, we ultimately

do not cover all impaired waters and all potentially contributing point sources:

 Some 303(d) waters have not been georeferenced by locating them with respect to Reach

File 3 (RF3) reaches. An impaired water that has not been georeferenced in this manner is

not covered in our analysis because we cannot trace upstream from it to find the point

sources that may be affecting it;

 Some point sources have not been georeferenced. A point source that has not been

georeferenced is not covered in our analysis because it cannot be “found” via this process

and cannot have any costs estimated for it;

 The procedure for matching water bodies against point sources is not operable for a

variety of reasons in several States. These entire States are not covered by the analysis.

We develop scaling factors to account for these shortfalls in analytical coverage. We estimate

point source costs for the portion of the universe that we do cover, assume that this portion is a sample

representative of the entire country, and then extrapolate the costs estimated for our sample to the entire

country by using an appropriate scaling factor.

The matching procedure is not currently operable for the Pacific Northwest States (AK, ID, OR,

WA), Massachusetts, Hawaii and the Territories. The matching procedure thus covers 44 States plus the

District of Columbia. In these 44 States plus DC, there are 41,316 active point sources that have been

georeferenced. In the nation as a whole plus territories, there are 58,977 active point sources. The scaling

factor to account for incomplete coverage involving point source georeferencing and the matching

procedure is thus 58,977/41,316, or 1.427.
I - 14

In the 44 States plus DC, there are 18,162 303(d)-listed waters, of which 16,143 have been

georeferenced. The scaling factor to account for incomplete georeferencing of impaired waters is thus

18,162/16,143, or 1.125. Although we do apply this scaling factor, it is very likely an overestimate. 

Adding more georeferenced waters to the analysis would likely lead to a less than proportional increase in

compliance costs, since many of the point sources implicated by the added waters would have already been

included in the analysis and would have already incurred compliance costs as a result of previously

georeferenced waters. (We assume that a point source that already must incur a compliance cost because it

affects an impaired water will not incur increased costs if it is found also to affect additional waters.)

Combining the two point source scaling factors (1.427 x 1.125) yields a combined scaling factor of

1.605. The aggregate point source costs we estimate in our analysis are multiplied by 1.605 in order to

estimate the total national costs for point sources. Again, we believe this is likely an overestimate.

b. Scaling in the nonpoint source analysis

Scaling issues are different for the nonpoint source cost analysis than for the point source analysis. 

For the nonpoint source analysis, georeferencing of impaired waters is essentially complete, using

procedures that do not depend on RF3. All impaired waters have been located and the counties through

which they pass have been identified. The coverage of our analysis is incomplete, though, because

identification of the nonpoint sources associated with these impaired waters is incomplete.

States vary in the degree to which they provide information on the source types responsible for

impairment of impaired waters. Some States do not report source information at all, some report in modest

detail (e.g., using only broad identifiers of source types such as “point sources”, “nonpoint sources”,

“unknown sources”, etc.), and some report in great detail (e.g., using specific identifiers of source types

such as “municipal point sources”, “CSOs”, “silviculture”, “irrigated crop land”, etc.). Our procedure for

identifying water bodies impaired by various nonpoint source categories relies on detailed source reporting

by those States that provide such information, either in their 303(d) submissions or in their 305(b)

submissions. For example, in analyzing silviculture, we:

 Identify the 303(d) water bodies that States report as impaired by silviculture as a source.

 Identify the 305(b) water bodies that States report as impaired by silviculture as a source. 

We then crosswalk from each of these silviculture-impaired 305(b) waters and determine

whether there is a corresponding 303(d) water body. (Some States report 305(b) source

information but not 303(d). This second step effectively increases the set of States within

which we can find silviculture-impaired 303(d) waters.)

 Add the results of the first and second steps, thus obtaining a list of silviculture-impaired

303(d) waters. We note the States in which these waters are located. We then assume this

set of States to be the sample covered by our analysis, and we assume that this sample is

representative of the nation as a whole.

 States for which we can identify no silviculture-impaired water bodies may either: a)

Actually have no silviculture-impaired water bodies; or b) Actually have them, but report

source information in a manner that does not allow for identifying them. Conservatively,

we assume the latter -- we assume that a State that reports no silviculture-impaired water
I - 15

bodies is effectively “non-reporting”. We extrapolate the costs we estimate for controlling

silviculture in the sample States (those that report silviculture impairments) to the assumed

non-reporting States by scaling up based on the volume of silviculture occurring in the

sample States relative to that occurring in the non-reporting States.

We employ this approach for each of the different nonpoint source types we analyze. Different

sets of States are considered to be “non-reporting” for the different nonpoint source types. For each

nonpoint source type, we use a different volume-based scaling factor to extrapolate our cost estimates from

the “reporting” to the “non-reporting” States. The volume measures that we use in scaling are as follows:

 For silviculture. The annual volume of timber harvested.

 For agriculture. Crop land-related costs are extrapolated based on the acreage of crop

land. Similarly, pasture-related costs and range-related costs are extrapolated based on the

acreage of pasture and range lands.

 For AFOs. The number of confined animal units (AUs).

 For on-site wastewater treatment systems. The number of dwelling units served by septic

systems.

The specific scaling factors we develop (e.g., the ratio between the total national annual timber

harvest and the harvest volume in our “reporting” States) are described in the report sections providing cost

estimates for each of the nonpoint source categories.

We also apply another sort of scaling factor in the nonpoint source cost analysis. In our nonpoint

source analysis, we attempt to cover those States that report source information and scale to those that do

not. Among the States that report source information, though, we count a water body as impaired by a

specific nonpoint source type only if the State affirmatively cites that specific nonpoint source type as a

source. A State that reports source information sometimes reports the source as “nonpoint source (not

classified)” or as “unknown source”. In some fraction of these cases, we would guess that silviculture or

AFOs or agricultural land or some other specific nonpoint source type we are interested in will eventually

be found to be one of the responsible sources. Perhaps we should regard as a sample the instances in which

a specific source type is reported, and we should extrapolate from that sample to the instances in which a

non-specific source type is reported (i.e., NPS not classified, or unknown source). The following exhibit

provides information that can be used in developing a scaling factor reflecting this approach:
16 The cost estimates are expressed in this manner so that they can be compared with cost estimates for other

regulations, policies, programs or initiatives that are also expressed as levelized, continuing annual

amounts. The actual costs of any program typically fluctuate over time, with varying amounts of capital

and operating/maintenance costs incurred in various future years. These costs may continue forever into

the future, or they may end at some point. In summarizing the costs of any such program, analysts

typically convert the fluctuating stream of actual cost payments into a single levelized annual amount by:

1) Discounting all the actual costs in different future years back to a discounted present value in the base

year; and 2) Annualizing this discounted present value, converting it into an equivalent stream of equal

annual payments that continue forever.

I - 16

Exhibit I-1 

Information Used for Nonpoint Source Scaling Factors

303(d) information 305(b) information

# rivers listed # lakes listed River miles Lake acres River miles Lake acres

Unknown source 8.1 % 5.4 % 5.7 % 6.8 %

1.9 %

N.A.

NPS (not classified) 12.5 % 8.6 % 14.7 % 8.8 % N.A.

All other sources 79.4 % 86.0 % 79.6 % 84.4 % 98.1 % N.A.

The nonpoint source categories we are interested in can be cited by a State only when the State

cites a specific source. Specific sources are cited in 79.4 - 98.1 % of the instances. The scale factor to

reflect extrapolation to instances where a State does not cite a specific source can range from 1.02

(100/98.1) to 1.26 (100/79.4). About half of the waters identified in our analysis as impaired by specific

nonpoint source types derive from 303(d) and about half derive from 305(b) listings. We thus adopt a

scale factor of 1.13, averaging between a typical scale factor of approximately 1.25 for 303(d) listings and

1.02 for 305(b) listings.

4. Cost estimating conventions

We estimate costs for pollutant sources in first quarter 2000 dollars. All costs include capital and

operating and maintenance costs, combined into a single annualized cost figure that is assumed to continue

forever. We estimate the time at which each pollutant source will begin to incur this annualized cost

stream, sum the costs across pollutant sources, and then discount the costs incurred in future years back to

a present value cost in 2000. We then annualize this present value cost. The cost estimates that we present

thus represent levelized annual amounts that will continue each year, forever.16 A real discount rate of 7 %

per year is used. The assumed useful life of capital investments varies with the nature of the investment,

ranging from 3 years for some nonpoint source management measures (e.g., a nutrient management plan) to

20 years for capital equipment at POTWs.

5. Assumptions regarding the time when costs will be incurred

A pollutant source will presumably not incur costs resulting from a TMDL until sometime after the

TMDL affecting the pollutant source has been developed. Given that the July 2000 TMDL regulations do

not require all TMDLs for the 1998 listed waters be developed until 2015, there may be many years until a

pollutant source needs to incur the costs of achieving any reduced load assigned by a TMDL. To the extent
17 Environomics and Tetra Tech, Inc., National Costs to Develop TMDLs, prepared for the U.S. EPA, Office

of Wetlands, Oceans and Watersheds, draft, May 2001.

I - 17

that costs are incurred far in the future, the present value of these costs is reduced. The costs that pollutant

sources will incur as a result of the TMDL program (or alternatives to it) depend on when these costs will

be incurred.

The pace at which TMDLs will be developed for the waters on the 1998 303(d) list is unknown. A

companion report to this one -- the TMDL Development Cost Report17 -- discusses various possibilities

regarding the pace of TMDL development. For this analysis, we have chosen an “even pace” projection

from among those considered in the Development Cost Report.

Exhibit I-2

Projected Pace of TMDL Development Used for This Analysis

Year of

Completion

# TMDLs

Completed

2000 and

before

2,000

2001 2,282

2002 2,282

2003 2,282

2004 2,282

2005 - 2014 2,282 each year

2015 2,282

Total 36,225

The “even pace” projection reflects the number of TMDLs for 1998 303(d) waters that have already been

developed (an estimated 2,000 developed before 2001) and then assumes that the remaining TMDLs are

developed at an even pace through the deadline at the end of 2015. Note that the estimated total number of

TMDLs to be developed is only 36,225, relative to a projected number of causes for the currently listed

303(d) waters totaling 41,318. Roughly 5,000 of the causes (about 12 % of the total) associated with

currently listed waters involve “pollution” rather than pollutants (e.g., flow alteration, habitat alteration)

and TMDLs are not expected to be prepared for such causes. The costs we estimate for pollutant sources

will increase somewhat to the extent that further research ultimately identifies pollutants requiring TMDLs

for some of these “pollution”-impaired waters.

For this cost analysis, we assume that a point or nonpoint source that will need to implement

further control measures as a result of a TMDL will begin to incur the costs of doing so an average of five

years after the TMDL is developed. The capital costs for the necessary control measures will be incurred

five years after the relevant TMDL is developed, and annual O&M costs will also begin at that point. 

Thus, the schedule upon which sources will begin to incur TMDL compliance costs will be lagged five

years relative to the TMDL development schedule shown above.
I - 18

The cost models we use to estimate compliance costs for sources generate estimates of annualized

costs as of the year when compliance costs begin. In effect, the numbers generated by the cost models are

estimates as if all the sources would need to begin incurring all their TMDL compliance costs immediately,

in the year 2000. To reflect the pace of TMDL development as shown above and the assumed 5-year time

lag between TMDL development and when compliance costs will begin, we must scale down the estimates

from the cost models. A spreadsheet in Appendix B shows the derivation of a scaling factor that reflects

the particular pace of TMDL development and compliance time lag that we have assumed. At a discount

rate of 7 %, the scale factor to convert the annualized cost once all sources are incurring their costs to an

equivalent annualized cost beginning in the year 2000s is 0.4484.

This pace/lag scale factor is applied to the outputs of the point source and nonpoint source cost

models. The raw outputs of the cost models show total annualized costs for sources after the point in time

when all sources have begun incurring their TMDL compliance costs. This will not be until 2020

(assuming the last TMDLs for the 1998 listed waters are developed in 2015 and compliance costs lag

TMDL development by another five years). Between now and 2020, annual costs to sources will slowly

rise until they reach the maximum in 2020, and they will then continue at this maximum level forever. 

Many pollutant sources will not need to implement their projected control and management measures until

many years in the future. This gradual development and implementation of TMDLs for currently listed

waters will reduce the present value of the management and control costs for the TMDL program well

below what it would be if all TMDLs were completed immediately and sources needed to comply

immediately. The impact of stretching out the compliance expenditures is captured in the “pace/lag” scale

factor. If TMDL development were accelerated relative to the pace shown in the exhibit above, or if the

compliance time lag were assumed to be less than five years, the scale factor would increase and the

estimated present value TMDL implementation costs would increase.

We assume that the timing of compliance investments by sources will be the same under Scenario 1

and Scenario 3 as what we have projected here for the Moderately Cost-effective TMDL Program

(Scenario 2). This is so that the estimated cost differences between the scenarios result only from

substantive differences between them rather than differences involving timing.

6. Assumptions regarding changing conditions over time

We estimate the costs for sources to achieve water quality standards based on current conditions. 

For example, for a POTW that will need to upgrade its treatment to meet the requirements of a TMDL, we

estimate its costs based on the POTW’s current level of flow or population served and current treatment in

place. For a county in which silvicultural activities will need to adopt improved management practices to

meet TMDL requirements, we estimate costs based on the current volume of silvicultural activity in the

county. In reality, though, if the TMDL affecting these two example sources will not be developed for

another decade or more, when it comes time to comply with the TMDL’s allocations, the POTW may have

a larger or smaller flow, and the volume of silvicultural activity taking place in the county and needing

control may have changed also. Or, conditions regarding other sources may have changed in a manner

affecting what these sources need to do -- perhaps, for example, by the time the TMDL is eventually

developed, a large, poorly controlled industrial discharger affecting the same water body will have gone out

of business, and the POTW and the silvicultural operations will not need to implement further controls. 

We do not attempt to predict these changes in source activities over time that may affect what the sources

need to do in order to meet the requirements of the eventual TMDLs. We estimate costs for sources to

meet the likely requirements of TMDLs given current conditions.
18 This analysis diverges in several additional respects from the TMDL Development Cost Analysis. Most

notably, costs are presented in this report as levelized annual amounts beginning now and continuing each

year, forever. Whereas compliance costs continue indefinitely (we assume that a source’s compliance

obligation is a continuing one), the cost of developing a TMDL is a one-time cost – once a TMDL is

developed, there is no further development cost. Consistent with the fact that TMDL development will

end at some point, the Development Cost Analysis thus shows costs in several ways that are different from

how costs are shown here: showing them as undiscounted costs in the years in which they will occur, and

also as total undiscounted costs over this time period.

The Development Cost Analysis also does not count the costs of developing the TMDLs for water bodies

on the 1998 303(d) lists that have already been developed. In this analysis, though, we include the costs

for pollutant sources to meet the requirements of these TMDLs because the bulk of these costs have

presumably not yet been incurred.

I - 19

We also do not evaluate the potential impact of another set of changing conditions over time --

changes in the list of waters for which TMDLs will be necessary. As States assess more of their waters

and as source activities increase with a growing population and economy, additional water bodies will

likely be listed for which TMDLs will need to be developed. Also, though, as a wide variety of incentive

programs (e.g., agricultural cost share programs) and new regulations (e.g., State requirements for nutrient

management planning, new Federal effluent guidelines, and new rules for SSOs) continue to be developed

and implemented and sources respond, some currently impaired waters that need TMDLs will attain

standards and ultimately not need TMDLs. Again, in this analysis we estimate costs for the current set of

listed waters, assuming current conditions. This approach differs somewhat from the accompanying

TMDL development cost analysis, which estimates costs also for future waters that might be added to the

present 303(d) lists.18
II - 1

II. IMPLEMENTATION COSTS FOR POINT SOURCES

A. OVERVIEW

We identified the specific point source facilities that might discharge the pollutants responsible for

impairments in 303(d) listed waters. For Scenario 1 (“Least Flexible TMDL Program”), we assumed that

all of the facilities that might reasonably be expected to control these discharges further will be required to

install the “next treatment step”, and estimated the costs associated with those controls. For Scenario 2

(“Moderately Cost-effective TMDL Program”) we scaled down the costs estimated for Scenario 1 to reflect

the degree to which actual TMDLs have required aggregate load reductions from point sources less than

that which would be achieved if all point sources implemented the next treatment step. For Scenario 3

(“Cost-Effective TMDL Program”), we adjusted the costs estimated for Scenario 2 to reflect the potential

savings to point sources from more cost-effective waste load allocations or trading. We will describe this

analysis in detail as consisting of eight steps:

1. Select the pollutants that point sources are most likely to be required to control further --

these included BOD, nutrients, toxic organics, ammonia and metals.

2. Identify the facilities that are within a relevant distance upstream of an impairment for any

of these pollutants.

3. Determine which of these upstream facilities will likely be required to implement further

controls for each impairment pollutant under a water quality-based permitting approach

(Scenario 1).

4. Develop cost functions for the “next treatment step” for each relevant pollutant

5. Apply the cost functions for every pollutant source needing further control for an

impairment pollutant.

6. Adjust the estimates to exclude costs for point sources affecting waters that States identify

as impaired by nonpoint sources only. At this point, costs for point sources under

Scenario 1 are estimated.

7. Adjust the Scenario 1 cost estimates to reflect the results of a sample of actual TMDLs

and estimate the costs for Scenario 2.

8. Adjust the Scenario 2 cost estimates to reflect opportunities for additional cost-effective

waste load allocations or trading in which lower-cost control of nonpoint sources might

substitute for some further point source controls.

This chapter summarizes each of these steps and their results. Appendices C through H provide further

details.
II - 2

B. POLLUTANTS FOR ANALYSIS

In order to limit the analytical workload (e.g., developing and applying cost functions for the next

treatment step for each pollutant), we chose to analyze only those particular pollutants for which TMDLs

or water quality-based permits are most likely to require further controls (beyond technology-based

standards) for point sources. We obtained data on the frequency with which different causes of impairment

are cited for waters impaired by point sources. We considered the most frequent causes of impairment, and

asked whether each of these causes would commonly trigger the need for further controls of point sources

that are already meeting technology-based standards. We concluded that the following pollutant classes are

the most likely to prompt requirements for further point source controls: BOD, nutrients, toxic organic

chemicals, metals, and ammonia. Some of our judgments in settling on this list of pollutants to trigger

point source controls were:

 We chose not to analyze causes of impairment when no pollutant was identified. 

Examples included flow or habitat alteration or fish consumption advisory when no

pollutant was listed also.

 We chose not to analyze pollutants that are extremely unlikely to be discharged in

sufficient quantity to be problematic by a point source meeting technology-based

standards. Examples included temperature or pH.

 We chose not to analyze pollutants for which only a very small fraction of point sources

might require additional beyond-technology-based controls for process water discharges. 

Examples include sediment or pathogens. We believe that the great majority of instances

where waters are impaired for these causes and point sources are cited as a source involve

wet weather discharges from point sources. We believe these problems will largely be

remedied when existing technology-based standards for wet weather discharges -- storm

water, construction, CSO and SSO requirements -- are complied with.

 We chose not to analyze in this study pollutants representing a very small fraction of

causes that would require specialized treatment technologies as the”next step”. Examples

include chlorine and cyanide. We could consider such infrequent causes of impairment in

a future study.

Appendix C provides supporting data and further information on our judgments in arriving at the list of

five pollutants that we will consider as triggering point source controls under TMDLs or water qualitybased permits.

The next step in the point source cost analysis is to identify the facilities that discharge any of these

five pollutant classes -- BOD, nutrients, toxic organics, metals, or ammonia -- in a manner so as to affect a

303(d) water that is impaired for one of these pollutants.

C. NEARBY FACILITIES

These are the point sources that we consider potentially to contribute to impairment and perhaps to

be affected by TMDLs or water quality-based permits. We adopted two alternative scenarios for

identifying point sources and considering them for further controls:
II - 3

 Case 1, “within and upstream”. We assume that a point source contributes to impairment

if it discharges the pollutant of concern: a) Directly into the waterbody; or b) Within 25

miles upstream of a water body impaired by BOD, ammonia or toxic organic chemicals, or

within 50 miles upstream of a water body impaired by nutrients or metals.

 Case 2, “within only”. We assume that a point source contributes to impairment if it

discharges the pollutant of concern directly into the impaired water body.

For each water body impaired by one of the five causes we selected as potentially triggering point

source controls (BOD, ammonia, toxic organic chemicals, nutrients, metals), we identified all point sources

with outfalls discharging into the impaired segment or within the 25 or 50 mile distance upstream of the

upstream end of the impaired segment. This step involved a complex procedure to interlink three very large

electronic data bases: 1) Information on the location and causes of impairment for most of the more than

21,000 currently listed 303(d) water bodies; 2) Information on the location of the receiving water and other

data for the nearly 60,000 active point source dischargers; 3) A nationwide network model that links water

reaches to each other, allowing one to trace upstream any specified distance from a water body to upstream

reaches, tributaries, headwaters, etc.. This analysis was performed by Tetra Tech, Inc.

The two cases for analysis reflect different possible judgments about how far downstream the

pollutants discharged by point sources will typically have an impact. Metals and nutrients -- conservative

pollutants that do not degrade over time or distance -- have the longest range downstream effect. 

Ammonia, BOD, and many toxic organics have a much shorter range downstream effect, strongly affecting

receiving waters shortly below the point of discharge and weakly affecting waters farther downstream. 

Tetra Tech’s engineers judged that 50 and 25 miles were reasonable upper limits to the upstream distance

within which point sources discharging these pollutants would likely have a substantial impact warranting

attention in TMDLs or water quality-based permitting.

In the TMDL “groundtruthing” analysis reported in Appendix A, we have attempted to determine

whether actual TMDLs have typically focused only on point sources discharging to the impaired water

body or whether they have typically addressed upstream point sources also. And, if upstream dischargers

were considered, how far upstream? The results from our sample of 15 TMDLs are not conclusive. 

Sometimes only point sources discharging directly into the impaired water are considered, sometimes the

TMDL addresses upstream point sources also.

In the absence of more extensive information, we believe the “within and upstream” case (and the

25 and 50 mile assumed distances) is generally conservative. For most impaired water bodies, these

upstream distances will pull in more point sources than would likely be considered as contributing

importantly to impairment. However, for some large and significantly impaired water bodies, basin-wide

load reductions from point sources may be necessary that will extend well beyond these distances. On the

whole, though, we expect the total national costs for point sources that actually result from TMDLs and

water quality-based permitting will be somewhere between the “within and upstream” case and the

“within only” case.

It should be noted that the number of point sources potentially affected by TMDLs or water

quality-based permitting increases much less than linearly with an increase in these assumed distances. 

Many impaired waters are in headwaters, and 25 or 50 miles already reaches a stream’s origin. Also,
II - 4

many impaired waters are near other impaired waters and looking further upstream simply identifies point

sources already identified as affecting other impaired waters.

D. FACILITIES THAT NEED TO REDUCE LOADS

The next step involved making a judgment about whether each point source discharging into or

within a 25/50 mile distance upstream of a water body that is impaired for one of these pollutants might be

required by the eventual TMDL or water quality-based permit to implement further controls. We sought to

determine whether an identified point source meeting applicable technology-based standards was likely to

discharge the impairment pollutant in sufficient quantity to warrant consideration for further controls. This

judgment was particularly difficult to make because there is little data available at the national level on the

pollutants that individual facilities discharge and their amounts. For the majority of dischargers, the Permit

Compliance System (PCS) – EPA’s major data base on point source dischargers that we used to identify

potentially relevant facilities -- provides information only on which pollutants a facility is required to

monitor for. For only a very few facilities does PCS provide reliable information on the amount of the

monitored pollutants that are discharged. PCS provides no information on whether a facility discharges

unmonitored pollutants or their amounts.

We tested three alternative approaches for determining whether or not a specific point source (after

meeting applicable technology-based requirements) discharges the impairment pollutant in an amount

making the source likely to be addressed in the TMDL or water quality-based permit:

 The first approach was to use the information in PCS on whether monitoring is required

for a pollutant as an indicator of whether or not a facility discharges the pollutant in a 

meaningful amount. We applied this approach for each 4-digit SIC code -- if at least 15 %

of all the facilities in PCS in a particular 4-digit SIC code were required to monitor for a

pollutant, then all the facilities in that SIC code were deemed to discharge the pollutant in a

meaningful amount. If the facility was thus judged to discharge the impairment pollutant,

we then assumed conservatively that the facility would be identified as contributing to

impairment and would be addressed in the TMDL or water quality-based permitting

process.

 The other approaches relied instead on an engineering judgment as to whether each 4-digit

SIC is likely, after meeting BPT/BAT/secondary treatment requirements, to discharge each

pollutant at levels that could warrant potential further control. Two EPA engineers

experienced in industrial water pollution control made these judgments for each of more

than 500 different SIC codes. We then implemented the engineering judgments in two

alternative ways, resulting in high and low estimates for the number of point sources likely

to be deemed as discharging the impairment pollutant in sufficient quantity as to be

contributing to impairment. The high estimate adopts more liberal rules for matching

sources and impairments than does the low estimate. For the high estimate, when a water

body is impaired by a specific metal (except mercury) or a specific toxic organic (except

PCBs or dioxin) and the facility (based on engineering judgment for its SIC) is expected

generally to discharge metals or toxic organics, then the facility is assumed to be a

candidate for mandated further controls. For the low estimate, the match must be exact in

order for further controls to be considered for the facility: if a water body is impaired for

metals generally then facilities that discharge metals generally are assumed to warrant
II - 5

consideration, but if a water body is impaired for a specific metal or toxic organic (e.g.,

zinc, phenol), only those facilities discharging that specific metal or toxic organic are

assumed to warrant consideration.

We ultimately selected the engineering judgment approach using liberal matching rules. The three

approaches yielded broadly similar results (within + or - 20 %) in terms of: a) the numbers of point sources

presumed likely to discharge an impairment pollutant in a quantity potentially warranting further control

under a TMDL or water quality-based permit; and b) the costs of these controls. The engineering judgment

approach, however, often yielded more sensible results regarding individual SIC codes than did the

approach based on monitoring requirements. The monitoring requirement-based approach, for example,

projected that metal finishers contribute to impairments for nutrients, and “fabricated metal products”

dischargers do not contribute to impairments for metals. The engineers, on the other hand, judged that

metal finishers meeting BPT/BAT requirements would typically not discharge significant quantities of

nutrients and that TMDLs or water quality-based permits would be unlikely to address them when nutrients

were at issue. The engineers believed the reverse was likely true for “fabricated metal products” facilities. 

We chose the approach using liberal matching rules in order to reduce the likelihood that we exclude from

our cost analysis some point sources that ultimately will end up being addressed by TMDLs or water

quality-based permits.

A fuller description of the three alternate approaches and the results obtained under each is

provided in Appendix D.

We made two further decisions that limited the set of point sources presumed likely to incur

additional costs as a result of TMDLs or water quality-based permits:

1. We assumed that POTWs that currently provide better-than-secondary treatment would

not be required by TMDLs or water quality-based permits to further improve their

treatment for BOD, nutrients, toxic organics and/or ammonia.

2. As a definitional matter, we decided to attribute any POTW treatment upgrade projects

that were listed in the 1996 Clean Water Needs Survey to Clean Water Act requirements

other than TMDLs. In effect, we believe that POTW upgrades that were far enough along

to be included in the 1996 CWNS should not be attributed to the TMDL program and

should instead be counted as part of the pre-TMDL baseline.

These limitations on the set of POTWs that we consider likely to incur incremental costs

attributable to the TMDL program have an important influence on the TMDL implementation costs that we

estimate. The following exhibit shows how the estimated implementation costs for POTWs would change

if one or both of the limitations were not adopted. Costs are shown for the “within and upstream” case.
II - 6

Exhibit II-1

Incremental Implementation Costs for POTWs – Scenario 1 (Least Flexible TMDL Program)

(“within+upstream” case)

Basis for Estimate

# of POTWs

Incurring Costs

Annualized Costs for

POTWs (2000 $ in

millions/yr)

Preferred estimate: 1) assume POTWs that are already beyond 2o

will incur no costs, and 2) attribute no TMDL costs to projects

approved in 1996 CWNS

3335 697

Drop the 1st limitation: assume TMDLs will require “next treatment

step” of all POTWs, whether or not they already provide advanced

treatment

5262 1,869

Drop the 2nd limitation: attribute costs of “next treatment step” for

POTWs not already beyond 2o

 to the TMDL program, whether or

not the upgrade was planned long ago

3694 836

Drop both limitations 5622 2,009

Incremental Implementation Costs for POTWs – Scenario 2 (Moderately Cost-effective TMDL

Program)

(“within+upstream” case)

Basis for Estimate

# of POTWs

Incurring Costs

Annualized Costs for

POTWs (2000 $ in

millions/yr)

Preferred estimate: 1) assume POTWs that are already beyond 2o

will incur no costs, and 2) attribute no TMDL costs to projects

approved in 1996 CWNS

2502 523

Drop the 1st limitation: assume TMDLs will require “next treatment

step” of all POTWs, whether or not they already provide advanced

treatment

3947 1,402

Drop the 2nd limitation: attribute costs of “next treatment step” for

POTWs not already beyond 2o

 to the TMDL program, whether or

not the upgrade was planned long ago

2770 627

Drop both limitations 4216 1,506

Abandoning these two limitations would increase our implementation cost estimates for POTWs

sharply, by a factor of nearly three (from $697 million annually to $2,009 million annually for Scenario 1,

and from $523 million annually to $1,506 million annually for Scenario 2). The assumption that TMDLs

will not require further controls of POTWs that already provide better-than-secondary treatment is

particularly important, resulting in nearly $1.2 billion in estimated cost reductions for Scenario 1 and

nearly $900 million for Scenario 2. In essence, we project that there are many large POTWs that already

employ advanced treatment that nevertheless still appear to discharge meaningful amounts of an
19 This finding is quite consistent with the previous observation that most (68 %) major POTWs appear

currently to have WQBELs that require better-than-secondary treatment. As noted previously, the nation

has already made important progress beyond technology-based standards in addressing impaired water

bodies.

II - 7

impairment pollutant into or somewhat upstream of impaired waters.19 Are the eventual TMDLs likely to

require further controls of these already well-controlled POTWs?

The sample of 15 TMDLs that we reviewed for “ground-truthing” purposes provide some

information relevant to this question. Across the 15 TMDLs, in some cases POTWs discharging the

impairment pollutant that now provide better than secondary treatment are being required to reduce their

loads further, and in some cases they are not. When they are not required to reduce loads further,

sometimes a rationale is offered that they have already reached their practical limits of treatment, and

sometimes no rationale is offered. In no case does the TMDL submission explicitly cite an “equity”

rationale to the effect that responsibility for further load reductions should not focus on sources that have

already gone beyond minimum technology-based requirements. On balance, we believe the sample size for

the groundtruthing case studies is small, and we cannot conclude anything more than some TMDLs in

practice will adopt limitation #1 and some will not.

The TMDL groundtruthing case studies do not shed any useful light on the second limitation. It is

really a policy question rather than an empirical one – what do we count as being in the baseline, and what

do we count as being incrementally attributable to the TMDL program? In our view, projects listed in the

1996 CWNS have been planned so far in advance of virtually all TMDLs that they should be defined as

not attributable to the TMDL program.

The rationales for these two potential limitations involving POTWs would seemingly apply to

industrial dischargers as well as to POTWs.

 Both industrial dischargers and POTWs that already provide better treatment than

technology-based standards require may receive some special consideration from control

authorities for their extra treatment efforts when wasteload allocations are developed under

TMDLs. Control authorities may look for additional controls first to sources that have not

yet gone beyond the required minimums. In many cases, POTWs or industrial dischargers

that already provide advanced treatment will not be required to do more in future TMDLs. 

In some cases, there may be no reasonably available treatment technologies that they could

implement beyond the advanced treatment they have already adopted.

 Similarly, the cost of treatment upgrades that were planned and approved five or more

years ago, whether for POTWs or for industrial dischargers, should not be counted as

prompted by the TMDL program.

However, we have implemented these two limitations for POTWs alone because we have data on

implementation of advanced treatment and long-planned projects only for POTWs, from the CWNS. There

is no parallel source of data for industrial dischargers. There is no ready source of information for

industrial dischargers on treatment-in-place (from which we could identify the facilities with treatment

beyond BPT/BAT) or on already-planned treatment upgrade projects.
20 U.S. EPA, Office of Water. Development Document for Proposed Effluent Limitations Guidelines and

Standards for the Centralized Waste Treatment Industry. December, 1998.

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E. COST FUNCTIONS FOR THE “NEXT TREATMENT STEP”

We developed relationships predicting cost as a function of flow for all pollutant sources

potentially needing additional controls for BOD, nutrients, toxic organics, ammonia or metals. These cost

functions are as follows.

1. Treatment for metals from direct dischargers except POTWs

Polishing multi-media filtration was assumed as the “next treatment step”, assumed to be

incremental over the technologies assumed to be in place to meet BAT (flow reduction, chemical

precipitation, clarification). The capital and O&M cost functions for polishing filtration are drawn from

EPA’s development document for the centralized waste treatment industry.20 The equations are described

more fully in Appendix E.

2. Treatment for metals from POTWs

An enhanced pretreatment program with tighter local limits (tighter than PSES) for significant

metals indirect dischargers was assumed as the “next treatment step” when POTWs need to provide

enhanced control of metals. The enhanced pretreatment program was assumed to be incremental over a

baseline pretreatment program in which local limits match effluent guideline requirements for indirect

dischargers.

Our procedure for estimating the costs for such an enhanced pretreatment program at a POTW

involves calculating the number of the POTW’s indirect dischargers that will need to improve their

treatment for metals, and then applying the cost functions for polishing filtration to the flows for these

indirect dischargers. There are several steps in this procedure:

 We assumed that any major POTW within the relevant distance upstream of a metalimpaired water will need to implement an enhanced pretreatment program for metals. We

assumed that no minor POTWs will need to implement such a program.. These

assumptions likely result in some overestimate of the number of POTWs that will

ultimately need to enhance their pretreatment programs as a result of TMDLs.

 For a major POTW that is presumed to need an enhanced pretreatment program for

metals, we obtained information from the CWNS on the POTW’s industrial flow. We

then made assumptions and applied information from EPA’s RIA for the Great Lakes

Water Quality Guidance to estimate that significant industrial users totaling about 10 % of

the POTW’s industrial flow would need to improve their metals treatment. These

significant industrial users were estimated to have an average flow of 0.1 mgd each.

 We then applied the cost functions for polishing filtration to the number of indirect

dischargers that was calculated to need to implement this next treatment step.
21 Tetra Tech, Inc. Software Requirements Document for the 1996 Clean Water Needs Survey Treatment

Plant Cost Curves, Revision 2. March 20, 1998.

22 51 F.R. 24974, July 9, 1986. Also: Science Applications International Corp. BCT Benchmarks:

Methodology, Analysis and Results. May, 1986.

II - 9

3. Treatment for BOD, nutrients, ammonia and toxic organics

Some form of advanced secondary treatment was assumed as the “next treatment step” for both

industrial dischargers and for POTWs. Advanced secondary treatment is the next treatment increment over

secondary biological treatment, which is assumed to be in place for industrial dischargers to meet

BPT/BAT and for POTWs to meet secondary treatment requirements. The capital cost functions for this

increment of control were drawn from the equations underlying EPA’s 1996 Clean Water Needs Survey.21

The CWNS includes an extensive set of cost functions that are used as checks on State-submitted cost

estimates for POTW treatment upgrade projects, and as defaults for generating treatment cost estimates

when States have not developed them. While the CWNS functions have been used previously by EPA

specifically to estimate costs for POTWs, we use them also to estimate costs for treatment upgrades at

industrial point sources. The CWNS cost functions are based on underlying cost models for basic

wastewater treatment unit processes (e.g., screening, flow equalization, primary clarification, etc.) that

were developed to apply to both domestic and industrial wastewater.

Capital cost functions were drawn from the CWNS for upgrades to the “next treatment step”

beyond secondary treatment, as follows:

 All dischargers presumed to need additional treatment for nutrients and/or ammonia are

assumed to incur the costs to upgrade to “secondary treatment with nutrient removal”;

 All dischargers presumed to need additional treatment for BOD and/or toxic organics are

assumed to incur the costs to upgrade to “advanced treatment I”; and

 All dischargers presumed to need additional treatment for nutrients and/or ammonia and

BOD and/or toxic organics are assumed to incur the costs to upgrade to “advanced

treatment I with nutrient removal”.

The specific cost functions that we used are shown and described further in Appendix E. This

Appendix also provides further detail on all the other point source cost functions discussed in this section.

It should be noted that the capital costs for upgrades estimated using the CWNS cost functions are

substantially higher than the costs that would be projected using equations derived from POTW cost data

for advanced secondary treatment that underlie EPA’s final Best Conventional Technology (BCT) rule.22

The BCT data had been suggested to us as an alternate source for cost information on treatment upgrades. 

Upon examination, we concluded that the CWNS equations were more appropriate for our purposes

because:

 The treatment upgrades considered in the BCT analysis focused exclusively on increased

chemical addition and included virtually no capital equipment.
23 Association of Metropolitan Sewerage Authorities. AMSA Financial Survey. 1999.

II - 10

 The BCT treatment upgrades were intended specifically to provide additional removals of

BOD and suspended solids. They likely would not have accomplished the additional

removals of nutrients, ammonia and toxic organics that can be addressed with the CWNS

cost functions.

 The BCT costs were estimated specifically and only for POTWs, and there is no reason to

believe they would be appropriate for industrial dischargers also. We believe the CWNS

cost functions are reasonably applicable to both POTWs and industrial dischargers.

 The CWNS cost functions have been developed and used more recently and more widely

than the BCT costs.

However, the CWNS cost functions have one major disadvantage. They are designed in a manner such that

the cost of upgrading an existing treatment plant is estimated as the cost of a new plant providing the

desired level of treatment less the salvage value of the existing plant. In reality, upgrades can generally be

accomplished for less than is projected by this “new plant less salvage value” approach. We believe the

CWNS cost equations thus probably overestimate the costs of treatment upgrades. Unfortunately, we are

aware of no alternative, broadly applicable, equations for estimating upgrade costs.

The CWNS – since it is concerned with capital costs only -- does not provide functions for

estimating the increased operating and maintenance (O&M) costs associated with upgrading wastewater

treatment facilities. We developed an O&M cost function for upgrades from survey data assembled by the

Association of Metropolitan Sewerage Authorities (AMSA) on O&M costs for POTWs operated by

member institutions.23 AMSA’s survey provides annual O&M costs for each of 119 agencies serving

nearly half of the nation’s sewered population. The data on O&M costs and flow for these agencies are

broken down by level of treatment provided (primary, secondary, and tertiary). We segregated the data by

level of treatment, and developed two regression equations, one explaining annual O&M costs as a function

of flow for secondary treatment POTWs and another explaining O&M costs as a function of flow for

tertiary POTWs. We then assumed that the increase in O&M cost for an upgrade from secondary to

advanced treatment was given by the difference between the estimated secondary and tertiary O&M cost

equations.

We have two reservations about this approach to estimating O&M costs associated with the “next

treatment step” beyond secondary treatment/BPT/BAT:

 The AMSA data is drawn specifically from POTWs, and there may be some reasons why

O&M costs for industrial facilities would differ systematically from those for POTWs. 

Labor costs for wastewater treatment plant operators, for example, might differ between

the private and public sectors.

 The AMSA data distinguished only between primary, secondary and tertiary levels of

treatment. AMSA’s data did not distinguish between plants that provided “secondary with

nutrient removal”, “advanced treatment I”, “advanced treatment I with nutrient removal”,

“advanced treatment II”, and “advanced treatment II with nutrient removal”. Based on
II - 11

discussions with officials responsible for the AMSA survey, respondents would likely

include plants at all of these levels within AMSA’s “tertiary” category. The likely result is

that the O&M cost differential we estimate between AMSA’s secondary and tertiary

categories somewhat overstates the real O&M cost differentials that we are interested in

resulting from the smaller increments from secondary to “secondary with nutrient

removal”, to “advanced treatment I”, and to “advanced treatment I with nutrient removal”.

We have used the equation derived from the AMSA data despite these reservations. We are not

aware of any better alternative.

A further issue in costing the “next treatment step” for point sources is that all of our cost

equations presume that the “next treatment step” begins from the point at which the source just meets

applicable technology-based requirements. For POTWs, the “next treatment step” is assumed to be an

increment beyond secondary treatment, while for industrial point sources the increment is beyond BPT and

BAT. In fact, though, as noted previously, many POTWs and industrial dischargers currently have

treatment in place that exceeds technology-based requirements. For dischargers with advanced treatment in

place, the “next treatment step” should be different from the “next treatment step” for dischargers without

advanced treatment in place. Assuming increasing marginal costs of control, one might surmise that the

“next treatment step” for a discharger already having advanced treatment would be more costly than that

for a discharger just meeting technology-based standards.

