United States

Environmental Protection

Agency

Regulatory Flexibility Act Section 610 

Review of the Effluent Limitations 

Guidelines and Standards for the 

Centralized Waste Treatment Industry

December 2010

December 2010 i

Regulatory Flexibility Act Section 610 Review of the Effluent Limitations Guidelines 

and Standards for the Centralized Waste Treatment Industry

Contents

1 Introduction ................................................................................................................................................... 1

2 Summary of the CWT Regulation and Industry Profile (2000)................................................................ 3

2.1 Summary of CWT Regulation......................................................................................................................... 3

2.2 Characteristics of CWT Facilities and the Industry (2000)............................................................................. 4

2.2.1 Demand for CWT Services................................................................................................................... 4

2.2.2 Number of CWT Facilities and Firms................................................................................................... 5

2.2.3 Market Structure ................................................................................................................................... 9

3 The Continued Need for the Centralized Waste Treatment Rule........................................................... 10

4 Summary of the Complaints and Comments Received by EPA and How EPA has Mitigated the 

Complexity of the Rule for Small Businesses............................................................................................ 11

4.1 The 2001 Small Entity Compliance Guide for CWTs................................................................................... 11

4.2 The 2003 Amendment to the CWT Rule....................................................................................................... 12

4.3 The 2003 and 2006 “Frequently Asked Questions” Documents................................................................... 13

5 CWT Overlap and Conflict with Other Government Regulations......................................................... 15

6 CWT Industry Conditions Since Promulgation of the 2000 Final CWT Rule....................................... 17

6.1 Demand for CWT Services............................................................................................................................ 18

6.2 Number of CWT Facilities and Firms........................................................................................................... 19

6.2.1 Number of Facilities............................................................................................................................ 19

6.2.2 Number of Firms................................................................................................................................. 21

6.2.3 Number of Small Firms....................................................................................................................... 22

6.3 Average Employment Size of CWT Firms.................................................................................................... 25

6.4 Market Structure of CWT Industry Segments............................................................................................... 26

6.5 Economic Performance in the CWT Industry Segments............................................................................... 27

6.5.1 Employment........................................................................................................................................ 27

6.5.2 Revenue, Employment, and Payroll in the CWT Industry Segments................................................. 28

6.6 Financial Performance in the CWT Industry Segments................................................................................ 29

7 Conclusion.................................................................................................................................................... 34

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1 Introduction

EPA first promulgated Effluent Limitations Guidelines (ELG) for the Centralized Waste Treatment (CWT) 

Category (40 CFR Part 437) in 2000 (65 FR 81241, December 22. 2000), with amendments in 2003 (68 FR 

71014, December 22, 2003). The CWT industry includes facilities that treat and/or recover hazardous or 

nonhazardous industrial waste, wastewater, or used material generated off-site from industrial facilities. Under the 

Regulatory Flexibility Act (RFA), 5 U.S.C. 601 et seq., as amended by the Small Business Regulatory

Enforcement Fairness Act (SBREFA), EPA is generally required to prepare a Regulatory Flexibility Analysis

describing the impact of the regulatory action on small entities as part of a rulemaking. EPA conducted an

analysis for the 2000 Final CWT Rule and did not certify that the Rule would have no significant economic 

impact on a substantial number of small entities. Specifically, EPA found that 63 small parent entities owned inscope CWT facilities in the United States and that the estimated costs for 30 of those parent entities would exceed

3 percent of their revenue.

The purpose of this report is to review the 2000 Final CWT Rule and its 2003 Amendments, pursuant to Section 

610 of the RFA (5 USC 610), to determine whether the Guidelines should be continued, amended, or rescinded in 

order to minimize impacts on small entities while still meeting Clean Water Act requirements. This document

assesses:

 the continued need for the rule;

 the nature of the complaints or comments received concerning the rule from the public since 

promulgation;

 the complexity of the rule;

 the extent to which the rule overlaps, duplicates, or conflicts with other Federal rules, and, to the extent 

feasible, with State and local government rules: and

 the degree to which technology, economic conditions, or other factors have changed in the area of the 

rule.