There are several reasons why we have not been able to improve our costing procedure and address

this issue:

 For POTWs. Note that this issue does not arise when we assume that the TMDL program

will not require a “next treatment step” of POTWs that already provide better-thansecondary treatment. Under this assumption, we do not cost out any additional treatment

for POTWs that already have advanced treatment. However, in the sensitivity analysis we

showed in the previous section (e.g., Exhibit II - 1) where we investigate the impact if

beyond-secondary POTWs are required to take the “next treatment step”, we have

assumed and costed “next treatment steps” that start from the wrong point for these

POTWs. We would face a major difficulty in trying to remedy this. The CWNS capital

cost functions for POTW upgrades involve projecting the cost of building a plant at the

new treatment level less the salvage value of the existing plant at the current treatment

level. The salvage value equations exist only for secondary plants, not for beyondsecondary plants. Upgrading a beyond-secondary plant to provide further improvements

would, following the CWNS approach, get a salvage value credit for the existing plant as

if it were only at secondary. The projected net costs for the upgrade from beyondsecondary to well-beyond-secondary would be unreasonably large.

 For industrial dischargers. There is no reasonable way to obtain information on the extent

of treatment in place for each industrial discharger, and hence the starting point for each

discharger from which the “next treatment step” will begin.
24 For POTWs, flow information from CWNS was used preferentially over flow information from PCS.

25 We say “presumably” because we do not have information particular to each point source on whether it

actually does or does not discharge any given pollutant. Instead, we make a judgment for each SIC as to

whether all dischargers in that SIC presumably discharge each class of pollutants. These broad judgments

may be inaccurate with respect to any particular point source discharger.

II - 12

F. FLOW DATA FOR USE IN COST FUNCTIONS

Costs were estimated on a facility-by-facility basis using the previously discussed cost functions

and facility flow information from PCS or CWNS.24 Costs were then summed for all dischargers.

We encountered significant problems resulting from missing or obviously inaccurate facility flow

information in PCS/CWNS. The set of assumptions and procedures adopted to address the issues that

arose are outlined in Appendix F.

The set of assumptions and procedures to deal with flow issues has a substantial impact on the

estimated costs for the affected sources to install the next treatment step. If the assumed limits on the flows

to be treated were much higher, the estimated costs could as much as double. We believe, however, that

our assumed upper limits on the flows presumed to be treated are conservative -- the great majority of

minor and major dischargers will have flows needing additional treatment that are actually well below the

upper limits that were assumed.

G. COSTS FOR SOURCES AFFECTING WATERS IMPAIRED BY NONPOINT SOURCES

ONLY

Many States provide an assessment of the source types that impair each of their 303(d) waters. 

For the States that provide this information, the data can be compiled to determine whether each water is

impaired by point sources only, by nonpoint sources only, by mixed point and nonpoint sources, by

unknown sources, or by other categories of sources. Other States do not provide such information on their

impaired waters. In our analysis to this point, we have identified all point sources that presumably

discharge an impairment pollutant within a relevant distance upstream of or into an impaired water.25 This

set of point sources is likely the maximum that potentially might be addressed in water quality-based

permitting or TMDLs. However, we believe we can use the information that States provide on source

types responsible for the impairments in these waters to judge which of the maximum set of potentially

relevant point sources are really likely to be addressed in the eventual TMDLs or water quality-based

permits. As the most obvious examples:

 When a State indicates that point sources are the source of impairment in a water body, we

expect that the TMDL or alternative approaches would likely address all the point sources

discharging the impairment pollutant within a relevant distance upstream (i.e., all of the

point sources we have identified in this analysis); but

 When a State indicates that nonpoint sources -- and not point sources -- are the source of

impairment in a water body, we expect that the TMDL or water quality-based permitting

process most likely would not address point sources, even if there are some point sources
26 These 4,234 water bodies are for the “within and upstream” case. They represent a little more than onequarter of the 16,143 impaired water bodies that we cover in our analysis. (Our procedure for matching

impaired water bodies against point sources is operable in 44 States plus the District of Columbia. In

these 44 States plus DC, there are 18,162 303(d)-listed waters, of which 16,143 have been

georeferenced.) Interpreting the “within and upstream” case as an upper bound, we thus believe that at

most about 1/4 of all TMDLs have the potential to trigger additional controls for point sources. In

contrast, the “within only” case provides a reasonable lower bound. In the “within only” case, there are

XXX water bodies that are impaired by one or more of the five pollutants and have one or more point

sources discharging the impairment pollutant directly into the impaired water. This suggests that there

may be as few as XXX percent of all TMDLs that have the potential to trigger additional controls for

point sources.

II - 13

that apparently (according to our engineering judgment approach) discharge the

impairment pollutant within a relevant distance.

In this step of the analysis, we use the information provided by States on the source types

responsible for impairment of each 303(d) water body to reduce the set of point sources that could

potentially be considered in TMDLs or water quality-based permitting (the maximum set) down to a

smaller set of point sources that are likely to be considered in these processes.

In the “within and upstream” case, there are 4,234 impaired water bodies that we identify as

impaired by one or more of the five pollutant classes that we analyze (BOD, nutrients, metals, toxic

organics, and ammonia) and that have one or more point source dischargers within a relevant distance

upstream that presumably discharge the impairment pollutant.26 The following exhibit shows what States

report as the sources of impairment for these water bodies, and also shows, in the final column, our

judgment as to whether point sources affecting these water bodies are likely to be addressed in TMDLs or

water quality-based permitting.

In essence, we assume that a State will consider requiring further controls for relevant point

sources via TMDLs when dealing with water bodies that States say are impaired by point sources, and a

State will not consider requiring further controls for point sources when dealing with water bodies that are

not impaired by point sources. This assumption is supported by findings among our “groundtruthing”

sample of actual TMDLs (see Appendix A). For a final category of waters – those for which States have

not reported information about the types of sources that are responsible for impairment – we will

extrapolate information derived from the waters for which States have reported information on sources of

impairment.

Our procedure for using the information from States on the source types responsible for

impairment is described fully in Appendix G. In essence, we assume that a State will not require further

controls for point sources if the water body is cited by the State as impaired by source types other than

point sources. This assumption has the effect of reducing estimated point source costs by roughly 35 %

(varying slightly across Scenarios and cases) relative to the costs that would be incurred if further controls

were to be required of all point sources discharging the impairment pollutant within a relevant distance of

any impaired water.

At this point, costs for Scenario 1 (“Least Flexible TMDL Program”) are estimated. The major

assumptions in estimating costs for Scenario 1 are summarized in Exhibit II-3.
II - 14

Exhibit II - 3

Assumptions in Estimating Costs for Scenario 1 – Least Flexible TMDL Program

1. Under a least flexible TMDL program, States would write water quality-based permits for every point sources identified

as discharging an impairment pollutant into (“Within only” case) or into or near upstream of (“Within and upstream case”) an

impaired water body, except:

- This applies only to water bodies cited as impaired in part by point sources. WQBELs will not be developed

for point sources affecting impaired waters cited as not impaired by point sources.

2. The WQBEL will require each such point source to implement an appropriate “next treatment step” beyond whatever

controls the source now has in place, except:

- We assume that POTWs already providing better-than-secondary treatment will not be required to implement

the “next treatment step”;

- The costs for POTW upgrades that were sufficiently far along in planning as of 1996 to be included in the

1996 CWNS are counted as part of the baseline and should not be attributed to Scenario 1.

- We lack information on treatment in place at industrial dischargers, and assume that the cost of the “next

treatment step” for an industrial discharger is the same whether treatment in place is just sufficient to meet

technology-based standards, or exceeds this minimum.

3. The sum of the “next treatment steps” that get implemented consistent with these assumptions is sufficient to abate the

point source contributions to impairment of all waters that are impaired at least in part by point sources.

Exhibit II-2

Sources of Impairment Reported for Water Bodies That Have Point Sources Within/Upstream That

Presumably Discharge the Impairment Pollutant

Sources of Impairment Reported by

States

Number of Water Bodies

(Within and Upstream Case)

For These Water Bodies, are TMDLs or Water

Quality-Based Permits Likely to Address Point

Sources?

 PS only 141 Yes

No

No

Unclear – scale to these waters

Unclear – scale to these waters

Yes

Yes

Yes

Yes

Yes

Yes

No

No

No

No

Yes

 NPS only 829

 other only 71

 unknown only 110

 not reported 1,727

 PS + NPS only 368

 PS + NPS + other only 339

 PS + NPS + unknown only 15

 PS + other only 53

 PS + unknown only 6

 PS + other + unknown only 5

 NPS + other only 425

 NPS + unknown only 48

 NPS + other + unknown only 35

 other + unknown only 25

 PS + NPS + other + unknown 37

Total 4,234
27 The sample of 15 actual TMDLs is used to inform and test the assumptions applied in this analysis. The

sample will be expanded and our assumptions will be revised accordingly for the final version of this

analysis.

28 Perhaps only half of all the contributing point sources would need to implement the “next treatment step”,

perhaps all the contributing point sources would need to implement something substantially less than the

“next treatment step”, or perhaps the outcome would be somewhere in between. In any case, the costs for

point source dischargers to achieve a 10 - 40 % aggregate load reduction would be roughly half of the

II - 15

Using these major assumptions, we estimate the costs to point sources under the “Least Flexible

TMDL Program” scenario to be:

Exhibit II - 4

Estimated Costs for Point Sources -- Least Flexible TMDL Program

Type of Source

Annual Costs

(2000 $ in millions) Number of Affected Facilities

Low Est. High Est. Low Est. High Est.

Industrial dischargers 676 1,465 3052 8557

Indirect dischargers (metals) 10 16 at 148 POTWs at 312 POTWs

POTWs 396 697 1094 3335

Total 1,082 2,178 4,146 11,893

H. COSTS FOR SCENARIO 2 (Moderately Cost-effective TMDL PROGRAM)

In Scenario 1 (“Least Flexible TMDL Program”), we assume that States will require load

reductions for every point source identified as contributing to impairment of a 303(d) water body. In

estimating the costs of Scenario 2 (“Moderately Cost-effective TMDL Program”), the costs estimated for

Scenario 1 are scaled down to reflect the load reductions typically required of point sources in actual

TMDLs relative to the load reductions simulated in Scenario 1. Based on a sample of 15 recent TMDLs

(see Appendix A),27 we project that:

 About half of all TMDLs will require an aggregate load reduction from point sources

approximately equal to the load reduction that would be obtained if all contributing point sources

were to implement the “next treatment step” (roughly 50 - 85 %).

 The remaining half of all TMDLs will require an aggregate load reduction from point sources

(roughly 10 - 40 %) that is only about half as much as the load reduction that would be obtained if

all contributing point sources were to implement the “next treatment step” (roughly 50 - 85 %). In

these TMDLs, the cost for point source dischargers to achieve their aggregate load reduction might

be only about half of that if all contributing point sources were to have to implement the “next

treatment step”.28
costs to achieve a 50 - 85 % aggregate load reduction.

29 Note again that we have not defined the “Least Flexible TMDL Program” scenario or the “Moderately

Cost-effective TMDL Program” scenario to involve the worst case for point sources in which States pursue

point sources for load reductions in an attempt to eliminate impairments in waters that are affected

primarily or entirely by nonpoint sources.

II - 16

Exhibit II - 4

Major Assumptions in Estimating Costs for Scenario 2 – Moderately Cost-effective TMDL Program

1. A State will develop a TMDL for an impaired water in a careful, holistic manner. The State will determine the maximum

pollutant load the water body can tolerate while meeting water quality standards (with a margin of safety), and will then

allocate this allowable load among the sources contributing the pollutant. The totaled allowable loads assigned to all

sources will be less than but close to the maximum that the water body can tolerate. In contrast, the water quality-based

permitting approach will address each point source in isolation, and States will often require load reductions that in total

overshoot the aggregate load reduction needed to meet standards.

2. Costs for the WQBEL approach (Scenario 1) are estimated based on the assumption that the State will require all point

sources that contribute to impairment to implement an appropriate “next treatment step” (subject to the assumptions

previously noted regarding waters impaired by nonpoint sources rather than point sources, POTWs that already provide

better-than-secondary treatment, etc.).

3. For about half of all TMDLs involving point sources, the aggregate load reduction required of point sources will be

approximately equal to the load reduction that would be obtained if all contributing point sources were to implement the

“next treatment step”. For the remaining half of the TMDLs involving point sources, the aggregate load reduction required of

point sources will be approximately half of the load reduction that would be obtained if all point sources implemented the

“next treatment step”.

- Costs of Scenario 2 for point sources are thus estimated at 3/4 the costs of Scenario 1.

This information suggests that total national costs for point sources if TMDLs are developed would be only

about 3/4 as much as their costs would be if States proceeded to develop water quality-based permits for all

point sources without making more careful TMDL calculations. For about half of the waters where point

sources contribute to impairment, the holistic assessment conducted during a TMDL will likely determine

that the aggregate load reduction needed from point sources is much less than the reduction that would be

obtained if each point source were addressed individually through water quality-based permitting. For

point sources, we estimate the costs under the “Moderately Cost-effective TMDL Program” scenario to be

3/4 of the costs that would prevail under the “Least Flexible TMDL Program” scenario.29 The major

assumptions in estimating costs for the Moderately Cost-effective TMDL Program scenario are

summarized in Exhibit II-4.

Using these major assumptions, we estimate the costs to point sources under the “Moderately Costeffective TMDL Program” scenario to be:
II - 17

Exhibit II - 5

Estimated Costs for Point Sources Under the Moderately Cost-effective TMDL Program

Type of Source

Annual Costs

(2000 $ in millions) Number of Affected Facilities

Low Est. High Est. Low Est. High Est.

Industrial dischargers 507 1,099 2289 6418

Indirect dischargers (metals) 8 12 at 111

POTWs at 234 POTWs

POTWs 297 523 821 2502

Total 812 1,634 3,110 8,919

I. SAVINGS WITH “COST-EFFECTIVE WASTE LOAD ALLOCATIONS”

Neither the Clean Water Act nor EPA’s implementing regulations prescribe how a total maximum

daily load is to be allocated among the sources that discharge the impairment pollutant. The State may

assign responsibilities among sources for load reductions as the State wishes. Different allocations will

result in different total costs of achieving the desired total load reduction, as a function of the differing

costs per pound for the various pollutant sources to reduce their loads. In general, the total costs of

achieving the target load reduction will be lower if the sources with lower per unit control costs are

assigned responsibility for achieving the bulk of the desired total load reduction. We use the term “costeffective wasteload allocation” to denote a situation in which the State attempts to minimize aggregate costs

by assigning responsibility for achieving most of the total desired load reduction to sources that have

relatively low costs of achieving load reductions. Alternatively, the same economically efficient result

(achieving a desired total load reduction in the least-cost manner) can be achieved, in theory, given any

initial allocation of control responsibilities, if “trading” is allowed. With trading, any source that is

assigned responsibility for a load reduction is free to achieve that load reduction itself, or to buy the

equivalent load reduction from another source that might be able to provide it at lesser cost. Whatever the

initial allocation, trading will tend ultimately to elicit load reductions from the lowest cost sources.

The “More Cost-Effective TMDL Program” scenario recognizes the possibility of reducing TMDL

costs to dischargers through either additional “cost-effective wasteload allocations” or through trading, or

both. Either of these approaches would reduce the eventual costs to dischargers well below what they

would be if TMDLs assigned load reductions on a cost-neutral basis (e.g., if sources were assigned load

reductions that required each of them to implement the “next treatment step”; or if load reductions were

assigned on a simple proportional rollback basis). We expect that pressure to adopt cost-minimizing

approaches will build as the TMDL program grows in the future, and more TMDLs will tend toward this

“more cost-effective” model. Note, though, that there may be some instances where other concerns (e.g.,

equity, concern about implementation and enforcement complexities attendant to trading) prevent use of

these cost-minimizing approaches.
30 See: Environomics, Inc. A Summary of U.S. Effluent Trading and Offset Projects. November, 1999. 

www.epa.gov/owow/watershed/trading.

31 Ibid.

II - 18

Many factors account for differences across sources in costs to abate additional pounds of a

pollutant:

 General differences between point sources and nonpoint sources in their typical costs of

controlling pollutants. In many cases, nonpoint sources have been found able to abate

additional pounds of nutrients, BOD and sediment at much lower costs than can point

sources.30

 Idiosyncratic differences between dischargers that reflect differing pollution abatement

options available to different dischargers. These differences may have some component

that reflects systematic differences across industries (e.g., metal finishers are likely able to

abate metal discharges at lower cost per pound than food processors, while food

processors are likely able to abate BOD dischargers at lower cost per pound than metal

finishers). However, there are also very often substantial additional differences across

dischargers in cost per pound of control that are essentially unpredictable.

 Systematic differences between pollutant sources involving economies of scale (e.g., other

things being equal, a large AFO will be able to abate additional nutrient loadings at lower

cost per pound than a small AFO) and increasing marginal costs of control (e.g., other

things being equal, a POTW currently providing secondary treatment will likely be able to

abate additional nutrient loadings at lower cost per pound than a POTW providing tertiary

treatment).

Such differences in per pound abatement costs provide opportunities for many sorts of costeffective waste load allocations: in allocations among several point sources, in allocations between point

and nonpoint sources, in allocations among several nonpoint sources, in allocations (developed by a

POTW) among several indirect dischargers, etc.. Or, restating this in terms of trading, there are many

ways that trading may save money: point/point trading, point/nonpoint trading, nonpoint/nonpoint trading,

pretreatment trading, etc.. Because so many of these trading or cost-effective waste load allocation

opportunities are idiosyncratic and not predictable, we are unable to simulate them in this analysis. In this

analysis, we have been able to simulate savings only from cost-effective waste load allocations in which

additional control of nonpoint sources is substituted for additional control of point sources (e.g.,

point/nonpoint trading). This form of trading is the most common form that has occurred to date in the

water program.31 However, experience in other programs suggests that other forms of trading may also

yield important cost savings (e.g., air program trading among point sources involving SOx, NOx, VOCs,

greenhouse gases, etc.). Ultimately, the savings achievable in restoring impaired waters via cost-effective

waste load allocations are likely to be much greater than those we can estimate here.

The cost-effective waste load allocation activity that we simulate here as representative of Scenario

3 involves shifting some responsibilities for additional control responsibilities from point sources to

nonpoint sources. This shift of some responsibilities from point sources to nonpoint sources may occur
32 Ibid.

II - 19

before the waste load allocation (WLA) is developed under the TMDL (e.g., the State considers the relative

cost-effectiveness of controlling point and nonpoint sources and then allocates loads among the source

types in a manner that reflects this and minimizes total compliance costs) or after the WLA is developed

(e.g., the WLA is established and then point and nonpoint sources are allowed to trade -- typically a point

source substitutes a lower cost reduction that it achieves by controlling nonpoint sources or by paying

nonpoint sources to control for some of the load reduction that the point source is required to accomplish).

We believe the most likely circumstances in which there will be cost-effective opportunities for

control of nonpoint sources to substitute for further control of point sources are as follows:

 For water bodies that are impaired by both point and nonpoint sources. Obviously both

sorts of sources must contribute meaningful amounts of the impairment pollutant if there is

to be any opportunity for control of one to substitute for control of the other.

 For impairments involving nutrients or BOD. Virtually all of the instances thus far in

which point-nonpoint tradeoffs have occurred involve nutrients or BOD.32 It is rare that a

water body impaired by a toxic pollutant faces significant discharges of the toxic pollutant

by both point and nonpoint sources that can allow for tradeoffs.

 For non-flowing as opposed to flowing water bodies. Impairment of lakes and estuaries

typically results from an accumulated load of a pollutant from an entire watershed over a

substantial period of time (ranging from a season to many years). In these circumstances,

loads from different locations in the watershed and loads that occur at different times can

relatively safely be traded off against each other -- a pound of the pollutant has a roughly

similar impact largely independent of whether it comes from a point or nonpoint source

and where and when it is discharged. In contrast, impairment of a flowing water body is

often more localized (e.g., a particular river reach rather than an entire lake) and more

episodic (e.g., the impairment occurs at particular times, such as during wet weather or

during low flow conditions). In flowing waters, discharges of the same pollutant by

various point and nonpoint sources often have differing impacts depending on the location,

time, and nature of the discharge. It is much more difficult to implement an

environmentally protective trading program under such circumstances.

We evaluated all the point sources affecting impaired waters with respect to these considerations,

and assigned the point sources (and the costs we estimated they would incur under Scenario 2, the

Moderately Cost-effective TMDL Program) to one of three groups reflecting their suitability for costeffective waste load allocations involving point/nonpoint tradeoffs:

 Group 1. Point sources highly suited to cost-effective WLAs/trading. These point

sources discharge BOD and/or nutrients to non-flowing waters that are impaired for these

pollutants by both point and nonpoint sources. We estimate that this group comprises 9 %

(upstream and within case) or 17 % (within only case) of all point sources that affect

impaired waters. The potentially tradeable costs for these point sources amount to 8 %
33 Note that the percentage of point sources apparently suited to participating in cost-effective WLAs (in

either Group 1 or Group 2) is substantially greater than the percentage of costs that are amenable to costeffective WLAs. This is because we have assumed that metals, toxic organics and ammonia are not

amenable to cost-effective WLAs, and costs for any “next treatment step” controls needed to abate these

pollutant classes are “off the table”. Many point sources may be able to participate in cost-effective WLAs

for BOD or nutrients (“tradeable” pollutants) while nevertheless incurring some control costs (for non-

“tradeable” pollutants) that are not eligible for cost-effective WLAs.

34 It is important to note that many point sources affect multiple impaired waters, particularly in the

upstream and within case, in which a point source’s influence is presumed to be felt far downstream. 

Considering only non-metal pollutants (in our view, metals require wholly different treatment

technologies than non-metals and have no impact on suitability or non-suitability for a point source to

participate in a more cost-effective WLA), 44 % of the point sources contribute to impairment of multiple

water bodies in the upstream and within case, and 12 % of the point sources do so in the within only case.

II - 20

(upstream and within case) or 10 % (within only case) of the total costs that we estimate

point sources will incur under the Moderately Cost-effective TMDL Program (Scenario 2).

 Group 2. Point sources moderately suited to cost-effective WLAs/trading. These point

sources discharge BOD and/or nutrients to flowing waters that are impaired for these

pollutants by both point and nonpoint sources. We estimate that this group comprises 29

% (upstream and within case) or 47 % (within-only case) of all point sources that affect

impaired waters. The potentially tradeable costs for these point sources amount to 21 %

(upstream and within case) or 27 % (within only case) of the total costs that we estimate

point sources will incur under the Moderately Cost-effective TMDL Program (Scenario

2).33

 Group 3. Point sources not suited to cost-effective WLAs/trading. These point sources

fail one or more of the conditions that we presume necessary for cost-effective

WLAs/trading. We estimate that this group comprises 62 % (upstream and within case) or

36 % (within only case) of all point sources that affect impaired waters. Non-tradeable

costs for the point sources in this and the other groups amount to 71 % (upstream and

within case) or 63 % (within only case) of the total costs that we estimate point sources

will incur under the Moderately Cost-effective TMDL Program (Scenario 2).

Note that we have assigned point sources and costs to these three groups in a conservative manner:

 A point source is assumed to be able to save money from participating in a more costeffective WLA only if all the impaired water bodies that the point source affects are

amenable to more cost-effective WLAs. Thus, if as few as one impaired water body

affected by a point source is not amenable to cost-effective WLA (i.e., if at least one water

body does not have both point and nonpoint sources discharging the impairment pollutant),

the source will be precluded by that water body from avoiding the next treatment step.34

 Even though a point source might seem able to avoid the cost of a “next treatment step” by

participating in a more cost-effective WLA for nutrients or BOD, the point source will not

be able to do so if it nevertheless is presumed to need the next treatment step to abate
II - 21

either toxic organics (advanced secondary treatment, the same upgrade as is needed for

BOD) or ammonia (secondary treatment with nutrient removal, the same upgrade as is

needed for nutrients). In effect, the presumed need to abate toxic organic loads precludes

participating in a cost-effective WLA for BOD, while the need to abate ammonia precludes

participating for nutrients.

 Any point source that affects multiple impaired waters and appears able to participate in a

cost-effective WLA for each of them is assigned to Group 2 rather than Group 1 if as few

as one of the impaired waters is non-flowing.

In estimating the potential savings to point sources from participating in more cost-effective WLAs

(Scenario 3), we assume that: 1) All of the Group 1 (highly suited) point sources will participate; 2) Half of

the Group 2 (moderately suited) point sources will participate; and 3) None of the Group 3 (unsuited) point

sources will participate. We have no empirical basis for this particular assumption regarding participation

rates. We are confident only that very few of the Group 3 sources will be able to participate in

point/nonpoint sorts of cost-effective WLAs, while participation should be substantially higher in Group 2

and substantially higher again in Group 1. Different assumptions may be substituted for the participation

rates we assume, and the effects will be proportional (if half of Group 1 sources were assumed to

participate rather than all of them, the savings for them would be half as much).

With these assumptions, we can estimate the cost savings for point sources that could result from

more cost-effective WLAs that shift some control responsibilities to nonpoint sources.

How much might it cost for nonpoint sources to control the quantity of pollutants that are no longer

to be controlled by point sources? The answer is highly uncertain. In Appendix H we summarize the

results from nine instances in which the costs for nonpoint source controls have been compared with the

costs for point source controls. The nine cases involve TMDLs or water quality standard attainment

studies that are very similar to the situations for which we are postulating more cost-effective WLAs --

instances in which nonpoint source controls for nutrients or BOD are being considered as alternatives to

additional treatment efforts at point sources (typically advanced treatment at POTWs). The results of

shifting control responsibilities from point to nonpoint sources are quite variable, ranging from more than

90 % savings in one case to an increase in cost in another case. The median figure across the seven

instances where percentage cost comparisons have been quantified is a 75 % savings for nonpoint source

controls relative to point source controls. On this basis, we will assume for our analysis that nonpoint

sources can provide additional control of nutrients and BOD at a cost per pound equal to 25 % of that for

additional point source controls. The additional nonpoint source controls that are needed to offset the

increased point source loads allowed in a more cost-effective WLA will cost 25 % as much as the savings

in point source costs.

Based on these assumptions, Exhibit II - 6 shows the estimated costs for Scenario 3, the “More

Cost-Effective TMDL Program”.
II - 22

TMDL Program Cost-Effective TMDL Program

# of PS Costs % of PS % of Costs % Participating # PS Participating PS Cost Savings Add'l NPS Cost 

Upstream and within case Highly suited to cost-effective WLAs 8.81 8.46 100 786 $138 $35  Moderately suited to cost-effective WLAs 28.72 21.40 50 1281 $175 $44 

 Not suited to cost-effective WLAs 62.47 70.14 0 0 $0 $0 

 Total 8919 $1,634 2067 $313 $78 Within only case Highly suited to cost-effective WLAs 16.79 9.50 100 522 $77 $19  Moderately suited to cost-effective WLAs 46.89 26.98 50 729 $110 $27  Not suited to cost-effective WLAs 36.32 63.52 0 0 $0 $0  Total 3110 $812 1251 $187 $47 

Exhibit II - 6

Estimated Costs for More Cost-Effective TMDL Program (Scenario 3) ($ in millions)
II - 23

Exhibit II - 7

Major Assumptions in Estimating Costs for Scenario 3 – More Cost-Effective TMDL Program

1. The estimates address potential savings from shifting control responsibilities from point to nonpoint sources. Savings

have not been estimated for other sorts of reallocations.

2. Cost-effective WLA opportunities will focus on non-flowing waters impaired by nutrients or BOD from both point and

nonpoint sources. Lesser opportunities will be available for similarly impaired flowing waters.

3. The following percentages of point sources are assumed to participate in more cost-effective WLAs: 100 % of highly

suited point sources, 50 % of moderately suited point sources, and no unsuited point sources.

4. The cost per pound for nonpoint sources to abate nutrient or BOD loads is about 1/4 of that for point sources.

The gross savings to point sources from more cost-effective WLAs are estimated at $187 - 313

million/yr, constituting 19 - 22 % of point source costs under the Moderately Cost-effective TMDL

Program (Scenario 2). 23 - 40 % of all point sources contributing to impairments are likely to participate

in the more cost-effective WLAs. The net savings from more cost-effective WLAs are estimated at $140 -

235 million/yr (savings to point sources partly offset by increased costs of nonpoint source controls). 

These savings are estimated only for cost-effective WLAs involving shifting control responsibilities from

point to nonpoint sources. Further savings are possible from other sorts of reallocations, but these have not

been estimated.

A more detailed description of some of our assumptions and procedures in simulating more costeffective WLAs is provided in Appendix H.

J. SUMMARY COST ESTIMATES FOR POINT SOURCES

For Scenario 1 (Least Flexible TMDL Program), costs are estimated for the next treatment step for

each point source identified as discharging the impairment pollutant into or within a relevant distance

upstream of each point source-impaired water body. Costs are then summed across pollutant sources. We

assume that a pollutant source affecting multiple impaired water bodies that are impaired for the same

pollutant will need to implement the next treatment step only once -- we assume that the next treatment step

will suffice to achieve this pollutant source’s desired load reductions whether the pollutant source

contributes to impairment of one or many water bodies.

The raw cost estimates calculated in this manner are then scaled to reflect two factors:

 Incomplete coverage in the analysis. The analysis is incomplete, in that it does not cover

all impaired water bodies (some are not georeferenced with respect to Reach File 3

reaches) and all point sources (some point sources also have not been georeferenced), and

the geographic procedure for matching water bodies against point sources is not operable

in several States. As described in section I.C.3, the scaling factor to account for

incomplete coverage in the point source analysis is 1.605.

 The time at which pollutant sources will begin incurring implementation costs. Costs are

estimated initially as the annualized amounts that pollutant sources will pay once their
35 There are an estimated 36,225 TMDLs to be developed for the 1998 303(d) waters. The mid-point in the

projected schedule over which these TMDLs will be developed will occur in 2008 -- half of the TMDLs

will be developed before then, half afterwards (see Exhibit I-2). A point source required to implement

further controls by a TMDL developed in 2008 is assumed to begin incurring costs five years later, in

2013. 

II - 24

implementation costs begin. In order to focus any comparison across Scenarios on

technical differences rather than timing issues, we assume that pollutant sources will incur

implementation costs at the same time under each of the three Scenarios. We assume that

implementation costs for a source will not to begin until five years after the TMDL is

developed that requires further controls for the source. We assume that TMDLs will be

developed at an even pace over the years from now through 2015, the deadline for

completing TMDLs for the 1998 303(d) list. As a result, the median source is not

expected to begin incurring its implementation costs until 2013.35 As described in section

I.C.5, the scaling factor to reflect the assumed pace of TMDL development and

compliance lag time is 0.4484.

Combining these two scaling factors, the raw implementation costs estimated for point sources

from the cost equations are multiplied by 0.7197 (1.605 x 0.4484) to develop national estimates of

annualized costs beginning in the year 2000.

Cost estimates for Scenario 2 (Moderately Cost-effective TMDL Program) are developed by

adjusting downward the costs estimated for Scenario 1, assuming that TMDLs will result in a more precise

calculation of how much load reduction is needed from point sources in order to meet water quality

standards. More specifically, the costs estimated for Scenario 2 reflect the degree of aggregate load

reduction that actual TMDLs have required of point sources, relative to the load reduction that would be

achieved if all point sources were to implement the “next treatment step” as in Scenario 1.

Cost estimates for Scenario 3 (More Cost-Effective TMDL Program) are developed by applying to

the cost estimates for Scenario 2: a) projections regarding how many point sources will participate in more

cost-effective WLAs; and b) an estimate for the percentage cost savings when nonpoint source controls for

nutrients and BOD are substituted for point source controls.

The resulting estimated annual costs for point source pollutant sources under each of the three

scenarios are as follows:
II - 25

Exhibit II - 8

Point Source Costs Under Scenario 1: Least Flexible TMDL Program

Annualized Costs by Type of Discharger

Within and Upstream Case

SIUs - Metals

Treatment 

POTWs (nonMetals)Industrial

Dischargers Total – All Sources

# Facilities at 312 POTWs 3,335 8,557 11,893

Total Cost/yr $16,493,652 $696,968,954 $1,464,694,468 $2,178,157,075

Average Cost/Facility/yr $52,864 $208,986 $171,169 $183,146

Within Only Case

SIUs - Metals

Treatment 

POTWs (nonMetals)Industrial

Dischargers Total – All Sources

# Facilities 148 POTWs 1,094 3,052 4,146

Total Cost/yr $10,120,959 $395,814,376 $676,345,333 $1,082,280,668

Average Cost/Facility/yr $68,385 $361,805 $221,607 $261,042

Exhibit II - 9

Point Source Costs Under Scenario 1: Least Flexible TMDL Program

Annualized Costs by Type of Discharger

Within and Upstream Case

Metals

All Other

Pollutants

Total - All

Pollutants

# Facilities 4,688 9,865 11,893

Total Cost/yr $209,419,393 $1,968,737,682 $2,178,157,075

Average Cost/Facility/yr $44,671 $199,568 $183,146

Within Only Case

Metals

All Other

Pollutants

Total - All

Pollutants

# Facilities 1,707 3,289 4,146

Total Cost/yr $93,827,202 $988,453,467 $1,082,280,668

Average Cost/Facility/yr $54,966 $300,533 $261,042
II - 26

Exhibit II - 10

Point Source Costs Under Scenario 2: Moderately Cost-effective TMDL Program

Annualized Costs by Type of Discharger

Within and Upstream Case

SIUs - Metals

Treatment 

POTWs (nonMetals)Industrial

Dischargers Total – All Sources

# Facilities at 234 POTWs 2,502 6,418 8,919

Total Cost/yr $12,370,239 $522,726,716 $1,098,520,851 $1,633,617,806

Average Cost/Facility/yr $52,864 $208,924 $171,162 $183,162

Within Only Case

SIUs - Metals

Treatment 

POTWs (nonMetals)Industrial

Dischargers Total – All Sources

# Facilities 111 POTWs 821 2,289 3,110

Total Cost/yr $7,590,719 $296,860,782 $507,259,000 $811,710,501

Average Cost/Facility/yr $68,385 $361,584 $221,607 $261,000

Exhibit II - 11

Point Source Costs Under Scenario 2: Moderately Cost-effective TMDL Program

Annualized Costs by Type of Discharger

Within and Upstream Case

Metals

All Other

Pollutants

Total - All

Pollutants

# Facilities 3,516 7,398 8,919

Total Cost/yr $157,064,544 $1,476,553,261 $1,633,617,806

Average Cost/Facility/yr $44,671 $199,588 $183,162

Within Only Case

Metals

All Other

Pollutants

Total - All

Pollutants

# Facilities 1,280 2,467 3,110

Total Cost/yr $70,370,401 $741,340,100 $811,710,501

Average Cost/Facility/yr $54,977 $300,503 $261,000

We project that total costs for point sources under the Moderately Cost-effective TMDL Program

(Scenario 2) will be 25 % lower than they would be with the Least Flexible TMDL program (Scenario 1). 

Although we show in the exhibits a similar 25 % reduction in the number of point sources affected under

the Moderately Cost-effective TMDL Program compared with the Least Flexible TMDL Program, we do

not intend this to be a conclusion of the analysis. The Moderately Cost-effective TMDL Program will

require 25 % less aggregate load reduction from point sources than will be required under the Least
II - 27

Flexible TMDL Program. This lesser load reduction can be accomplished by: 1) Requiring the same

load reduction per source but requiring such load reductions from 25 % fewer sources (as we show);

2) Requiring a 25 % lower load reduction per source, but requiring these load reductions from all sources;

or 3) Any combination of load reduction per source and number of sources addressed that results in 25 %

less aggregate load reduction.

Costs for point sources under the More Cost-Effective TMDL program will be an estimated 19 -23

% lower than the costs under the Moderately Cost-effective TMDL Program.

Exhibit II-12

Projected Savings to Point Sources from Cost-Effective WLAs ($ in millions/yr)

Moderately Cost-effective More Cost-Effective TMDL Program

Costs # PS w/ costs Costs Savings #PS w/savings

Into + upstream $1,634 8919 $1,321 $313 2067

 case

% relative to TMDL

program:

19.2% 23.2%

Into only case $812 3110 $625 $187 1251

% relative to TMDL

program:

23.0% 40.2%

Finally, Exhibit II - 13 shows the costs for point sources estimated under each of the three

scenarios.

Exhibit II-13

Costs for Point Sources Under All Three TMDL Program Scenarios ($ in millions/yr)

Least Flexible TMDL

Program

Moderately Cost-effective

TMDL Program

More Cost-Effective TMDL Program

$2,178 $1,634 $1,321

 Into + upstream case

25 % savings 39 % savings

$1,082 $812 $625

Into only case

25 % savings 42 % savings

Relative to the “Least Flexible TMDL Program” scenario, having the Moderately Cost-effective

TMDL Program will save point source dischargers an estimated 25 %. A more cost-effective TMDL

program could save 39 - 42 %.
III - 1

III. IMPLEMENTATION COSTS FOR NONPOINT SOURCES

The implementation costs that nonpoint sources might incur under the three TMDL program

scenarios are estimated for the following nonpoint source types:

 Agricultural land, including crop land, pasture land, and range land;

 Animal feeding operations (AFOs);

 Silviculture; and 

 On-site wastewater treatment systems (including septic systems, cesspools, etc.)

Our approach for estimating implementation costs for these nonpoint sources is similar to our

approach for point sources. For each 303(d) water impaired by one of these nonpoint source types, we

identify the volume of nonpoint source activity contributing to the impairment, assume that some fraction

(depending on the scenario) of this nonpoint source activity will need to implement the “next treatment

step”, and then estimate the costs associated with this amount of “next treatment step” controls. The Least

Flexible TMDL Program scenario and the Moderately Cost-effective TMDL Program scenario are

differentiated based on the degree to which actual TMDLs have required load reductions from nonpoint

sources relative to the load reductions that we simulate for the Least Flexible TMDL program scenario. 

The Cost-Effective TMDL Program scenario adds the additional costs for nonpoint source controls that we

estimated in the previous chapter as some point source control responsibilities are assumed shifted to

nonpoint sources.

A. COVERAGE OF THE NONPOINT SOURCE ANALYSIS

There are many other nonpoint source types that contribute to impairment of 303(d) waters for

which we were not able to estimate implementation costs, such as:

 abandoned mines,

 contaminated in-stream sediments,

 air deposition,

 natural sources,

 land disposal,

 many leaks and spills,

 hydrological modification,

 habitat alteration,

 dispersed petroleum and other resource extraction activities; and

 CSOs, SSOs and storm water (urban, construction, industrial) to the extent they are not

addressed by existing technology-based requirements.

The nonpoint source categories that we do cover likely comprise the bulk of nonpoint source

pollutant loadings to impaired waters in total, but there remain many waters that are impaired only by one

or more of these omitted categories for which we do not estimate costs. For each of the omitted nonpoint

source categories, at least one of the data sets required for estimating costs is not available:
36 The totals shown should not be interpreted as the total extent of impaired waters in the nation. Only about

half of the States report source information for their 303(d) lists. This causes the totals shown in the

exhibit to fall far short of the national total. On the other hand, for many impaired waters States cite

multiple sources of impairment, and this will tend to make the figures in the exhibit exceed the national

total. It is only by chance that the total river miles shown in the exhibit is close to the roughly 300,000

mile aggregate length of all impaired river segments on the 1998 303(d) lists.

III - 2

 Information on the volume and location of the nonpoint source activity, at sufficiently fine

geographic resolution so that the amount of the nonpoint source activity contributing to

impairment of a specific water body can be identified; and

 Information on the level of water pollution-abating practices that are currently applied by

the nonpoint source activity, and on unit costs for the “next treatment step” for the activity.

The following exhibit suggests the relative importance of the source types we cover in the

implementation cost analysis and those we omit.

Exhibit III-1

Coverage of Different Source Types in Implementation Cost Analysis

Source 303(d)

River Miles

303(d) Lake

Acres

(thousands)

Now Covered

in Cost

Analysis

Pollution,

not

Pollutants

Will be

Mitigated by

Tech-Based

Standards

Omitted

Agriculture 108,284 2,548 X

Hydromodification/Habitat Alteration 48,319 1,879 X

Nonpoint Source (No Further 

Information) 30,223 1269 scaled to

Municipal Point Sources 23,136 930 X

Resource Extraction 22,971 293 X

Other Source 20,821 1,899 X

Urban Runoff/Storm Sewers 18,732 1,908 X

Source Unknown 16,206 992 scaled to

Silviculture 10,350 289 X

Construction 9,805 409 X

Septic Systems 7,009 1,394 X

Industrial Point Sources 6,319 292 X

Combined Sewer Overflow 3,918 436 X

Atmospheric Deposition 1,696 1,080 X

Marinas 378 151 X

Total36 328,168 15,769

Source: Tetra Tech, Inc. analysis of 303(d) data base, with sources of impairment aggregated into these 15 groups.

The exhibit shows the different source types listed by States as responsible for impairment of

303(d) waters and the river miles and lake acres of such impaired waters. Hydromodification and habitat
37 Here are two estimates that suggest the magnitude of the costs that might be involved for control of some

sorts of abandoned mines.

The U.S. Forest Service estimates that there are approximately 38,000 abandoned mines on National

Forest lands, among which perhaps 10,000 pose important water quality problems. The 1,800 sites that have toxic

discharges are being pursued under CERCLA and the point source program. The remaining 8,200 sites do not

involve toxic pollutants, but are thought to cause significant resource damage. It is not known how many of these

sites affect impaired waters specifically. The average cost of addressing these sites is estimated at $150,000 -

$280,000 per site. USFS estimated that it will require $60 - $115 million per year to resolve water quality

problems from these sites by the year 2022. (Note that these cost estimates are not directly comparable with the

levelized annual costs continuing forever that we estimate in this report.) Source: USDA review of EPA’s draft

TMDL cost analyses, June/July, 2001.

EPA’s Draft Nonpoint Source Gap Analysis (Tetra Tech, Inc., February 7, 2001, op cit.) estimates the cost

to reclaim all coal-related abandoned mined lands at $5.7 billion. This estimate includes mines on all lands,

including Federal lands. It excludes costs for non-coal mines, which are thought to be less numerous and costly

than are coal mines. The estimate therefore overlaps to some degree with the USFS estimate. If this $5.7billion

cost were incurred over the period from 2005 through 2020 and then converted into a levelized annual amount

continuing forever, thus making these costs comparable to those estimated in this report, the annual cost would be

$173 million/yr.

It is now known how many of either the USFS sites or the coal-related sites affect 303(d)-listed impaired

waters specifically. For other nonpoint source types that we analyze, the fraction of all nonpoint source activity

that affects 303(d) waters specifically (under the Least Flexible Scenario) ranges from 1% (for on-site wastewater

treatment systems) to 53% (crop land).

III - 3

alteration often involve physical changes to water bodies or their drainage areas without explicit pollutants,

and these sources will often not be addressed by TMDLs. Most impairments due to urban runoff, storm

sewers, construction and CSOs will be mitigated by full compliance with recently adopted technologybased standards for these sources, and implementation costs in these areas can be attributed to the baseline

rather than to the TMDL program. This leaves several important source categories as potentially affected

by the TMDL program but omitted from this implementation cost analysis:

 “Source Unknown” and “Nonpoint Source (No Further Information)” are categories that

we cannot analyze presently because there is insufficient information available as to

exactly what the responsible sources are. Our scaling process described earlier (Section

I.C.3.b), however, extrapolates costs to these waters by scaling from costs estimated for

waters with known nonpoint source types. In effect, TMDL implementation costs are

estimated for waters impaired by such sources.

 “Resource extraction” includes mostly impacts from mining and, to a lesser degree, oil and

gas development. Some mining impacts will be addressed (and have been costed in the

point source analysis) through NPDES permits for mining discharges that involve discrete

conveyances. Most impacts, though, involve abandoned mines or diffuse runoff and

seepage from mined areas generally. Implementation costs will occur for these sources,

but have not been estimated here. These costs could be significant.37
III - 4

 “Other sources” include a wide variety of activities that we did not break out individually,

such as contaminated sediments, land disposal, and natural sources (e.g., salt springs, acid

bogs). Most, if not all, of these sources will be addressed by TMDLs and implementation

costs will often occur. In some cases, the costs to implement appropriate treatment or

remediation will be substantial (e.g., dredging and disposing of contaminated sediments).

 “Atmospheric deposition” is a difficult issue for the TMDL program. Hopefully most

atmospheric deposition problems will be resolved as air pollution control programs

continue to progress (e.g., NESHAPs, NOx and SOx programs, controls on utility

emissions of mercury, etc.). It is unclear how a TMDL developed by a State will be able

to address atmospheric deposition originating from beyond the State’s boundaries. The

first TMDL for atmospheric deposition was recently approved by EPA (for the Savannah

River, GA), and it was projected to add no costs for sources beyond what they will need to

spend to meet existing air regulations.

In sum, the source types completely omitted from the implementation cost analysis (excepting the

unknown and “nonpoint source (no further information)” categories that we scale to) account for about 14

% of the 303(d) river miles and 22 % of the 303(d) lake acres. The important omitted sorts of nonpoint

sources that we would like to include in the analysis if the necessary data were available are: resource

extraction (mining, petroleum activities), land disposal, and perhaps some sorts of contaminated sediments

and natural sources. Developing methods and data for costing these omitted nonpoint source activities

should be high priority in future efforts to improve our estimates of TMDL implementation costs.

B. WATERS IMPAIRED BY AGRICULTURE, AFOS, SILVICULTURE AND ON-SITE

SYSTEMS

When one of these nonpoint source types is cited by a State as a source of impairment for a 303(d)

water, we assume that the State will require or induce this nonpoint source type to implement further

control measures, whether under the moderate and more cost-effective TMDL program scenarios

(Scenarios 2 and 3) or under the least flexible TMDL program (Scenario 1). Our first step in estimating

the implementation costs for these nonpoint sources is to identify the 303(d) waters that are impaired by

each of the nonpoint source types that we cover.

States vary in the degree to which they provide information on the source types responsible for

impairment of impaired waters. Some States do not report source information at all for their 303(d)

waters, some report in modest detail (e.g., using only broad identifiers of source types such as “point

sources”, “nonpoint sources”, “unknown sources”, etc.), and some report in great detail (e.g., using specific

identifiers of source types such as “municipal point sources”, “CSOs”, “silviculture”, “irrigated crop land”,

etc.). Our procedure for identifying water bodies impaired by various nonpoint source categories relies on

detailed source reporting by those States that provide such information, either in their 303(d) submissions

or in their 305(b) submissions. For example, in analyzing silviculture, we:

 Identify the 303(d) water bodies that States report as impaired by silviculture as a source.

 Identify the 305(b) water bodies that States report as impaired by silviculture as a source. 

We then crosswalk from each of these silviculture-impaired 305(b) waters and determine

whether there is a corresponding 303(d) water body. (Some States report 305(b) source
III - 5

information but not 303(d). This second step effectively increases the set of States within

which we can find silviculture-impaired 303(d) waters.)

 Add the results of the first and second steps, thus obtaining a list of silviculture-impaired

303(d) waters. We note the States in which these waters are located. We then regard this

set of States as a sample that we analyze. We assume that this sample is representative of

the nation as a whole.

 States for which we can identify no silviculture-impaired water bodies may either: 

a) Actually have no silviculture-impaired water bodies; or

b) Actually have them, but report source information in a manner that does not allow

for identifying them. 

Conservatively, we assume the latter -- we assume that a State that reports no silvicultureimpaired water bodies is effectively “non-reporting”. We extrapolate the costs we estimate

for controlling silviculture in the sample States (those that report silviculture impairments)

to the assumed non-reporting States by scaling up based on the volume of silviculture

occurring in the sample States relative to that occurring in the non-reporting States. The

scaling factor we use for this extrapolation is the ratio between the total national annual

timber harvest and the harvest volume in our “reporting” States. In this case, 10.91

million cubic feet of timber was harvested in the 30 “reporting” States and 16.35 million

cubic feet was harvested in the nation as a whole. The scaling factor is thus 16.35/10.91,

or 1.499.

We employ this approach for each of the different nonpoint source types we analyze; for crop land,

pasture land, range land, AFOs and on-site wastewater systems as well as for silviculture. Different sets of

States are considered to be “non-reporting” for the different nonpoint source types. For each nonpoint

source type, we use a different volume-based scaling factor to extrapolate our cost estimates from the

“reporting” States to the entire nation. The volume measures that we use in scaling are:

 For silviculture. The annual volume of timber harvested.

 For agriculture. Crop land-related costs are extrapolated based on the acreage of crop

land. Similarly, pasture-related costs and range-related costs are extrapolated based on the

acreage of pasture and range lands.

 For AFOs. The number of confined animal units (AUs).

 For on-site wastewater systems. The number of dwelling units served by on-site

wastewater systems.

The exhibit below shows the States that reported (in either 303(d) or 305(b) reporting) 303(d)

water bodies impaired by each nonpoint source type that we analyze. At the bottom of the exhibit we show

the fraction of the total national volume of activity occurring in the “reporting” States, and the resulting

scaling factor that we apply in extrapolating TMDL implementation costs from the “reporting” States to

the nation as a whole.
III - 6

Exhibit III-2

States Using NPS Categories in Reporting Sources of Impairment

STATE Crop Land Pasture or Range AFOs Silviculture On-Site Wastewater

Alabama X X X X X

Alaska X

Arizona X X X X

Arkansas X X

California X X X X

Colorado

Connecticut X X

Delaware X X

District of Columbia

Florida X

Georgia

Hawaii

Idaho

Illinois X X X X X

Indiana

Iowa X

Kansas X X

Kentucky X X X X X

Louisiana X X X X X

Maine X X X X

Maryland

Massachusetts X X

Michigan X X X X X

Minnesota X

Mississippi X X X X X

Missouri X X

Montana X X X X X

Nebraska X X X

Nevada X

New Hampshire X

New Jersey X

New Mexico X X X X X

New York X X

North Carolina X X X X X

North Dakota X X X X

Ohio X X X X X

Oklahoma X X X X X

Oregon

Pennsylvania X X

Rhode Island X X X

South Carolina X X

South Dakota X X X X X

Tennessee X X X X X

Texas X X X X

Utah

Vermont X X X X X

Virginia X X X X

Washington

West Virginia X X X X X

Wisconsin X X

Wyoming X X

Number of States using this category 23 25 32 30 24

Fraction of total in “reporting” States .64 .59 .70 .65 .67 .58

Scale Factor 1.56 1.69 1.43 1.55 1.499 1.732
38 There are roughly 2200 8-digit watersheds (USGS hydrologic unit codes) in the U.S., 3000 counties, and

XXX 11-digit watersheds.

39 USDA staff, personal communication, June 22, 2001.

III - 7

The exhibit shows that the number of States citing (in either their 303(d) or 305(b) lists) these

nonpoint source types as responsible for impairment of waters ranged from 23 (for crop land) to 32 (for

AFOs). We conservatively assumed that any State not citing one of these nonpoint source types as

responsible for impairments actually had such impairments, but simply did not report sources at all or did

not use an appropriate code in its system of reporting sources of impairments. The States that we classified

as “reporting” accounted for a percentage of the total national volume of activity ranging from 58 % for

on-site wastewater treatment systems land to 70 % for range land.

We noted each water body that was cited by a “reporting” State as impaired by one of the nonpoint

source categories that we address. This set of water bodies impaired by each nonpoint source category was

the starting point for the cost analysis. After estimating the costs that nonpoint sources affecting these

water bodies in “reporting” States would incur, we scaled up these implementation costs to extend the cost

estimate from the “reporting” States to the entire nation.

C. THE AMOUNT OF NONPOINT SOURCE ACTIVITY NEEDING FURTHER CONTROL

FOR AN IMPAIRED WATER BODY

When a State identifies a water body as impaired by a nonpoint source type, we assume in the 

“Least Flexible TMDL Program” scenario that the State will require further control for the entire volume

of that nonpoint source activity that occurs within the county or counties in which the impaired water body

is located. Thus, for example, in addressing an AFO-impaired water body, we assume in this scenario that

the State would require or somehow elicit load reductions from all the AFOs in the county or counties

surrounding the impaired water body.

This assumption is based on the general belief that most nonpoint source management programs

are targeted at a finer geographic level than an entire county. States, USDA and others typically direct

nonpoint source management and assistance efforts at particular watersheds with water quality problems. 

Practices are eligible for cost-share in some watersheds but not others, technical assistance is focused on

some watersheds and not others, etc.. Commonly the watershed is defined at the scale of roughly an 11-

digit catalog unit (substantially smaller than a county), but sometimes the watershed is defined at a more

gross scale approximating an 8-digit catalog unit (approximately similar in size to a county).38 In

reviewing a draft of this report, USDA staff believed that the “entire county” assumption represented a

substantial overestimate of what typically occurs in practice: “While technically feasible, it is highly

unlikely that Section 319 efforts will cover 100 percent of the county. This is not the level of activity being

observed..”39

We believe the “entire county” assumption underlying the “Least Flexible TMDL Program”

scenario represents for most impaired water bodies a substantial overestimate of the volume of nonpoint

source activity that will actually be addressed in a TMDL as needing further controls. Most of the

identified nonpoint source-impaired water bodies are relatively small (typical length of the impaired river

segments is 5 to 25 miles). For most impaired water bodies, the upstream watershed from which the

impairment pollutants derive is much smaller than the size of the entire county or counties within which the

water body is located. The assumption that the typical TMDL will seek nonpoint source load reductions
40 It is currently possible to locate the boundaries of the 8-digit watershed within which each impaired water

is located, but for most impaired waters this will include very large amounts of land that drain into waters

downstream of the impaired water itself, and which thus will not be implicated in the TMDL for the

impaired water. At present, it is not possible to locate the 11-digit watershed within which each impaired

water is located. This level of detail will be necessary before watershed areas corresponding closely to

impaired waters can be identified on a nationwide basis using a GIS.

41 As noted previously, we are expanding this sample of completed TMDLs that we analyze, and we will

reflect the results from the expanded sample in the final report.

42 We seek comment on this approach. Although a range established by the 25th and 75th percentiles would

seem to encompass the typical TMDL, our sample of 15 TMDLs includes an outlier on the high end. The

TMDL for the Neuse River Estuary will require nonpoint source controls from a very large watershed

encompassing most of 19 counties. (This TMDL will actually address another impaired water body

within the watershed, so this TMDL seeks nonpoint source controls from nearly 9.5 counties per impaired

water body.) This large geographic area for this one TMDL skews the distribution such that the mean

(not median) area addressed per impaired water body across our sample is nearly 86 % of a county. For

this sample of TMDLs, the mean area addressed (86 % of a county) is substantially greater than the

median and greater than even the 75th percentile. This sort of pattern that we see in this sample of 15

TMDLs may be typical for all TMDLs. We believe it likely that the great majority of impaired waters

III - 8

from an area as large as the entire county or counties surrounding the impaired water seems likely to

generate something close to a worst case.

Ideally we might like to delineate the watershed boundaries for each impaired water body and

determine what volume of relevant nonpoint source activity occurs within each exact watershed. This was

not possible – both because nonpoint source data is not available at the watershed or sub-county level, and

also because the watershed boundaries corresponding to 303(d) water bodies have not yet been identified at

a sufficiently fine level of detail.40

We have generated some limited information on the relationship in practice between the size of the

geographic area from which actual TMDLs have required nonpoint source load reductions and the size of

the county or counties surrounding a water body. Among the sample of 15 TMDLs we reviewed for

“ground-truthing” purposes (see Appendix A), 13 required load reductions from nonpoint sources. In 7 of

the 13 cases, the acreage needing controls is less than 10% as large as the acreage of the county or counties

in which the water bodies are located. In 2 more cases, the acreage needing control is 10 - 50% as large as

the acreage of the surrounding counties. In 2 cases, the acreage needing control is greater than the size of

the surrounding counties, but both of these “TMDLs” is actually a single submission covering multiple

impaired waters. Across our “ground-truthing” sample, the median acreage needing control is somewhat

less than 10% as large as the acreage of the county(s) surrounding the water body.41

In Appendix A, we rank order the 13 TMDLs that require nonpoint source load reductions

according to the size of the watershed area from which nonpoint source load reductions are required. The

25th percentile of this distribution is 3.2 % of the surrounding county (i.e., 25 % of this sample of TMDLs

require nonpoint source controls for a watershed area with a number of acres less than 3.2% of the number

of acres in the surrounding county). The 75th percentile of this distribution is 32.8 % of the number of

acres in the surrounding county (i.e., 75 % of this sample of TMDLs require nonpoint source controls for a

geographic area smaller than 32.8 % of the surrounding county). We use these 25th and 75th percentile

figures to establish a rough range in estimating the size of the area for which a typical TMDL will require

nonpoint source controls.42 In simulating the costs of the Scenario 2 (Moderately Cost-
(and the great majority of TMDLs) are for streams or lakes with small to modest watersheds. However, a

few impaired waters may be major estuaries or large lakes whose eventual TMDLs will require reduction

of nonpoint source loads from very large upstream watersheds. Our procedure looking at the 25th and 75th

percentiles of a range ignores the impact of such rare TMDLs requiring controls for large areas. 

However, these rare TMDLs may, in fact, account for an important fraction of the total land area for

which controls will ultimately be required across all TMDLs. Perhaps we should develop a cost

estimation procedure that explicitly accounts for the impact of these outliers. We welcome suggestions.

III - 9

effective TMDL Program), we assume that the typical TMDL will require controls for acreage equal to 5%

(lower estimate) to 40 % (upper estimate) of the number of acres in the county or counties within which the

impaired water body is located.

In sum, for the “Least Flexible TMDL Program” scenario (Scenario 1), we assumed that load

reductions would be required for all of the relevant nonpoint source activity that occurs within the entire

county or counties within which the nonpoint source-impaired water body is located. We also assumed that

it makes no difference how many impaired water bodies there are in single county. One impaired water

body is sufficient to trigger the need for controls for all of the relevant nonpoint source type activity in the

county; but once all the nonpoint source activity in the county is controlled we assume this will be

sufficient to address the nonpoint source contribution to impairment for all the impaired water bodies in the

county.

For the Moderately Cost-effective TMDL Program scenario, we assumed instead (based on the

results from our sample of 15 actual TMDLs) that load reductions would be required for a geographic area

ranging in acreage from 5 % to 40 % of the number of acres in the surrounding county or counties. Absent

any data on how the nonpoint source activity is distributed within a county, we assumed that 5 % to 40 %

of the area of the county would comprise 5 % to 40 % of the relevant sort of nonpoint source activity

within the county. We assumed for the Moderately Cost-effective TMDL Program scenario that this need

for nonpoint source controls was cumulative with multiple impaired water bodies within a county until 100

% of the county’s nonpoint source activity had been controlled.

The following exhibit provides numerical examples demonstrating how much nonpoint source

activity we assumed would need control under the two scenarios. For the purpose of these examples, the

nonpoint source type under consideration is silviculture.

Exhibit III-3

Examples Showing Amount of Nonpoint Source Activity

Needing Further Control for Scenarios 1 and 2

# of Silviculture-Impaired

Water Bodies in the

County

Amount of Silviculture Needing Further Control in the County

Least Flexible TMDL Program (Scenario

1)

Moderately Cost-effective TMDL Program

(Scenario 2)

1 100 % of silviculture in the county 5 - 40 % of silviculture in the county

2 100 % of silviculture in the county 10 - 80 % of silviculture in the county

3 100 % of silviculture in the county 15 - 100 % of silviculture in the county

4 100 % of silviculture in the county 20 - 100 % of silviculture in the county
43 USDA. December 1999 (unrevised version). 1997 National Resources Inventory. Natural Resources

Conservation Service. http://www.nhg.nrcs.usda.gov/NRI/1997.

44 USDA. 1997. 1997 Census of Agriculture. National Agricultural Statistics Service. 

http://www.nass.usda.gov/census.

45 USDA Forest Service. Timber Product Output Datafile. Timber Product Output (TPO) Database Retrieval

System. http://srsfia.usfs.msstate.edu/rpa/tpo/. The TPO provides timber harvest data that is updated at

different times for different States. At any point in time, the data in TPO derive from different years for

different States.

III - 10

We thus employed the following procedure to determine the volume of nonpoint source activity that

will likely be required to implement further controls under the three TMDL program scenarios that we

analyze:

 The Research Triangle Institute (RTI) identified all 303(d) waters that States had cited (in

either their 303(d) or 305(b) submissions) as impaired by any of the nonpoint source types

that we cover in this analysis;

 RTI provided us with further information on each of these nonpoint source-impaired water

bodies, including the county or counties in which it is located, its size, and its type (e.g.,

lake, river, estuary, coastal shoreline); and

 Environomics and Tetra Tech extracted information from various national data bases on

the volume of nonpoint source activities in each of the counties with nonpoint sourceimpaired waters.

County-level nonpoint source information was extracted from the most current national data bases

relevant to each nonpoint source type. The information that was obtained included data on the volume of

the nonpoint source activity occurring in each impairment county and further data on characteristics of that

activity in each county that affect the potential costs of management measures for the nonpoint sources. 

We used the following data bases:

 For agricultural land (crop, pasture and range), the 1997 National Resources Inventory

(NRI) 43 as it existed prior to some corrections released in early 2001. Data obtained from

NRI included the acreage of crop, pasture and range land in each county, the average slope

of such land, and the acreage of crop land eroding at greater than 15 tons/acre/year.

 For AFOs, the 1997 Census of Agriculture.44 From the Census of Agriculture, we

obtained information by county on the number of farms with confined beef, dairy cows,

swine, broilers and layers, and on the size distribution of these farms.

 For silviculture, the Timber Product Output Data File.45 This provides information on the

amount of timber harvested and on characteristics of the land from which it was harvested

(e.g., slope). Regional timber yield estimates were applied to convert the harvest data to

county-by-county estimates of the timber acreage harvested and the acreage undergoing

artificial regeneration.
46 USDA recommends a wider buffer strip when adjoining crop land than when adjoining pasture land.

III - 11

 For on-site wastewater systems, the 1992 Census of Housing (USDOC cite...). This

provides information on the number of dwelling units served by on-site wastewater

systems.

As noted, for most nonpoint source BMPs, we assumed under Scenarios 1 and 2 that differing

fractions of the nonpoint source activity in a county would be required to reduce their loads and implement

the next treatment step. However, for those BMPs that are intended to be applied specifically in riparian

zones -- for example streamside buffer strips to arrest runoff and trap sediment, or fencing to keep grazing

animals out of streams -- we assumed they would be applied in a band alongside impaired waters rather

than throughout some percentage of the surrounding county. For these riparian BMPs, we did not vary the

amount of the BMP needed with the scenario (i.e., we assumed the same amount of riparian BMPs would

be necessary under the Moderately Cost-effective TMDL Program scenario as for the Least Flexible

TMDL Program scenario. The riparian BMPs include:

 For crop land: a riparian forest buffer comprising a 75-foot wide corridor on each side of

every crop-impaired water body.

 For pasture land: a similar 50-foot wide riparian forest buffer on each side of every

pasture-impaired water body.46

 For range land: fencing along the entire bank length of every range-impaired water body

or, alternatively, conservation practices encompassing “stream protection” and/or

“streambank stabilization” applied to a riparian zone of 100 feet on each bank of every

range-impaired water body.

 For AFOs: a riparian forest buffer similar to that for crop land, on each side of every

AFO-impaired water body.

 For on-site wastewater systems: a zone extending for 100 yards from the shoreline of every

septic system-impaired water body within which all malfunctioning septic systems must be

rehabilitated.

For all of these riparian BMPs, the key data elements we used in estimating the volume of nonpoint

source activities that will need to implement the BMP include: the length of the impaired water body and

the width of the riparian zone within which the BMP is to be applied.

D. BMPS FOR REDUCING NONPOINT SOURCE LOADS

We assume that the nonpoint sources addressed under either the Least Flexible TMDL Program

Scenario or the Moderately Cost-effective TMDL Program will be required to achieve load reductions that

can be accomplished by implementing a set of basic BMPs specific to each source type. For each nonpoint

source type, we chose a set of basic BMPs that would constitute the “next treatment step” for costestimating purposes for that nonpoint source type. We did this in two steps. First, we chose a set of broad

practice groups that we assumed the nonpoint source type would need to implement. For crop land, for

example, we assumed that farms contributing to water quality impairments would implement five groups of

practices:

1. Conservation tillage;
47 Personal communications with: Clay Ogg (EPA, 9/00, 10/00), Matt Moore (ARS, 10/00), Seth Dabney

(ARS, 10/00), Jim Fouss (ARS, 10/00), Glen Weesies (NRCS, 11/00), and Wayne Skaggs (North Carolina

State University, 11/00). Also, comments from numerous USDA staff during USDA’s review of the draft

TMDL cost studies in June and July, 2001.

III - 12

2. Nutrient management;

3. Practices to reduce sediment transport within or at the edge of the field;

4. Practices to protect and restore riparian areas; and

5. Management of highly erosive crop land.

For each chosen practice group, we then selected a single BMP that we would use to represent what the

costs of implementing the practice group might be. Each practice group includes a range of possible BMPs

(e.g., in-field or edge-of-field measures to reduce sediment transport can include many different contouring,

buffer and runoff management measures). For costing purposes, though, we chose a single, relatively

expensive BMP to represent what it might cost to implement whatever specific BMP among the practice

group is appropriate in each individual circumstance. To represent costs for riparian practice groups, for

example, we chose riparian forest buffers, a BMP which is generally more expensive than other sorts of

buffer, filter strip or stream protection measures. To represent costs for managing highly erosive crop

land, we chose retirement with establishment of permanent vegetative cover, a BMP that again is generally

more costly than alternatives such as conservation strip cropping, contouring, etc..

We believe our selected BMPs yield a conservative cost estimate in two respects:

 We have chosen to simulate the implementation of each of a broad set of several practice

groups, even though many impairment situations may not require all of the practice

groups. In most circumstances, the entire package of practices that we assume and then

estimate costs for will be more than enough to achieve the desired load reduction from the

nonpoint source.

 For costing purposes, we represent each practice group with a relatively expensive specific

BMP.

Note that we have selected these practice groups and specific BMPs only for the purpose of

estimating costs. We do not mean to imply that our particular selected measures should or must always be

implemented by nonpoint sources in order to mitigate water quality problems. The selection of appropriate

BMPs in practice must be highly site-specific. One or more of our particular selected BMPs may be poor

choices in many circumstances. Riparian forest buffers, for example, are not cost-effective for areas where

trees are very difficult to plant and grow.

In sum, the set of practice groups we chose are intended to represent the initial, broadly applicable

measures that each nonpoint source type can be expected to implement to minimize impacts on water

quality. Relatively more expensive BMPs were selected to represent the costs of each practice group. Our

selected practice groups and BMPs are broadly consistent with guidance published by EPA (national

nonpoint source management measures developed pursuant to CZARA and subsequently updated) and

USDA (National Handbook of Conservation Practices). The BMPs chosen for agriculture and AFOs

derive largely from discussions with EPA and USDA experts.47 USDA does not, however, in any way

endorse the specific selection of BMPs, or, more broadly, the assumptions or findings of this report. In

fact, USDA staff have suggested many changes or improvements in this analysis that we have not yet

accomplished.
III - 13

The basic sets of BMPs that we chose for each nonpoint source type are as follows:

Exhibit III-4

Basic BMPs Assumed for Each Nonpoint Source Type

Nonpoint Source

Type Practice Group and BMP Purpose

Crop land 1. Conservation tillage

2. Nutrient management planning

3. In-field, edge-of-field measures:

vegetative barrier

4. Riparian measures: riparian forest

buffers

5. Management of erosive land:

retirement and cover

1. Reduce sheet and rill erosion and sediment transport

from tilled land

2. Avoid over-application of nutrients

3. Prevent concentrated (gully) erosion in upland fields

4. Remove sediment and nutrients from runoff before

reaching water bodies

5. Avoid disturbing highly erosive land

Pasture land 1. Riparian measures: riparian forest

buffers

2. Upland measures: rotational stocking

1. Remove sediment and nutrients from runoff before

reaching water bodies

2. Rotate stock sequentially through fenced pastures to

prevent overgrazing and erosion of any one area

Range land Riparian measures:

1. Use exclusion

 or

1A. Stream protection/bank stabilization

1. Fence stock away from watersides to avoid damage to

stream banks and bottoms, avoid manure in water

1A. Repair and prevent further damage by animals to

riparian zone

AFOs 1. On-farm manure collection and

management (facilities and equipment

to collect, store, manage and use

manure on nearby land, control runoff,

and compost dead animals)

2. Manure transport from nutrientsurplus to nutrient-deficient areas

3. Nutrient management planning

(plans, soil and manure testing, training,

record-keeping)

1. Prevent nutrients, pathogens and BOD from reaching

waters through runoff, spills from lagoons, and groundwater

2. Avoid over- application of manure nutrients relative to

local crop needs, with resulting buildup of N and P and

release to local waters

3. Avoid over-application of nutrients (both chemical

fertilizers and manure)

Silviculture Various BMPs addressing:

 1) Preharvest planning;

 2) Streamside management areas;

 3) Road construction/reconstruction;

 4) Road management;

 5) Timber harvesting;

 6) Site preparation and forest

regeneration;

 7) Fire management;

 8) Revegetation of disturbed areas;

 9) Chemical management;

10) Wetlands forest management

Minimize erosion, siltation, and bank destabilization. Avoid

loss of vegetative cover and increase in water temperature. 

Avoid slash and other material in streams. Avoid runoff of

forest management chemicals

On-site wastewater

systems

Rehabilitate all failing septic systems

within a wide riparian zone

Prevent nutrients, pathogens and BOD from reaching water

bodies through runoff and infiltration
48 Tetra Tech, Inc. Draft Nonpoint Source Gap Analysis. Drafts of July, 2000; February 7, 2001. Some of

the unit cost information used in developing the cost estimates in this report will be updated and revised

for the final report to bring it into better conformity with unit cost information cited in the most recent

draft of the Nonpoint Source Gap Analysis.

49 USDA. “Comments on EPA documents ‘Cost of Restoring the Nation’s Impaired Waters’ dated June 13,

2001 and ‘Total National Costs for Pollutant Sources to Implement TMDLs’ dated June 13, 2001". June

22, 2001

50 DPRA, Incorporated. Economic Impact Analysis of National Nonpoint Source Management Measures

Affecting Confined Animal Facilities. May 17, 1995.

51 U.S. EPA, Office of Water, Office of Science and Technology. Final Cost Methodology Report for Beef

and Dairy AFOs. Final Cost Methodology Report for Swine and Poultry Sectors. January, 2001.

III - 14

These BMPs are assumed to be applied to:

 For the Least Flexible TMDL Program scenario, the entire volume of the nonpoint source

activity that occurs in the county or counties within which the nonpoint source-impaired

water body is located; or

 For the Moderately Cost-effective TMDL Program scenario, per impaired water body in

the county, 5 - 40 % of the volume of the nonpoint source activity that occurs in the

county; and

 (For riparian BMPs) the entire riparian zone surrounding the nonpoint source-impaired

water body.

E. UNIT COSTS FOR THESE BMPS

Many sources of unit cost information are used in estimating the cost of implementing these

nonpoint source BMPs as a function of the volume and characteristics of the nonpoint sources. The costing

relationships and the underlying sources are described fully in Appendix I. The more important cost

references we used include:

 For all nonpoint source categories. EPA’s recent “ “Draft Nonpoint Source Gap

Analysis”.48

 For agriculture (crop, pasture and range land). Numerous studies supported by EPA

and USDA on costs or savings from various BMPs. Information summarized in EPA’s

recent Draft National Management Measures to Control Nonpoint Source Pollution from

Agriculture (cite..). Information provided by USDA staff in the course of the USDA

review during June and July, 2001, of EPA’s draft TMDL cost studies.49

 For AFOs. Costing studies supporting EPA’s promulgation of recommended management

measures for AFOs in the “Management Measures Guidance for Coastal Zone Nonpoint

Source Pollution” required by the Coastal Zone Management Act Reauthorization

Amendments of 1990.50 Also, to a much lesser degree, some information has been used

from preliminary costing studies supporting EPA’s proposed new effluent guidelines for

feedlots.51 Note here that EPA’s cost studies supporting the effluent guidelines are much
52 Lander et al. Manure Nutrients Relative to the Capacity of Cropland and Pastureland to Assimilate

Nutrients: Spatial and Temporal Trends for the United States. USDA. Publication No. ps00-0579. 2000. 

Also, Lander et al. Nutrients Available from Livestock Manure Relative to Crop Growth Requirements. 

USDA. Resource Assessment and Strategic Planning Working Paper 98-1.1998.

53 Research Triangle Institute. Economic Analysis of Coastal Nonpoint Source Pollution Controls:

Forestry. 1992.

54 U.S. Census Bureau. American Housing Survey for the United States. 1997. 

Www.census.gov/prod/99pubs/h150-97.pdf

III - 15

newer and more comprehensive than EPA’s CZARA costing effort, and they differ from

the CZARA cost estimates in some important respects. However, EPA’s feedlot effluent

guideline cost studies are currently being revised, and we did not believe that we could

effectively use them while they were still in flux. As a result, our AFO cost estimates in

this report rely on unit cost information that we know in some instances is outdated and

has been supreseded. The AFO cost estimates in this report are inconsistent in important

ways with EPA’s AFO cost estimates published thus far in support of the feedlots effluent

guidelines. We intend to conform our estimates to the effluent guideline cost information

before this report is finalized. Finally, important information relevant to needs for

transporting manure from AFOs was obtained from a series of USDA studies by Lander,

et al.52

 For silviculture. Costing studies supporting EPA’s promulgation of the management

measures for silviculture under CZARA.53

 For on-site wastewater systems. Information drawn from the National Census of

Housing54 on the proportion of septic systems found to be failing was combined with

information from EPA’s “nonpoint source gap analysis” on the costs of rehabilitating a

failed septic system.

These references provided both information on the unit costs of implementing the chosen BMPs for these

nonpoint source categories and information on the extent to which these BMPs have already been

implemented.

In some cases, BMPs anticipated to be adopted by nonpoint sources in order to meet load reduction

targets may yield savings that partly or perhaps even completely offset the costs of the BMPs. BMPs that

likely involve such cost savings include:

 Nutrient management planning for crop farmers and AFOs. Nutrient management

planning includes as a major objective balancing the amount of nutrients applied to crops

to crop needs. Most farmers overapply nutrients relative to crop needs; better planning

can save the cost of the no longer applied excess nutrients. Many studies have found that

the costs of developing nutrient management plans (including costs for soil and manure

testing, training, and record-keeping) are outweighed by the cost savings that result as less

chemical fertilizer is purchased and applied. Few studies, though, provide a

comprehensive before/after comparison that also considers effects on crop yield and

overall farm profitability.
55 USDA concludes in one analysis: “Generally speaking, no-till systems offer a slight to fairly significant

reduction in input costs. If proper management of conservation tillage is used, yields will most likely be

maintained and costs will decrease. An overall improvement in the efficiency of a farm operation will

result and thus enhance profitability. In areas where moisture retention is improved and soil productivity

rises, yield increases can be expected together with improved profits.” USDA, Natural Resource

Conservation Service. CORE4 Conservation Practices, the Common Sense Approach to Natural

Resource Conservation. 1999.

III - 16

 Conservation tillage. Conservation tillage is widely agreed to reduce costs for labor, fuel

and equipment maintenance as less tillage is performed. On the other hand, conservation

tillage involves purchase of new equipment and likely increased costs for herbicides and

seed. It is also perceived as being more risky. Effects on yields are variable.55

 Transporting manure from a nutrient-surplus area to a nutrient-deficient area.. Manure

increases in value when it is shipped from a location where manure nutrients are in excess

to a location where the manure’s full nutrient content is needed. The increase in value is

likely not sufficient to pay for the shipping cost (otherwise one would expect that market

forces would have already prompted the shipping to occur). Nevertheless, there will likely

be some increase in value that will partly offset the shipping cost.

 Repairing a malfunctioning septic system. In many cases, repairing a poorly functioning

septic system forestalls more expensive responses that will be needed if the system is

allowed to deteriorate to the point where it fails completely.

It is very difficult to project what these sorts of savings might amount to if these BMPs were

applied on a widespread basis, as we simulate in this analysis. There are both conceptual and empirical

difficulties:

 In theory, farmers, livestock operators and homeowners as economically rational actors

would adopt these BMPs in the circumstances in which the BMPs would pay for

themselves. These individuals do not need a TMDL to induce them to act in their selfinterest. We might reasonably assume that, in all instances where these BMPs have not

yet been adopted, the cost savings would not be large enough to offset the costs.

 On the other hand, lack of information and adherence to traditional ways are significant

barriers to adoption of newer BMPs, even in instances where they would appear to be

profitable.

 On the other hand again, farmers and others are risk averse. Overapplication of nutrients,

for example, may cost a little more than is necessary but it also provides a relatively

inexpensive sort of insurance against disasters that could occur as a result of weather,

pests, or miscalculations.

 Analytically, the cost savings from adoption of these BMPs tend to have been studied in

the circumstances for which the BMPs are best suited. It is questionable whether the

savings found in instances where the BMPs have been adopted can be extrapolated to other

settings where the BMPs have not yet been adopted. One might expect the circumstances
56 For example, in the “CORE4" study cited above, USDA estimates for a sample farm that adopting a no-till

system plus nutrient management reduces net costs for corn and wheat but increases costs for soybeans. 

Considering positive yield changes for all three crops, the total impact of adopting no-till and nutrient

management appears to be positive for all three crops.

Should we use this information as a basis for estimating the cost savings that might occur if no-till and

nutrient management were adopted more generally as a result of TMDLs? We think not. Recent figures indicate

that conservation tillage is used for 33% of all wheat (small grains) acreage, 54% of soybean acreage, and 40% of

corn acreage. There must be reasons why farmers have not adopted conservation tillage for most of these three

crops’ acreage, and we are wary of projecting that acreage that doesn’t use this measure will benefit from it to the

same degree as the acreage that already does use it. Furthermore, what should we surmise about the likely impact

of conservation tillage on other crops, particularly ones where it is currently used much less than for these three

crops (e.g., cotton, for which conservation tillage is used on only 12% of the acreage)?

III - 17

in which the BMPs have been adopted to differ systematically from the circumstances

where they have not yet been adopted, and extrapolation may be inappropriate.56

In view of these very large uncertainties in estimating the national savings that might result from

widespread implementation of TMDL-prompted BMPs, we decided to treat the potential savings from the

BMPs in a different manner from the costs. We explicitly estimate the costs of the BMPs and display them

as our estimate of TMDL implementation costs. We also develop some very rough quantified estimates of

the potential cost savings from the BMPs, but, -- in an effort both to be conservative and to recognize the

much greater uncertainty of the savings estimates -- we choose not to display these savings estimates and

not to net them out in the tables summarizing TMDL implementation costs. Note that this decision not to

display the savings estimates does not mean that we believe the potential savings to be unimportant or

nonexistent. To the contrary, we believe that in many circumstances these BMPs will engender substantial

savings that offset some portion of the BMP costs. We are unable, however, to estimate these savings with

much confidence. For the final version of this analysis, we intend to gather additional data that will allow

us to narrow the range of uncertainty in our national savings estimates.

Unit costs and cost savings drawn from these references were applied to the volume of nonpoint

source activity assumed to need further controls as estimated in the previous step. To the extent that some

portion of the nonpoint sources have already implemented some of the BMPs, the implementation cost and

savings estimates were reduced to reflect the practices that are already in place.

F. SUMMARY COST ESTIMATES FOR NONPOINT SOURCES

For each type of nonpoint source activity, we sum the costs across impaired water bodies and scale

appropriately to reflect missing data and obtain a nationwide estimate.

We have previously discussed the three scaling steps involved in developing a national

implementation cost estimate for nonpoint sources:

 Scaling to reflect the portion of the national total of each nonpoint source activity that

occurs in States that report on impairment of their waters by the particular nonpoint source

activity. (Different scaling factor for each nonpoint source type.)

 Scaling to reflect the likelihood that the nonpoint source types we analyze will eventually

be found responsible for a share of the waters reported by States as impaired by “unknown

sources” or by “nonpoint sources (no further information)”. (Scaling factor of 1.13.)
III - 18

 Scaling to reflect the assumed pace of TMDL development for the 1998 303(d)-listed

waters and the assumed 5-year lag between TMDL development and when affected

sources begin to incur implementation costs. (Scaling factor of .4484.)