EPA published a Federal Register Notice, in April 2010 (75FR 21882, April 26, 2010), opening a 90 day 

comment period in order to obtain public input on the above assessment criteria with respect to the CWT rule. 

EPA received no public comments on the section 610 review notice.

The remainder of this document is organized as follows:

 Section 2 is a summary of the CWT regulation and an overview of the industry as it existed in 2000, 

including the general market structure, financial performance, and employment.

 Section 3 summarizes the continued need for the CWT Rule.

 Section 4 summarizes the nature of the complaints and comments received by EPA concerning the CWT

rule, since its promulgation in 2000, and how EPA has mitigated the complexity of the CWT Rule for 

small businesses.

 Section 5 assesses how the existing CWT Rule overlaps and conflicts with other Federal, State, and local 

government regulations. 

 Section 6 assesses the changes that have occurred in technology, economic conditions, or other factors 

that might have had an impact on the CWT industry in general and small CWT parent firms in particular 

since rule promulgation in 2000. Specifically the section is a review of CWT industry conditions, 

including numbers of firms and facilities, sales, employment, market structure, economic and financial 
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performance, from the period before promulgation of the 2000 Final CWT Rule to the present, with the 

objective of assessing whether and how this rule may have affected performance of small businesses in 

the CWT industry.

 Section 7 concludes with a determination, based on the analysis and results outlined in this report, as to 

whether the 2000 Final CWT Rule should be continued, amended, or rescinded in order to minimize 

impacts on small entities while still meeting the Clean Water Act requirements.
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2 Summary of the CWT Regulation and Industry Profile (2000)

This section provides a summary of the CWT regulation as well as information on the CWT industry profile as 

prepared at the time of the 2000 Final CWT Rule. The section is divided as follows:

 Subsection 2.1 a brief overview of the CWT regulation.

 Subsection 2.2 a summary of the industry profile for the CWT industry.

All economic information presented in this section is from the Economic Analysis of Effluent Limitation 

Guidelines and Standards for the Centralized Waste Treatment Industry (the original 2000 CWT report).1

2.1 Summary of CWT Regulation

EPA first promulgated Effluent Limitation Guidelines for the CWT Category in 2000, with amendments made in 

2003. This category is divided into four subcategories based on type of waste received, shown in Table 2-1. The 

technology basis for the final rule varies by subcategory:

 Two-stage chemical precipitation and filtration for metal-bearing wastes; 

 Emulsion breaking, two-stage gravity separation and dissolved air flotation for oily wastes; and 

 Equalization and biological treatment for organic wastes. 

In order to ensure that combined wastes are treated, not simply co-diluted, facilities that elect to comply with 

Subpart D, Multiple Wastestreams, would likely have to certify that an equivalent treatment system is installed 

and properly designed, maintained, and operated. 

Table 2-1 provides more detail on the applicability of each subcategory.

Table 2-1: Subcategories and Subpart Applicability

Subpart Name Subpart Applicability

A: Metals Treatment 

and Recovery

The discharge of wastewater from a CWT facility that results from the treatment of, or recovery of 

metals from, both metal-bearing wastes received from off-site and other CWT wastewater associated 

with the treatment of, or recovery of metal-bearing wastes.

B: Oils Treatment and 

Recovery

The discharge of wastewater from a CWT facility that

results from the treatment or recovery of oil from both oily wastes received from off-site and other 

CWT wastewater associated with the treatment of, or recovery of oily wastes.

C: Organics Treatment 

and Recovery

The discharge of wastewater from a CWT facility that results from the treatment of, or recovery of 

organic material from both organic wastes received from off-site

and other CWT wastewater associated with the treatment of, or recovery of organic wastes.

D: Multiple

Wastestreams

The discharges of wastewater from a CWT facility that

treats wastes subject to more than one of the previous

Subparts must comply with either provisions of this subpart or the applicable provisions of Subpart 

A, B, or C. The provisions of this subpart are applicable to that portion of wastewater discharges 

from a centralized waste treatment facility that results from mixing any combination of treated or 

untreated waste otherwise subject to Subpart A, Subpart B, or Subpart C of this part only if a facility 

requests the permit writer or control authority to develop Subpart D limitations (or standards) and 

establishes that it provides equivalent treatment as defined in §437.2(h).