The estimated national nonpoint source implementation costs are as follows:

Exhibit III-5a

Implementation Costs for Nonpoint Sources -- Crop Land ($ in millions/yr)

Number of States analyzed 23

Number of counties in these States with crop-impaired waters 710

Fraction of crop acreage in these States that is in impairment counties .53

Scale factor from these States to the nation 1.56

National total annualized implementation costs (millions of 2000 dollars/yr):

 Conservation tillage

 Nutrient management planning

 Riparian forest buffers

 Vegetative barriers

 Retirement of highly erosive crop land

 Total costs

Scenario 1

Least Flexible

TMDL

85 - 785

317 - 781

41 - 104

49 - 108

154 - 177

645 - 1956

Scenario 2

Reas. TMDL

19 - 644

70 - 641

41 - 104

12 - 88

42 - 154

183 - 1632

National total potential savings from implementing these BMPs (millions of 2000

dollars/yr):

 Conservation tillage

 Nutrient management planning

 Total potential savings

Scenario 1

Least Flexible

TMDL

0 - 414

0 - 804 

0 - 1218

Scenario 2

Reas. TMDL

0 - 340

0 - 660

0 - 999
III - 19

Exhibit III-5b

Implementation Costs for Nonpoint Sources –Pasture Land ($ in millions/yr)

Number of States analyzed 25

# of counties with pasture and/or rangeland-impaired waters in these

States

511

Fraction of pasture acreage in these States that is in impairment

counties

.363

Scale factor from these States to the nation 1.69

National total annualized implementation costs (millions of 2000

dollars/yr):

 Riparian forest buffers

 Rotational stocking

 Total costs

Scenario 1

Least Flexible TMDL

5.0 - 10.7

0

5.0 - 10.7

Scenario 2

Reas. TMDL

5.0 - 10.7

0

5.0 - 10.7

Exhibit III-5c

Implementation Costs for Nonpoint Sources –Range Land ($ in millions/yr)

Number of States analyzed 25

# of counties with pasture and/or rangeland-impaired waters in these

States

511

Fraction of rangeland acreage in these States that is in impairment

counties

.459

Scale factor from these States to the nation 1.43

National total annualized implementation costs (millions of 2000 dollars/yr):

 Riparian fencing only; OR

 Stream protection/bank stabilization

 Total costs

Scenario 1

Least Flexible

TMDL

5.1 - 16.4

2.3 - 5.1

2.3 - 16.4

Scenario 2

Reas. TMDL

5.1 - 16.4

2.3 - 5.1

2.3 - 16.4
III - 20

Exhibit III-5d

Implementation Costs for Nonpoint Sources -- AFOs ($ in millions/yr)

Number of States analyzed 32

Number of counties with AFO-impaired waters in these States 451

Fraction of animal units in these States that is in impairment counties .31

Scale factor from these States to the nation 1.55

National total annualized implementation costs (millions of 2000

dollars/yr):

 Riparian forest buffers

 Facilities upgrades

 Additional manure hauling

 Nutrient management planning

 Total costs

Scenario 1

Least Flexible TMDL

4.0 - 10.2

28.3

41.0 - 68.2

3.0

76.4 - 109.8

Scenario 2

Reas. TMDL

4.0 - 10.2

4.3 - 19.9

3.8 - 41.2

0.4 - 2.1

12.5 - 73.4

National total potential savings from implementing these BMPs (millions

of 2000 dollars/yr):

 Value of additional collected manure

 Increased valued from additional manure hauling

 Nutrient management planning

 Total potential savings

Scenario 1

Least Flexible TMDL

0 - 17.3

7.5 - 18.2

0 - 31.2

7.5 - 66.7

Scenario 2

Reas. TMDL

0 - 11.3

0.2 - 11.9

0 - 19.6

0.2 - 42.7

Exhibit III-4e

Implementation Costs for Nonpoint Sources -- Silviculture ($ in millions/yr)

Number of States covered 30

Number of counties with silviculture-impaired waters in these States 294

Fraction of timber harvest in these States that is in impairment

counties

.2106

Scale factor from these States to the nation 1.499

National total annualized BMP costs (millions of 2000 dollars/yr)

Scenario 1

Least Flexible TMDL

 29.7 - 41.7

Scenario 2

Reas. TMDL

7.2 - 30.6
III - 21

Exhibit III-5f

Implementation Costs for Nonpoint Sources – On-Site Wastewater Treatment Systems ($ in

millions/yr)

Number of States covered 24

Number of counties with OWTS-impaired 303(d) waters in these States 318

Fraction of OWTS-served dwelling units in these States that is in riparian

zones and will be addressed by TMDLs

0.013

Scale factor from these States to the nation 1.732

National total annualized implementation costs (millions of 2000

dollars/yr)

Scenario 1

Least Flexible TMDL

 24.1 - 27.7

Scenario 2

Reas. TMDL

24.1 - 27.7

Total nonpoint source costs are estimated as follows:

Exhibit III-6

Total Implementation Costs for Nonpoint Sources

Type

Scenario 1

Least Flexible TMDL

Program

Scenario 2

Moderately Costeffective TMDL

Program

Agricultural land

 crop land

 pasture land

 range land

 Potential savings

645 - 1,159

5 - 11

2 - 16

(not estimated)

183 - 1,632

5 - 11

2 - 16

(not estimated)

AFOs

 Potential savings

76 - 110

(not estimated)

13 - 73

(not estimated)

Silviculture 30 - 42 7 - 31

On-site wastewater treatment systems 24 - 28 24 - 28

Total

 Potential Savings

783 - 2,162

(not estimated)

234 - 1,791

(not estimated)

ADDITIONAL COSTS TO NONPOINT SOURCES

UNDER SCENARIO 3 (MORE COST-EFFECTIVE

TMDL PROGRAM)

47 - 78

In the final row of this exhibit showing total nonpoint source costs, we show the estimated costs for

additional nonpoint source control measures under our simulated “More Cost-Effective TMDL Program”

Scenario. These are the costs for nonpoint sources to provide increased load reductions to offset the

additional loads to be discharged by point sources under this scenario (see section II - I). We have not

estimated which specific nonpoint source types will incur these costs for additional nonpoint source

controls.
IV - 1

IV. MAJOR ASSUMPTIONS, BIASES, AND UNCERTAINTIES

Any estimate of the nationwide costs to pollutant sources of meeting water quality standards

through the TMDL program or other means will necessarily be imprecise. The analysis must cover nearly

22,000 impaired waters, at least 60,000 point sources, and millions of acres of diverse nonpoint source

activities. Accurate estimation of the amounts by which loads from these sources to these waters exceed

desired levels, and identification of the specific sources that are responsible and the load reductions that

they will need to achieve must await development of the actual TMDLs for these waters. Projecting these

elements in the absence of TMDLs, years in advance and on a nationwide basis, is a difficult task. In

developing our estimates of the implementation costs likely to arise in meeting water quality standards, we

have made many simplifying analytical assumptions. In this section of the report, we note these

assumptions and discuss the potential biases and uncertainties that likely result from them. We first

discuss each major assumption in some detail, and we then provide a exhibit summarizing the implications

of all the major assumptions.

A. HOW THE “LEAST FLEXIBLE TMDL PROGRAM” SCENARIO IS DEFINED

Assumption

For point sources, we assume that a reasonable least flexible case is that States will continue

writing WQBELs as required by the Clean Water Act. We assume that each point source that contributes

to impairment will have a WQBEL written that will require the source to implement an appropriate “next

treatment step”. (An even-worse case might be envisioned, in which nonpoint sources are left out of the

TMDL and States attempt to make up for not including nonpoint sources by developing ever-tighter limits

for point sources. We consider this option unrealistic.)

For nonpoint sources, we assume that States will either induce or require all nonpoint sources that

contribute to impairment similarly to implement an appropriate “next treatment step”. We assume, based

on how many nonpoint source programs are currently managed, that a least flexible case would be that

these further nonpoint source controls will be sought for all of the relevant nonpoint sources within the

county or counties in which the nonpoint source-impaired water body is located.

Impact of Assumption

For both point and nonpoint sources, these assumptions will usually cause the “Least Flexible

TMDL Program” to overshoot the load reduction that would actually be required to meet water quality

standards. One might question whether States would be so short-sighted as to require controls of individual

point and nonpoint sources that in the aggregate far overshoot the overall load reduction needed. Despite

the high cost of this approach, though, we find it plausible that this could occur in some TMDLs. Water

quality-based permitting often does proceed for each point source discharger in isolation, without

considering the aggregate load reduction that is being obtained from all dischargers. Nonpoint source

management programs, particularly when they confer some benefit on participating nonpoint sources (e.g.,

agricultural cost-share programs) sometimes find it difficult to direct resources at one part of a county and

exclude the remainder of the county from participation.
IV - 2

B. HOW MUCH LOAD REDUCTION FROM POINT SOURCES WILL THE “MODERATELY

COST-EFFECTIVE TMDL PROGRAM” SEEK?

Assumption

Based on the results from a sample of 15 completed TMDLs, we assume that about half of the

TMDLs in practice will require an aggregate load reduction from point sources approximately equal to that

which would be obtained if all point sources that contribute to impairment were to implement an

appropriate “next treatment step”. The remaining half of the TMDLs will require an aggregate load

reduction from point sources that is about half of that which would be obtained if all point sources that

contribute to impairment were to implement the “next treatment step”.

Impact of Assumption

This specific assumption results in point source costs for the “Moderately Cost-effective TMDL

Program” scenario being only about 3/4 of the costs that would prevail if all point sources that contribute

to impairment were to implement the “next treatment step”. Basing such an important assumption on a

relatively small sample of only 15 TMDLs is unfortunate. We will expand the sample and revise this

assumption accordingly for the final report.

C. HOW MUCH LOAD REDUCTION FROM NONPOINT SOURCES WILL THE

“MODERATELY COST-EFFECTIVE TMDL PROGRAM” SEEK?

Assumption

First, we assume that TMDLs are legally required for waters impaired by nonpoint sources only. 

Second, based on the results (25th and 75th percentile figures) from a sample of 15 completed TMDLs, we

assume that a typical TMDL for a single impaired water will require load reductions from a watershed

acreage amounting to an area ranging in size from about 5 % to 40 % of the surrounding county. Third,

we assume that the percentage load reduction that a typical moderately cost-effective TMDL will require of

nonpoint sources within this geographic area is roughly similar to the percentage load reduction that would

be achieved by our chosen “next treatment steps” for nonpoint sources.

Impact of Assumption

The latter two assumptions make nonpoint source costs under the “Moderately Cost-effective

TMDL Program” scenario much lower than under the “Least Flexible TMDL Program” scenario. This

seems sensible – typically the watershed for a 303(d) water is much smaller than a county. However, a few

TMDLs will address water bodies (particularly estuaries) that will require nonpoint source load reductions

throughout a very large upstream watershed. These few instances where very large areas need further

controls may make the average size of the geographic area needing controls larger than even the 75th

percentile figure. We seek suggestions from reviewers about how to deal with this issue.

Again, the sample of 15 completed TMDLs is undesirably small.

We have very little data on the load reduction effectiveness of the BMPs we have selected as the

“next treatment step” for the various nonpoint source types. We believe that the BMPs we selected may

generally abate a greater proportion of nonpoint source loads than is typically required in actual TMDLs,

particularly because for several nonpoint source types we include several BMPs simultaneously as
IV - 3

constituting the next treatment step. If so, somewhat less than 5 - 40 % of all the nonpoint sources in the

county would need to implement our “next treatment step” in order to obtain the desired aggregate load

reduction. If so, this assumption leads us to overestimate nonpoint source costs.

D. WHAT COST SAVINGS OPPORTUNITIES ARE AVAILABLE UNDER THE “MORE

COST-EFFECTIVE TMDL PROGRAM?

Assumption

We simulate only one sort of more cost-effective WLA opportunity – instances where some point

source control responsibilities may be shifted to nonpoint sources. We do not simulate any of several other

potential cost-saving approaches, including point/point tradeoffs and nonpoint/nonpoint tradeoffs. For the

point/nonpoint allocations that we do simulate, we adopt a rather restrictive set of rules as to when such

allocations or trading is possible (e.g., for nutrients or BOD only, for nonflowing waters preferentially). 

We assume (based on nine case examples of point/nonpoint trading) that nonpoint sources can abate

nutrients and BOD at roughly 1/4 the cost per pound as can point sources.

Impact of Assumption

The potential cost savings associated with More Cost-Effective TMDLs are sharply

underestimated because we have not been able to simulate many of the available mechanisms. On the other

hand, the administrative costs of investigating, implementing and overseeing more cost-effective WLAs or

trades have not been estimated, and they could consume some of the projected savings and/or deter these

allocations from being implemented.

E. UNDER WHICH OF THE THREE SCENARIOS WILL THE IMPAIRED WATERS BE

RESTORED SOONEST?

Assumption

We do not address this issue. We assume that the timing of compliance spending by pollutant

sources will be identical across the three scenarios.

Impact of Assumption

We have made this assumption so that the estimated cost differences between the scenarios result

only from differences between them in how much load reduction they will require and how efficiently they

will achieve this load reduction. We do not want to complicate this comparison by introducing differences

in the timing when load reduction efforts will be made.

F. THE DISTANCE UPSTREAM OF AN IMPAIRED WATER WITHIN WHICH POINT

SOURCES CONTRIBUTE TO IMPAIRMENT

Assumption

We simulate two cases. In the “within only” case, only point sources discharging the impairment

pollutant directly into the impaired water are assumed to contribute to impairment. In the “within and

upstream” case, the point sources contributing to impairment are those that discharge the impairment
IV - 4

pollutant: 1) Within 25 miles upstream of impairments for BOD, ammonia or toxic organics; and 2) Within

50 miles upstream of impairments for nutrients or metals.

Impact of assumption

The “within and upstream” case likely “pulls in” too many point sources. Most impaired stream

segments are relatively short (more than 80 % are less than 20 miles). Unless the stream segments

immediately upstream and immediately downstream of these short impaired segments are impaired also, we

can conclude that most impairments are localized – they begin and end within a short distance. This

suggests that the source of impairment is also local. If pollution from a more distant source (up to 25 or 50

miles away) were the cause of impairment, the impaired stretch of river would tend to be much longer.

On the other hand, the “within only” case likely pulls in too few point sources. Several of the

“ground-truthing” TMDLs that we reviewed address point sources located upstream of the impaired

segment itself. Several address all the point sources in the watershed upstream of the impairment.

The two cases likely bracket the true average.

G. DETERMINING WHETHER OR NOT A POINT SOURCE IS LIKELY TO DISCHARGE THE

IMPAIRMENT POLLUTANT IN A QUANTITY WARRANTING FURTHER CONTROLS

BEYOND TECHNOLOGY-BASED STANDARDS

Assumption

We test several different decision rules that involve the SIC code in which the point source is

classified and what we know about the typical nature of discharges from facilities in that SIC. A first

alternative assumption is that if at least 15 % of the facilities in an SIC monitor for a pollutant, then all

facilities in the SIC discharge the pollutant in quantities warranting further treatment. An alternative set of

assumptions involves SIC-by-SIC engineering judgments as to whether or not a facility that meets

applicable technology-based standards is likely to discharge a sufficient remaining quantity of the pollutant

to warrant serious consideration for further control.

Impact of assumption

Sensitivity analysis suggests that alternative assumptions have relatively little impact (+ or - 15 %

or so) on estimated implementation costs.

H. POINT SOURCES THAT ARE LEFT OUT OF THE ANALYSIS

Assumption

The need for further control measures is considered for every point source discharger in PCS, as

well as for all indirect industrial dischargers connected to major POTWs. Point sources that do not have

individual NPDES permits are thus omitted, including, for example, CAFOs that are not yet permitted, and

the many small point sources covered by general permits. Point source discharges from inactive and

abandoned mines (IAMs) also are not estimated here. (Note that costs for further controls needed for urban

wet weather point sources are viewed as attributable to existing technology-based standards and are

counted as part of the baseline. These include costs associated with CSOs, SSOs., municipal and industrial

storm water dischargers.) 
IV - 5

Impact of assumption

Some of the omitted point source dischargers are not likely to be significant targets in TMDLs, and

their omission probably results in only a small underestimate of point source compliance costs (e.g many of

the small dischargers covered under general permits). Other of the omitted point source pollutant sources

are effectively covered in our nonpoint source cost analysis (e.g., CAFOs). Discharges from IAMs,

however, could be costly to mitigate. Currently we do not have accurate estimates of the proportion of

listed waters that are impaired by IAMs. Omitting this category from the cost assessment underestimates

point source implementation costs, but it is difficult to predict the exact magnitude of this underestimation

without further detailed analysis.

I. WILL TMDLs FOR WATERS CITED BY STATES AS IMPAIRED BY NONPOINT

SOURCES ONLY REQUIRE CONTROLS ALSO FOR POINT SOURCES?

Assumption

We assume not. If the State indicates that a water body is impaired by nonpoint sources only, we

presume that the TMDL will not require controls for point sources even if, in our analysis, there appear to

be point sources within a relevant distance that discharge the impairment pollutant.

Impact of the assumption

This assumption reduces our cost estimates by roughly 35 %. We believe the assumption is

reasonable. We suspect that many of the point sources we identify as apparently discharging the

impairment pollutant into or near a nonpoint source-impaired water body are “false positives”. Presumably

the State is well aware of any point sources that may be contributing to an impairment, and will note any

such point sources when listing the sources of impairment. We probably often incorrectly attribute the

discharge of an impairment pollutant to a point source as a result of our crude SIC-by-SIC engineering

judgments.

J. SOURCE TYPES COVERED BY THE NONPOINT SOURCE ANALYSIS AND SOURCE

TYPES THAT ARE LEFT OUT

Assumption

The need for further control measures is considered for four sorts of nonpoint sources: agricultural

land (including crop, pasture and range), AFOs, silviculture, and on-site wastewater treatment systems. 

Many potentially important types of nonpoint and other sources are omitted: abandoned mines,

contaminated sediments, unintended stream modification, atmospheric deposition, etc..

Impact of assumption

In omitting these categories of nonpoint sources, we underestimate total costs to nonpoint sources

of meeting water quality standards. The categories of nonpoint source activities that we cover are

responsible for the majority of nonpoint source impairments; the categories that we omit account for about

14 % of the 303(d) river miles and 22 % of the 303(d) lake acres. However, some of the omitted nonpoint

source categories, although they are occur less frequently, can be costly to mitigate: contaminated

sediments and abandoned mines, for example.
IV - 6

K. IDENTIFYING THE WATER BODIES THAT ARE IMPAIRED BY EACH OF THESE

NONPOINT SOURCE ACTIVITIES

Assumption

We rely on the data provided by States on the sources responsible for impairment of each listed

water. If a State does report some impairments due to a particular nonpoint source type, we assume that the

State has reported all such impairments (except that we assume some fraction of the “source unknown” and

“nonpoint source – no further information” waters will also eventually prove to be impaired by the source

type of interest). We also assume that a State that does not report any impairments due to a particular

nonpoint source type is, in fact, not reporting at all -- the State may really have impairments due to the

nonpoint source type. We scale from the “reporting” States to the “non-reporting” States, presuming that

there are impairments dues to the nonpoint source type in the “non-reporting” States also.

Impact of assumption

This likely results in a modest overestimate of the number of water bodies actually impaired by the

nonpoint source type in question. Some of the States that do not report any impairments due to the

nonpoint source type in fact have no such impairments.

L. WILL STATES REQUIRE FURTHER CONTROLS OF POTWs THAT ALREADY

PROVIDE BETTER-THAN-SECONDARY TREATMENT?

Assumption

We assume not. POTWs that now provide better-than-secondary treatment are identified using

CWNS data, and we assume that TMDLs as a matter of equity will focus requirements for load reductions

on other sources that have not yet implemented control measures beyond the applicable technology-based

requirements.

Impact of assumption

This assumption has a large impact. It reduces estimated costs for POTWs by approximately 63

% (Moderately Cost-effective TMDL Program scenario, “upstream and within” case), from $1.40

billion/yr to $523 million/yr. The ground-truthing information suggests that some TMDLs are requiring

further controls from POTWs that already provide advanced treatment, while other TMDLs are not

requiring further controls from such POTWs. This assumption represents one of the most important

respects in which we may underestimate the costs of the TMDL program.

M. THE SPECIFIC FURTHER CONTROLS THAT POINT OR NONPOINT SOURCES WILL

NEED TO IMPLEMENT

Assumption

We assume that each source that needs to reduce its load will do so by implementing “the next

treatment step” beyond whatever technology-based requirements are currently applicable to that source. If

the source has already implemented all or part of “the next treatment step”, we reduce the estimated costs

accordingly (e.g., no costs are estimated for POTWs that already provide better-than-secondary treatment,

and nonpoint source costs are reduced to the extent that the nonpoint source already has some of the “next

treatment step” BMPs in place). However, we are unable for industrial dischargers to apply this credit
IV - 7

when treatment in place exceeds technology-based requirements because we have no means of identifying

which or how many industrial dischargers have such treatment in place.

Impact of assumption

Uncertain. Some water bodies are so seriously impaired that all contributing sources will need to

implement controls well beyond the next treatment step. Other water bodies are only slightly impaired, and

they will need only modest further source controls, well short of the next treatment step for all sources. For

the Moderately Cost-effective TMDL Program Scenario, we have attempted to match the extent of point

and nonpoint sources that we assume will need to implement the next treatment step against the typical

aggregate load reductions from point and nonpoint sources that have been required in a sample of actual

TMDLs. Hopefully this procedure calibrates our cost estimates so that, although we may be far from

accurate about costs for any particular water body, our total national estimate is reasonably accurate.

Costs for industrial dischargers are overestimated because we do not have the data that would

allow us to reduce their estimated costs by recognizing the extent to which they have already implemented

the next treatment step.

Many point and nonpoint pollutant sources currently have more treatment in place than is needed

to meet technology-based requirements. If we were to assume that all pollutant sources need to implement

the “next treatment step”, even those who currently surpass technology-based requirements, we would face

the difficult task of developing cost functions for many additional treatment technologies that represent

“next steps” beyond the wide variety of technologies currently in place.

N. THE “NEXT TREATMENT STEP” A POINT OR NONPOINT SOURCE WILL NEED TO

IMPLEMENT

Assumption

The assumed next treatment step varies with the type of point or nonpoint source and (for point

sources) the pollutant needing further control. All sources are assumed to have treatment in place to meet

applicable current technology-based-standards. For point sources, this means treatment measures

sufficient to meet effluent guideline (BPT, BAT, PSES, etc.) and secondary treatment requirements. For

nonpoint sources, no treatment is assumed to be in place to meet Federal regulatory requirements (i.e., for

most nonpoint source types, there are no technology-based standards currently applicable), but we attempt

to reflect the degree to which treatment is in place for other reasons. For urban wet weather sources, we

assume that controls are in place or are being implemented to meet CSO, SSO and storm water

requirements under current CWA programs. The following exhibit shows the treatment assumed to be in

place and the assumed next treatment step for all types of sources.

Impact of assumption

 These assumptions regarding treatment in place and what the next treatment step would be are

undoubtedly inaccurate in many specific instances. To improve on these assumptions, though, we would

need to acquire source-specific information on treatment actually in place and potential further control

options for tens of thousands of point and nonpoint sources -- a formidable task. We do not believe there is

any systematic bias resulting from the assumptions we have made.
IV - 8

Exhibit IV-1

Treatment Technology Assumptions

Type of Source Pollutant or Activity Treatment in Place Next Treatment Step

Industrial point

sources

Metals

BOD, nutrients, ammonia,

or toxic organics

Chemical precipitation

Biological treatment

(secondary)

Polishing filtration

Advanced secondary

treatment

POTW

Metals

BOD, nutrients, ammonia,

or toxic organics

Pretreatment program

requiring metals dischargers

to meet effluent guidelines

(chemical precipitation)

Biological treatment

(secondary)

Enhanced pretreatment

program with tighter limits

(polishing filtration)

Advanced secondary

treatment, secondary

treatment with nutrient

removal, or both

Agricultural

land (nonpoint

source)

Tillage

Fertilizer use

Riparian zones

Concentrated runoff on

sloped fields

Farming on highly erosive

land

Partial adoption of

conservation tillage

Partial adoption of nutrient

management planning

Minimal

None

Some land already retired in

Conservation Reserve

Conservation tillage

Nutrient management

planning

Riparian forest buffers for

crop and pasture land; use

exclusion or stream protection

for range land

Vegetative barriers

Retire and cover remaining

highly erosive cropped land

AFOs (nonpoint

source)

Collect manure and spread

it on nearby fields

Manure hauling

Manure and fertilizer use

Most necessary facilities are

commonly in place

Virtually none

Partial adoption of nutrient

management planning

Comprehensive set of manure

management measures

Transport manure to locations

where it can be spread at

agronomic (P-based) rates

Nutrient management

planning

Silviculture

(nonpoint

source)

Harvesting-related

activities

Artificial forest

regeneration

As prevailed in roughly

1990

As prevailed in roughly

1990

Comprehensive set of

measures to minimize

impacts

Comprehensive set of

measures to minimize

impacts

On-site

wastewater

treatment

Failing systems Actual rate of failure Repair and failing systems

in riparian zone
IV - 9

O. ESTIMATING COSTS FOR SOURCES TO IMPLEMENT THESE CONTROL MEASURES

Assumption

For each type of source and type of control, we estimate costs using a control cost function drawn

from an appropriate EPA reference. Each cost function projects costs as a function of the size (e.g.,

wastewater flow, number of animals at an AFO, number of acres cut for silviculture) of the source.

Impact of assumption

Unknown. Perhaps these cost models overestimate the ultimate costs for meeting LAs and WLAs. 

Ex post analyses of the actual costs that sources have incurred to meet pollution control standards have

often found that ex ante engineering cost models overestimated costs -- process modifications or material

substitutions were implemented that reduced emissions at costs lower than the add-on control equipment

that provided the basis for the original cost estimate.

The capital cost functions drawn from the CWNS for the next treatment step for point sources for

BOD, nutrients, toxic organics and ammonia seem potentially likely to overestimate costs of upgrades

because they simulate building a new plant and receiving a credit for the salvage value of the existing plant.

For nonpoint sources, we generally selecte a more expensive specific BMP to represent the costs of

the entire variety of possible BMPs within any given practice group.

P. FLOW OR VOLUME INFORMATION USED FOR EACH SOURCE IN TREATMENT COST

FUNCTIONS

Assumption

For point sources, wastewater flow information is obtained from PCS. This is despite our

impression that flow information reported in PCS is poorly quality-controlled and often in error. We use

the flow information reported in PCS for any facility for which such information is available. For the

many dischargers with no flow information reported, we assign the source the average flow reported for

other sources in that SIC or group. We assume that dischargers with large flows will segregate their waste

streams such that advanced treatment will be applied to only the small, most contaminated portions of their

total flow. We thus limit in various ways the maximum flows that we assume each point source discharger

will need to treat. For nonpoint sources, we use the following measures of volume in the cost functions:

acreage (for agricultural land), acreage and volume cut (for silviculture), number of animals or animal

units (for AFOs), and number of dwelling units served by on-site wastewater treatment systems (for

OWTS).

Impact of assumption

The implementation costs we estimate for point sources are substantially affected by the set of

assumptions and procedures to deal with flow issues. On the whole, we believe that our assumed upper

limits on the flows that will be treated are conservative -- that is, the great majority of point sources will

have flows to be treated that are actually well below the upper limits that we assumed, and costs therefore

are likely overestimated. For nonpoint sources, we believe the volume information used for costing is

reasonably accurate.
IV - 10

Q. ADJUSTMENTS OF THE IMPLEMENTATION COST ESTIMATES TO REFLECT

MISSING DATA

Assumption

The data that we use to estimate costs are not complete. Some impaired water bodies are not

georeferenced. Without location information for these water bodies, they can not trigger any

implementation costs for nearby point or nonpoint sources. Similarly, some point sources are not

georeferenced; we cannot estimate whether or not they will incur costs because we do not know whether or

not they are within or upstream of impaired waters. We use a scaling procedure to adjust our cost

estimates to reflect this missing data. Implementation costs are estimated for the subset of States and

sources for which we have data, and we then extrapolate the results to the remainder of the Nation using a

scaling factor reflecting the portion of the Nation for which we do have data. Our key assumption is that

the portion of the Nation for which we do not have data has impairments and will incur compliance costs at

the same rate as a function of source activities as does the portion of the Nation for which we do have data.

Impact of assumption

This scaling adjustment for missing data adds some uncertainty, but probably entails little bias. 

Our extrapolation from the areas where we have data to the areas where data are missing is problematic

only if there is something systematically different in the relationships between sources and impairments in

the areas with data compared with these relationships in the areas without data. We do not expect any such

systematic differences to arise because of missing georeference information for some point sources, as it

appears to be generally random whether or not point sources are georeferenced. However, there are

systematic differences in whether or not water body location information is available. Georeference

information is not available for about 35 % of all impaired waters, including all waters in CA and Region

10 (which include about 17 % of all impaired waters). Our extrapolation procedure may be inaccurate if

source/impairment relationships are generally different in these far-western States than in the rest of the

country. If, for example, silviculture is either more or less likely to cause water quality impairments in the

far-western States than in the rest of the country, then extrapolating silviculture implementation costs based

on volume cut from the remainder of the Nation to these States is inaccurate. We believe, for example, that

silviculture is significantly more tightly regulated in these States than elsewhere, suggesting that it may

cause fewer water quality problems in the far West. On the other hand, the generally steep slopes in the

areas where logging is conducted in the far West suggest perhaps greater problems there than elsewhere. 

On the whole, we believe that these sorts of possibilities for bias in our extrapolation procedure are not

substantial.

USDA has suggested in reviewing a draft of this report that using national average figures for the

unit costs of agricultural BMPs may result in underestimating national costs if costs are typically higher in

the specific areas where TMDLs will most frequently require load reductions. For example, although we

have estimated the costs to retire crop land based on national averages for this practice, USDA surmises

that much of the crop land retirement that may be prompted by TMDLs will occur in the midwestern

agricultural heartland, where crop land values are particularly high. We will investigate this sort of

possibility before finalizing this report.

R. TIMING ASSUMPTIONS CHOSEN FOR THE IMPLEMENTATION COST ANALYSIS

Assumption

We have estimated the costs for point and nonpoint sources to achieve water quality standards for

the currently listed 303(d) waters. We estimate these costs assuming a steady pace of TMDL development
IV - 11

from now through 2015 (and we further assume that costs will be incurred under the other scenarios at the

same time as under the TMDL Program scenario). We assume that the average source will begin incurring

its compliance costs five years after the TMDL is developed. We discount costs that will be incurred in the

future back to the present, and calculate an equivalent level, annualized amount beginning in the year 2000

and continuing forever.

Impact of assumption

The implementation costs we estimate would be substantially different if different analytical

ground rules were chosen. Our chosen TMDL pace/compliance time lag scenario reduces the costs we

show as annualized costs beginning now to an amount that is 44.84 % of what annual costs will be after all

affected sources have had to meet TMDL requirements.

On the other hand, the costs for a pollutant source to achieve its allowed load under a TMDL

developed far in the future may be greater than if the TMDL were developed today. Growth in the

population served by a POTW or growth in production by an industrial discharger may make achieving the

same discharge limit in, say, 2010 more costly than achieving that limit in 1999. In addition, as States

assess more of their waters, additional water bodies will be listed for which TMDLs will need to be

developed. In this analysis, we estimate the costs associated with implementing TMDLs only for waters

that are currently listed.
APPENDICES
A-1

APPENDIX A: GROUNDTRUTHING THE ASSUMPTIONS

In estimating the costs to pollutant sources from TMDLs or alternatives to them, this study makes

many assumptions that simplify the analysis and reduce the extent of data needed. To assess the validity of

these assumptions, we would like to compare them against actual experience among the TMDLs that have

been completed thus far. We have only begun to do this. We have reviewed 15 completed TMDLs and

compiled information from them that is relevant to the analytical assumptions we have made. In this

appendix, we “groundtruth” the assumptions by comparing them against what has happened among this

sample of completed TMDLs. Given the wide variation in the sorts of waters and impairments that actual

TMDLs will address, a sample of 15 completed TMDLs is obviously far short of an ideal data base from

which to draw conclusions. Nevertheless, this initial groundtruthing effort provides some preliminary

indications of patterns across actual TMDLs, and the results are sufficiently interesting to warrant a

substantially increased effort to develop a larger and more representative database of completed TMDLs

for groundtruthing.

Tetra Tech selected 15 recently completed TMDL submissions for analysis. No formal statistical

sampling or selection procedure was employed. Tetra Tech simply selected TMDLs that the firm was

familiar with, and which would cover a substantial range of impairment pollutants, source types (both point

and nonpoint sources) and geographic locations. Tetra Tech then abstracted information from the selected

TMDLs to fill in a common data collection template. This information was further condensed to develop a

one-page summary for each TMDL (attached at the end of this appendix) and a summary exhibit for the

entire set of 15 TMDLs (appearing on the next page). On the following pages, we review what can be

learned from the 15 TMDLs that is relevant to the major assumptions adopted for this analysis.
A-2

Exhibit A -1 

Summary of Groundtruthing Information From 15 TMDLs

TMDL Submission # of 303(d) Waterbodies

Covered

Pollutants % Reduction

Source Types

Assigned

Reductions

Are All Relevant

PS AssignedReductions?

Geogra

Ass

Anderson Run, WV 1 Fecal

coliformbacteria

42 NPS N/A Entire wate

Appoquinimink River,DE

1 CBOD

NBODP

565268

PS

NPS

Yes Entire wate

Bayou Nezpique, LA 1

(or more,

unclear)

CBODNH3

For both pollutants,0-50% reductionfrom PS, 85-90%reduction fromNPS

PS

NPS

No Entire wate

counties

Buckhannon River,WV

1 Al

FeMn

883

NPS No Loads were 

watershed, 18% of totacounties. Rassigned to within this l

Coeur d’Alene RiverBasin, ID

28 plus Dissolved

Metals (Pb,Cd, Zn)

Unknown. Targetload is assignedbut current loadsunknown

PS

NPS

Yes Entire wate

of 3 countie

Duck Creek, AK 1 Sediment/

Turbidity

42-62 NPS N/A Entire wate

Elk Creek, OK 1 BOD

NH3

50-67Unknown

PS Yes N/A
TMDL Submission # of 303(d) Waterbodies

Covered

Pollutants % Reduction

Source Types

Assigned

Reductions

Are All Relevant

PS AssignedReductions?

Geogra

Ass

A-3

Garcia RiverWatershed, CA

1 Sediment 60 NPS N/A Entire wate

Hurricane Lake, WV 1 Sediment

PFe

304530

NPS No Entire wate

Lake Thonotosassa,FL

1 N

P

Unknown. Targetload is assignedbut current loadsunknown86

NPS No Entire wate

Muddy Creek, VA 1 Fecal

coliformbacteria

99 NPS No Entire wate

Nanticoke River andBroad Creek, DE

2 BOD5

NP

292332

PS

NPS

No Entire wate

Neuse River Estuary,NC

1 (large

estuary)

N 30 PS

NPS

Yes Entire wate

19 counties

Noyo RiverWatershed, CA

1 Sediment 67 NPS N/A Entire wate

Sanders Branch/CoosawhatchieRiver, SC

2 CBOD

NBOD

Unknown PS No N/A
A-4

I. COMPARISON OF KEY ANALYTICAL ASSUMPTIONS WITH INFORMATION FROM 15

TMDLS

A. ASSUMPTIONS RELEVANT TO POINT SOURCE COSTS

 Are controls for point sources triggered by pollutants other than BOD, nutrients, metals,

toxic organics, or ammonia?

 No. Among this set of TMDLs, the pollutants triggering point source controls

include: BOD (5 instances), nutrients (3), ammonia (2), and metals (1).

 Are the only point sources assigned reductions those that discharge directly to the impaired

segment, or are upstream point sources addressed also?

 In many instances, point sources upstream of the impaired segment are addressed

also. In some instances, some upstream point sources are believed to be too

distant to warrant further controls.

 At what distance upstream of the impairment are point sources that discharge the

impairment pollutant still considered to need controls? (e.g. 25/50 miles?)

 We can’t tell from the available information how far upstream each point source is

located (whether the point source is addressed or not addressed). Further

investigation would be necessary to ascertain distances.

 Are all point sources thought to be discharging the impairment pollutant within a relevant

distance of the impairment assigned a load reduction?

 No. In 4 of 11 cases, all relevant point sources are assigned reductions. In 4

cases the point sources contributing minimally to impairment are assigned no

reductions and all important point source pollutant sources are assigned

reductions. In 2 cases explicit decisions were made that some significant pollutant

sources would need reductions while others would not. In one case an aggregate

load reduction was assigned to all point sources and trading was expected.

 Do the TMDLs often require further load reductions from point sources that already

provide treatment in excess of technology-based standards?

 Yes, in at least two cases point sources that already provide advanced treatment

are being required to do more. In many cases, it is difficult to tell from the limited

information available.

 In two other cases, particular point sources are not required to reduce their loads

further because they have already adopted some form of advanced waste treatment

(even though they could reduce loads further anc achieve zero discharge).

 How does the percentage load reduction required of point sources in the aggregate compare

with the load reduction that would be achieved if all relevant point sources implemented

“the next treatment step”?

- See the exhibit and detailed conclusions that follow below.
A-5

Exhibit A-2 

Information From 11 Groundtruthing TMDLs Regarding % Reductions Sought from Point Sour

Water Body Overall Approach to Point Sources in This TMDL Our Judgment About Ov

This TMDL Requires fo

Sou

Appoquinimink River, DE River is affected by only one point source; it is assigned load reductions CBOD: 57%

NBOD: 83%P: 85%

Bayou Nezpique, LA Is significantly affected by 9 PS and insignificantly affected by 16 PS. 

The 9 are assigned varying load reductions ranging from 0 - 50 % for

BOD and NH3. The 16 are assigned no load reductions

BOD, NH3 both likely 10 - 4

Buckhannon River, WV Very small contributions from numerous PS in the watershed. No load

reductions assigned to PS

Waterbody is affected by NPrelevant in assessing typical 

PS.

Coeur d’Alene River Basin, ID Numerous PS identified as contributing metals, the impairment

pollutants. Allowable loads were assigned to PS in the aggregate, but

current loads are unknown and hence % reduction is unknown

Unknown

Elk Creek, OK Creek is affected by only one point source; it is assigned load reductions BOD: 50 - 67 %, depending 

Hurricane Lake, WV Lake may be affected trivially by only one small PS. It is not assigned a

load reduction

Waterbody is affected by NPrelevant in assessing typical 

PS.

Lake Thonotosassa, FL Lake may be minimally affected by numerous PS that already employ

land treatment/zero discharge

Waterbody is affected by NPrelevant in assessing typical 

PS.

Muddy Creek, VA Very small contributions (of pathogens) by PS. They are not assigned

load reductions

Waterbody is affected by NPrelevant in assessing typical 

PS.

Nanticoke River & Broad Creek, DE Significant contributions from many point sources. Explicit decision

made to require load reductions from some and not from others

BOD: roughly 30 %

Nutrients: roughly 30 %
A-6

Neuse River Estuary, NC Significant contributions from many, many point sources. Uniform

permit limits assigned to each that will achieve the desired aggregate

load reduction. Trading expected

N: 30 %

Sanders Branch/Coosawhatchie R,SC

Several important, several lesser PS identified. Significant reductions

assigned to the important PS, while no reductions required of lesser PS

BOD: unclear, but likely sign
A-7

B. CONCLUSIONS REGARDING % REDUCTIONS SOUGHT FROM POINT SOURCES:

 Among the sample of 15 TMDLs, 4 do not involve point sources at all, leaving 11 to be

reviewed in this analysis.

 Many waters identified as impaired essentially by nonpoint sources nevertheless have point

sources nearby that contribute small or insignificant amounts of the impairment pollutant. 

We have 4 examples of this sort among the 11 groundtruthing TMDLs. In each of these 4

cases, the TMDL requires no load reductions from the point sources. These cases support

our assumption in the implementation cost analysis that TMDLs for NPS-only waters will

not require further controls for point sources.

 Among the 7 cases where point sources are seriously addressed by the TMDL, 3 involve

an aggregate load reduction across all point sources in the 10 - 40 % range, 3 involve

aggregate load reductions in the 50 - 85 % range, and one is unknown.

 The “next treatment steps” that we simulate for point sources will yield very roughly the

following percentage load reductions: (Note, further work is proceeding on this issue)

- metals from industrial dischargers 90 %

- metals from POTWs (enhanced pretreatment) 70 %

- BOD 50 %

- nitrogen 75 %

- phosphorus 50 %

- ammonia 75 %

- toxic organics ? (not addressed in this

sample)

 For perhaps half of the TMDLs, the aggregate load reduction that will be obtained by

implementing the next treatment step at all relevant point sources (50 to 90 %) is much

greater than the aggregate load reduction needed (10 - 40 %). For the other half of the

TMDLs, the aggregate load reduction that will be obtained by the next treatment step for

all relevant point sources will yield approximately the same aggregate load reduction as

that called for by the TMDL.

 Based on this, in analyzing the “Moderately Cost-effective TMDL Program” Scenario, we

will assume that:

- In half of the TMDLs, all the point sources will need to take the next treatment

step;

- In the other half of the TMDLs the next treatment step for all point sources will

provide twice the load reduction that is needed. In this half of the TMDLs, in

effect, only half the point sources will need to implement the next treatment step

and half of the point sources will likely be able to avoid the next treatment step.