 

1 This report is available online at http://www.epa.gov/waterscience/guide/cwt/final/econanal.pdf.
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2.2 Characteristics of CWT Facilities and the Industry (2000)

EPA developed different effluent limitations and standards for CWT operations depending on the type of waste 

received by the CWT facilities. Specifically, EPA divided the CWT industry into the following subcategories 

based on the types of waste treated or recovered:

1. Metals subcategory: Facilities that treat or recover metal from metal-bearing waste, wastewater, or used 

material received from off-site.

2. Oils subcategory: Facilities that treat or recover oil from oily waste, wastewater, or used material received 

from off-site.

3. Organics subcategory: Facilities that treat or recover organics from organic waste, wastewater, or used 

material received from off-site.

CWT facilities may offer more than one waste treatment or recovery service and may discharge directly to surface 

water (direct discharges) and/or to Publicly Owned Treatment Works (POTWs) (indirect discharges). In terms of 

their relationships with waste generating facilities, privately owned CWT facilities fall into the following three 

main categories:

1. Commercial: these facilities accept waste only from off-site generators not under the same ownership as 

their facility.

2. Noncommercial: these facilities accept waste only from off-site generators under the same ownership as 

their facility and/or they accept waste on a contract basis from a small number of adjacent facilities.

3. Mixed: these facilities accept both.

To determine the universe of the CWT facilities for the CWT Rule analyses, EPA conducted a survey 

questionnaire in 1990.2,3 The majority of survey respondents identified their industry according to the Standard 

Industry Classification (SIC) system as SIC 4953: Refuse Systems. EPA also collected information on additional 

oils subcategory CWT facilities through comments to its 1996 Notice of Data Availability (NODA). Based on the 

1990 survey and the comments to the 1996 NODA, EPA determined that there were 223 CWT facilities, of which 

EPA had adequate data on 211 facilities for modeling. Consequently, for the 2000 Final CWT Rule analyses, EPA 

assumed the CWT universe consisted of 211 facilities. EPA estimated that only 4 of these 211 facilities accepted 

waste on an exclusively noncommercial basis. 

2.2.1 Demand for CWT Services

The demand for waste treatment services arises from the generation of waste as a by-product of manufacturing or 

other industrial activities. Consequently, the demand for CWT services is derived from and depends on the 

demand for the goods and services whose industrial activity generates the waste. Waste generating facilities can 

treat waste in the following three ways: 

1. On-site waste management: Facilities can invest in capital equipment to be able to treat waste on-site; this 

is usually the least expensive way to treat large volumes of waste. 

 

2 This survey was a census of 452 CWT facilities identified at that time. See the Development Document for the CWT Point Source 

Category (http://water.epa.gov/scitech/wastetech/guide/treatment/develop_index.cfm), Chapter 2 Data Collection and Chapter 5 

Industry Subcategorization.

3 Questionnaire data were available for CWT facilities in the Metals, Oils, and Organics subcategories known at that time. The number 

of CWT facilities in the oils subcategory grew substantially between the questionnaire and the 1995 Proposed Rule. As a result, EPA 

issued a Notice of Data Availability (NODA) in 1996 to collect updated information. EPA then modeled oils subcategory facility data 

using information received in the questionnaire and information received through the comments to NODA together with some 

publicly available information.
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2. On-site/off-site waste management: Facilities may partially treat waste on-site and then send it off-site for 

ultimate treatment and disposal.

3. Off-site waste management: Facilities may send all or some of the waste they generate directly to CWT 

facilities. 