- We will thus assume that Moderately Cost-effective TMDL Program costs

can be reduced by 1/4 from Scenario 1 costs.
A-8

C. ASSUMPTIONS RELEVANT TO NONPOINT SOURCE COSTS

 What is the geographic extent of the nonpoint source watersheds from which load reductions are

sought?

- In 12 of 13 cases, nonpoint sources throughout the entire upstream watershed will be

affected. In one case, nonpoint sources were singled out in only a few of the key

subwatersheds.

 Relative to the acreage in the county or counties within which the impaired waters is located, how

many acres are in the zone within which nonpoint sources will need to be controlled?

- For Scenario 1 (“Least Flexible TMDL Program”), we assumed that the acreage to be

controlled was equal to the acreage of the surrounding county or counties. This appears

nearly always to be a substantial overestimate relative to what actual TMDLs have

required. See the exhibit on the next page. Across the 13 TMDLs requiring nonpoint

source controls, the median watershed acreage needing controls per waterbody amounted

to 7.0 % of the acreage of the county or counties. The 25th percentile was controls for

acreage amounting to 3.2 % of the county’s acreage per waterbody, while the 75th

percentile was controls for acreage amounting to 32.8% of the acreage of the county per

waterbody. The mean figure is substantially higher, due to one TMDL covering two

waterbodies that will require nonpoint source controls for acreage amounting to that for 19

surrounding counties. See the exhibit on the following page.

- For this analysis, for Scenario 2 (“TMDL Program”), we will assume that the TMDL

for a nonpoint source-impaired water body will controls for acreage equal to 5 % of

the number of acres in the surrounding county (lower estimate, slightly larger than

the 25th percentile figure) or 40 % of the number of acres in the surrounding county

(upper estimate, slightly larger than the 75th percentile figure).

 How does the percentage load reduction required of NPS within the area needing controls compare

with the percentage likely to result from our assumed “next treatment step” packages for nonpoint

sources?

- The percentage reduction required by the TMDLs from nonpoint sources within the

targeted areas is: 0 - 25%, 1 case; 25 - 50%, 4 cases; 50 - 75%, 4 cases; 75%+, 2 cases.

- We need to do further research to determine what percentage reduction is likely achieved

by each of our NPS “next treatment step” packages. As a very rough guess, if our NPS

packages were to reduce loadings by 75%, we would be overestimating costs somewhat.
A-9

Exhibit A-3

Extent of Nonpoint Source Controls Required by TMDLs

Comparison of Number of Acres in County with Number of Acres of Watershed Controlled 

TMDL

# of 303d

waterbodi

es

addresse

d in TMDL

Additional

303d

waterbodies

subsumed

in

controlled

area

Total #

waterbodi

es

#

Counties

within

which

NPS load

reduction

s are

sought

% of these

counties'

area

affected

% of one

typical

county's

area

affected

% of a

typical

county's

area

affected

per

waterbody

Duck Creek, AK 1 1 1 0.03 0.03 0.03

Hurricane Lake, WV 1 1 1 0.7 0.7 0.7

Garcia River, CA 1 1 1 3.2 3.2 3.2

Noyo River, CA 1 1 1 3.2 3.2 3.2

Muddy Creek, VA 1 1 1 3.7 3.7 3.7

Lake Thonotosassa, FL 1 1 1 5.2 5.2 5.2

Anderson Run, WV 1 1 1 7.0 7.0 7.0

Coeur d’Alene, ID 28 28 3 100.0 300.0 10.7

Appoquinimink, DE 1 1 1 11.0 11.0 11.0

Nanticoke River, Broad

Creek, DE 2 2 1 42.0 42.0 21.0

Bayou Nezpique, LA 1 1 2 4 22.3 89.2 44.6

Buckhannon, WV 1 1 3 18.0 54.0 54.0

Neuse River, NC 1 1 2 19 100.0 1900.0 950.0

Elk Creek, OK 1 1

Sanders Branch/

Coosawhatchie, SC 2 2

mean 85.7

median 7.0

25th

percentile 3.2

75th

percentile 32.8
B-1

S cale F actor for P ace of T MDL Development and Compliance T ime L ag

Assume, once all sources have begun incurring costs, that the total annualized compliance costs for all these sois $1.00 per year, continuing forever

Dis count Rate: 0.07 0.03 0

Year # TMDLs Completed % TMDLs Completed Cumulative % TMDLs Completed After 5-Year Lag, % of Sources Incurring Compliance Costs Present Value of Compliance Costs Present Value of Compliance Costs Baseline: $1 per yea

2000 and continui

2000 2000 5.52% 5.52% 0.0000 0.0000 1.0000 1.002001 2281.666667 6.30% 11.82% 0.0000 0.0000 1.0000 0.932002 2281.666667 6.30% 18.12% 0.0000 0.0000 1.0000 0.872003 2281.666667 6.30% 24.42% 0.0000 0.0000 1.0000 0.812004 2281.666667 6.30% 30.72% 0.0000 0.0000 1.0000 0.762005 2281.666667 6.30% 37.01% 5.52% 0.0394 0.0476 1.0000 0.712006 2281.666667 6.30% 43.31% 11.82% 0.0788 0.0990 1.0000 0.662007 2281.666667 6.30% 49.61% 18.12% 0.1128 0.1473 1.0000 0.622008 2281.666667 6.30% 55.91% 24.42% 0.1421 0.1927 1.0000 0.582009 2281.666667 6.30% 62.21% 30.72% 0.1671 0.2354 1.0000 0.542010 2281.666667 6.30% 68.51% 37.01% 0.1882 0.2754 1.0000 0.502011 2281.666667 6.30% 74.81% 43.31% 0.2058 0.3129 1.0000 0.472012 2281.666667 6.30% 81.10% 49.61% 0.2203 0.3480 1.0000 0.442013 2281.666667 6.30% 87.40% 55.91% 0.2320 0.3807 1.0000 0.412014 2281.666667 6.30% 93.70% 62.21% 0.2413 0.4113 1.0000 0.382015 2281.666667 6.30% 100.00% 68.51% 0.2483 0.4397 1.0000 0.362016 74.81% 0.2534 0.4662 1.0000 0.332017 36225 1 81.10% 0.2568 0.4907 1.0000 0.312018 87.40% 0.2586 0.5134 1.0000 0.292019 93.70% 0.2591 0.5344 1.0000 0.272020 100.00% 0.2584 0.5537 1.0000 0.25

Pres ent value for years 2000 through 2020: 3.1622 5.4484 11.59PV in 2020 for all years after that: 14.2857 33.3333 14.28PV in 2000 for annual cos ts after 2020: 3.6917 18.4559 3.69PV for all years : 6.8539 23.9042 15.28Annuity value: 0.4798 0.7171 1.07

S cale factor, relative to cos t of $1/yr forever, beginning in 2000: 0.4484 0.6962 1.00

APPENDIX B: TMDL PACE AND TIME LAG SCALE FACTOR
C-1

APPENDIX C: POLLUTANTS FOR ANALYSIS

In order to limit the analytical workload (e.g., developing and applying cost functions for the next

treatment step for each pollutant), we chose to analyze only those particular pollutants for which TMDLs

are most likely to require further controls (beyond technology-based standards) for point sources. We

considered the most frequent causes of impairment, and asked whether each of these causes would

commonly trigger the need for further controls of point sources that are already meeting technology-based

standards.

Exhibit C - 1 summarizes our judgments and rationale. The exhibit shows the number of point

sources upstream within 50 miles of 303(d) waters impaired for different pollutants. Pollutants are listed in

descending order of the frequency with which they implicate point sources for potential further control

needs. For example, the exhibit shows that there are 4386 point sources upstream within 50 miles of water

bodies that are impaired for BOD/DO and that States have cited as impaired by both point and nonpoint

sources. There are 460 point sources upstream within 50 miles of water bodies that are impaired for

BOD/DO and that States have cited as impaired by point sources only.

Exhibit C - 1

Decisions on Causes/Pollutants to Analyze as Triggers for Further Point Source Controls

Cause/pollutant

# of point sources w/in

50 mi. upstream of

waters impaired by

Include this

as a

pollutant

for

analysis?

Waters Rationale

Impaired

by PS +

NPS

Waters

Impaired

by PS

only

BOD/DO 4386 460 Yes

Metals 4277 776 Yes

Nutrients 3965 293 Yes

Sediment 3656 86 No Probably rare that PS process water discharges are worth

controlling for sediment beyond BPT. PS sediment problems

in wet weather will likely be handled by eventual compliance

with storm water and construction technology-based

requirements.

Pathogens 3564 131 No Problems are likely CSOs, SSOs and other wet weather

discharges, to be controlled by compliance with technologybased standards. Unlikely that other PS are worth controlling

for pathogens beyond BPT.

Habitat 2420 37 No TMDL necessary only if a pollutant can be identified

Suspended solids 2165 130 No Same as sediment

PCB 1599 126 No Problems are likely legacies, not ongoing, controllable process

water discharges needing control beyond BAT

Flow alteration 1570 NA No No TMDL necessary

Ammonia 993 64 Yes Which SICs might be worth controlling? POTWs? Others?
C-2

Pesticides 971 24 No Very few PS likely worth controlling for pesticides beyond BAT. 

Which SICs?

Dioxin 794 27 No Most problems are likely due to air deposition or legacy, not

ongoing, controllable discharges. Any SICs worth controlling

beyond BAT? Pulp/paper?

pH 622 8 No Unlikely that PS at BPT could be causing a problem

Oil and grease 560 21 No Unlikely that PS process discharges are worth controlling

beyond BPT. Compliance with existing wet weather

requirements will help.

Salinity 532 4 No Highly likely to be NPS problem

Toxics 517 35 Yes Absent more specificity, though, it is unclear what controls to

implement.

Chlorine 293 1 No Why is this a frequent problem in PS/NPS waters, but not in

PS only waters? Could use further investigation. Candidate

for addition to analysis.

Thermal mod. 288 17 No Expect that any PS problems should be taken care of by BPT

Unknown 275 43 No Unclear what controls to implement. Scale up to cover this.

Organics 274 30 Yes Assume this means toxic organics.

Odor 150 0 No Interesting that this shows up for PS/NPS waters, but not for

PS waters. Unclear what treatment measures might be

considered.

Dissolved solids 123 15 No Likely a NPS problem only

Fish advisories

(w/no mention of

the pollutant)

84 NA No Usually due to NPS, legacies, air deposition. Candidate for

addition to analysis if can get more data on which pollutant

and whether any suspected contribution from PS process

discharges.

Bacteria 78 0 No Same as pathogens

Sulfates 48 0 No Likely a NPS problem only

(Next most

frequent)

24 23 No Do not address very infrequent causes/pollutants

Cyanide 4 140 No Surprisingly high frequency in PS-only waters. Why? 

Candidate for addition to analysis.

Total (Note: this

exceeds the

number of point

sources upstream

of impairments. 

Many PS are

counted for

multiple causes.)

43,747 4,136 xxx xxx
C-3

We chose to analyze further those pollutants for which point sources are most frequently likely to

need additional controls beyond technology-based standards. Several sorts of considerations are reflected

in Exhibit C - 1:

 We chose not to analyze causes of impairment when no pollutant was identified. 

Examples included flow or habitat alteration or fish consumption advisory when no

pollutant was listed also.

 We chose not to analyze pollutants that are extremely unlikely to be discharged in

sufficient quantity to be problematic by a point source meeting technology-based

standards. Examples included temperature or pH.

 We chose not to analyze pollutants for which only a very small fraction of point sources

might require additional beyond-technology-based controls for process water discharges. 

Examples include sediment or pathogens. We believe that the great majority of instances

where waters are impaired for these causes and point sources are cited as a source involve

wet weather discharges from point sources. We believe these problems will largely be

remedied when existing technology-based standards for wet weather discharges -- storm

water, construction, CSO and SSO requirements -- are complied with.

 We chose not to analyze in this study pollutants representing a very small fraction of

causes that would require specialized treatment technologies as the”next step”. Examples

include chlorine and cyanide. We could consider such infrequent causes of point source

impairment in a future study.
D-1

APPENDIX D: APPROACHES FOR DETERMINING WHETHER A POINT

SOURCE IS LIKELY TO BE CONSIDERED FOR FURTHER CONTROLS

The objective of this portion of the analysis was to make a judgment about whether each point

source within a relevant distance upstream of an impairment for a specific pollutant would likely be

considered by the eventual TMDL or water quality-based permit to implement further controls. We sought

to determine whether an identified point source meeting applicable technology-based standards was likely to

discharge the impairment pollutant in sufficient quantity to warrant consideration for further controls. This

judgment was particularly difficult to make because there is little data available at the national level on the

pollutants that individual facilities discharge and their amounts. For the majority of dischargers, the Permit

Compliance System (PCS) -- EPA’s major data base on point source dischargers that we used to identify

potentially relevant facilities -- provides information only on which pollutants a facility is required to

monitor for. Only for a very few facilities does PCS provide reliable information on the amount of the

monitored pollutants that are discharged. PCS provides no information on whether a facility discharges

unmonitored pollutants or their amounts.

We tested three alternative approaches for determining whether or not a specific point source (after

meeting applicable technology-based requirements) discharges the impairment pollutant in an amount

sufficient to contribute to impairment and making the source likely to be considered in the TMDL or water

quality-based permit.

I. USE OF PCS INFORMATION: “SCREEN #1"

Our first approach to making this judgment was to use the information in PCS on frequency of

monitoring to judge by 4-digit SIC code whether each upstream facility is likely to discharge each

impairment pollutant. If the facility was judged to discharge the impairment pollutant, we would then

assume conservatively that the TMDL would require the facility to provide further controls beyond

technology-based standards. This approach, which we term Screen #1 rests on three assumptions:

 Assume that if facilities in a SIC generally monitor for a particular pollutant, all facilities

in that SIC likely discharge that pollutant. This assumption is probably nearly always

accurate.

 Assume also the converse: if facilities in a SIC rarely monitor for a pollutant then all

facilities do not discharge the pollutant. This assumption will often be untrue.

 Assume that if a facility discharges the impairment pollutant, the TMDL will likely require

further controls beyond technology-based standards. This assumption is likely often

untrue, but yields a conservative cost estimate.

Consistent with these assumptions, Screen #1 was implemented as follows:

 If no facilities in the SIC monitor for any pollutant, discard all facilities in the SIC. No

such facilities will be required to control further by the TMDL.

 If less than 15% of the facilities in the SIC monitor for the pollutant, assume that none of

the facilities without monitoring information discharge that pollutant. Assume that any

facility that does monitor for the pollutant does discharge it.
57 These are raw figures, not yet scaled to reflect the incomplete coverage of the analysis.

D-2

 If more than 15% of the facilities in the SIC monitor for the pollutant, assume that all of

the facilities without monitoring information (as well as those with monitoring information)

discharge that pollutant

The result when Screen # 1 was implemented that the roughly 20,000 point sources identified as

located upstream within 25/50 miles of impaired waters declined to 10,838 facilities.57 This Screen

eliminated about half of the identified facilities as being unlikely to discharge the impairment pollutant, and

thus unlikely to be required to control further by the TMDL.

The results of Screen #1 included many apparent anomalies. For example, metal finishers

appeared to need beyond-BPT/BAT controls for nutrients. Facilities in the “fabricated metal products”

industry did not appear to be candidates for further metals controls.

II. USE OF ENGINEERING JUDGEMENT: “SCREEN #2"

Screen #2 involves an engineering judgment as to whether each 4-digit SIC is likely, after meeting

BPT/BAT/secondary treatment requirements, to discharge each pollutant at levels that could warrant

potential further control. Two EPA engineers experienced in industrial water pollution control made these

judgments for each of more than 500 different SIC codes.

An example page among the engineers’ judgments follows. The page lists the facilities in SICs that

had passed Screen #1. For SIC 8062 (general hospitals), for example, 24 facilities had been identified

using Screen #1 as discharging the impairment pollutant within the relevant distance upstream of an

impaired water body. 4 hospitals discharged BOD upstream of a BOD/DO impairment, 22 discharged

metals upstream of a metals impairment, and 10 discharged a nutrient upstream of a nutrient impairment. 

Screen #1 would lead to these hospitals being costed for the next treatment step for these pollutants. 

Screen #1 did not identify any hospitals as discharging ammonia or toxic organics upstream of an

impairment for either of these pollutants. In contrast, the engineers’ judgment was that hospitals were

likely candidates for further controls for BOD, metals, nutrients and toxic organics whenever they were

upstream within the relevant distance of an impairment for any of these pollutants. The engineers believed

that hospitals were not a likely candidate for further controls if ammonia was the impairment pollutant. In

Screen #2, engineering judgment was used to over-ride the conclusions drawn from the monitoring-based

Screen #1. Some pollutants were crossed out as being unlikely to warrant beyond-technology-based

controls for some SICs, and other pollutants were added as being likely candidates for further controls even

though the monitoring information for facilities in that SIC suggested that perhaps the pollutants were not

being discharged by the SIC. Engineering judgments were also provided for several hundred SICs that

Screen #1 had eliminated from consideration altogether because no facilities in these SICs monitored for

any impairment pollutants.

Screen #2 reflecting the engineers’ judgments was ultimately implemented in two alternative ways,

resulting in high and low estimates for the number of point sources likely to be required by TMDLs to

implement further controls. The high estimate adopts more liberal rules for matching sources and

impairments than does the low estimate. For the high estimate, when a water body is impaired by a specific

metal (except mercury) or a specific toxic organic (except PCBs or dioxin) and the facility (based on

engineering judgment for its SIC) is expected generally to discharge metals or toxic organics, then further
D-3

controls are assumed to be required for that facility. For the low estimate, the match must be exact in order

for controls to be required at a facility: if a water body is impaired for metals generally then facilities that

discharge metals generally are assumed to require controls, but if a water body is impaired for a specific

metal or toxic organic (e.g., zinc, phenol), only those facilities discharging that specific metal or toxic

organic are assumed to require controls.

Screen #2 resulted in a variety of changes relative to Screen #1. Many SICs were dropped as

unlikely to discharge the impairment pollutant in sufficient quantity to make the SIC a likely target for

beyond-technology-based controls. Some new SICs were added with many facilities that appear to be

mostly storm water (surface coal mining [600 facilities], crude petroleum & natural gas [46], oil & gas

field services [40]) and may not be reasonable targets for further controls under TMDLs. Other SICs were

added that may reasonably be targets for further controls: private households (11 facilities) and car washes

(23).
D-4

INSERT PHOTOCOPY PAGE OF ENGINEERS’ JUDGMENT
D-5

Ultimately Screen #1 and Screen #2 (high and low estimates) gave surprisingly similar results, in

terms of the number of point sources likely to need further controls under TMDLs and in terms of

implementation costs for these sources:

Exhibit D-1

Summary Results of Alternate Screening Processes

Screen # of Point Sources

Incurring Costs

Annualized Projected Costs

(1999 $ in millions)

#1, based on PCS monitoring information 9,101 1,499

#2, engineering judgment, higher estimate 9,492 1,378

#2, engineering judgment, lower estimate 8,533 1,141

On the whole, we believe that the pattern of pollutant/SIC combinations for which further controls

are projected to be necessary is most reasonable under Screen #2 (higher estimate). We adopted this

screening approach for our final cost estimating procedure. Note that the three screens give very similar

results despite rather different underlying rationales, lending some credence to our conclusions.

Also note that this comparison of alternate screening processes was developed relatively early in

the implementation cost analysis. We made several important changes in our analytical procedures

subsequent to choosing among the three screening approaches. As a result, the estimates shown in Exhibit

B-1above are not comparable to other estimates shown elsewhere in this report. Most importantly, the cost

functions for next step treatment technologies that we ultimately use in the cost analysis are different from

the preliminary cost functions that underlie Exhibit D-1 and that we were using at the time we made the

choice among screening processes.
E-1

APPENDIX E: DETAIL ON COST FUNCTIONS FOR POINT SOURCES

This appendix provides additional information on all the cost functions used in the point source

analysis. The functions themselves are also shown.

I. CAPITAL COSTS FOR POTWS AND INDUSTRIAL DISCHARGERS FOR “NEXT STEP”

TREATMENT

The relevant CWNS capital cost functions are as follows:

Capital Cost = $1,000,000 x A x (flow)

B

where A and B are coefficients selected from the exhibit below based on the type of function requested, and

flow is expressed in million gallons per day.

Exhibit E-1

CWNS Capital Cost Functions (1996 dollars)

Function

flow < 0.35 mgd flow 0.35 to 1 mgd flow > or = 1 mgd

A B A B AB

Secondary treatment

1.188 0.396

5.488 1.854 5.488 0.673

Secondary treatment w/ nutrient removal 5.903 1.923 5.903 0.754

Advanced treatment I 7.215 2.114 7.215 0.740

Advanced treatment I w/ nutrient removal 8.651 2.287 8.651 0.728

Filtration NA NA 0.770 0.527 0.770 0.527

Secondary treatment salvage NA NA 1.195 0.840 1.195 0.840

The CWNS applies these capital cost functions as follows:

 For most plants with flow greater than 0.35 mgd currently providing secondary treatment,

the cost of an upgrade is estimated as the cost of a new plant at the desired level of

treatment (e.g., advanced treatment I) as given by the correct function, less the salvage

value of the former secondary treatment facility, as given by the “secondary treatment

salvage” function.

 For plants employing lagoon systems with no mechanical process units (generally smaller

plants), the cost to upgrade from secondary treatment is given by the filtration cost

function.

 For plants of less than 0.35 mgd flow, the cost to upgrade from secondary treatment is

0.35 x the cost of a new plant, as given by the function shown above for these small plants.

The capital costs for treatment upgrades estimated using these functions are in January, 1996

dollars. They are updated to March, 2000 dollars by multiplying by 1.0662 to represent the change over

this period in the producer price index for materials and components for construction.
E-2

II. O&M COSTS FOR POTWS AND INDUSTRIAL DISCHARGERS FOR “NEXT TREATMENT

STEP”

Our cost estimate is developed by subtracting a regression equation estimating the O&M cost for

secondary treatment as a function of flow from another regression equation estimating the O&M cost for

tertiary treatment as a function of flow. The two equations are as follows:

 O&M cost for secondary treatment ($/yr) = 261,396 x flow0.855 (1)

 O&M cost for tertiary treatment ($/yr) = 399,749 x flow0.780 (2)

where flow is measured in mgd.

Costs are given in these equations in 1999 dollars. We update to March, 2000 dollars based on the

producer price index for finished goods (factor of 1.0286).

The O&M cost increment in upgrading from secondary to tertiary treatment is given by equation

(2) minus equation (1). Although this gives the cost difference in upgrading from secondary to tertiary

treatment as AMSA defines it, we use this relationship also to estimate the cost of upgrading from

secondary to advanced secondary treatment.

There is an important quirk in this relationship. At flows exceeding about 80 mgd, the relationship

predicts that the O&M cost differential will decline as flow increases. The relationship predicts, for

example, that the O&M cost increase in upgrading a 100 mgd plant would substantially exceed the cost

increase in upgrading a 200 mgd plant. We believe this is unlikely to be true in reality. We have adjusted

the O&M cost function for upgrades to linearize the relationship at flows in excess of 80 mgd. At flows

greater than 80 mgd, we assume that the O&M cost increase varies linearly with flow. Thus, for example,

we assume that the O&M cost increase when upgrading a 120 mgd plant is 1 1⁄2 times the O&M cost

increase that would be experienced in upgrading a 80 mgd plant.

There are several complexities in developing the regression equations using AMSA’s data. AMSA

presents information by sewerage authority, not by plant. Thus, AMSA might report that an authority

operates 3 plants providing secondary treatment and 2 plants providing tertiary treatment, and AMSA then

gives data on the total flow and total O&M costs for the 3 secondary plants and on total flow and total

O&M costs for the 2 tertiary plants. Lacking data on individual plants, we thus perform the regressions on

data aggregated at the authority level. Assuming that there is some non-linearity in the relationship

between flow and O&M cost for an individual plant, performing regressions with the data aggregated at the

authority level results in increased statistical imprecision.

AMSA also excludes sludge management costs in reporting the authority’s O&M costs. Sludge

management costs are reported in total for the entire authority, and are not broken out and attributed

separately to the authority’s primary, secondary and tertiary plants. We thus don’t know the authority’s

full O&M costs, including sludge costs, for its plants providing secondary treatment and for its plants

providing tertiary treatment. We address this shortcoming in a rough manner by allocating sludge

management costs to the authority’s primary, secondary and tertiary plants in proportion to their flow. If,

for example, sixty percent of an authority’s flow occurred in secondary plants and forty percent in tertiary

plants, we would allocate 60 % of the sludge costs to the secondary plants and 40 % to the tertiary plants. 
58 U.S. EPA, Office of Water. Development Document for Proposed Effluent Limitations Guidelines and

Standards for the Centralized Waste Treatment Industry. December, 1998.

E-3

This proportional allocation is inaccurate; a tertiary plant will likely generate significantly more sludge than

a secondary plant of the same flow.

Nevertheless, the regression equations come out quite well despite these rough adjustments. The

regression equations explain a high fraction of the variance in the dependent variables (secondary and

tertiary O&M costs), and the coefficient estimates for the independent variables (secondary and tertiary

flow) are both significant at beyond the 99 % level.

III. TREATMENT FOR METALS FROM DIRECT DISCHARGERS EXCEPT POTWS

Polishing multi-media filtration was assumed as the “next treatment step”, assumed to be

incremental over the technologies assumed to be in place to meet BAT (flow reduction, chemical

precipitation, clarification). The capital and O&M cost functions for polishing filtration are drawn from

EPA’s development document for the centralized waste treatment industry.58 The equations are:

 Capital cost: ln(Y1) = 12.0126 + 0.48025ln(X) + 0.04623(ln(X))2

 O&M cost: ln(Y2) = 11.5039 + 0.72458ln(X) + 0.09535(ln(X))2

where: Y1 = capital costs (1989 dollars)

Y2 = O&M costs (1989 dollars/yr)

 X = flow rate (mgd)

To update to March, 2000 dollars, we multiplied the capital costs by 1.2473 (PPI for materials and

components for construction) and O&M costs by 1.2042 (PPI for all finished goods).

The applicable flow rate range for these equations is 0.023 - 1.0 mgd. For a discharger with flow

needing additional metals treatment of less than 0.023 mgd, we assumed costs as if flow was 0.023 mgd. 

For a discharger with flow needing additional metals treatment of greater than 1.0 mgd, we assumed a

proportional increase in costs relative to costs for treating a flow of 1.0 mgd. Thus, for example, for a

discharger needing to treat 2.0 mgd, we assumed that costs would equal twice what the EPA cost equations

gave for a flow of 1.0 mgd.

IV. TREATMENT FOR METALS FROM POTWS

 An enhanced pretreatment program with tighter local limits (tighter than PSES) for significant

metals indirect dischargers was assumed as the “next treatment step” when POTWs need to provide

enhanced control of metals. The enhanced pretreatment program was assumed to be incremental over a

baseline pretreatment program in which local limits match effluent guideline requirements for indirect

dischargers.

The key steps in developing the cost function for this enhanced pretreatment program were as

follows:
59 RCG/Hagler Bailly, Inc. Regulatory Impact Analysis of the Final Great Lakes Water Quality Guidance. 

Final Report, March, 1995.

60 The 1,600 pretreatment POTWs serve 270,000 industrial users, of which 31,842 are SIUs. The average

pretreatment POTW thus serves about 169 industrial users, of which about 20 are SIUs. SIUs are defined

as those indirect industrial dischargers that are either: 1) subject to categorical standards (14,914 SIUs) or

2) greater than 25,000 gpd flow or greater than 5 % of POTW flow or have reasonable potential for passthrough or interference.

E-4

 We assumed that any major POTW within the 50 mile distance upstream of a metalimpaired water will need to implement an enhanced pretreatment program. We assumed

that no minor POTWs will need to implement such a program..

These two assumptions may overstate the number of POTWs that will ultimately need to enhance

their pretreatment programs as a result of TMDLs. There are approximately 1,600 POTWs required to

have pretreatment programs. All of them are majors. They account for about 30 billion gpd of flow, or

approximately 80 % of total national POTW flows. There are many additional major POTWs that are not

required to have pretreatment programs, but we could not in the time available single out the pretreatment

POTWs and cost metals controls only for them.

 For each major POTW needing to implement an enhanced pretreatment program, we

determined from the CWNS data base the POTW’s average daily industrial flow.

 EPA’s RIA for the Great Lakes Water Quality Guidance59 estimated that the typical

POTW needing to meet more restrictive Guidance-based limits for toxic pollutants would

focus its tightened pretreatment requirements on 30 % of its significant industrial users

(SIUs).60 We adopted this estimate, and further assumed that 2/3 of such SIUs might be

affected by tighter requirements primarily for metals, while 1/3 of the affected SIUs would

be affected primarily by tighter requirements for other toxic pollutants (organics, cyanide,

pesticides, etc.) Thus, we assumed that a typical POTW facing tighter metals discharge

requirements will require further metals treatment for 20 % of its SIUs (30 % x 2/3) and

20 % of its SIU flow.

 We assume that half of total industrial flow to pretreatment POTWs is from SIUs, while

half is from other industrial users. Across the major POTWs identified in our analysis as

needing enhanced pretreatment for metals, industrial flow averages about 20 % of total

flow. Thus, we assume that SIU flow averages about 10 % of flow for these POTWs.

 If this 10 % average figure holds also for all pretreatment POTWs nationally, the average

SIU has a flow of approximately 0.1 mgd. (30 billion gpd in total pretreatment POTW

flow) x (10 % of this flow that is attributable to SIUs) ÷ (32,000 SIUs) = approximately

0.1 mgd/SIU.

 For each POTW needing an enhanced pretreatment program for metals, we take the

assumed 20 % of SIU flow that will need further metals treatment (equivalent to 10 % of

the POTW’s industrial flow) and divide this by the average flow for an SIU (0.1 mgd). 

This calculation yields the number of SIUs that will need to implement enhanced treatment

for metals at each POTW. For example, assume a POTW with 20 mgd total flow and 35
E-5

% industrial flow (7 mgd). This POTW will have 3.5 mgd of SIU flow, 20 % of which

(0.7 mgd) will need enhanced treatment for metals. At 0.1 mgd for the average SIU, 7

indirect discharger SIUs will thus need to adopt enhanced treatment for metals.

 We assume that the enhanced treatment for metals that SIUs will implement is polishing

filtration -- similarly as for direct dischargers needing additional treatment for metals. The

cost function for polishing filtration for SIUs is the same as the cost function previously

discussed for direct dischargers.

 In sum, the costs for an enhanced pretreatment program for a major POTW needing

additional control of metals is calculated as follows:

# of SIUs needing polishing filtration = 

POTW industrial flow (mgd) x 0.5 x 0.2 ÷ 0.1 (mgd)

cost for each of these SIUs = 

polishing filtration cost functions given previously, at 0.1 mgd flow

Such costs apply only for major POTWs. Minor POTWs are assumed unlikely to have important

indirect dischargers and unlikely to be targeted in TMDLs for additional metals treatment.
61 Flow information that is reported in CWNS for the POTWs appearing in CWNS appears to have fewer

problems than the flow information in PCS.

F-1

APPENDIX F: PROCEDURES FOR ESTIMATING FLOW NEEDING

TREATMENT

I. DEALING WITH MISSING FLOW INFORMATION

What if information on flow was not available in PCS/CWNS for a facility for which we wanted to

cost additional controls? This was common. For example, for the facilities identified as discharging the

impairment pollutant within a relevant distance upstream in the “within or upstream” case:

42.1 % had positive reported flows

 2.6 % had zero reported flow

55.3 % had no flow reported (mostly industrial dischargers, which are addressed only in

PCS)

We used the flow information in PCS/CWNS for any facility for which flow information was

reported. We assumed that a facility with zero reported flow was exactly that, a permitted facility with

zero discharge (perhaps land treatment or some such). For a facility with no flow information reported, we

assigned it the average flow across all facilities of its SIC code for which flow information was reported. 

For facilities in SICs for which no facilities have reported flows, we assigned the average flow observed in

our data base for major industrials (2.505 mgd for metals, 6.313 mgd for non-metals), minor industrials

(0.186 mgd for metals, 0.309 mgd for non-metals), major POTWs (8.537 for metals, 8.137 mgd for nonmetals), or minor POTWs (0.189 mgd for non-metals), as appropriate.

II. DEALING WITH LIKELY INACCURATE OR INAPPROPRIATE FLOW INFORMATION

Flow information in PCS has not been well quality-controlled, and some very high numbers

reported for facility flows undoubtedly represent errors.61 In other cases, the flow listed in PCS appears

likely to be cooling water or perhaps storm water, not process waste water. It is extremely unlikely that

anyone would consider applying the advanced control technologies that we are costing to huge cooling

water or storm water flows.

In order to avoid estimating costs for technologies to treat clearly unreasonable flows, we adopted

the following assumptions:

 Generally, dischargers with large flows will segregate their waste streams in order that

advanced treatment (polishing filtration for metals, or advanced secondary for BOD,

nutrients, ammonia or toxic organics) can be applied to only the smaller, more 

concentrated portions of their total flow.
F-2

 We assumed that a minor industrial NPDES permittee will need to apply advanced

treatment for the lesser of its flow reported in PCS and these flows:

For metals 1 mgd

For BOD, nutrients, etc. 5 mgd

 We assumed that a major industrial NPDES permittee will need to apply advanced

treatment for the lesser of its flow reported in PCS and these flows:

For metals 5 mgd

For BOD, nutrients, etc. 25 mgd

 However, for electric utilities specifically (SIC 4911 and related), whether they are major

or not, we assumed they will apply advanced treatment for the lesser of their flows

reported in PCS and these flows:

For metals 1 mgd

For BOD, nutrients, etc. 0.5 mgd

 We adjusted any flow shown in CWNS/PCS for a minor POTW that exceeded 1 mgd (the

maximum that a minor POTW can have) downward to the 1 mgd limit. (Two minor

POTWs, for example, were shown in PCS as having flows of 55 mgd and 1003 mgd.)
62 We say “presumably” because we do not have information particular to each point source on whether it

actually does or does not discharge any given pollutant. Instead, we make a judgment for each SIC as to

whether all dischargers in that SIC presumably discharge each class of pollutants. These broad judgments

may be inaccurate with respect to any particular point source discharger.

63 These 4,234 water bodies are for the “within and upstream” case. They represent a little more than onequarter of the 16,143 impaired water bodies that we cover in our analysis. (Our procedure for matching

impaired water bodies against point sources is operable in 44 States plus the District of Columbia. In

G-1

APPENDIX G: EXCLUDING COSTS FOR POINT SOURCES AFFECTING

WATERS THAT ARE IMPAIRED BY NONPOINT SOURCES ONLY

Many States provide an assessment of the source types that impair each of their 303(d) waters. 

For the States that provide this information, the data can be compiled to determine whether each water is

impaired by point sources only, by nonpoint sources only, by mixed point and nonpoint sources, by

unknown sources, or by other categories of sources. Other States do not provide such information on their

impaired waters. In our analysis to this point, we have identified all point sources that presumably

discharge an impairment pollutant upstream within a relevant distance upstream of or into an impaired

water.62 This set of point sources is likely the maximum that potentially might be addressed in water

quality-based permitting or TMDLs.

I. USING STATE DATA ON SOURCE TYPES TO IDENTIFY LIKELY POINT SOURCES

However, we believe we can use the information that States provide on source types responsible for

the impairments in these waters to judge which of the maximum set of potentially relevant point sources are

really likely to be addressed in the eventual TMDLs or water quality-based permits. As the most obvious

examples:

 When a State indicates that point sources are the source of impairment in a water body, we

expect that the TMDL or alternative approaches would likely consider all the point sources

discharging the impairment pollutant within a relevant distance upstream (i.e., all of the

point sources we have identified in this analysis); but

 When a State indicates that nonpoint sources -- and not point sources -- are the source of

impairment in a water body, we expect that the TMDL or water quality-based permitting

process most likely would not address point sources, even if there are some point sources

that apparently (according to our engineering judgment approach) discharge the

impairment pollutant within a relevant distance.

In this step of the analysis, we use the information provided by States on the source types

responsible for impairment of each 303(d) water body to reduce the set of point sources that could

potentially be considered in TMDLs or water quality-based permitting (the maximum set) down to a

smaller set of point sources that are likely to be considered in these processes.

In the “within and upstream” case, there are 4,234 impaired water bodies that we identify as

impaired by one or more of the five pollutant classes that we analyze (BOD, nutrients, metals, toxic

organics, and ammonia) and that have one or more point source dischargers within a relevant distance

upstream that presumably discharge the impairment pollutant.63 The following exhibit shows what States
these 44 States plus DC, there are 18,162 303(d)-listed waters, of which 16,143 have been georeferenced.) 

Interpreting the “within and upstream” case as an upper bound, we thus believe that at most about 1/4 of

all TMDLs have the potential to trigger additional controls for point sources. In contrast, the “within

only” case provides a reasonable lower bound. In the “within only” case, there are XXX water bodies that

are impaired by one or more of the five pollutants and have one or more point sources discharging the

impairment pollutant directly into the impaired water. This suggests that there may be as few as XXX

percent of all TMDLs that have the potential to trigger additional controls for point sources.

G-2

report as the sources of impairment for these water bodies, and also shows, in the final column, our

judgment as to whether point sources affecting these water bodies are likely to be addressed in TMDLs and

water quality-based permitting.

Exhibit G-1

Sources of Impairment Reported for Water Bodies That Have Point Sources Within/Upstream That

Presumably Discharge the Impairment Pollutant

Sources of Impairment Reported by

States

Number of Water Bodies

(Within and Upstream Case)

For These Water Bodies, are TMDLs or Water

Quality-Based Permits Likely to Address Point

Sources?

 PS only 141 Yes

No

No

Unclear – scale to these waters

Unclear – scale to these waters

Yes

Yes

Yes

Yes

Yes

Yes

No

No

No

No

Yes

 NPS only 829

 other only 71

 unknown only 110

 not reported 1,727

 PS + NPS only 368

 PS + NPS + other only 339

 PS + NPS + unknown only 15

 PS + other only 53

 PS + unknown only 6

 PS + other + unknown only 5

 NPS + other only 425

 NPS + unknown only 48

 NPS + other + unknown only 35

 other + unknown only 25

 PS + NPS + other + unknown 37

Total 4,234

Several aspects of this exhibit need explanation:

 The first column provides a comprehensive list of categories into which we have grouped

the information provided by the States on the sources of impairment for each of their

303(d) waters. States use hundreds of different terms or codes in describing sources of

impairment, ranging from the general (e.g., “nonpoint sources”) to highly specific (e.g.,

“Duenweg Mines Area”, “zebra mussels”, “I-95 culvert has inadequate passage”). For

this analysis, Tetra Tech grouped all the source terms and codes in a particular manner. 

“PS” includes any codes referring to discharges from point sources likely to be included in

PCS. “NPS” includes any source codes involving nonpoint sources that produce

pollutants that could reasonably be addressed with controls in TMDLs (e.g., agriculture,

silviculture, urban runoff, abandoned mines, road maintenance). “Other” includes any

source codes that are unlikely to be addressed with controls in TMDLs, either because they
64 We are not aware of any reason why the third set of waters should be systematically different from the first

two sets of waters. Among the 44 States plus DC that we cover in the analysis, we do not find any

important differences between the States that do not report 303(d) source information (which contribute

the great majority of the third set of waters) and those that do.

G-3

involve pollution rather than pollutants (e.g., habitat alteration, hydrologic modification),

or because they are very unlikely to be controllable by a State (e.g., air deposition). 

“Unknown” is where a State reports that a source of an impairment is unknown. “Not

reported” includes instances in which the State provides no information of any sort about

the sources responsible for an impairment.

 As shown in the exhibit, States may report several sources of impairment for a single

water body. The various sources of impairment may all contribute to a single cause of

impairment (e.g., both point sources and nonpoint sources may contribute excessive

nutrients), or one source of impairment may be responsible for one cause while another

source is responsible for another cause (e.g., a water body is impaired by BOD from a

point source and by undetermined toxicity from an unknown source), or there can be

various other combinations.

 Unfortunately, there is no information available on the sources of impairment for many

303(d) water bodies. Among the 4,234 water bodies identified in the “within and

upstream” case, for example, more than 43 % have either no source information reported

or report unknown sources only.