The last two groups of facilities make up the demand for CWT services. EPA used Toxic Release Inventory (TRI)

data to determine the largest generators of hazardous waste by industry and to profile the types of waste treated

within these facility categories. EPA found that the industries transferring the largest quantities of waste off-site 

for either treatment or recycling in 1995 were: SIC 3312: Blast Furnaces and Steel Mills; SIC 3691: Storage 

batteries; SIC 3357: Nonferrous Wire Drawing and Insulating; SIC 2821: Plastics Materials and Resins; SIC 

3714: Motor Vehicle Parts and Accessories; and SIC 2869: Industrial Organic Chemicals. Table 2-2 presents the 

quantity of waste transferred off-site for treatment or recovery reported in TRI for 1991 through 1997. As shown 

in Table 2-2, the demand for off-site waste recovery increased significantly – by 57 percent – over the period of 

analysis. While demand for off-site waste treatment also increased during that time period, this increase was much 

smaller at 6 percent.

Table 2-2: Trends in Demand for Off-Site Waste Management Services

Year

Waste Transferred Off-site for Recovery Waste Transferred Off-site for Treatment

Quantity (millions of lbs) % Changea Quantity (millions of lbs) % Changea

1991 1.517 na 244.6 Na

1992 1.886 24.32% 215.3 -11.98%

1993 1.940 2.86% 210.3 -2.32%

1994 2.170 11.86% 219.1 4.18%

1995 2.450 12.90% 250.6 14.38%

1996 2.397 -2.16% 226.5 -9.62%

1997 2.381 -0.67% 258.7 14.22%

Annual Average 

Growth Over Period na 8.14% na 0.82%

Source: 2000 Economic Analysis of Effluent Limitation Guidelines and Standards for the Centralized Waste Treatment Industry.

a. Year-over year percent changes were recalculated to correct the values reported in the original 2000 CWT report.

2.2.2 Number of CWT Facilities and Firms

2.2.2.1 Facilities

As discussed above, based on the survey conducted in 1990 and comment responses to its 1996 NODA, EPA 

estimated that 223 CWT facilities would be within the regulation’s scope, and performed cost and economic 

analysis of 211 facilities for which the Agency had sufficient data. For the cost and economic analysis for the 

final regulation, EPA accepted the definition of “facility” used in the survey; in some instances a facility is 

defined as only the waste management part of a plant site, while in others as the entire plant site, including nonCWT operations. Surveyed facilities were located in 38 states; the states with the highest number of CWT 

facilities were Texas, Ohio, and California. Because not all CWT facilities provide the same service, facilities 

located nearby may not be competitors, while facilities located far from one another may compete. 

Facility size can be defined in terms of total quantity of waste accepted for treatment or recovery, number of 

employees, treatment costs, total revenues, or profits at the time of the final rule. Table 2-3 and Table 2-4

summarize CWT facility counts by waste quantity - and employment - based size categories.
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Table 2-3: Facility Size Categories Based on Quantity of Commercial Wastewater Treated, by Discharge 

Categorya

Metals

Recovery

Metals

Treatment

Oils

Recovery

Oils

Treatment

Organics

Treatment or

Recovery

Wastewater Treated by Direct Dischargers

< 5 million gallons 2 2 2 3 2

5 million to 10 million gallons 0 0 3 2 0

10 million to 50 million gallons 0 2 0 0 2

50 to 100 million gallons 0 1 0 0 0

Over 100 million gallons 0 1 0 0 0

Total 2 6 5 5 4

Wastewater Treated by Indirect Dischargers

< 5 million gallons 4 27 69 67 12

5 million to 10 million gallons 1 4 24 14 2

10 million to 50 million gallons 1 10 20 15 2

50 to 100 million gallons 0 0 0 0 0

Over 100 million gallons 0 0 0 0 0

Total 6 41 113 96 16

Wastewater Treated by Zero Dischargers

b

< 5 million gallons 1 7 31 18 4

5 million to 10 million gallons 0 0 0 0 1

10 million to 50 million gallons 0 1 2 0 0

50 to 100 million gallons 0 0 0 0 0

Over 100 million gallons 0 0 0 2 0

Total 1 8 33 20 5

Source: 2000 Economic Analysis of Effluent Limitation Guidelines and Standards for the Centralized Waste Treatment Industry.

a. Data are scaled up to account for the entire universe of CWT facilities. Counts do not include four facilities that do not treat wastewater commercially.

b. Zero discharge facilities may dispose of their wastewater by pumping it into underground injection wells, evaporating it, applying it to land, selling it or 

recycling it, or sending it off-site to another CWT facility for treatment.

Table 2-4: Size Distribution of Commercial CWT Facilities by Number of CWT 

Employeesa

Total Number of 

Employees Number of Facilities Percentage

1 to 9 60 29%

10 to 19 50 24%

20 to 29 44 22%

30 to 49 29 14%

50 to 100 19 9%

More than 100 5 2%

207 100%

Source: 2000 Economic Analysis of Effluent Limitation Guidelines and Standards for the Centralized 

Waste Treatment Industry.

a. Data are scaled up to account for entire universe of CWT facilities. Counts do not include four facilities that do 

not treat wastewater commercially.

The largest numbers of facilities and the largest quantities of waste treated by commercial facilities are related to 

the treatment and recovery oils (Table 2-5).
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Table 2-5: Quantity of Waste Treated by Commercial Facilities, by Subcategory (Thousand Gal/Yr)a

Number of 

Facilities

Quantity of Waste Treated (Thousand gal/yr)

Total Average Minimum Maximum

Metals Recovery 8 56,538 6,282 25.9 44,702

Metals Treatment 54 555,030 10,091 0.1 129,340

Oils Recovery 156 569,873 5,875 17.9 104,885

Oils Treatment 123 442,359 5,978 0.1 131,000

Organics Treatment and Recovery 24 11,305 4,452 1.4 23,309

Source: 2000 Economic Analysis of Effluent Limitation Guidelines and Standards for the Centralized Waste Treatment Industry.

a. Data are scaled up to account for entire universe of CWT facilities. Counts do not include four facilities that do not treat wastewater commercially.

Baseline in-scope waste treatment projected compliance costs at commercial facilities ranged from $3,641 to over 

$26 million per facility, with a total and average per facility revenue of $250 million and $1.7 million, 

respectively, across all 207 commercial CWT facilities. Table 2-6 shows a frequency distribution for the baseline 

cost of treating waste.

Table 2-6: Baseline Waste Treatment Costs at Commercial CWT Facilitiesa

Operating Costs ($1997) Number of Facilities Percentage

<$0.1 million 20 10%

$0.1 to $1 million 89 43%

$1 to $2 million 47 23%

$2 to $5 million 40 20%

Over $5 million 10 5%

Total 207 100%

Source: 2000 Economic Analysis of Effluent Limitation Guidelines and Standards for the Centralized 

Waste Treatment Industry.

a. Data are scaled up to account for entire universe of CWT facilities. Counts do not include four facilities that do 

not treat wastewater commercially.

Treatment and recovery revenues at commercial CWT facilities ranged from $5.1 to $93.3 million with total and 

average per facility revenues of $717 million and $4.9 million, respectively. Table 2-7 shows a frequency 

distribution for the baseline treatment and recovery revenues.

Table 2-7: Baseline Treatment and Recovery Revenues for Commercial CWT 

Facilitiesa

Revenues ($1997) Number of Facilities Percentage

<$0.1 million 13 6%

$0.1 to $1 million 58 28%

$1 to $2 million 31 15%

$2 to $5 million 60 29%

Over $5 million 45 22%

Total 207 100%

Source: 2000 Economic Analysis of Effluent Limitation Guidelines and Standards for the Centralized 

Waste Treatment Industry.

a. Data are scaled up to account for entire universe of CWT facilities. Counts do not include four facilities that do 

not treat wastewater commercially.

Profits for CWT commercial facilities ranged from a loss of $8.0 million to a profit of $375 million. Table 2-8

shows a frequency distribution of profit by business size.
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Table 2-8: Baseline Profits at Commercial CWT Facilitiesa,b

Profits ($1997) Number of Facilities Percentage

<$0.1 million 47 23%

$0.1 to $1 million 76 37%

$1 to $2 million 29 14%

$2 to $5 million 28 14%

Over $5 million 27 13%

Total 207 100%c

Source: 2000 Economic Analysis of Effluent Limitation Guidelines and Standards for the Centralized 

Waste Treatment Industry.

a. Profit = total revenue – total cost

b. Data are scaled up to account for entire universe of CWT facilities. Counts do not include four facilities that do 

not treat wastewater commercially.

c. Does not sum to 100 percent due to rounding.