The final column of the exhibit presents our judgment as to whether point sources affecting these

water bodies are likely to be addressed in TMDLs. For example, if the State cites the water body as

impaired by point sources only, we presume that a TMDL is likely to consider further control requirements

for all relevant point sources. The opposite would be true for a water body that the State cites as impaired

by nonpoint sources only -- for this water body, we would not expect a TMDL to consider further controls

for the point sources that we have identified as presumably discharging the impairment pollutant. The

decision rules underlying the conclusions in the final column are:

 Point sources will be addressed in TMDLs for any water for which a State cites point

sources as being among the sources of impairment;

 Point sources will not be addressed in TMDLs for any water for which a State: a) Cites

one or more sources of impairment (except for “unknown”); and b) Does not include point

sources among the cited sources; and

 For water bodies for which a State provides no information on sources of impairment (“not

reported”) or cites only “unknown sources”, we have no information suggesting whether

point sources will or will not likely be addressed in TMDLs.

We regard the first two sets of waters -- those for which we have information suggesting whether

point sources are among the source types responsible for impairment -- as a sample, and extrapolate data

from them to the third set of waters for which we do not have such information. We assume that the degree

to which various source types are responsible for impairments in the third set of waters is the same as it is

in the first two sets of waters.64
G-4

II. EXTRAPOLATING INFORMATION FROM WATERS WITH KNOWN SOURCES OF

IMPAIRMENT TO WATERS WITHOUT KNOWN SOURCES OF IMPAIRMENT

Our process for using information on these three sets of waters in order to estimate point source

implementation costs is rather complex.

At this point, we introduce a new, “shorthand” terminology. We refer to an impaired water as

“tagging” a point source if the point source presumably discharges the impairment pollutant directly to the

impaired water (for the “within only” case) or directly to the impaired water or within 25/50 miles

upstream (for the “within and upstream” case). All the point sources in our analysis are tagged one or

more times by impaired waters. Many point sources are tagged multiple times. If a water body is impaired

for several pollutants, a particular point source may be tagged multiple times by that water body for

different pollutants. For example, according to the EPA engineers’ judgments, a major POTW is presumed

to discharge all five pollutant classes that we analyze -- BOD, nutrients, metals, ammonia, and toxic

organics -- in sufficient quantity so as potentially to warrant further controls beyond applicable technologybased standards. A water body that is impaired for all five of these pollutants thus could “tag” a major

POTW that discharges into this water body five times, once for each pollutant class. A point source can

also have multiple tags because it is tagged by multiple water bodies. Particularly in the “within and

upstream” case, there can be several impaired water bodies within 25/50 miles downstream of a point

source. Even in the “within only” case, impaired water bodies may overlap and point sources are

sometimes tagged by multiple water bodies.

When a point source is tagged multiple times for different pollutants by water bodies of different

sorts (i.e., by some water bodies that are presumed to impose costs on the point sources they tag, by some

that are presumed not to impose costs on the point sources they tag, and by some that are in the

undetermined and “to be scaled to” category), it becomes complex to determine whether the point source

should or should not be expected to incur costs for further controls. We take the following steps:

 Point sources that are tagged by one or more waters with reported source types become the

set of facilities that we scale from. We estimate for this set of “scale from” facilities: A)

What their costs would be if all impaired waters (not just those waters impaired by point

sources, among other source types) were assumed to impose costs on relevant point

sources; and B) What their costs are when we assume that only those waters impaired by

point sources impose costs on relevant point sources. Among the “scale from” facilities,

our assumption that point sources do not incur costs when they are tagged by waters not

impaired by point sources results in reducing the total estimated implementation costs from

A to B. Expressed another way, the fraction B/A represents the degree to which the

potential total cost of all tags (among the “scale from” facilities) gets reduced by

recognizing that some tags do impose costs on point sources and that some do not.

 Point sources that are tagged exclusively by waters that are uncertain in whether or not

they will impose costs on point sources (“source not reported” or “source unknown”

waters) become the set of facilities that we scale to. We estimate the costs these facilities

would bear if all the waters that tag them were of a sort that would impose costs on point

sources (C). We then multiply this raw cost by the fraction B/A, representing the degree

to which (based on the “scale from” facilities) the raw cost is reduced by recognizing that

some tags do not impose costs on point sources.
G-5

Within Only Case Within and Upstream Case

Costs (billion $/yr) # of PS Costs (billion $/yr) # of PS

All tagged facilities, assuming all water bodies impose costs on point 

sources $1.684 7012 $3.369 19438

A. "Scale from" facilities (those tagged by water bodies with information 

on responsible source types) $1.060 4324 $2.078 12086

B. "Scale from" facilities that do incur costs (tagged by water 

bodies impaired by PS) $0.681 2557 $1.343 7394

"Scale from" facilities that don't incur costs (tagged by water 

bodies not impaired by PS) $0.379 1767 $0.734 4691

Scaling factor: B/A 0.64 0.59 0.65 0.61

C. "Scale to" facilities (those tagged exclusively by water bodies 

without information on responsible source types) $0.624 2688 $1.291 7353

"Scale to" facilities that will incur costs, after application of scaling 

factor: (B/A)xC $0.401 1590 $0.835 4498

Total estimated costs and number of facilities: B + (B/A)xC $1.082 4146 $2.178 11893

 The resulting total costs for point sources is given by:

B + [(B/A) x C].

where A = the costs among “scale from” facilities if all tags were to impose costs

 on point sources

B = the costs among “scale from” facilities from tags only by those water bodies

 that we assume do impose costs on point sources (i.e., water bodies that

 states cite as impaired by PS, as well as perhaps additional source types)

C = the costs among “scale to” facilities if all tags were to impose costs on point 

 sources.

Sample calculations of this sort are shown in the exhibit below, for Scenario 1 (“No TMDL Program”)

Exhibit G-2

Calculations Reflecting Information from States on Sources of Impairment (Scenario 1)

Referring to the figures for the “within only” case, if we were to assume that water quality-based

permits would be developed for all tagged point source facilities, even those that discharge into waters

impaired by nonpoint sources only, 7012 point sources would incur costs of $1.684 billion/year. However,

we assume that tagged point source facilities that discharge only into waters impaired by nonpoint sources

will not have water quality-based permits issued for them, and costs thus decline to $1.082 billion/year for

4146 facilities. Our assumption that waters impaired by nonpoint sources only will not give rise to control

obligations for point sources has the effect in this case of reducing costs by 36% and the number of point

sources affected by 41%. This assumption has roughly similar impacts in reducing costs and the number

of sources affected for other cases (i.e., “upstream and within”) and Scenarios (i.e., Scenarios 2 and 3).
H-6

APPENDIX H: DETAIL ON SIMULATING “COST-EFFECTIVE WASTE LOAD

ALLOCATIONS”

I. CIRCUMSTANCES WHERE COST-EFFECTIVE WLAs MAY BE POSSIBLE

We assumed that a cost-effective WLA could occur only if both point sources and nonpoint

sources were believed by the State to be responsible for impairment of the water body. If point sources

alone were responsible for the impairment, there would presumably be no or few contributing nonpoint

sources to whom some of the point sources’ responsibilities for further controls could be shifted. The

following exhibit shows the source combinations for which we assumed cost-effective WLAs to be

possible:

Exhibit H-1

Impairment Source Combinations for Which Cost-Effective WLAs are Assumed Possible

Sources of Impairment Reported by

States

Are TMDLs for These Water

Bodies Likely to Require Further

Controls for Point Sources?

Are Point Sources Affecting These

Waters Then Candidates for CostEffective WLAs?

 PS only Yes

No

No

Unclear – scale to these waters

Unclear – scale to these waters

Yes

Yes

Yes

Yes

Yes

Yes

No

No

No

No

Yes

No

No

No

Unclear – scale to these waters

Unclear – scale to these waters

Yes

Yes

Yes

No

No*

No*

No

No

No

No

Yes

 NPS only

 other only

 unknown only

 not reported

 PS + NPS only

 PS + NPS + other only

 PS + NPS + unknown only

 PS + other only

 PS + unknown only

 PS + other + unknown only

 NPS + other only

 NPS + unknown only

 NPS + other + unknown only

 other + unknown only

 PS + NPS + other + unknown

Total

The final column of the exhibit indicates that we assume cost-effective WLAs to be possible only

for waters for which the State indicates that both point and nonpoint sources are responsible for the

impairment. Waters for which there is no information about the source types responsible for impairment

are scaled to.

Note that point sources may be “tagged” as needing further controls by multiple water bodies. We

assume that a point source can benefit from a more cost-effective WLA and avoid the next treatment step

for a particular pollutant if and only if:

 It is tagged by at least one “yes” water body for that pollutant (i.e., the point source needs

further treatment for a pollutant as a result of a water body that also has nonpoint sources

that contribute that pollutant)
F-1

 It is not tagged by any “no” water bodies for that pollutant. A single “no” water body that

tags a point source will preclude the point source from avoiding the next treatment step for

that pollutant.

 “No*” water bodies have no effect. They represent situations in which it is not clear

whether or not cost-effective WLAs will be possible -- point sources will incur costs (the

first condition for possible trade offs), but it is uncertain whether or not there will be

nonpoint sources also found to contribute to impairment. Perhaps the “unknown” sources

will eventually prove to be nonpoint sources and a cost-effective WLA will be possible,

perhaps not. In our simulation, a tag by a “no*” water body neither enables cost-effective

WLAs nor precludes them.

The assumption that a tag by a single “no” water body precludes a source from participating in a

cost-effective WLA is conservative and has an important effect in reducing the number of point sources

that we estimate as likely to be able to reduce their needs for additional treatment. Many point sources are

tagged by several water bodies, all but one of which would be amenable to cost-effective WLAs. We

assume, however, that the one non-amenable water body precludes such sources from avoiding the next

treatment step for the impairment pollutant.

We assumed there would be an opportunity for a more cost-effective WLA only for water bodies

impaired by nutrients and/or BOD. However, even if a water body is impaired for one of these pollutants

and is amenable to a cost-effective WLA, a point source discharging one of these pollutants may not be

able to participate in the more cost-effective WLA if the point source discharges another pollutant that

requires the point source to implement the next treatment step notwithstanding the cost-effective WLA. 

More specifically, the assumed next treatment step for nutrients (secondary treatment with nutrient

removal) is also the next treatment step that we assume is required if the point source needs to provide

further controls for toxic organic compounds. Thus, a point source that needs further control of both

nutrients and toxic organics will need to implement secondary treatment with nutrient removal to address

the toxic organics, whether or not there is a cost-effective WLA for nutrients. In effect, a need to control

toxic organics prevents a point source from saving any money by participating in a cost-effective WLA for

nutrients. Likewise, a need to control ammonia prevents a point source from saving any money (avoiding

the need for advanced secondary treatment) by participating in a cost-effective WLA for BOD. In sum, we

assume that a point source may avoid the need for a next treatment step by participating in a more costeffective WLA if the point source needs additional control for:

 Nutrients and not toxic organics; and/or

 BOD and not ammonia.

II. COSTS FOR CONTROLLING NONPOINT SOURCES RELATIVE TO POINT SOURCES

The following are several examples suggesting the magnitude of costs for nonpoint sources to

abate a pollutant load in comparison to the costs for point sources to abate a similar load. Most of these

examples involve point/nonpoint effluent trading. Nearly all involve nonpoint source controls substituting

for additional point source control efforts for nutrients or BOD. Most of the following are prospective

studies of the savings if trading were to be implemented. Few are retrospective estimates of what actual

trades have saved.
F-2

Long Island Sound, CT - The State of Connecticut estimated that to reach the 15 year goal of nitrogen

reduction in the absence of trading would cost point sources (mostly POTWs) $960 million, while the

inclusion of trading would reduce costs to $760 million. Thus trading is expected to result in a $200 million

savings over 15 years. The great majority of the trading simulated here is point/point trading, not

point/nonpoint.

Tar-Pamlico, NC - A Great Lakes Trading Network report cites an estimate by a member of the TarPamlico Basin Association that nutrient reduction for point sources would cost approximately $70 million

compared with $11 million for similar reductions through increased NPS controls.

Saginaw Basin, MI - Modeling performed by World Resources Institute. Establishing a 0.5 mg/L

phosphorus limit for point sources would reduce loadings by 16% at a cost of $23.89/lb reduced. A broad

subsidy program to non-point sources would cost $16.00/lb reduced. The least cost solution -- a targeted

and performance-based subsidy to only some non-point sources -- would reduce loadings 15% and cost

$1.87/lb. What was identified as a best solution (not the least cost) would be a combination of point source

controls and point/non-point trading (including targeting the most cost-effective NPS reductions) using 2:1

ratios; this would reduce loadings 26% and cost $4.37/lb reduced.

Minnesota River Basin, MN - Modeling performed by WRI, very similar to the Saginaw study. The Study

projects that the costs per lb of controlling P could be reduced from $18 for point source controls only to

$4-5 for trading coupled with “targeted” BMPs.

Boulder Creek, CO - Estimated savings (thought 12/96) of $3 - $7 million as a result of in-stream

restoration efforts rather than plant upgrades alone. No information regarding what percentage savings this

represents.

Virginia Tech Study (Watershed’96) - Paper showed a range of non-point source control costs typical for

Virginia compared with Biological Nitrogen Removal. BNR costs were listed as $20-$50/lb. Most nonpoint source costs listed were less expensive; some were more expensive.

Lower Boise River, ID - Municipalities were asked to consider what their 20 year plan would be in the face

of a mandated 20%, 40% or 80% phosphorus reduction, given a low population growth scenario and a high

population growth scenario. The municipalities responded that the cost range for an 80% reduction would

be $12-$178/lb of P. For non-point sources, the stakeholders looked at a few BMP studies that focused

primarily on sediment reductions at sites on the Boise River and the mid-Snake River, and factoring in what

is known about the sediment-phosphorus relationship, determined that the costs of phosphorus reductions

would be in the range of $2-$20/lb of P. The implied cost savings are therefore $10-$158/lb. of P, but with

some uncertainty as to what will actually occur in the market. 

Lake Chatfield, CO - A high level of further point source reductions would be necessary before NPS

reductions and trading become economical.

Stamford, CT (Watershed ‘96) - It was calculated that reductions from the treatment plant would be more

cost-effective than reductions from non-point sources.
F-3

Exhibit H-2

Percent Savings in Cost per Pound for Nonpoint Source Controls

Relative to Point Source Controls

Long Island Sound, CT 21

Tar-Pamlico, NC 84

Saginaw Basin, MI 82 - 92

Minnesota River Basin, MN 75

Boulder Creek, CO Unknown

Virginia Tech study Variable

Lower Boise River, ID 83 - 89

Lake Chatfield, CO Minimal

Stamford, CT Negative

Among the seven instances where the percentage savings can be rank-ordered (all except for Boulder Creek

and the Virginia Tech study), the median figure is a 75 % savings.
65 3 of the 710 counties have no crop land.

I-1

APPENDIX I: DETAIL ON ESTIMATED COSTS FOR NONPOINT SOURCES

This Appendix provides detail on how the costs for nonpoint sources were estimated for the “Least

Flexible TMDL Program” scenario (Scenario 1). Under this Scenario, we assume when a State identifies a

water body as impaired by a nonpoint source type that the State will require further control for the entire

volume of that nonpoint source activity that occurs within the county or counties in which the impaired

water body is located. Costs under Scenarios 2 and 3 are estimated by adjusting the information and

estimates developed for Scenario 1 in the manner described in Chapter III, Section C.

I. AGRICULTURE

A. CROP LAND

We found 2,228 water bodies on States’ 303(d) lists that States have identified as impaired by crop

land. These water bodies were either cited directly in a State’s 303(d) submission as impaired by crop

land, or they were cited as impaired by crop land in a State’s 305(b) submission and corresponded to a

303(d)-listed water body. These water bodies are in 710 counties65 in 23 States. We assume conservatively

that the remaining States may have crop land-impaired water-bodies, but either did not report sources of

impairment at all or reported them in a manner that was insufficiently specific to identify crop land as a

source of impairment. The 23 States reporting crop land-impaired 303(d) waters contain 240.3 million

acres of crop land. In the Nation as a whole, there are 375 million acres of crop land. We assume that the

degree to which crop land impairs waters in the 23 “reporting” States is replicated in the remaining States. 

The scale factor to extrapolate from whatever crop land costs we estimate for the 23 States to the entire

nation is thus 1.56 (375 million divided by 240.3 million).

1. Extent of nonpoint source activity requiring BMPs

We determined the amount of crop land in these 710 counties, located in 23 States, using crop land

acreage data from USDA’s 1997 National Resources Inventory (NRI) as it existed prior to recently

released corrections. We also acquired data from NRI on the acreage of this crop land that is eroding at

greater than 15 tons/acre/year, and on the average slope of the crop land in each of these counties.

There are 128.1 million acres of crop land in the 710 counties within which the crop land-impaired

water bodies are located. We assume for the “Least Flexible” scenario that the TMDLs for these impaired

water bodies will require the implementation of BMPs for the entire acreage of crop land in these counties. 

The 128.1 million acres of crop land needing BMPs in these 23 States represent 53.3 percent of all the crop

land in the 23 States. Applying a scale factor of 1.56 to extrapolate from the 23 States to the entire nation,

we estimate that there are 199.9 million acres of crop land in the nation that will need to implement BMPs

under the Least Flexible scenario.

2. Description of the BMPs required where controls are needed

We assumed that owners of crop land identified as contributing to impairment of a 303(d) water

will achieve the load reductions required by TMDLs by implementing BMPs that are widely available,

relatively low cost, effective, and easily put in place. Based on these criteria and the ability to slow or
I-2

prevent soil erosion and phosphorus and nitrogen loss from crop lands, five broad groups of practices were

selected for use on crop lands contributing to impairment of 303(d) waters:

1. Conservation tillage

2. Nutrient management

3. Practices to reduce sediment transport within or at the edge of the field

4. Practices to protect and restore riparian areas

5. Management of highly erosive crop land

These conservation practices or groups of practices are described as follows:

a) Conservation tillage. Management of planting and tillage practices and crop residues so

as to maintain at least 30 % of the soil surface covered by residue after planting. Three

varieties of conservation tillage include no-till, mulch till and ridge till. Conservation

tillage increases the water-holding capacity of the soil and reduces sheet and rill erosion.

b) Nutrient management. Balancing the amount of nutrients provided with crop nutrient

requirements so as to prevent nutrient loss to the environment. Requires proper timing of

nutrient application and control of the amount of nutrients applied.

c) Practices to reduce sediment transport within or at the edge of the field. In general,

physical measures to reduce slope length and steepness (e.g., contour farming, terraces,

contour strip-cropping) reduce runoff velocity and increase infiltration. Vegetative

measures (e.g., grassed waterways, filter strips, vegetative barriers, field borders) will also

slow runoff, increase infiltration and trap sediment. A wide variety of different practices

can be appropriate in different circumstances. In order to develop a reasonably

conservative (i.e., not likely to be too low) estimate for the costs of applying appropriate

practices to reduce in-field or edge-of-field sediment transport, we will assume costs as if

vegetative barriers were to be implemented. Vegetative barriers are intended to reduce 

concentrated (gully) erosion on sloped crop land by planting a series of 4 - 6 feet wide

barriers of stiff, tall grasses across a field at specified increments of elevation. Vegetative

barriers entail installation and management costs that likely exceed the costs for most other

in-field or edge-of-field measures to reduce sediment transport.

d) Practices to protect and restore riparian areas. These may include practices that

intercept runoff before it reaches streams or lakes (e.g., riparian filter strips, riparian forest

buffers) and practices that protect the waterway’s banks and channel (e.g., streambank and

shoreline protection, livestock exclusion, stream channel stabilization). Again in order to

develop a reasonably conservative estimate for the costs of such practices, we will assume

costs as if riparian forest buffers were to be implemented. Riparian forest buffers include:

1) a permanent zone of trees and shrubs adjoining the water, 2) an additional adjoining

zone of trees and shrubs from which modest harvesting may occur; and 3) an additional

vegetated filter strip when the buffer is adjacent to cropland or other erosive areas. Such a

corridor of permanent vegetation on the banks of a water body will reduce sediment,

nutrients and other pollutants in surface runoff, and will also reduce excess nutrients and

other chemicals in shallow ground-water flow. The riparian buffer will also create shade

to lower water temperatures, stabilize banks, provide wildlife habitat, and protect against
66 We will update this range when we complete the review we plan to do of additional completed TMDLs for

“ground-truthing” purposes.

67 U.S. EPA. National Management Measures to Control Nonpoint Source Pollution from Agriculture.

Page 101. (http://www.epa.gov/owow/nps/agmm/chapter_4)

I-3

scour erosion within the floodplain. Establishment costs for riparian forest buffers are

likely higher than other riparian measures to intercept runoff.

e) Management of highly erosive crop land. A variety of more intensive measures can be

targeted specifically for crop land that is eroding at high rates. One possibility is to retire

such crop land: take it out of production and establish a permanent vegetative cover on it. 

Retirement, conservation crop rotations, contour strip cropping, terracing and other

measures will substantially reduce losses of soil and agricultural chemicals. In estimating

the costs of this practice, we will assume that all crop land eroding at greater than 15

tons/acre/year (as estimated in NRI) will need one of these more intensive measures. 

Again, in order to be conservative in costing, we will estimate costs as if the selected

measure is to retire the land and establish permanent vegetative cover on it.

For most crop land-related water quality problems, the combination of all these selected practices

will be more than enough to mitigate the contribution of crop land to impairment. TMDLs requiring

reductions of sediment or nutrients from agricultural land have typically required reductions in the range of

20 - 70 %.66 EPA cites the following rough estimates of the effectiveness of some of the practice groups

we are assuming will be applied:67

Exhibit I-1

Relative Gross Effectiveness of Sediment Control Measures (% reduction)

Practice Category Total Phosphorus Total Nitrogen Sediment

Reduced tillage systems (e.g., conservation

tillage)

45 55 75

Diversion systems (e.g., grassed waterways) 30 10 35

Terrace systems 70 20 85

Filter strips (vegetative control measures) 75 70 65

These effectiveness figures are for each of the practices applied individually. We assume,

however, that several of these practices will be applied simultaneously (conservation tillage plus in/edgeof-field measures plus riparian measures), as well as additional measures not among those shown in the

table (nutrient management planning plus management of highly erosive crop land). In most

circumstances, the entire package of practices that we assume and then estimate costs for will be more than

enough to achieve the desired reduction in load from crop land. This fits with our aim to be generally

conservative in costing. In some instances, however, the water quality problem caused by crop land may

not be addressed by the group of practices we assume. For example, water quality problems relating to use

of agricultural herbicides may require application of BMPs other than these (e.g., integrated pest

management). We have also not considered any of the specific measures that might apply particularly to
68 The great majority of States do not identify sources of agricultural impairment with sufficient specificity to

indicate whether the crop land is irrigated or whether irrigation somehow contributes to the problem. 

Even if we wanted to simulate the application of a set of practices specifically for irrigated crop land, we

would have difficulty determining where these practices might need to be applied and where they would

not.

I-4

irrigated agriculture.68 Note, though, that even in these instances where our set of practices might not be

sufficient (e.g., pesticides, irrigation), the set of practices that we do simulate will at least contribute

substantially to diminution of the water quality problem. For example, the practices we simulate that

reduce sediment losses and transport will also sharply reduce direct runoff of pesticides and transport of

pesticides adsorbed to soil particles.

In assuming the application of this full set of practices in our cost analysis, we do not mean to

imply that all these particular practices should necessarily or always be chosen by farmers to meet the load

reduction requirements of TMDLs. Conservation tillage, for example, is obviously not appropriate for

crops that do not involve tillage. The choice of appropriate practices will be highly site-specific, depending

on both the nature of the agricultural operation and the nature and severity of the water quality problem. 

We intend this chosen set of practices as a reasonably comprehensive set of measures that will be more

than sufficient to address the great majority of water quality problems from crop land. We might attempt

to be more specific about additional tailored practices that could be appropriate in particular circumstances

(e.g., for irrigated land, for tile–drained land, for different sorts of crops), but we judged that our current

level of detail is reasonable for a nationwide analysis that involves broad uncertainties in virtually all the

other steps in developing cost estimates.

In estimating the costs of applying this group of practices to crop lands that contribute to water

quality impairment, we have further assumed particular BMPs that we use to represent the cost of each

practice group. Each practice group includes a range of possible BMPs (e.g., in-field or edge-of-field

measures to reduce sediment transport can include many different contouring, buffer and runoff

management measures). For costing purposes, though, we have chosen a single, relatively expensive BMP

to represent what it might cost to implement whatever specific BMP among the practice group is

appropriate in each individual circumstance. The specific BMPs we selected for costing purposes are as

follows:

Exhibit I-2

Specific BMPs Selected to Represent Practice Groups for Costing Purposes

Practice Group BMP Selected for Costing

Conservation tillage Mix of no-till/ridge till/mulch till

Nutrient management Nutrient management planning: plans, soil testing

Practices to reduce sediment transport within or at the

edge of the field

Vegetative barriers (discrete)

Practices to protect and restore riparian areas Riparian forest buffers

Management of highly erosive crop land Retirement of land and establishment of permanent

cover
69 USDA, comments provided to EPA upon review of draft version of this report, June/July, 2001.

I-5

These specific BMPs will be described further in the next section. We have selected these specific

BMPs only for the purpose of estimating costs. We do not mean to imply that these particular BMPs

should or must be applied by farmers in order to mitigate water quality problems. Again, the selection of

appropriate BMPs in practice should be site-specific. One or more of our particular selected BMPs may be

poor choices in many circumstances. Riparian forest buffers are not reasonable for areas where trees are

very difficult to plant and grow. Vegetative barriers are a relatively new and somewhat experimental (but

very promising) measure, and alternative in-field measures should also be considered. We have not

selected these particular BMPs with the intention of being prescriptive. Instead, we believe these particular

BMPs are reasonably broadly applicable and they are among the more expensive BMPs included within

each of the practice groups, and they therefore provide a relatively conservative indication of what the costs

of abating loads from crop lands might be.

3. Unit costs for These BMPs

For each BMP in each of our 710 counties, we (1) determined the number of crop land acres to

which the BMP would need to be applied; (2) estimated the cost per acre required to implement the BMP;

and (3) estimated the proportion of acreage that is assumed already to have the BMP in place. Further

detail on these procedures for each of the five crop land BMPs is provided below.

Exhibit I-3

Retirement

Extent BMP is Needed Unit Cost for BMP Degree Already Implemented

For all cropped crop land eroding at >

15 tons/acre/yr in every county with at

least one crop-impaired water body. 

These data were obtained from NRI.

Assume that Conservation Reserve

Program (CRP) rental payments for

retired crop land equal the actual social

cost of this BMP. Annual rental costs

were estimated at $52.76/acre/yr ( the

avg. rate for latest CRP signup). 

Establishment cost for cover estimated

at $67.20/acre (low, for non-native

grasses) to $98.86/acre (high, for

native grasses).69 Annual maintenance

cost assumed as zero (low est.) to

$5/acre (high est. based on MD CREP

data).

Much highly erosive land is already

enrolled in CRP and retired. Such land

is not counted as crop land in NRI. 

Thus, none of the additional crop land

we calculate as needing to be retired

(based on NRI figures) has yet been

retired.
70 USDA. Ibid.

71 See Turhollow, A. July 2000. Costs of Producing Biomass from Riparian Buffer Strips. Oak Ridge

National Laboratory, Energy Division.

72 See TetraTech. July 2000. Draft Nonpoint Source Gap Analysis.

I-6

Exhibit I-4

Riparian Forest Buffer

Extent BMP is Needed Unit Cost for BMP Degree Already Implemented

75-foot wide corridor on each side of

every crop-impaired water body. 

(NRCS conservation practice standard

is for minimum of 55 feet plus)

For low est., assume that CRP rental

rate ($52.76/acre/yr for latest signup)

accurately represents social cost of

having land in this use rather than

crop production. For high est,

assume that USDA CREP rental

payments needed to attract small

tracts represent the social cost

($130/acre).70 Add to this the cost of

establishing trees (assume $300/acre

for poplar71) plus annual maintenance

cost (assumed at $5/acre/yr based on

MD CREP)

About 2.2 of the needed 4.2 - 5.0 million

acres of all sorts of buffers are currently

in place. However, more than 90 % of

the buffer acreage in place is grass

waterways and shelterbelts.72 For low

cost estimate we assume 25% of the

needed riparian forest buffer is already

in place, for high estimate we assume

zero.
73 Based on SEDLAB briefing. See USDA. Vegetative Barriers: A New Upland Buffer Tool. National

Sedimentation Laboratory. Upland Erosion Processes Research Unit.

(http://www.sedlab.olemiss.edu/uep_unit/projects/Dab_veg/index.htm)

74 Ibid. The SEDLAB briefing simulates both continuous (following the complete field contour line) and

discrete (placed strategically on only those portions of the field contour line where gully erosion is most

likely) barriers.

75 See Turhollow, A. July 2000. Costs of Producing Biomass from Riparian Buffer Strips. Oak Ridge

National Laboratory, Energy Division.

I-7

Exhibit I-5

Vegetative Barrier

Extent BMP is Needed Unit Cost for BMP Degree Already Implemented

Barrier 4 feet wide constructed for

every 5 feet of elevation difference in

crop field.73 Applied to all crop land in

every county with at least one cropimpaired water body. The acreage

that would be needed for continuous

barriers in each county is calculated

from crop acreage and slope data in

NRI, then scaled by 5/14 to represent

the lesser acreage that would be

needed for discrete barriers.74

Similar reasoning as for riparian forest

buffer. Costs = CRP rental rate or

CREP payment rate for small plots +

establishment cost ($100/acre for

switchgrass75) + annual maintenance

cost. (Note: establishment cost might

be higher for very small plots as would

be in barriers than the figure in the

reference.) Annual maintenance

costs were assumed to range from

$5/acre (lower estimate, as above) to

$10/acre (higher estimate; SEDLAB

suggests vegetative barriers could

need more costly maintenance than

other sorts of vegetated strips)

No data. Given the newness of this

BMP, we presume that very little is

already in place. We have assumed

that none is in place.
76 See TetraTech. July 2000. Draft Nonpoint Source Gap Analysis.

77 USDA, 2001, op cit.

78 CTIC. 1998. 1998 Crop Residue Management Survey Report, 1998 United States Summary.

Conservation Technology Information Center, West Lafayette, Indiana.

I-8

Exhibit I-6

Conservation Tillage

Extent BMP is Needed Unit Cost for BMP Degree Already Implemented

For all annually planted crop

land (that does not go into

retirement, buffer or barrier)

in every county with at least

one crop-impaired water body

Low estimate: $12.43/acre in capital costs and

$8.66/acre savings in annual costs.76 (Note:

these figures represent an average for the

corn/wheat/soybean acreage where CT is

already being used. One might expect that the

cost savings from CT would be much less if it

were applied to the acreage where it currently

isn’t being used. Pending further research, we

will assume $8.66 as an upper estimate of

savings and $0 as a lower estimate.)

High estimate is based on figures from EQIP

for ridge-till ($13.30/acre), mulch till

($10.60/acre) and no-till/strip-till ($23.70/acre),

assumed to be annual costs.77 These figures

were weighted by the percentage of

conservation tillage land in each of these three

practices (3.2%, 53%, 43.8%) from CTIC,

1998, to derive an average cost per acre of

$16.43.

37.2% of all planted acres nationally in

1998.78
79 See USEPA. National Management Measures to Control Nonpoint Source Pollution from Agriculture.

Chapter 4A, page 63. (http://www.epa.gov/owow/nps/agmm/index.html)

80 TetraTech, July 2000, op cit.

81 U.S. EPA. National Management Measures to Control Nonpoint Source Pollution from Agriculture. Op

cit. This document cites the change in N and P application rates observed for 19 USDA Demonstration

and Hydrologic Unit Area Projects where nutrient management planning was implemented. (Source:

Meals, Sutton and Griggs. 1996. Assessment of Progress of Selected Water Quality Projects of USDA

and State Cooperators. USDA-NRCS. 1996) The median change in N use across 15 N-oriented projects

was a reduction of 43 lb/acre. The median P reduction across 14 P-oriented projects was 21 lb/acre. We

valued reduced N application at $.23/lb and reduced P application (conservatively) at $0/lb. $.23/lb x 43

lb/acre = roughly $10/acre. The source does not report whether changes in crop yields, costs for nutrient

application, or other factors were observed in the projects. The absence of such data on other potential

impacts of nutrient management planning means that our assessment of potential savings from

nutrient management planning are incomplete.

82 See Khanna et al., 2000. Site Specific Crop Management: Adoption Patterns and Incentives. Review of

Agricultural Economics. 21: 455-472. 

83 See Shortle et al. 1993. Economic and Environmental Potential of the Pre-sidedressing Soil Nitrate Test.

Draft final report on the USEPA Contract No. CR-817379-01-0, Department of Agricultural Economics

and Rural Sociology. The Pennsylvania State University.

I-9

Exhibit I-7

Nutrient Management Planning

Extent BMP is

Needed

Unit Cost for BMP Degree Already Implemented

For all crop land (that

does not go into

retirement, barrier or

buffer) in every county

with at least one cropimpaired water body.

USEPA estimates $5 - $15/acre/yr for nutrient

management plan and soil testing.

79 NPS Gap analysis

assumes $12/acre initial cost plus $7/acre for soil test

every three years.80 We assumed initial cost (for plan) of

$7 - $15/acre and annual costs (testing) of $2.33 - $4/acre.

Annual savings from NMP (at $.15 - $.25/lb of N) may

range from virtually nothing to $30/acre. A median figure

assuming farmers will save only through reduced use of

commercial N is $10/acre/yr.81 We use this as an upper

estimate for cost savings, and zero as a lower estimate. 

(Note: These savings calculations could use more work.)

6 % of cultivated crop land is

managed under CCA NMPs (NPS

Gap analysis). Other surveys

suggest more extensive use of

NMP techniques: IL/IA/IN/WI – 30

- 37 %,82 PA – 36 %.83 We

assumed 35% (upper estimate) or

17.5% (lower estimate) of total

acreage already had nutrient

management plans in place.

4. Total national annual BMP costs for crop land

To estimate the number of acres that will need each BMP, we used the following data from NRI

for each of the 710 counties: (1) acres of crop land in the county; (2) the average slope of these crop acres;

(3) the number of crop acres eroding at greater than 15 tons/acre/year. From these data, we estimated the

nationwide acres needing BMPs as follows:
84 The NRCS conservation practice standard for a riparian forest buffer requires a Zone 1 of at least 15 feet

immediately adjacent to the stream and a Zone 2 of at least 20 feet adjoining Zone 1. The total should be

100 feet or 30 % of the flood plain, whichever is less, but at least 35 feet. In addition, when the riparian

forest buffer is to be next to cropland or other sparsely vegetated or highly eroded areas, NRCS

recommends an additional filter strip (Zone 3) of at least 20 feet. For cropland riparian buffers, we have

assumed an average width of 75 feet, comprising Zones 1,2 and 3.

I-10

a. Retirement acres

In each of the 710 counties, the acreage to be retired was assumed to be all acres that are eroding

at a rate greater than 15 tons/acre/year. We then summed over all counties to find the total acres to be

retired in the 23 States, and multiplied this sum by the scaling factor of 1.56 to obtain the national estimate. 

In the 710 counties, there are 3,118,400 acres of crop land eroding at greater than 15 tons/acre/year. 

Nationally, we estimate 4,864,704 acres of crop land to be retired.

b. Riparian forest buffer acres

The number of acres requiring riparian buffers in each county depends on the length of the banks

of the impaired waters in the county and the width of the buffer that is assumed necessary. For each crop

land-impaired water body, we obtained information from the 303(d) data base on its size -- its length (for

rivers and coastal shorelines) or area (for lakes and estuaries). A 75 foot buffer84 was assumed to be

necessary on each side of the rivers, around the perimeter of lakes and estuaries, and along the length of

coastal shoreline. We calculated the total number of bank-feet needing buffers as follows:

• For rivers. We assumed that buffers would be required on each side of a river. The

number of bank-feet needing buffers is thus double the length of all the impaired river

segments.

• For lakes. We assumed that all lakes were circular in shape, and thus estimated each

lake’s circumference from its area. A buffer was assumed to be required around the lake’s

perimeter. The number of bank-feet needing buffers is therefore the circumference of the

lake.

• For estuaries. Similarly as for lakes, we assumed that estuaries are roughly circular and

calculated their circumference given their area. Estuaries are partly but not fully enclosed

by land.; we assumed that the average estuary is enclosed by land around only two-thirds

of its circumference. The number of bank-feet needing buffers is therefore the

circumference multiplied by two-thirds.

• For coastal shoreline. A buffer is required on only the landward side, and the number of

bank-feet needing buffers is thus equal to the length of crop-impaired shoreline.

We summed bank-feet across the crop-impaired water bodies in a county, and then estimated the number of

acres to be put into riparian buffers in the county through the following equation:

Number of acres needing riparian buffer = total number of bank-feet x 75 feet x .000022957 acres/sq ft

We summed over all 710 counties and multiplied by 1.56 to scale up to the nation.
85 SEDLAB, op cit.

I-11

Calculating the number of bank-feet for each type of impaired water body as described above, we

estimate 469,364,293 bank-feet needing buffers for the 2,228 crop-impaired water bodies in the 710

counties. Applying a buffer depth of 75 feet, converting to acres and scaling to the entire nation, we

estimate 1,260,698 acres of riparian forest buffer needed. We assume that all this buffer will be land that

was formerly crop land.

c. Vegetative barrier acres

We developed assumptions based on a briefing describing this BMP by the USDA National

Sedimentation Laboratory (SEDLAB).85 SEDLAB considers the use of two types of vegetative barriers:

continuous contour barriers, and discrete barriers. Continuous vegetative barriers on contours across the

full width of a field would prevent both sheet and rill and concentrated erosion, whereas properly located

discrete barriers would be sufficient to prevent concentrated erosion alone. A SEDLAB simulation

suggests that discrete barriers might require only 5/14 the acreage that continuous barriers would require. 

We assumed that conservation tillage would satisfactorily reduce sheet and rill erosion, and hence

simulated the implementation of discrete vegetative barriers to address concentrated erosion specifically. 

We simulated discrete buffers by first estimating the acreage of continuous barriers that would be needed

and then by scaling this acreage down by the 5/14 factor.

Consistent with SEDLAB guidance, we assumed a 4-feet wide continuous vegetative barrier for

every 5 feet of field elevation change. We estimated the acreage of continuous barriers that would be

needed in counties with crop impairments for all crop land that will neither be retired nor put in riparian

forest buffers. The proportion of crop land acres in each county that will need to go into barriers is given

by the following equation:

Fraction of acreage needed in barrier strips = 0.8* [1/sqrt(1+1/(average slope)

2

)]

We estimated the number of acres needing vegetative barriers by multiplying this fraction by the

total crop land acres in each county. We then scaled down this acreage estimate in each county for

continuous barriers by multiplying by 5/14. To calculate the national estimated acres required for

vegetative barriers, we summed over all counties and multiplied this sum by the scaling factor of 1.56.

In the 710 counties, assuming that the highly erosive crop land is retired and using the information

on average slope, we calculate 2,524,753 acres as needed if continuous vegetative barrier strips were to be

implemented. Scaling down by 5/14 to represent discrete barriers rather than continuous ones and scaling

up by 1.56 to obtain a national estimate, we project 1,406,648 acres needed for discrete vegetative barriers.

d. Conservation tillage and nutrient management plan acres

To estimate the number of acres needing conservation tillage and nutrient management plans in the

710 counties, we subtracted from the total area of crop land in these counties the acreage that is to be

retired, devoted to vegetative barriers, and devoted to riparian buffers to determine the acres of crop land

remaining. It was assumed that both conservation tillage and nutrient management would be applied to

these lands. We then scaled this estimate by 1.56 to extrapolate to the nation as a whole.
86 Conservation Tillage Information Center, 1998, op cit.

87 Sometimes States reported in a manner that identified whether the impairment was due specifically to

pasture land or to range land or to both. In other instances, though, a State reported source information in

a manner that did not allow us to determine whether pasture or range was responsible -- citing “animal

damage to riparian zone”, for example. Because we were unable to distinguish pasture from range

impairments, we decided to estimate the amount of BMPs that are necessary to respond to both source

I-12

In the 710 counties, there are:

128,138,800 acres of crop land

- 3,118,400 acres to be retired (eroding at > 15 tons/acre/year)

- 901,698 acres needed for discrete vegetative barriers

- 808,140 acres needed for riparian forest buffers

123,310,562 acres needing conservation tillage and nutrient management

After scaling to the nation, we estimate 192,364,478 crop land acres potentially needing conservation

tillage and nutrient management planning. However, not all of this acreage of crop land is planted in

annual crops for which conservation tillage could be appropriate. Some is orchards, perennial crops,

vegetables, potatoes, etc.. NRI, from which we draw our information on crop land in each county,

estimates 375 million acres of crop land in the U.S. CTIC estimates only 293 million acres of annually

planted crop land.86 Thus 21.9% of all crop land ([375-293]/375) is inappropriate for conservation tillage. 