Strictly noncommercial facilities accept waste only from facilities owned by the same company as their CWT 

facility. These CWT facilities are assumed to provide services for the entire parent company; consequently, EPA 

assumed that compliance costs of noncommercial CWT facilities will be borne by the parent company as a whole 

and performed the cost and economic impact analysis for these facilities at the level of the parent firm.

2.2.2.2 Firms

CWT parent entities have the capacity to conduct business transactions and make business decisions affecting 

facilities they own. The parent entities of the CWT facilities are expected to experience the financial impacts of 

the regulation. Consequently, EPA assessed the financial impact of the 2000 Final CWT Rule at the highest level 

of corporate ownership. EPA had sufficient data to determine the parent for 145 of the estimated 211 CWT 

facilities; these 145 facilities were owned by 114 individual firms and the federal government. However, only 118 

of these 145 CWT facilities had sufficient financial parent-level information to support the economic impact 

analysis; these 118 facilities were owned by 87 companies.4 Extrapolating from these relationships, the Agency 

estimated that the total CWT universe of 211 facilities was owned by 167 companies. 

2.2.2.3 Small Firms

EPA estimated that 82 of these 167 parent entities were small based on the $6 million annual revenue threshold, 

which was the Small Business Administration (SBA) small entity size criterion at the time of the analysis5(Table 

2-9). For these 82 small firms, EPA estimated that 63 owned discharging facilities; and of these 63 small firms, 30 

were expected to incur compliance costs exceeding 3 percent of their revenues.

Table 2-9: Size Distribution of Potentially Affected Companiesa,b,c

Revenue Categories

($1997)

Number of 

Companies

Revenue (Millions; $1997)

Median Minimum Maximum

$6 million or less 82 $2.0 $0.0 $5.7

$6 to $20 million 34 $12.1 $6.2 $19.2

$20 to $50 million 14 $35.9 $20.1 $45.9

$50 to $500 million 19 $169.5 $62.1 $429.0

Over $500 million 16 $1,955.1 $661.9 $40,697.0

Source: 2000 Economic Analysis of Effluent Limitation Guidelines and Standards for the Centralized 

Waste Treatment Industry.

a. Sales distribution of all companies, scaled up to reflect the universe of companies owning CWT facilities.

b. Does not include one facility owned by the federal government and another for which no financial data are 

available.

c. Includes firms that own discharging and zero-discharge facilities.

 

4 To perform the firm-level analysis for the parents of these 118 facilities, EPA used available parent-level information from the survey; 

for the remaining 27 facilities, EPA assumed that firm-level revenues were the same as facility-level revenues.

5 The 2010 SBA small entity size criterion is $12.5 million in annual revenue.
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2.2.3 Market Structure

In general, markets for CWT services are regional even though exceptions may occur. Wastewater and 

concentrated oily or metal-bearing wastes are extremely heavy and bulky; consequently, they are generally not 

shipped long distances for treatment - therefore localized geographic markets do exist. 1990 EPA survey 

responses indicated that most of a CWT’s customers were located in the same state as the CWT or within a few 

adjacent states. Based on this information EPA assumed markets for CWT services were regional, and defined 

markets in six geographic regions - which were assumed to be completely independent. The regions were:

 Northeast: CT, DE, MA, MD, ME, NH, NJ, NY, PA, RI, VT

 Northwest: WA, OR, ID, MT, WY

 Southeast: AL, FL, GA, KY, MS, NC, SC, TN, VA, WV

 Southwest: AZ, CA, CO, NM, NV, UT

 Upper Midwest: IA, IL, IN, MN, MI, NE, ND, OH, SD, WI

 Lower Midwest: AR, KS, LA, MO, OK, TX

The markets were further subdivided by baseline waste treatment costs, assuming that treatment cost differences 

reflect differences in the types of waste being treated or recovered. The number of CWT facilities offering a 

particular type of CWT service in a region varied from zero to 31. Depending on the number of CWT facilities in 

a specific waste treatment or recovery market, market structure was modeled as monopoly, duopoly, or perfect 

competition. Because of the large number of the CWTs in the oils recovery and/or oily wastewater treatment 

markets, for the purpose of the cost and economic impact analysis EPA assumed that this segment of the CWT 

industry was perfectly competitive. 
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3 The Continued Need for the Centralized Waste Treatment Rule

Congress adopted the Clean Water Act (CWA) to ``restore and maintain the chemical, physical, and biological 

integrity of the Nation's waters'' (Section 101(a), 33 U.S.C. 1251(a)). To achieve this goal, the CWA prohibits the 

discharge of pollutants into navigable waters except in compliance with the statute. The Clean Water Act 

confronts the problem of water pollution on a number of different fronts. Its primary reliance, however, is on 

establishing restrictions on the types and amounts of pollutants discharged from various industrial, commercial, 

and public sources of wastewater.

Congress recognized that regulating only those sources that discharge effluent directly into the nation's waters 

would not be sufficient to achieve the CWA's goals. Consequently, the CWA requires EPA to promulgate 

nationally applicable pretreatment standards that restrict pollutant discharges for those who discharge wastewater 

indirectly through sewers flowing to publicly-owned treatment works (POTWs) (Section 307(b) and (c), 33 

U.S.C. 1317(b) and (c)). National pretreatment standards are established for those pollutants in wastewater from 

indirect dischargers which may pass through or interfere with POTW operations. Generally, pretreatment 

standards are designed to ensure that wastewater from direct and indirect industrial dischargers are subject to 

similar levels of treatment. In addition, POTWs are required to implement local pretreatment limits applicable to 

their industrial indirect dischargers to satisfy any local requirements (40 CFR 403.5).

Direct dischargers must comply with effluent limitations in National Pollutant Discharge Elimination System 

(NPDES) permits; indirect dischargers must comply with pretreatment standards. These limitations and standards 

are established by regulation for categories of industrial dischargers and are based on the degree of control that 

can be achieved using various levels of pollution control technology.

EPA believes that the CWT Rule is needed to ensure appropriate environmental protection. Without the CWT

regulation, point source polluting industrial dischargers that are regulated under other effluent limitations, water 

quality based standards, or pretreatment standards would be able to ship waste to third party CWT facilities that 

would be able to discharge wastewater containing pollutants at levels which are not environmentally protective.

In 2000, EPA expected compliance with the CWT regulation would reduce the discharge of conventional 

pollutants by at least 9.7 million pounds per year and toxic and non-conventional pollutants by at least 9.3 million 

pounds per year6.

 

6

Pounds removed data from the 2000 Final CWT Rule Federal Register Notice (65 FR 81241, December 22. 2000).
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4 Summary of the Complaints and Comments Received by EPA and How

EPA has Mitigated the Complexity of the Rule for Small Businesses

In December 2000, EPA promulgated effluent guidelines limitations and standards for the Centralized Waste 

Treatment Point Source Category. This regulation established wastewater discharge limitations and standards for 

facilities that treat or recover metal-bearing, oily, and organic wastes, wastewater, or used material received from 

off-site. Since promulgation the Agency has received public comment chiefly in the areas of rule applicability to 

certain types of facilities and treatment technologies and the effectiveness of treatment technologies for the 

removal of specific metals. The Agency’s response has been to develop a Small Entity Compliance Guide for 

CWTs (SECG), to Amend the CWT Rule in 2003, and to up-date the SECG’s “frequently asked questions” 

section twice ( in 2003 and again in 2006). EPA believes that these past efforts remain sufficient and no 

additional amendments to the Rule are necessary at this time, particularly in light of the fact that no additional 

comments were submitted to the Agency in response to the section 610 request for comment published in April 

2010.

This section is organized as follows:

 Subsection 4.1 offers a brief overview of the Small Entity Compliance Guide released in June 2001.

 Subsection 4.2 covers the 2003 amendments to the CWT regulations.

 Subsection 4.3 reviews the two revisions of the “frequently asked questions” material available on EPA’s 

website.