We scale down the estimated 123,310,562 acres potentially needing conservation tillage by a factor of .781

to account for the lesser acreage for which conservation tillage might by appropriate.

e. Total annualized national costs and savings from BMPs for crop land

To estimate the nationwide costs for each BMP, we multiply the total number of acres needing

each BMP by the estimated costs per acre and by the percent of acreage needing BMPs. Summing across

all 5 BMP costs, we estimate the total annual costs for crop land BMPs at roughly $1.3 billion/year (lower

estimate) or $3.9 billion/year (higher estimate). Applying two further scaling factors (0.4484 to reflect the

pace/lag scale factor and 1.13 to reflect unknown/not classified source information), we estimate the total

annualized national cost at $645 million/year (lower estimate) and $1.956 billion/year (higher estimate).

For conservation tillage and nutrient management plans, we estimate the unscaled annual potential

savings at up to $0.8 million and $1.6 billion, respectively. Applying the two further scaling factors

(0.4484 to reflect the pace/lag scale factor and 1.13 to reflect unknown/not classified source information),

we estimate the annualized national potential savings at up to $414 million for conservation tillage and up

to $804 million for nutrient management plans. The lower estimate for potential annual savings for both of

these practices is zero.

A spread sheet following the discussion of pasture land and range land provides detail on these

calculations for crop land.

B. PASTURE AND RANGE LAND

We found 1,454 water bodies on States’ 303(d) lists that States have identified as impaired by

pasture and/or range land (either directly in their 303(d) submission or cited as impaired in their 305(b)

submissions and corresponding with a 303(d)-listed water body).87 These water bodies are in 511 counties
types simultaneously, and then to split this total amount of BMPs required into portions attributable to

each of pasture and range separately.

88 This calculation is complicated by the fact that the NRI data on range acreage by county covers private

land only. In many States, though, there is substantial additional non-private land (e.g., Federal, State,

Tribal) that is used for range grazing. This non-private range land, in additional to the private range

land, will need BMPs if range-related impairments are to be remedied. We are unable to find complete

data on non-private range land acreage. GSA provides figures (by State, not county) on Federal land

leased for grazing purposes, which is likely the large majority of non-private range land. (Federal land

leased for grazing amounts to roughly 38 % as much land as NRI reports for private range acreage.) We

have added the amount of Federally leased range land to the private range land totals from NRI in

estimating the extent of range land in each of the 25 “reporting” States and in the nation as a

whole. Source of Federal range information: General Services Administration. Summary Tables

of Real Property Owned by the U.S. Throughout the World. Table 12.

I-13

in 25 States. We assume conservatively that the remaining States may have pasture or range land-impaired

water-bodies, but either did not report sources of impairment at all or reported them in a manner that was

insufficiently specific to identify pasture or range land as a source of impairment. The 25 States reporting

pasture or range land-impaired 303(d) waters contain 70.596 million acres of pasture land. In the Nation

as a whole, there are 119.573 million acres. We assume that the degree to which pasture land impairs

waters in the 25 “reporting” States is replicated in the remaining States. The scale factor to extrapolate

from whatever pasture land costs we estimate for the 25 States to the entire nation is thus 1.69 (119.573

million divided by 70.596 million).

Similarly, in the 25 States there are 387.143 million acres of range land.88 In the nation as a

whole, there are 555.278 million acres. The scale factor for range land is thus 1.43.

1.Extent of nonpoint source activity requiring BMPs

Using NRI data, we determined that there are 25,628,300 acres of pasture land and 137,703,200

acres of private range land in these 511 counties. The pasture land in these counties constitutes 36.3% of

all the pasture land in the 25 States (70.596 million acres). The private range land in these counties

constitutes 45.9% of the private range land in the 25 States (299.986 million acres). We assume that in

these counties there is also 45.9% of all the Federally owned grazing land in the 25 States (87.157 million

acres), or 40.005 million acres of Federal grazing land. In total, then, there are 177.708 million acres of

range land in the 511 counties.

Applying the scale factors of 1.69 and 1.43 to extrapolate from the 25 States to the entire nation,

we estimate that 43.31 million acres of pasture land and 254.1 million acres of range land will need to

implement BMPs in the Least Flexible TMDL Program scenario.

2. Description of the BMPs required where controls are needed

We assumed that owners of pasture land identified as contributing to impairment of a 303(d) water

will achieve the load reductions required by TMDLs by implementing the following groups of BMPs:

1. Prescribed grazing practices. Planting, field management and livestock use are planned

and coordinated such that grazing needs are met and healthy vegetative cover is maintained

to minimize soil erosion. Also, grazing is managed in a manner to distribute the manure to
I-14

increase its rate of decomposition and nutrient cycling. In estimating the costs of such

practices when applied to pasture land, we have assumed intensive rotational stocking as a

specific practice. Intensive rotational stocking is defined as the rotation of grazing animals

among several small pasture subunits (paddocks) rather than continuously grazing one

large pasture. Each paddock is grazed quickly and then allowed to regrow for a period

ungrazed until is it ready for another grazing. The practice both maximizes forage and

eliminates denuded areas.

2. Practices to protect and restore riparian areas. As for crop land, we will assume

riparian forest buffers as a relatively higher cost measure within this general category.

For range land, we assumed that conservation practices applied in riparian areas would be

sufficient to address most range land-related impairments, and that measures addressing the range acreage

itself would not be necessary. For costing purposes we assumed two alternative riparian measures that will

establish two different cost estimates:

1. Use exclusion. Grazing animals are prevented from accessing the riparian zone,

commonly by fencing it off. The exclusion may be permanent, or only when streambanks

are most vulnerable to damage (via fences with gates). This will allow riparian vegetation

to re-establish itself, and will prevent livestock from degrading a stream’s banks and

channel.

2. Stream protection and/or bank stabilization. These practices can include a variety of

measures to protect and/or restore riparian areas, including livestock exclusion, alternate

livestock watering facilities, tree planting, bank stabilization, filter strips, critical area

plantings, channel vegetation, mulching, stock trails and walkways, and more.

Again, these various practices for pasture and range are selected for costing purposes. We do not

mean to suggest that any of these specific practices must be chosen. Selection of specific BMPs should

reflect the particular characteristics of the water quality problem and the pasture or range grazing operation

that needs to be managed.

3. Unit costs for these BMPs

For these BMPs in each of the 511 counties with pasture and/or range-impaired waters, we (1)

determined the number of acres to which the BMP would need to be applied; (2) estimated the cost per

acre required to implement the BMP ; and (3) estimated the proportion of acreage that is assumed already

to have the BMP in place. Further detail on unit costs for each BMP is provided below.
89 USDA, Grazing Lands Technology Institute. Dairy Farmer Profitability Using Intensive Rotational

Stocking. September, 1996. Www.ftw.nrcs.usda.gov/pdf/Dairy.pdf

90 Jan McNitt, et al. Livestock and the Environment: Precedents for Runoff Policy. Policy Options –

CEEOT-LP. Prepared for the U.S. EPA’s Office of Policy Development, contract No. CR 820374-02. 

October, 1999.

I-15

Exhibit I-7

Intensive Rotational Stocking (Pasture)

Extent BMP is Needed Unit Cost for BMP Degree Already Implemented

For all pasture land in every

county with at least one pastureimpaired water body. These data

were obtained from NRI.

Zero net costs. Several studies

considering net farm profit find

that intensive rotational stocking

(IRS) is profitable relative to

alternative approaches. IRS was

found more profitable than

continuous pasture, hay, or corn

silage for dairy operations in PA.89

IRS was found to increase net

returns by 2 - 8 % relative to open

access grazing for TX dairy

farms.90

Because of uncertainty in

extrapolating these savings to all

pasture operations, we have

assumed zero savings as well as

zero costs.

15 % in PA. Unknown elsewhere. 

The degree to which this practice is

already implemented makes no

difference, however, when we

assume that it entails zero net costs.

Exhibit I-8

Riparian Forest Buffer (Pasture)

Extent BMP is Needed Unit Cost for BMP Degree Already Implemented

50-foot wide corridor on each side

of every pasture-impaired water

body. (NRCS conservation

practice standard is for minimum

of 35 feet plus). Note that this is

different from the assumption for

buffers adjoining crop land, which

require an additional zone of 20

feet on each side.

Same approach as for riparian

forest buffer for crop land. The

average CRP rental rate for

pasture land is $43.29, and for the

low estimate we assumed that this

represents the social cost of

having land in this use rather than

pasture. For the high estimate, we

assumed $130/acre the average

cost incurred by CREP to enroll

small tracts, as discussed for crop

land buffers. The cost of

establishing trees ($300/acre) and

annual maintenance cost ($5/acre)

are assumed to be the same as for

crop land buffers.

As cited previously, about 2.2 of the

needed 4.2 - 5.0 million acres of all

sorts of buffers are currently in

place. However, more than 90 % of

the buffer acreage in place is grass

waterways and shelterbelts. We

assume that no riparian forest buffer

has been implemented for pasture

land.
91 As summarized in RCG/Hagler, Bailly, Inc. Controlling Nonpoint Source Loadings from Federal Lands:

an Analysis in support of Clean Water Act Reauthorization. July 1, 1992.

92 Ibid.

93 Robert Edwards and Travis Stoe, Susquehanna River Basin Commission. Nutrient Reduction Cost

Effectiveness Analysis, 1996 Update. Publication No. 195, March, 1998.

94 RCG/Hagler Bailly, Inc. Op cit.

I-16

Exhibit I-9

Use Exclusion (Range)

Extent BMP is Needed Unit Cost for BMP Degree Already Implemented

Along both banks for the entire

length of every range-impaired

water body. 9 acres are enclosed

by fence (lost to grazing) per

bank-mile (18 acres per stream

mile), making the exclusion zone

equivalent to roughly 75 feet in

depth on each bank..91

Low estimate is based on costs

from BLM/SCS studies.92 Fencing

installation costs $5261 per stream

mile (1978 $), or $3,006 per bankmile in current dollars. Annual

O&M cost = 1 % of capital cost. 

Average annual rental rate for

grazing land = $8/acre/yr or

$9.14/acre/yr in today’s $. Assume

that riparian land lost to grazing is

worth twice the average, or

$18.28/acre/year. Assume 25 year

useful life for fencing.

High estimate. Fencing costs

$19,000 per stream mile ($9500

per bank-mile).93 Annual O&M

cost = 5% of capital cost.94 Value

of lost grazing in exclusion zone

calculated identically as for low

estimate.

Assumed not to be implemented at

all yet.
95 U.S. EPA, Agriculture Policy Branch, Office of Policy, Planning and Evaluation. Economic Achievability

Analysis: Agricultural Management Measures. December 18, 1992.

96 Tony Esser, NRCS. Personal communication, March, 2000.

I-17

Exhibit I-10

Stream Protection and/or Streambank Stabilization

Extent BMP is Needed Unit Cost for BMP Degree Already Implemented

Along both banks for the entire

length of every range-impaired

water body. Assume that these

practices are applied to a riparian

zone of 100 feet in depth on each

bank.95

Capital cost is estimated from

NRCS data for 1997 on cost share

payments per acre for installation

of WP2 (stream protection) and

SP10 (streambank stabilization)

(avg. $47.88/acre, applied to the

riparian zone calculated as the

number of bank-feet of impaired

water multiplied by the assumed

100 foot depth). This cost share

amount is assumed to represent

40% (upper estimate) to 75% of

total practice cost.96 WP2 and

SP10 useful life are assumed to be

15 years. Annual O&M costs are

calculated similarly as for use

exclusion – 1 % of capital cost for

low estimate, 5 % for high

estimate. 50 % (low estimate) to

100 % (high estimate) of the 100

foot depth riparian zone is

assumed lost to grazing use, and

the acreage lost is valued at

$18.28/acre, as for use exclusion.

Assumed not to be implemented at

all yet.

Note again that these two sets of practices -- use exclusion and stream protection and/or streambank

stabilization -- are regarded as alternatives for protecting and restoring range-impaired riparian areas. The

costs estimated for the two sets of practices represent alternative cost estimates. We do not presume that

both sets of practices need to be applied, and the cost estimates are not to be added.

4. Total national annual BMP costs for pasture and range land

Because we have assumed that the unit costs of implementing intensive rotational stocking are

zero, we estimate that there will be no cost to implement this practice on all the pasture land in the 511

counties with pasture-impaired waters in the 25 States. The cost after scaling to the nation is similarly

zero.

Our procedure for estimating costs for pasture land-related riparian forest buffers is similar to that

for crop-land related buffers. However, we believe there should be no costs for buffers for the pasture

land-impaired waters that are also crop land-impaired. Many pasture-impaired water bodies are also crop-
97 Note that the cost per acre for a crop land riparian buffer is higher than the cost per acre for either use

exclusion or stream protection/streambank stabilization.

I-18

impaired, and 75-foot buffers have already been costed for them in the crop land section. Adding further

buffer costs due to pasture land would constitute double-counting.

We make a similar assumption regarding use exclusion or stream protection/streambank

stabilization for range-impaired water bodies. For any water body that is also impaired by crop land and

has had riparian forest buffers already costed for it, we assume that use exclusion or stream

protection/streambank stabilization is unnecessary.97

Among the 1454 water bodies in the 25 States that are cited as pasture and/or rangeland impaired,

773 water bodies are also cropland-impaired and have already had buffers costed for them. The remaining

681 pasture and/or rangeland-only water bodies are in 22 States. For three States (ME, NC, NE), all

pasture and/or rangeland-impaired water bodies are also impaired by crop land. No additional bank-feet of

buffer, use exclusion or stream protection are needed in these three States due to pasture and/or range land.

For the 681 waterbodies (impaired by pasture and/or rangeland, but not by cropland) in 22 States,

there are 150,473,159 bank-feet of control measures needed. However, four of these 22 States reported

pasture/range impaired waterbodies but did not report on crop impairments (NV, RI, VA, WI). These

latter four States pose some difficulty in our analysis. In the crop land analysis, we assumed that these

“non-reporting” States for crop land may in fact have crop land-related impairments, and we scaled to these

States in estimating the need for crop land-related buffers, as well as the other crop land-related BMPs. 

Thus, for four of the 19 States that report pasture or range land-related impairments, crop land-related

buffers have already been projected, but we do not know which (presumed) crop land-related water bodies

these buffers apply to. We apply a scaling procedure to address this issue. Some of the pasture/range

impaired water bodies in these four States are also likely crop-impaired, and these water bodies have

already been scaled to in the crop land buffer analysis.

• 147,714,887 bank-feet are in the 18 states that report for rangeland and/or pastureland but

not for cropland. These bank-feet are completely incremental to the bank-feet needed for

crop land in these 18 States.

• 150,473,159 - 147,714,887 = 2,758,272 bank-feet are associated with pasture and/or

rangeland water bodies in the four States that did not report on crop impairments. Some of

these bank-feet are already scaled to in the crop land analysis; thus not all of these bankfeet are incrementally due to pasture and range.

 In the 21 States that report for both crop and pasture/range, there are 353,066,997 bankfeet associated with pasture and/or rangeland-impaired water bodies. 147,714,887 of

these bank-feet are associated with waterbodies that are impaired only by pasture and/or

range land, and not by crop land. The portion of the total that is due exclusively to pasture

and/or range is thus 41.83% (147,714,887/353,066,997 = .4183).

 We apply this percentage to the total pasture/range-impaired bank-feet in the 4 States that

do not report for crop land: 2,758,272*41.83% = 1,153,996. Thus 1,153,996 bank-feet

are needed for exclusively crop/pasture-impaired water bodies in the 4 States.
I-19

 The total number of incremental bank-feet attributable solely to pasture/range in the 25

States is thus1,153,996 +147,714,887 = 148,868,883.

We split this total amount of pasture/range bank-feet needed among pasture and range in each

State according to the fractions of pasture vs. range land in each State. The result for the 25 States is

66.548 million bank-feet needed for pasture lands, and 82.321 million bank-feet needed for range lands.

The scale factor for pasture land is 1.69. Therefore, the national number of bank-feet of riparian

buffers needed for water bodies impaired by pasture only is 1.69*66.548 = 112.466 million bank-feet. 

The scale factor for range land is 1.43. Therefore, the national number of bank-feet of use

exclusion or stream protection/streambank stabilization needed for water bodies impaired by range only is

1.43*82.321 = 117.719 million bank-feet.

We convert these estimates of bank-feet needing BMPs to acreage and then to costs by applying

the factors shown previously in the unit cost tables. We also scale the costs to reflect the pace of TMDL

development/compliance time lag (factor of 0.4484) and to reflect unknown/not classified source

information (factor of 1.13). 

We estimate the costs for pasture land-related BMPs at $5.0 - $10.7 million/year. These costs are

for buffers, as intensive rotational stocking is assumed to be costless.

We estimate the total annual costs for range land BMPs at:

 For use exclusion: $5.1 - $16.4 million/year. OR

 For stream protection and/or streambank stabilization: $2.3 - $5.1 million/year.

Regarding these two sets of practices as alternative ways of estimating costs and taking the low and high

estimates, we project the costs for range land BMPs at $2.3 million to $16.4 million per year.

C. SUMMARY COSTS FOR AGRICULTURAL LAND

Exhibits I-10 through I-12 summarize the estimated costs for Scenario 1 (Least Flexible TMDL

Program) for crop, pasture and range land.
I-20

Exhibit I-10

Implementation Costs for Crop Land ($ in millions/yr)

Number of States analyzed 23

Number of counties in these States with crop-impaired waters 710

Fraction of crop acreage in these States that is in impairment counties .53

Scale factor from these States to the nation 1.56

National total annualized implementation costs (millions of 2000 dollars/yr):

 Conservation tillage

 Nutrient management planning

 Riparian measures

 In-field or edge-of-field measures

 Management of highly erosive crop land

 Total costs

85 - 785

317 - 781

41 - 104

49 - 108

154 - 177

645 - 1956

National total potential savings from implementing these BMPs (millions of 2000

dollars/yr):

 Conservation tillage

 Nutrient management planning

 Total potential savings

0 - 414

0 - 804

0 - 1218

Exhibit I-11

Implementation Costs for Pasture Land ($ in millions/yr)

Number of States analyzed 25

Number of counties with pasture and/or rangeland-impaired waters in these States 511

Fraction of pasture acreage in these States that is in impairment counties .363

Scale factor from these States to the nation 1.69

National total annualized implementation costs (millions of 2000 dollars/yr):

 Riparian measures

 Intensive rotational stocking

 Total costs

5.0 - 10.7

0

5.0 - 10.7
I-21

Exhibit I-12

Implementation Costs for Range Land ($ in millions/yr)

Number of States analyzed 25

Number of counties with pasture and/or rangeland-impaired waters in these States 511

Fraction of rangeland acreage in these States that is in impairment counties .459

Scale factor from these States to the nation 1.43

National total annualized implementation costs (millions of 2000 dollars/yr):

 Riparian measures:

 Use exclusion (fencing); OR

 Stream protection/bank stabilization

 Total costs

5.1 - 16.4

2.3 - 5.1

2.3 - 16.4

On the following page is a spread sheet showing the derivation of these estimates for crop, pasture

and range land.
I-22

Scenario 1 -- Summary Costs for Nonpoint Sources; Detail on Agriculture and AFO BMPs ($/yr)

BMP Acres* Needing BMPCapital Cost/ Acre* -- Low Capital Cost/ Acre*-- High Useful Life (Years) Annual O&M Cost/Acre* -- Low Annual O&M Cost/Acre* -- High Annualized Cost/Acre* -- Low Annualized Cost/Acre* -- High

Degree Not

Needed/

Already

Implemented

- High

Degree Not

Needed/

Already

Implemented

- Low

Estimated

Annualized C

-- Low

Crop Land

Conserv ation tillage 150,236,657 $12.43 $0.00 10 $0.00 $16.43 $1.77 $16.43 37.20% 37.20% $166,973 Potential CT sav ings 150,236,657 $0.00 $0.00 10 ($8.66) $0.00 ($8.66) $0.00 37.20% 37.20% ($817,059Nutrient mgt plan 192,364,478 $7.00 $15.00 3 $2.33 $4.00 $5.00 $9.72 35.00% 17.50% $624,854 Potential NMP sav ings 192,364,478 $0.00 $0.00 3 ($10.00) $0.00 ($10.00) $0.00 35.00% 17.50% ($1,587,006Riparian forest buffer 1,260,698 $300.00 $300.00 20 $57.76 $135.00 $86.08 $163.32 25.00% 0.00% $81,388Vegetativ e barrier 1,406,648 $100.00 $100.00 15 $57.76 $140.00 $68.74 $150.98 0.00% 0.00% $96,692Retirement 4,864,704 $67.20 $98.86 10 $52.76 $57.76 $62.33 $71.84 0.00% 0.00% $303,206

Sub

Subtotal o

Pasture Land

Riparian forest buffer 129,094 $300.00 $300.00 20 $48.29 $135.00 $76.61 $163.32 0.00% 0.00% $9,889Rotational stocking 43,180,906 $0.00 $0.00 0.00% 0.00% 

Range Land

Riparian fencing only *; or 22,295 $3,005.50 $9,500.00 25 $194.58 $639.52 $452.48 $1,454.72 0.00% 0.00% $10,088

Stream protection/bank stabilization 270,248 $63.84 $119.70 15 $9.78 $24.27 $16.79 $37.41 0.00% 0.00% $4,536

* for range riparian fencing, units are miles rather than acres

O COS S O O O SO C S
98 Source: Data on confined animals of various sorts in each State, obtained from the 1997 Census of

Agriculture, multiplied by the number of animal units (EPA definition) per head for each sort of animal. 

U.S. Department of Agriculture. 1997 Census of Agriculture. Www.nass.usda.gov/census.

99 We assume that AFOs where beef cattle are raised in confinement are represented by the Census category

“Cattle and calves fattened on grain and concentrates for slaughter”. This category should generally

include beef feedlots and exclude pasture and range operations in which the cattle are not confined.

I-23

II. ANIMAL FEEDING OPERATIONS (AFOs)

We found 750 water bodies on States’ 303(d) lists that States have identified as impaired by

AFOs. These water bodies were either cited directly in a State’s 303(d) submission as impaired by AFOs,

or they were cited as impaired by AFOs in a State’s 305(b) submission and corresponded to a 303(d)-listed

water body. These water bodies are in 451 counties in 32 states. We assume conservatively that the

remaining 18 states may have AFO-impaired water bodies, but either did not report sources of impairment

at all or reported them in a manner that was insufficiently specific to identify AFOs as a source of

impairment. The 32 States reporting AFO-impaired waters have 44,790,402 animal units confined in

AFOs. In the nation as a whole, there are 69,312,402 animal units confined in AFOs.98 We assume that

the degree to which AFOs impair waters in the 32 “reporting” States is replicated in the remaining States. 

The scale factor to extrapolate from whatever AFO costs we estimate for the 32 States to the entire nation

is thus 1.55 (69,312,402 divided by 44,790,224). 

A. EXTENT OF AFO ACTIVITY REQUIRING CONTROLS

To determine the amount of AFO activity occurring in these 451 counties, located in 32 States, we

used data from the 1997 Census of Agriculture on the number of farms in each county and their animal

inventories.

1. Types of animals covered in the analysis

The types of animals covered in the analysis include:

• Beef cows99

• Milk cows

• Layers 3 weeks old and older

• Broilers and other meat-type chickens

• Swine.

The Census of Agriculture also provides some, but not complete, information on other animal

species: turkeys, sheep, goats, horses, ducks, mink, etc.. For a variety of reasons, including incomplete

county-level inventory information, limited information on manure management costs for farms raising

these species, and a desire to keep the amount of data collection and analysis to a manageable level, we

decided to analyze in this study only AFOs raising beef and dairy cows, swine, layers and broilers. This set

of animals that we analyzed accounts for nearly 95 % of the volume of confined animal manure produced
100 Source: U.S. EPA. Preliminary Study of the Livestock and Poultry Industry: Section 2, Economics. 

September 30, 1998. 

101 U.S. Department of Agriculture, Economic Research Service. “Confined Animal Production Poses

Manure Management Problems.” Agricultural Outlook. September, 2000. Pages 12-18.

102 Existing regulations also define some farms of smaller size as CAFOs because they discharge pollutants in

specified undesirable ways.

I-24

annually at U.S. livestock and poultry farms.100 We believe that omitting the numerous animal types other

than the five we have analyzed results in only a very small underestimate of the likely costs for AFOs to

achieve TMDL-mandated load reductions.

For broilers as well as beef fattened on grain and concentrates, the Census provides information on

the number of animals sold over the course of the year rather than on the inventory on hand at the end of

the year. We converted the sales information to approximate inventory by dividing sales by the number of

production cycles assumed to take place at a typical farm in a year (for broilers, 6.0 and for confined beef,

2.5).

2. Size of AFOs covered in the analysis

We assumed that very small AFOs would be unlikely to be addressed in TMDLs. USDA

estimated that in 1997 AFOs with less than 50 animal units represented roughly 40 % of all farms, but less

than 5 % of all animal units.101 For this analysis, we assume that AFOs with less than approximately 20

animal units will not face TMDL requirements. This cutoff level defining a de minimis AFO is the same as

EPA used for its economic analyses of both coastal zone management measures for CAFOs and national

nonpoint source management measures for CAFOs. More specifically, AFOs with fewer than the

following numbers of animals were assumed to be unlikely targets for the TMDL requirements:

 50 beef cattle sold (equivalent to 20 beef cattle inventory, or 20 animal units);

 20 dairy cows (28 animal units; the Census provides data on dairies using a 20 cow break

point, and provides no data on farms corresponding with 20 animal units or approximately

14 dairy cows);

 50 swine (20 animal units);

 3,200 layers (the equivalent of 32 animal units, the closest of the Census break points to

20 animal units for layers); and

 60,000 broilers produced (10,000 broilers inventory, the equivalent of 100 animal units,

but roughly the size of the smallest broiler house in common use).

In the cost analysis, we also make some distinctions involving AFOs that are sufficiently large to

be CAFOs. We defined CAFOs with reference only to their size and not to their “method of discharge”.102

In this analysis, CAFOs include all farms with more than the following numbers of animals:
103 Source: USDA. “USDA Review of EPA’s TMDL Cost Assessment” June 29, 2001.

104 U.S. EPA, Office of Water, Office of Science and Technology. Final Cost Methodology Report for Beef

and Dairy AFOs. Final Cost Methodology Report for Swine and Poultry Sectors. January, 2001.

I-25

 1,000 beef cattle (equivalent to 2,500 cattle sold);

 700 dairy cows;

 2,500 swine;

 30,000 layers or broilers (equivalent to180,000 annual production of broilers) at an AFO

with a liquid manure system. We assume that 10 % of layer farms use liquid manure

systems, and no broiler farms use such systems.103

Using data from the Census of Agriculture, we calculated the total number of animal units in the

451 AFO-impaired counties as 13,830,056. This number represents 31% of the total number of animal

units in the 32 States.

B. RELATIONSHIP BETWEEN THE AFO COST ANALYSIS AND EPA’S PROPOSED CAFO REGULATIONS

EPA has recently proposed substantially revised effluent guidelines for feedlots. The AFO cost

analysis in this report does not account for these proposed revisions. We assume that the existing feedlots

effluent guideline is part of the baseline for the cost analysis (as we assume for other promulgated

technology-based standards also), and that the new proposed-but-not-yet-finalized effluent guideline is not

part of the baseline. Any not-yet-incurred costs for CAFOs (as defined under the existing regulations) to

meet existing requirements are part of the baseline, not attributable to the TMDL program. To the extent

that TMDLs will likely require load reductions of AFOs or CAFOs that exceed what is required by the

existing effluent guideline, we attribute the ensuing costs to the TMDL program. In fact, if the revised

feedlot effluent guideline is promulgated in roughly the same form as it has been proposed, much of these

costs that we now attribute to the TMDL program will instead be required by the new effluent guideline. 

Nevertheless, for this analysis, we do not anticipate the promulgation of the revised effluent guideline, and

we instead count as attributable to the TMDL program all costs for AFOs beyond the requirements of the

existing guideline.

In support of the proposed effluent guideline, EPA has conducted extensive research and analysis

on potential management measures for AFOs and their costs.104 Most of the work for the TMDL cost

analysis was completed before this effluent guideline AFO costing work was performed. In many respects,

this TMDL cost analysis for AFOs does not reflect the newer and generally better data developed for the

effluent guideline. However, EPA’s feedlot effluent guideline cost studies are currently being revised, and

we did not believe that we should make the substantial effort to change our TMDL costing to conform to

the effluent guidelines work while this work is still in flux. We plan soon (likely during the period while the

draft TMDL cost analysis is undergoing public review) to revise the TMDL cost analysis for AFOs to

conform our estimates to the effluent guideline cost analysis information.
105 In general, P-based limits allow less manure to be spread than will N-based limits. P-based limits will

thus require manure to be transported a greater distance in order to find a sufficient quantity of

agricultural land on whcih the manure can be used. EPA’s proposed feedlots effluent guideline would

require application of manure consistent with phosphorus needs.

I-26

C. DESCRIPTION OF BMPS REQUIRED WHERE CONTROLS ARE NEEDED

We assumed four sets of measures would be necessary for AFOs that contribute to impairment of

waters that States have identified as AFO-impaired:

 Upgrades to AFO facilities as necessary to collect, store and spread manure on nearby

fields. Necessary facilities and equipment include those to:1) Collect and store

manure/process wastewater and runoff that comes in contact with manure; 2) Manage the

manure by spreading it on nearby agricultural land; 3) Compost dead animals; and 4)

Prevent pollutant movement to ground water.

 Additional manure hauling and/or composting. Manure should be used consistent with

agronomic needs rather than simply spread nearby. In areas where the amount of manure

generated exceeds crop needs, excess manure will need to be transported either to nutrientdeficient areas or to alternative end uses such as composting. We assume that manure

application rates should not exceed phosphorus-based limits.105

 Nutrient management planning. For AFOs, this will include: (1) Developing a nutrient

management plan; 2) Manure and soil testing; 3) Training and certification of personnel

who apply manure; and 4) Keeping records regarding manure generation and disposition.

 Practices to protect and restore AFO-impaired riparian areas. As for crop and pasture

land, for costing purposes we will assume riparian forest buffers will be implemented. 

Again, riparian forest buffers will tend to be more expensive than alternatives such as

grass buffers, use exclusion, stream protection, etc..

We estimate the costs for these four practice groups for all AFOs of greater than de minimis size in

counties within which there are AFO-impaired water bodies. These practices are likely to generate some

savings that will offset the costs in part or in whole:

 As AFOs improve their manure management facilities, they will collect and manage a

greater percentage of their manure. The additional manure collected and available for

spreading may have some value.

 Manure increases in value when it is hauled to where its nutrient content can be more fully

used rather than always being spread near the farm where it is generated.

 Nutrient management planning and careful use of manure nutrients may allow a farmer to

reduce his purchases of commercial fertilizers.

We will also estimate the amount of these potential savings.
106 DPRA Incorporated. Economic Impact Analysis of Coastal Zone Management Measures Affecting

Confined Animal Facilities. October 7, 1992. Also, DPRA Incorporated. Economic Impact Analysis of

National Nonpoint Source Management Measures Affecting Confined Animal Facilities. May 17, 1995.

I-27

D. CALCULATING THE COSTS TO UPGRADE AFO FACILITIES

In estimating the costs of upgrading manure management facilities at AFOs, we used a set of unit

cost estimates developed by DPRA for EPA in connection with the Agency’s “Management Measures

Guidance for Coastal Zone Nonpoint Source Pollution” required by the Coastal Zone Management Act

Reauthorization Amendments of 1990. Until the recent feedlots effluent guideline work, the set of CZARA

measures promulgated for AFOs and the accompanying cost analyses represented EPA’s most

comprehensive review of AFO facilities needs. The 1995 Economic Impact Analysis supporting the

CZARA management measures describes the measures recommended for AFOs and their costs in more

detail:106

Management measures considered in this analysis focus on (1) facility runoff controls, (2) nutrient

management practices with respect to the disposal of manure on agricultural land and (3) dead

animal composting for poultry. Facility runoff is controlled primarily through diversions (diking)

for eliminating run-on and channeling on-site effluents to the ultimate control mechanisms... [The

measures also] included lined retention ponds and irrigation for ultimate disposal of effluents...

Variable rainfall patterns were also considered in estimating management measures for controlling

run-on and runoff. For example, retention ponds were designed to hold runoff from a 25-year, 24-

hour rainfall event, plus allowances for additional freeboard, process water, and storage for periods

when water cannot be disposed. Because a storm of this magnitude is variable, control designs

varied to provide capacity for 4-, 6-, 8- and 10-inch rainfall events. Ultimately, facilities in different

states were required to have management measure controls designed appropriately for the expected

rainfall event (e.g., Louisiana facilities were designed on the basis of a 10-inch 25-year/24-hour

storm, Michigan facilities for a 4-inch storm).

Investment costs for effluent control mechanisms vary by size of facility and expected intensity of

storm events. The ranges of total investment costs are ... [from $900 for a small swine operation to

$60,500 for a large dairy]... (Effluent control costs for poultry operations, which are presumed to be

entirely enclosed, are not significant and were not estimated.) ... Annual operating costs for these

facilities, including farmer provided labor, range from a low of approximately four percent to a high

of eight percent of total investment costs.

Manure management includes provisions for disposing of manure on agricultural land. Manure

management consisted of spreading manure so that application of the nitrogen and phosphorus

constituents do not exceed 60 and 20 pounds per acre, respectively. This requirement increased

manure land application costs by requiring operators to apply manure over larger areas, consequently

increasing transportation costs. Transport distances were estimated to increase up to five (5) miles

(one-way) for the largest model facilities considered. Manure management cost estimates ranged

from approximately $100 per year for small swine feedlots to over $12,000 per year for large dairies.

Dead animal disposal was considered only for poultry (layers and broilers). The disposal method

considered was composting dead birds with poultry litter. Composting facility investment costs

ranged from approximately $400 for small 5,000-bird facilities, to more than $6,700 for 80,000-bird

facilities. (Source: DPRA, 1995. op cit., pp 7-8.)
I-28

DPRA estimated the costs for such facilities for model AFOs of different sizes for each animal

type that we address (confined beef, dairy, swine, layers, broilers). We made several adjustments in using

DPRA’s unit costs for AFOs for this study. First, we deleted a cost reduction of $3,500 per farm assumed

by DPRA to be provided in environmental cost sharing funds by Federal and State agricultural agencies. 

Our analysis aims to estimate the total implementation costs of TMDLs. Cost sharing funds reduce costs

to farmers, but for our analysis they represent transfer payments from governments rather than any

reduction in total implementation costs. Second, we extend DPRA’s cost estimates to several new model

AFOs that were sized smaller or larger than the range that DPRA had dealt with in its analysis. We did

this by developing regression equations giving DPRA’s estimated costs as a function of AFO size, and

using these estimated equations to extrapolate costs for model AFO sizes outside of DPRA’s range. Third,

we inflate DPRA’s costs to March, 2000 dollars, using the index of producer prices.

There are both pros and cons in our using the DPRA costs to estimate the unit costs for AFOs that

will need to improve their environmental performance to meet the requirements of TMDLs:

 Pro: The DPRA costs cover a broad set of minimum management measures that are typical of the

least that a representative AFO will need to do. The costs reflect the effluent guideline requirement

of no discharge except for a 25-year/24-hour storm, and add some modest manure spreading

requirements.

 Pro: The DPRA costs represent the most comprehensive set of costs for AFO water quality

management that EPA had developed until recently, and they have been widely used by the Agency

and others.

 Con: DPRA presents the costs as a package that is very difficult to break into component pieces

and component costs. One result is that it is difficult to adjust the DPRA costs to reflect the fact

that the various different items are currently in place at AFOs to varying degrees. DPRA costed

out construction of waste lagoons, retention basins, liquid waste irrigation equipment, dead animal

composting facilities, manure hauling equipment, etc., assuming that no portion of any of these

facilities or equipment was yet in place. Some of these items are currently in place at the great

majority of AFOs (virtually all AFOs have some equipment for collecting and disposing of their

manure), but other items are much less commonly in place (e.g., many AFOs already have waste

lagoons, but many of the lagoons are not lined).

 Con: DPRA does not assume that poultry farms need manure storage structures. In fact, virtually

all poultry farms should have such structures (perhaps only half of them now have them) in order

to store dry litter appropriately after it is removed from the poultry house until it can be spread on

fields.

 Con: DPRA’s assumptions seem generally low regarding the typical distance from an AFO that

manure will need to be transported before it can be spread consistent with agronomic needs. 

DPRA assumes transport distances of 0 - 5 miles. In many areas of the country, however, there

are large excesses of confined animal manure relative to local crop needs and manure will need to

be shipped much greater distances. We are able to estimate the amount of manure needing to be

shipped out of the county of origin and the resulting costs for inter-county shipping (see below),

but there may also be a substantial quantity of manure that needs to be shipped some distance
I-29

intermediate between DPRA’s 0 - 5 miles and entirely out of the county (typically 15 miles or

more). We likely miss the costs when such intermediate shipping is needed.

 Con: Embedded within the DPRA estimate of annualized costs is an assumed 10 % discount rate. 

We would prefer to use a 7 % discount rate consistent with the remainder of this analysis. 

However, it would be very difficult to disentangle DPRA’s annualized costs into capital and annual

O&M costs and then substitute our preferred discount rate. We have chosen to retain DPRA’s

annualized costs despite their 10 % discount rate assumption. Annualized compliance costs with a

10 % discount rate may be, by our rough estimate, about 0 - 5 % higher than they would be if we

were to recalculate them with a 7 % discount rate. This error is small compared with other likely

uncertainties in our estimates.

In sum, the DPRA cost estimates have some important shortcomings relative to our desires, but they are the

best available to us pending completion of the feedlots effluent guideline cost estimates. We will convert

this analysis to use the effluent guideline cost estimates as soon as possible.

We applied DPRA’s unit costs to the numbers of farms of each animal type and size in each of the

counties with AFO-impaired waters. We also reflected the degree to which each type/size farm currently

has these facilities in place.

CAFOs were presumed already to have all the needed facilities in place due to requirements of the

existing CAFO effluent guideline. Costs for facilities upgrades were presumed to be zero for all CAFOs. 

We assumed that CAFOs included all farms with more than 1,000 AU (EPA definition) of a single animal

type, with the exception of broiler farms (all were assumed to use dry manure management techniques, and

hence none are CAFOs by reason of size) and 90 % of layer farms with more than 30,000 inventory (10%

of such large layer farms were assumed to use liquid manure systems and hence subject to CAFO status).

Treatment-in-place estimates for AFOs having fewer than 300 animal units were developed from

EPA’s Nonpoint Source Gap Analysis data. We assumed that the following percentage of AFOs

containing fewer than 300 AU already had the desired facilities in place:

Exhibit I-6

Percentage of AFOs < 300 Animal Units With Facilities in Place

Animal Type Storm Water Diversion, Management

Beef 90

Dairy 90

Swine 50

Layer 73

Broiler 11

Source: TetraTech, Inc. Nonpoint Source Gap Analysis. Op cit.
I-30

For AFOs containing 300 to 1000 AU, we assumed that the percentage needing facilities was half

of that for AFOs containing fewer than 300 AU, such that:

Exhibit I-7

Percentage of AFOs 300-1000 Animal Units With Facilities in Place

Animal Type Storm Water Diversion,

Management

Beef 95

Dairy 95

Swine 75

Layer 87

Broiler 56

Note that the information on facilities in place from EPA’s Nonpoint Source Gap analysis covers only

some of the sorts of facilities presumed to be necessary at AFOs in EPA’s CZARA analysis. We assume

that the fraction of farms with storm water diversion and management facilities in place is representative of

the fraction of farms with all of the osther sorts of facilities in place also (e.g., dead animal composting,

lined lagoons). This assumption is likely inaccurate, and better information on facilities in place will be

obtained before this analysis is finalized.

To estimate the costs for AFOs to upgrade manure management facilities, we multiply the number

of farms in each of the 451 counties of each animal type/size clas by the appropriate DPRA cost for that

sort of farm by the proportion of that sort of farm that is presumed not yet to have the needed facilities in

place. Exhibit I-8 shows the resulting estimated costs for AFOs to upgrade their facilities. These costs

include the various scaling factors to extrapolate from the States that “report” regarding AFO impairments

and to reflect the incomplete coverage of the nonpoint source analysis and the TMDL pace/lag factor.

Exhibit I-8

National Facilities Costs by Animal Type (in millions of 2000 dollars/yr)

Animal Type Facilities Costs

Broilers $19.707

Swine $3.916

Beef $0.997 

Layers $0.498 

Milk Cows $3.197 

Total $28.316
107 Lander et al. February 1998. Nutrients Available from Livestock Manure Relative to Crop

Growth Requirements.

I-31

 Our final estimate of the nationwide incremental cost of upgrading facilities at AFOs is $28.3 million/yr

for Scenario 1.

E. POTENTIAL COST SAVINGS FROM ADDITIONAL MANURE MANAGEMENT FACILITIES

As some AFOs improve their facilities for collecting and managing manure, more manure will

become available for use. Depending on the local relationship between the amount of nutrients available

through already-collected manure and crop needs, this additional collected manure may or may not have

economic value for local use. We estimate this potential value of the additional collected manure assuming,

for this step in the analysis, that it is not shipped. We assume that the additional collected manure has

value (without hauling) if local crop nutrient needs exceed local manure availability of nutrients through

manure.

We estimate the volume of additional manure collected as a result of the AFO facilities upgrades,

the amount of nutrients recovered and available to crops if such manure were spread locally, and the value

of these nutrients as a function of the local balance between nutrient needs and availability. These

calculations involve the following data:

 Data from the 1997 Census of Agriculture on the number of confined animals in each

county within which an AFO is located;

• Estimates from DPRA of the tons of manure generated per animal per year;

• Data from Lander et al107 on:

- The proportion of generated manure from each animal type that is typically

recovered and then available for use ( the “recoverable manure factor”),

- The pounds of nutrients (phosphorus, nitrogen, and potassium) available per ton

of recoverable manure generated by each animal type; and 

- The ratio of the amount of nutrients that will be available to plants after the

manure is spread to the total amount of nutrients in recovered manure.

For each county and animal type, the total tons of manure generated and then recovered as a result

of upgraded facilities at AFOs are calculated by multiplying the number of animals at upgraded facility

farms by DPRA’s estimated number of tons of manure generated per animal. The total tons of recoverable

manure is calculated by multiplying the total tons of manure generated by the “recoverable manure factor”.

For phosphorus and potassium, the total pounds of nutrients available to crops in the additional manure are

calculated by multiplying the total tons of recoveraed manure by the pounds of nutrients per ton of
108 Lander et al. Op cit.

109 Sources for value per pound and factors for converting from oxide form. Jacobs, L.W. February 12, 1997.

Resource Value of Dairy Manure. Crop and Soil Science Department. Michigan State University.

http://ww.canr.msu.edu/fldcrp/manure2.htm. Zublena, J.P. et al. March 1996. Swine Manure as a

Fertilizer Source. North Carolina Cooperative Extension Service. Publication Number AG-439-4. Hart, J.

et al. August 1997. Dairy Manure as a Fertilizer Source. Oregon State University Extension Service.

http://eesc.orst.edu. Bennett, M., Fulhage, C., and Osburn, D. October 1993. Waste Management

Systems for Dairy Herds. Department of Agricultural Economics, University of Missouri-Columbia.

I-32

recoverable manure. For nitrogen, based on Lander, it is assumed that 30 percent of nitrogen in recovered

manure is lost and unavailable to crops due to volatilization of ammonia.108

The application of manure to crop land can have economic value if it allows for decreased

expenditures on commercial fertilizer. Exhibit I-9 shows the average potential value per pound that we

assumed for the nutrients contained in the additional manure. This value will be realized if all the manure

nutrients displace on a one-for-one basis an equivalent amount of purchased nutrients in commercial

fertilizer.

Exhibit I-9

 Maximum Value Per Pound for Manure Nutrients

Nutrient (oxide form) Value per lb. Nutrient Value per lb.109

N $0.23 N $0.23

P2O5 $0.237 P $0.543

K2O $0.154 K $0.186

The spreadsheet “sum of nutrients all animals” contains the final estimates of the total value of

nutrients in each county. Those counties located in Great Plains states are assigned no value for

Potassium because......EXPLAIN....The number of pounds of P, N, and K are summed up over all

animal types to give the total pounds of nutrients contained within each county.

To determine whether nutrients in the additional manure collected due to upgraded AFO facilities

has value at these maximum levels, or at some lower level, or has no value at all, we conducted a countyby-county analysis. For each of the 451 counties, we used data from Lander et al. to compare the amount

of nutrients available in all manure generated in the county to the amount of nutrients that is needed for

non-legume, harvested crop land, hay land, and pasture land in the county. We assumed the following:

 Nitrogen. Manure nitrogen has full value if it is generated in a county where total manure

nitrogen amounts to 25% or less of total county crop and pasture nitrogen needs. It has

half of full value if it is generated in a county where total manure nitrogen amounts to 25 -

50% of crop/pasture needs. It has 25% of full value ... THE AFO DISCUSSION IN

THIS APPENDIX IS NOT WRITTEN/EDITED BEYOND THIS POINT
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b. Nutrient management planning costs (for both AFOs and CAFOs)

AFO nutrient management planning costs include the following:

• Capital costs associated with training

• Costs to develop and periodically update nutrient management plans

• Annual soil testing 

• Annual manure testing

• Annual record-keeping

Due to the lack of nutrient management plan requirements in the existing effluent guidelines for

CAFOs, we calculated costs for both AFOs and CAFOs. For some AFOs and CAFOs, we assumed that

nutrient management planning was current practice, and hence did not require them to incur any

incremental costs. Exhibit I-9 indicates the percentage of AFOs and CAFOs that are assumed currently to

conduct these nutrient management activities.

Exhibit I-9

Percentage of AFOs and CAFOs 

Currently Conducting Nutrient Management Activities

Animal Type Training NMP Soil Test Manure Test

Beef 0 100 100 100

Dairy 0 100 100 100

Swine 0 13 90 40

Layer 0 72 42 73

Broiler 0 19 20 20

Source: Tetra Tech GAP Analysis

We assumed that AFOs and CAFOs would have the same performance, regardless of size.

However, CAFOs and larger AFOs were assumed to incur greater nutrient management planning costs than

smaller AFOs (that is, those with fewer than 300 animal units). Exhibits I-10 and I-11 illustrate the

assumed cost per AFO for AFOs with fewer than 300 animal units, and the additional assumptions used for

CAFOs and larger AFOs, respectively.
110 We assumed a 5-year useful life for the turnover of the $117 capital investment in training and certifying

the assumed one employee per farm who is to supervise manure testing and application.

111 We assumed that record-keeping was required as an element of nutrient management planning. Record

keeping entails keeping records of how the manure the AFO or CAFO generates is used and disposed of. 

We estimated this cost at $20/year (2 hours at $10/hour) for an AFO < 300 AU.

I-34

Exhibit I-10

Nutrient Management Cost per AFO--Fewer than 300 Animal Units

Animal

Type

Training1

10

(capital)

NMP

(yearly)

Soil Test

(yearly)

Manure Test

(yearly)

Record

Keeping111

(yearly)

Beef $117 $11 $12 $50 $20

Dairy $117 $50 $25 $50 $20

Swine $117 $26 $17 $50 $20

Layer $117 $9 $11 $50 $20

Broiler $117 $28 $18 $50 $20

Exhibit I-11

Nutrient Management Cost per AFO and CAFO (Relative to AFO with Fewer than 300 AU)

Training NMP Soil Test Manure Test Record Keeping

Costs per AFO

<300 AU

ABC D E

Costs per AFO 

300 - 1,000 AU

A 4B 4C 2D 4E

Costs per CAFO A 8B 8C 4D 8E

With these assumptions, we estimated the national nutrient management costs as follows:

• We obtain Census of Agriculture data for each county on the number of farms for each

animal type and farm size category (1)

• We multiply (1) by the proportion of farms assumed to be currently conducting nutrient

management plans by the estimated cost per farm. We sum each management activity for

all counties and determine a total nutrient management plan cost for the 32 states.

• To obtain an estimate for the entire nation, we multiply by the scaling factor of 1.55 and

obtain a national estimate of $ 5.9 million/yr.

We next apply two further scaling factors (.4484 to reflect the pace of TMDL development at a 7

% discount rate, and 1.13 to reflect unknown/not classified source information). Our final estimate of the

nationwide incremental cost of nutrient management plans for AFOs is $ 3.0 million/yr.
112 Lander et al. Manure Nutrients Relative to the Capacity of Cropland and Pastureland to Assimilate

Nutrients: Spatial and Temporal Trends for the United States. USDA. Publication No. ps00-0579. 2000.

113 County areas (in square miles) taken from U.S. Census Bureau. Land Area, Population, and Density for

States and Counties: 1990. Www.census.gov/population/censusdata/90den_stco.txt

I-35

c. Savings due to nutrient management plans

d. Additional manure hauling and/or composting costs (only for AFOs and CAFOs in nutrient

access counties)

Some 303(d) water impaired counties were considered “manure-excess counties,” because the

nutrient content in the manure produced from concentrated animals exceeded plant uptake. We assumed

that both AFOs and CAFOs in these counties would need to transport their manure some extra distance

(over the minimal distance presumed in the DPRA facility costs) in order to find land on which it could be

agronomically applied. We used 1997 data from a USDA/Lander et al study112 on nutrient balance in every

US county to identify which of the 451 303 (d) counties needed extra shipping. The USDA/Lander et al

study provides data on confined animal manure P and N production and crop P and N needs. We assumed

manure would need to be hauled a sufficient distance to permit its application consistent with phosphorus

needs for crop and pasture land.

In order to estimate the costs for additional manure hauling, we calculated the following:

4. Tons of manure needing shipping. The tons of manure needing shipping were calculated

for each animal type using several data sources: Agricultural Census data on the number

of confined animals per farm, DPRA data on the tons of manure produced per head per

day, and USDA/Lander et al data on the percentage of recoverable manure in each state.

5. Extra shipping distance. In order to decide whether an extra shipping distance was

required and how far the manure should be shipped, we used the following criteria:

 If the county crop nutrient needs exceeded recoverable manure nutrient 

availability. No additional shipping distance was assigned and the minimal

manure hauling included in the facilities costs is presumed sufficient.

 If the recoverable manure P exceeds the crop P needs.

a. A quantity of manure sufficient to meet crop P needs can stay incounty, incurring no additional shipping cost; and

b. The remainder of the manure was assumed to need to be shipped

into another county.

The shipping distance depended upon several factors:

 The size of the county. Each county was assumed to be circular in shape, and the

distance to the perimeter was assumed to be the radius taken from its known

area113. 
114 Pratt et al. Estimate that using a large central composting facility at 20 miles distance would cost a dairy

farm $73/cow/year (sum of hauling cost and tipping fee). At 100 lb manure generated/head/day for a dairy

cow (DPRA), about 75% of which is recoverable (Lander), the $73 would pay for disposal of 75

lbs/day*365 days/yr=13.7 tons/yr of manure. The composting cost would thus be $5.33/ton of manure

managed.

115 Again based on Pratt, Jones and Jones. The large central composting facility they evaluate serves

approximately 12,000 dairy cows. At 13.7 tons/yr of recoverable manure per dairy cow, the composting

facility processes 164,400 tons of manure per year. We assumed that the composting facility becomes

economical at a slightly lower figure of 150,000 tons of recoverable manure per year.

I-36

 Proportion of the county surrounded by other counties with excess P. If the

county was surrounded by another excess county, it was assumed that manure

would need to be shipped some distance beyond that county.

 Proportion of the county where transport was impossible or uncertain. If a

portion of the county was surrounded by a large lake or ocean, it was assumed

that manure must be shipped elsewhere..In addition, if the county was surrounded

by a state that is not included in our AFO analysis, hauling manure into that

county was considered uncertain.

3. Hauling cost per mile. In general, hauling costs per ton-mile vary widely, depending upon

the assumed capacity of the transport vehicle and the nature of the waste. For the average

cost per ton-mile, we used a range recommended by TetraTech, set at $.10 to $.25 per ton

mile. To calculate these upper and lower hauling costs estimates, we multiplied the tons

recoverable manure by the assigned shipping distance by the average $.10 and $.25 per ton

mile.

With these assumptions in place, we estimated the national nutrient management costs as follows:

• To calculate the tons of manure needing shipping in each of the 451 counties, we collected

data on (1) the number of animals for each animal type in each farm size category; (2) tons

of manure produced per animal for each animal type; and (3) the proportion of manure

generated that is recoverable, and multiply (1) by (2) by (3) and summed across all animal

types for each county.

• To calculate the excess shipping distance, we collected data on (1) the radius of each of the

451 counties, (2) the proportion of the county that is surrounded by other excess counties;

(3) the proportion of the county that is surrounded by an ocean or large lake; and (4) the

proportion of the county where transport is uncertain. We then multiplied:

 (1) x [1+[(2)+ (3)]/[1-(4)]] We capped the total cost estimated for excess shipping at

some figure corresponding to an assumed cost for a large regional composting facility. We

assumed the cost of a central composting facility to be $5.33/ton, based on Pratt, Jones

and Jones (TIAER, 1997).114 We assumed that such a central composting facility becomes

economically feasible only if the volume of recoverable manure to be managed exceeds

150,000 tons/year within an assumed 20-mile radius catchment area.115

• We then multiplied the tons of manure needing shipping by the excess shipping distance by

the $.10 (lower estimate) and $.25 (higher estimate) cost per ton mile estimates for each

county and estimated the total national manure hauling costs in 32 states. To obtain an
116 For broilers and beef fattened off of grains and concentrates, the county data pertained to sales instead of

inventories. To calculate the number of confined animals by inventory, we divided the number of animals

sold by the production cycle (for broilers :6, for beef :2.5). For broilers and layers, county-level data was

only provided for the number of farms. To estimate the number of animals, we assumed that each county

had the same average number of animals per farm as the state. We calculated the average number of

animals per farm for each state in each farm size category and multiplied it by the number of farms in

each farm size county for each county. In cases where state data was lacking, we referred to national-level

data. For the rest of the animal groups, there were instances where the data on the number of animals was

not provided. In these cases, we used the mean number of animals in each farm size category as an

approximation of the number of animals.

117 According to XXX source, there are 3.62 pounds of P produced for every ton of recoverable manure.

I-37

estimate for the entire nation, we multiply by the scaling factor of 1.55 and obtain a

national estimate of $ 81.0 - 134.7 million/yr.

We next apply two further scaling factors (.4484 to reflect the pace of TMDL development at a 7

% discount rate, and 1.13 to reflect unknown/not classified source information). Our final estimate of the

nationwide incremental cost of hauling additional manure for AFOs is $41.0 - 68.2 million/yr.

e. Increased economic value of the shipped/composted manure

The increased value of manure when it is shipped may offset part of the shipping cost. Manure can

have economic value because its use on crops can reduce the amount of chemical fertilizer that needs to be

used. The value of manure depends on its nutrient content (N, P and K), and the effective value of each

nutrient in the location to which the manure has been shipped (e.g., whether the manure nutrients serve to

displace purchased chemical nutrients).

To estimate the increased value of the shipped manure, we first estimated the tons of recoverable

manure generated by multiplying the number of confined animals per animal type116 by the tons manure per

head per year by the percentage of recoverable manure for each animal type. We then multiplied the tons of

recoverable manure by the percentage content of N, P and K for each variety of manure.3.62 pounds P117

to calculate the P content of the manure.

$7.5 - $18.2 million /year.

f. Costs for buffers for AFO-impaired water bodies

We estimated costs for a 75 foot buffer width on both sides of an impaired river, and that the

buffer would take crop land out of production. We estimated buffer needs only for those AFO-impaired

water bodies that have not yet had buffers costed because of crop, pasture or range impairments.

$4.0 - $10.2 million/year.
118 Other private land is defined as private land owned by an entity that does not operate a wood-using

facility.

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g. Total costs and savings for AFOs

Summing over all estimated costs for AFOs, we estimate the total national implementation cost for

AFOs at $76.4 - $109.8 million/year. The total potential savings are estimated at $7.5 - $66.7

million/year.

III. SILVICULTURE

Silvicultural activities can contribute to water impairment through several means: erosion, siltation,

bank destabilization, runoff of forest management chemicals, loss of vegetative cover, and an increase in

water temperature. The level of water quality impairment caused by silviculture depends not only on the

degree of site disturbance (given by the acres or volume of timber harvested), but also the terrain (whether

an area is hilly or flat).

We found 646 water bodies on States’ 303(d) lists that States have identified as impaired by

silviculture (either directly in their 303(d) submission or cited as impaired in their 305(b) submissions and

corresponding with a 303(d)-listed water body). These water bodies are in 294 counties in 30 States. We

assume conservatively that the remaining States may have silviculture-impaired water bodies, but either did

not report sources of impairment at all or reported them in a manner that was insufficiently specific to

identify silviculture as a source of impairment. The 30 States reporting silviculture-impaired 303(d) waters

harvest 10.9 million cubic feet (mcf) of timber per year. In the Nation as a whole 16.3 mcf are harvested

per year. We assume that the degree to which silviculture impairs waters in the 30 “reporting” States is

replicated in the remaining States. The scale factor to extrapolate from whatever silviculture costs we

estimate for the 30 States to the entire nation is thus 1.498 (16.3 million divided by 10.9 million).

A. EXTENT OF NONPOINT SOURCE ACTIVITY REQUIRING BMPS

We determined the amount of silvicultural activity in these 294 counties, located in 30 states, using

timber harvest volume data from the U.S. Forest Service’s Timber Product Output Data Retrieval System

(http://srsfia.usfs.msstate.edu/rpa/tpo/), developed in support of the 1997 Resources Planning Act

Assessment. Timber harvest volume for 1996 is available by type of product at the regional, sub-regional,

state and county level, and can be broken out into volumes harvested on National Forest land, other public

land, forest industry land, and other private land.118 The timber harvest volume estimates for 1996 are

shown in the exhibit below.
119 In 1996, there were 10.9 mcf of timber in the 30 States for which we had data.

120 TDC estimated the acres harvested in order to produce a given log volume based on queries of Timber

Data Company’s database of USFS and selected State timber sale appraisal data for 1998 sales. TDC

adjusted this data somewhat based on discussions with industry professionals regarding differences

between public and private timberland management practices. Adjustments also were made for known

regional differences in land growth potential and harvest methods. 

I-39

Exhibit I- 12

National Timber Cut in 1996 (mcf)

From private lands 14,330,530

From National Forests 912,060

From other public lands 1,025,628

Total 16,268,218

Using this harvest data, we calculated the total volume of timber harvested in the 294 counties: 2.3

million cubic feet (mcf). This volume represents 21% of the total timber harvest in the 30 States for which

we have data. 119 For our BMP unit costs, we used both mcf estimates and acreage estimates.

In order to convert the USFS timber harvest data into acreage information, The Timber Data

Company developed for us regional estimates of the number of acres on which harvesting operations would

occur in order to obtain 1 mcf of timber.120 These estimates are as follows:

Exhibit I- 13

Timber volume per acre, by region

Region mcf/Acre

Westside Oregon & Washington 3.0

California 2.0

Arizona & New Mexico 1.5

Inland & Rocky Mountain 1.5

Lake States 1.3

Midwest 0.6

Northeast 0.6

Westside Southeast 1.0

Eastside Southeast 1.0
I-40

B. DESCRIPTION OF BMPS REQUIRED WHERE CONTROLS ARE NEEDED

There exists a fairly typical set of BMPs that silviculture operations should employ to minimize

their impacts on water quality. These practices, and the particular combination of practices used, will vary

somewhat according to the type of silviculture operation and the conditions (e.g. region, climate,

topography, soils) of the silviculture site. Examples of BMPs for silvicultural activities are available from

numerous sources, including State forest practices laws and State forestry boards. The most important

document in which EPA has indicated the Agency’s judgment about the BMPs that are generally

appropriate is EPA’s 1993 Guidance Specifying Management Measures for Sources of Nonpoint

Pollution in Coastal Waters. The Guidance specifies 10 management measures for use in coastal States

(including the Great Lakes States) to protect waters from silvicultural sources of nonpoint pollution, and

lists and describes management practices that can be applied successfully to achieve the management

measures. 

According to The Guidance, we assumed that the following BMPs would be required where

controls are needed:

2. Preharvest planning

3. Streamside management areas

4. Road construction/reconstruction

5. Road management

6. Timber harvesting

7. Site preparation and forest regeneration

8. Fire management

9. Revegetation of disturbed areas

10. Chemical management

11. Wetlands forest management

Each BMP is described as follows:

12. Preharvest planning . Performing advance planning for forest harvesting to minimize

negative water quality impacts. BMPs include laying out harvest units to minimize the

number of stream crossings, systematically designing transportation systems to minimize

total mileage; minimizing road and skid trail grades; and surfacing roads (with gravel,

grass, crushed rocks, etc.) where grades increase the potential for surface erosion. 

2. Streamside Management Areas. Establishing and maintaining a streamside management

area (SMA) along surface waters, which is sufficiently wide and which includes a

sufficient number of canopy species to buffer against detrimental changes in the

temperature regime of the water body, to provide bank stability, and to withstand wind

damage. BMPs include providing a minimum SMA width of 35 to 50 feet; avoiding

operating skidders or other heavy machinery in the SMA; and applying harvesting

restrictions in the SMA to maintain its integrity.

3. Road Construction/Reconstruction. Minimizing delivery of sediment to surface waters

during road construction/reconstruction projects. BMPs include following the design

developed during preharvest planning to minimize erosion by properly timing and limiting
I-41

ground disturbance operations; using straw bales, grass seeding, and other erosion control

and revegetation techniques to complete the construction project; and installing surface

drainage controls to remove storm water from the roadbed before the flow gains enough

volume and velocity to erode the surface.

4. Road Management. Managing existing roads to maintain stability and utility and to

minimize sedimentation and pollution from runoff-transported materials. BMPs include

maintaining road surfaces by mowing, patching, or resurfacing as necessary; and

revegetating to proving erosion control.

5. Timber Harvesting. Minimizing sedimentation resulting from the siting and operation of

timber harvesting, and managing petroleum products properly. BMPs include felling trees

away from watercourses; removing slash from the water body and placing it out of the

SMA; minimizing the size of landings; skidding uphill to landings whenever possible;

avoiding cable yarding in or across watercourses; and taking precautions to prevent fuel

leakage and spills.

6. Site Preparation and Forest Management. Regenerating harvested forest lands. 

Examples of BMPs include avoiding mechanical site preparation on slopes greater than 30

percent or in SMAs; distributing seedlings evenly across the site; and hand planting highly

erodible sites, steep slopes, and SMAs.

7. Fire Management. Minimizing potential NPS pollution and erosion resulting from

prescribed fire for site preparation and from the methods used for wildfire control or

suppression. BMPs include planning burning to achieve the desired results while

minimizing impacts on water quality; avoiding intense prescribed fire or construction of

firelines in SMAs; avoiding burning on steep slopes with high-erosion-hazard areas or

highly erodible soils.

8. Revegetation of Disturbed Areas. Preventing sediment and pollutants from entering water

bodies by revegetating disturbed soil. BMPs include using seed mixtures adapted to the

site; using native woody plants planted in rows, cordons, or wattles on steep slopes; and

seeding during optimum periods for establishment, preferably just prior to fall rains.

9. Chemical Management. Minimizing the water quality impact of the use of pesticides and

fertilizers. BMPs include maintaining a buffer area around all water bodies for aerial

spray applications; and applying pesticides and fertilizers during favorable atmospheric

conditions, and during maximum plant uptake periods to minimize leaching.

10. Wetlands Forest Management. Taking special measures to protect beneficial wetlands

functions and avoid water quality impacts in wetlands areas. BMPs include providing

adequate cross drainage to maintain the natural surface and subsurface flow of the

wetland; and establishing a SMA adjacent to natural perennial streams, lakes, ponds, and

other standing water in the forested wetland.
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C. UNIT COSTS FOR BMPS

To cost out a typical set of BMPs that designated and permitted silvicultural operations might need

to employ, we used the set of BMPs and costs provided in EPA’s 1992 report, “Economic Analysis of

Coastal Nonpoint Source Pollution Controls: Forestry”, prepared by the Research Triangle Institute (RTI). 

The report analyzes the economic achievability of the management measures cited above and contained in

the Guidance Specifying Management Measures for Sources of Nonpoint Pollution in Coastal Waters. 

RTI estimated the incremental costs of these management measures by: 1) Specifying a set of key BMPs

that RTI judged the coastal states in each major forest region as likely to require in order to achieve each

management measure; and 2) Estimating the incremental costs of these BMPs relative to the costs of

following current silvicultural practices. In summarizing the results of the incremental cost analysis, RTI

combined the BMPs for the ten management measures into groups:

 Management measures for activities generally relating to harvesting. RTI analyzed the

incremental costs for seven management measures -- preharvest planning, streamside

management areas, road construction/reconstruction, road management, timber harvesting,

revegetation of disturbed areas, and wetlands forest management. Incremental costs for

the management measures for these seven activities were added and then presented in two

alternative ways -- as the summed incremental cost of these seven management measures

per acre harvested, and as the summed incremental cost of these seven management

measures per volume of timber harvested.121

 Management measures for activities relating to artificial forest regeneration. Costs for

the remaining four management measures -- site preparation prior to planting, forest

regeneration (tree planting or seeding), fire management (prescribed burns for clearing

unwanted vegetation) and forest chemical management (herbicides, fertilizer) -- were dealt

with by RTI in a very different manner than the harvesting-related costs.

The unit costs for harvesting-related activities in each of the 30 States and the unit costs for

artificial forest regeneration in the north and south regions, are described in the exhibits below.
I-43

Exhibit I-14

Estimated Harvest-Related BMP Costs (2000 $)

Flat % Hilly %

BMP

cost/acre

for flat, 

wet forest

land

BMP

cost/acre

for hilly,

wet

forest land

BMP

cost/100 cu. ft

for flat, 

wet

forest land

BMP

cost/100 cu. ft

for hilly, 

wet

forest land

Alabama 77.2% 22.8% $24.72 $33.66 $1.16 $1.77

Alaska 25.3% 74.7% $35.36 $35.36 $2.14 $2.14

Arizona 63.2% 36.8% $24.72 $33.66 $1.16 $1.77

California 18% 82% $35.36 $35.36 $2.14 $2.14

Florida 99% 1% $24.72 $33.66 $1.16 $1.77

Illinois 95% 5% $18.20 $18.20 $1.65 $1.65

Kentucky 70.8% 29.2% $24.72 $33.66 $1.16 $1.77

Louisiana 96.1% 3.9% $24.72 $33.66 $1.16 $1.77

Maine 85.5% 14.5% $18.20 $18.20 $1.65 $1.65

Massachusetts 100% 0% $18.20 $18.20 $1.65 $1.65

Minnesota 87.2% 12.8% $18.20 $18.20 $1.65 $1.65

Mississippi 80% 20% $24.72 $33.66 $1.16 $1.77

Montana** 25.3% 74.7% $35.36 $35.36 $2.14 $2.14

New Mexico 38.9% 61.1% $24.72 $33.66 $1.16 $1.77

North Carolina 78.8% 21.2% $24.72 $33.66 $1.16 $1.77

North Dakota 92.9% 7.1% $18.20 $18.20 $1.65 $1.65

Ohio 53.5% 46.5% $18.20 $18.20 $1.65 $1.65

Oklahoma 68.7% 31.3% $24.72 $33.66 $1.16 $1.77

Pennsylvania 54.5% 45.5% $18.20 $18.20 $1.65 $1.65

Rhode Island 100% 0% $18.20 $18.20 $1.65 $1.65

South Carolina 86.5% 13.5% $24.72 $33.66 $1.16 $1.77

South Dakota 95.7% 4.3% $18.20 $18.20 $1.65 $1.65

Tennessee 47.9% 52.1% $24.72 $33.66 $1.16 $1.77

Vermont 39.8% 60.2% $18.20 $18.20 $1.65 $1.65

Virginia 54.6% 45.4% $24.72 $33.66 $1.16 $1.77

West Virginia 46.2% 53.8% $24.72 $33.66 $1.16 $1.77

Wyoming** 26.4% 73.6% $35.36 $35.36 $2.14 $2.14
I-44

Exhibit I-15

Incremental Costs for Management Measures Associated With Artificial Regeneration (2000 $)

Region Costs

South - hilly ($.63 + $15.05 x %S) x SH

South - flat $0.63 x SF

North - hilly ($.19 + $3.50 x %S) x NH

North - flat $0.19 x NF

West Assumed identical to North

SH = acreage harvested in South/hilly

SF = acreage harvested in South/flat

NH = acreage harvested in North/hilly

NF = acreage harvested in North/flat

%S = percentage of hilly acreage harvested in each State that has slope > 30%

D. TOTAL NATIONAL ANNUAL BMP COSTS

To estimate total national annual BMP costs:

• We obtained data for each county on:(1) Total million cubic feet (mcf) of timber harvested

on all lands; (2) The total number of acres harvested on all lands; (3) The percentage of

all lands that have flat terrain; (4) The percentage of all lands that have hilly terrain; and

(5) The percentage of hilly lands that have steep terrain (classified as having a greater than

a 30% slope) The BMP costs per acre and costs per 100 cubic feet for each of the 30

States are listed in the exhibit below.

• In every county of our 30 States, we multiplied the number of acres in all lands by: (1) The

per-unit harvest BMP costs (State-by-State per-acre and per-volume cost estimates,

weighted according to the flat and hilly terrain percentages); and (2) The per-unit artificial

regeneration BMP costs (per-acre cost estimates for Southern and Northern/Western

States, weighted according to the flat, hilly, and steep terrain percentages). For each state,

we then added (1) to (2) to estimate the higher estimate of the total BMP cost (based off of

the BMP cost per mcf and the artificial regeneration BMP cost per acre) and the lower

estimate of the total BMP cost per acre (based off of the BMP cost per acre and the

artificial regeneration BMP cost per acre). Summing across all 30 states, we estimated the

total annual cost for silviculture BMPs at $39.1 million (lower estimate) or $54.9 million

(higher estimate). 

• Applying two further scaling factors (.4484 to reflect the pace of TMDL development at 7

% discount rate, and 1.13 to reflect unknown/not classified source information), we

estimated $29.7 - 49.7 million/yr as the annualized national BMP cost for silviculture.
122 Tetra Tech, Inc. Draft Nonpoint Source Gap Analysis. Prepared for U.S. EPA, Office of Water. 

February 7, 2001.

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IV. ON-SITE WASTEWATER TREATMENT SYSTEMS (OWTS)

On-site wastewater treatment systems (OWTS) may serve one or more homes or businesses,

typically in rural areas where public sewers and a central wastewater treatment plant are not available. An

OWTS typically includes a septic tank and a leach field, where partially treated wastewater from the septic

tank percolates into the soil which provides further removal before the effluent leaches to ground water. 

OWTS can fail or perform poorly for a variety of reasons, including:

 Locations in inappropriate soils, or too close to surface water or ground water;

 Too many systems located in close proximity to each other;

 Hydraulic overloading;

 Insufficient maintenance (conventional septic tanks need to be pumped out every 3 - 5

years);

 Mechanical failure with age.

Approximately 23 % of the dwellings in the U.S. are served by OWTS. Their prevalence is

particularly high among second homes and rural resort areas.

We found 596 water bodies on States’ 303(d) lists that States have identified as impaired by

OWTS (either directly in their 303(d) submission or cited as impaired in their 305(b) submissions and

corresponding with a 303(d)-listed water body). These water bodies are in 318 counties in 24 States. We

assume conservatively that the remaining States may have OWTS-impaired water bodies, but either did not

report sources of impairment at all or reported them in a manner that was insufficiently specific to identify

OWTS as a source of impairment. The 24 States reporting OWTS-impaired 303(d) waters include 14.2

million dwelling units served by OWTS. In the Nation as a whole, 24.7 million dwelling units are served

by OWTS. We assume that the degree to which OWTS impair waters in the 24 “reporting” States is

replicated in the remaining States. The scale factor to extrapolate from whatever OWTS costs we estimate

for the 24 States to the entire nation is thus 1.732 (24.7 million divided by 14.2 million).

We assume that a TMDL addressing OWTS will require all OWTS within a riparian zone around

the impaired water to be functioning properly. We further assume that “functioning properly” means that

any OWTS that fails must promptly be repaired or replaced.

Estimates of the rate at which OWTS are currently failing vary across studies. Reasons for

variation may include differences across studies in how “failing” is defined, and geographic differences in

construction practices and environmental settings that result in actual differences in failure rates. EPA’s

Draft Nonpoint Source Gap Analysis122 summarizes the estimates developed in many studies. One of the

most broadly based estimates was developed by the National Small Flows Clearinghouse, which estimated
123 National Small Flows Clearinghouse. Summary of On-Site Systems in the United States. 1996.

124 Nelson, Dix and Shepard. Advanced On-Site Wastewater Treatment and Management Scoping Study:

Assessment of Shrot-Term Opprotunities and Long-Run Potential. Prepared for the Electric Power

Research Institute, the National Rural Electric Cooperative Association, and the Water Environment

Research Federation. 1999.

I-46

10.2 % of OWTS as failing during the mid-1990s.123 A survey of State officials yielded failure estimates

that ranged from as low as 0.5 percent (Arizona and Utah) to 50 - 70 percent in Minnesota.124 In the

Nonpoint Source Gap Analysis, Tetra Tech reviews these and other studies and assigns 24 States as having

a “low” average failure rate (5 %), 19 States as having a “moderate” average failure rate (20 %), and 7

States as having a “high” failure rate (30 %). For this analysis, we will assume as a low estimate that 10

% of all OWTS are currently failing, and as a high estimate that 20 % of all OWTS are currently failing.

The cost of addressing a failed OWTS varies with the nature of the failure. In the Nonpoint

Source Gap Analysis, Tetra Tech cites possible remedial responses ranging from pumping out an

overloaded septic tank and installing a tank filter (cost about $300) to installing an entirely new advanced

system with nitrogen removal and/or disinfection (cost about $12,000). The most common likely

responses, according to Tetra Tech, are developing a new subsurface wastewater infiltration field (cost

about $1,500) or installing a complete new conventional septic tank/leach field (cost about $3,000). Tetra

Tech weights each remedial response by its likelihood and develops a weighted average cost of $3,040 per

failed OWTS. We use this figure in this analysis.

A properly operated and maintained OWTS can last 20 - 35 years or more. Tetra Tech assumes

that the average system will function for 25 years.

We thus estimate the cost to assure that the average OWTS is functioning correctly as $142.88 - $

164.16 per year, as follows:

Exhibit I-16

Average Cost Per OWTS For Assuring Proper Performance

Low Estimate High Estimate

Cost to remediate the backlog

of failed systems

0.1 (low est. of fraction of failed

systems) x $3,040 = $304 capital

cost, or, at 7% interest, $21.28

annualized cost

0.2 (high est. of fraction of failed

systems) x 

$3,040 = $608 capital cost, or, at 7%

interest, $42.56 annualized cost

Recurring cost to remediate

the additional systems that

will fail each year

0.04 (fraction of systems failing each

year) x $3,040 per system = $121.60

per year

0.04 (fraction of systems failing each

year) x $3,040 per system = $121.60

per year

Total $142.88 per system per year $164.16 per system per year

This estimated average cost will be applied to each OWTS that is assumed to be required by a TMDL to be

functioning correctly.
125 U.S. EPA. Guidance Specifying Management Measures for Sources of Nonpoint Pollution in Coastal

Waters. Www.epa.gov/owowwtr!/NPS/MMGI/Chapter4/ch4-5a.

126 Buzzards Bay Project. National Estuary Project Management Plan: Septic System Action Plan. 

Www.buzzardsbay.org/ccmp/septicac.

127 W.D. Robertson and J. Harman. Phosphate Plume Persistence at Two Decommissioned Septic System

Sites. Ground Water. Volume 37, No. 2, 1999, pp. 228 - 236

I-47

We assume that the riparian zone within which TMDLs will require all OWTS to be functioning

properly extends for 100 yards in all directions from an OWTS-impaired water. The 100 yard distance

was based on the following information:

 We reviewed State recommendations or requirements regarding surface water setback

distances – the minimum distance that an OWTS should be located away from a surface

water body. We reasoned that the riparian zone within which all OWTS should be

functioning correctly should be at least as large as these setback distances. The maximum

State setback distance in any State, as cited in EPA’s National Nonpoint Source

Management Measures Guidance, was 100 feet.125

 We reviewed the management measures for OWTS recommended by the Buzzards Bay

National Estuary Project, an effort rather like a TMDL and one of the best known

investigations of extensive pollution from OWTS. The Project found that existing OWTS

setback requirements, while adequate to deal with indicator bacteria, were inadequate to

deal with viruses from OWTS that may reach ground water and then travel great

distances. The Project recommended a setback distance of 250 feet for all new OWTS,

and improvements to system design and application rate for existing OWTS within this

zone.126

 We reviewed a study examining transport of pollutants from large failed septic systems. 

The study showed evidence of increased pollutant concentrations for different pollutants at

various downgradient distances, the greatest of which was nearly 100 meters.127

Based on this information, we assume that a surface water is likely to be adequately protected from

impairment by OWTS if all OWTS within 100 yards of the waters are properly sited (i.e., no inappropriate

soils, no excessive OWTS density, no hydraulic overloading), operated and maintained.

To determine the area of the riparian zone around each OWTS-impaired water, we then multiplied

the length of each impaired water body by the assumed 100-yard-deep zone, as adjusted for the type of

water body:

 Rivers. In the 24 States, there were 5440 miles of OWTS-impaired rivers, multiplied by

300 feet on each of two sides. This results in 395,630 riparian acres needing OWTS

controls.
128 This result seems at least plausible in this instance. Some of the OWTS-impaired waters in Fairfield

County have shorelines fully developed with OWTS-served homes on lots averaging as little as 8,000

square feet per lot (density of roughly one dwelling per 0.2 acres). Others of the impaired waters in

Fairfield County have typically larger lots in the developed shoreline areas, and some (limited) portions of

the shorelines that are relatively undeveloped. The average density throughout the entire riparian zones

for Fairfield County’s ten OWTS-impaired waters could well be approximately one OWTS-served

dwelling per 0.4 acres.

I-48

 Lakes. The 167 OWTS-impaired lakes average 5,103 acres per lake. Approximating the

lakes’ shape as circular, a 300-foot riparian ring around each lake results in an estimated

60,785 acres needing OWTS controls.

 Estuaries. The 47 OWTS-impaired estuaries average 7,064 acres each. Approximating

their shape as circular and assuming that land occupies 2/3 of their circumference, a 300-

foot ring around their landed perimeter results in an estimated 13,424 acres needing

OWTS controls.

 Coastal shorelines. In the 24 States, there were 249 miles of OWTS-impaired coastal

shorelines, multiplied by 300 feet on the land side of each. This results in 9,067 riparian

acres needing OWTS controls.

Summing across all OWTS-impaired water bodies in the 24 States, we estimate there are 478,906

riparian acres within which OWTS controls are needed.

How many OWTS are there within this acreage? Absent a painstaking and impractical

investigation to delineate these riparian zones, count the dwelling units within them, and estimate the

fraction of the dwelling units that rely on OWTS, we cannot know the answer with any precision. Instead,

we make a very rough simplifying assumption -- that the density of dwellings served by OWTS in any

riparian zone is 10 times the density of dwellings served by OWTS in the county surrounding the impaired

water. In essence, we assume that the riparian zone is much more intensively developed than is the county

as a whole. This seems reasonable, as we would expect waterside home sites typically to be much more

attractive than more undistinguished locations. If, for example, an entire county has an average of one

OWTS-served dwelling unit per four acres of land area (e.g., as in Fairfield County, CT, one of the

counties with the greatest number of OWTS-served homes), then we would assume in this county that there

would be one dwelling per 0.4 acres specifically in the riparian zone around OWTS-impaired waters.128

With this final assumption that the density of OWTS in the riparian zones surrounding OWTSimpaired waters in a county is 10 times the density of OWTS in the county as a whole, we are able to

estimate the national costs for control of OWTS:
129 U.S. Census Bureau. Land Area, Population, and Density for States and Counties: 1990. 

Www.census.gov/population/censusdata/90den_stco.txt

130 U.S. Census Bureau. American Housing Survey for the United States. 1997. 

Www.census.gov/prod/99pubs/h150-97.pdf

I-49

 We obtained data for each county on: (1) The riparian acreage needing OWTS controls, as

described previously; (2) The total acreage in each county;129 (3) The number of dwelling

units served by OWTS.130

 [(1)/(2)] x 10 x (3) = # of dwelling units needing OWTS controls in each county.

 Summing across all 318 counties with OWTS-impaired waters in 24 States gives 191,921

dwellings needing OWTS controls

 Total annual cost for OWTS controls in the 24 States = 191,921 x $142.88 (lower

estimate) or $164.16 (higher estimate) per system per year = $27.4 million/yr (lower

estimate) or $31.5 million/yr (higher estimate).

 To obtain an estimate for the entire nation, we multiply by the scaling factor of 1.732. and

obtain a national estimate of $47.5 - $54.6 million/yr.

We next apply two further scaling factors (.4484 to reflect the pace of TMDL development at a 7

% discount rate, and 1.13 to reflect unknown/not classified source information). Our final estimate of the

nationwide incremental cost of TMDLs for OWTS is $24.1 - $27.7 million/yr.