4.1 The 2001 Small Entity Compliance Guide for CWTs

EPA published, in June 2001, a compliance support guide, Small Entity Compliance Guide for CWTs (SECG), to 

help owners and operators of CWT facilities that are small entities – whether they are small businesses, small 

government jurisdictions or small non-profit organizations – understand and comply with the CWT effluent 

guidelines and pretreatment standards. This document is available on the EPA website at: 

http://www.epa.gov/waterscience/guide/cwt/CWTcompliance_guide.pdf. 

The guide also provides a list of EPA staff whom small entities may contact with CWT-specific questions. In 

addition to the information presented in the Guide, EPA provides a number of web site resources that may help 

small entities obtain additional information related to implementation of the CWT effluent limitation guidelines 

and standards for new and existing sources, and general information about the 2000 Final CWT Rule, related 

programs, and general EPA policies (Table 4-1 shows updated SECG contact and reference information). 
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Table 4-1: General Resources Information

Resource Web Address Description

General EPA website www.epa.gov Press releases, proposed and final EPA rules 

and regulations, and updates to the SECG.

Engineering and Analysis Division 

website

www.epa.gov/ost/guide Federal Register notices of proposed and final 

effluent limitation guidelines and standard 

rules, supplemental notices, pre-proposal 

documents, background information, draft 

industry questionnaires, public meeting 

notices, development documents and other 

supporting documents, updates to the SECG, 

and related documents. The site also has a 

continually updated list of EPA staff (and their 

contact information) that are available to 

answer questions for all effluent limitation 

guidelines.

CWT-Specific EPA website www.epa.gov/ost/guide/cwti.html

People may also obtain copies of these 

documents by contacting the Office of Water 

Resource Center at (202) 566-1729 or by e-mail at:

center.water-resource@epa.gov or fax: (202) 566-

1736.

Copies of documents directly related to the 

CWT effluent guidelines and standards such as 

the published CWT regulation (December 22, 

2000), the published CWT Amendment 

(December 22, 2003), the Technical 

Development Document (EPA-821-R-00-020), 

the Economic Analysis (EPA-821-R- 00-024), 

the Cost Effectiveness Analysis (EPA-821-R00-023), the Detailed Costing Document 

(EPA- 821-R-00-021),and the Environmental 

Assessment Document (EPA-821-R-00-022)

as well as any revisions to the Effluent 

Limitations Guidelines and Standards, and the 

SECG. 

EPA Small Business Gateway

Assistance Program (SBAP)

www.epa.gov/smallbusinesswttn/sbap State and local SBAP contacts, SBAP 

materials, related web sites, meetings and 

conferences

EPA Office of Enforcement and 

Compliance Assurance: Policy on 

Compliance Incentives for Small 

Business website

ewww.epa.gov/compliance/incentives/smallbusiness/

index.html s.epa.gov/oeca/smbusi.html

Applicability of EPA’s policy to promote 

environmental compliance among small 

businesses. Criteria for civil penalty 

mitigation.

List of Financial Resources for Small 

Businesses EPA Office of 

Enforcement and Compliance 

Assurance: Audit Policy: Incentives 

for Self-Policing

http://www.epa.gov/smallbusiness/money.htmes.epa.

gov/oeca/auditpol.html

EPA has compiled a variety of sources to assist 

small businesses in applying for loans for 

pollution control. Applicability of EPA’s 

policy to enhance protection of human health 

and the environment by encouraging regulated 

entities to voluntarily discover, and disclose 

and correct, violations of environmental 

requirements.

List of Financial Resources for Small 

Businesses

http://www.epa.gov/smallbusiness/money.htm EPA has compiled a variety of sources to assist 

small businesses in applying for loans for 

pollution control. 

4.2 The 2003 Amendment to the CWT Rule

Following publication of the December 2000 CWT Final Rule, facilities in the regulated community conducted 

compliance monitoring studies and began to develop compliance strategies for the regulated pollutants. Based on 

these efforts, several members of the regulated community and a trade association submitted new information to 

the Agency and asked EPA to revise certain aspects of the 2000 final rule. After our own analysis and review of 

comments received, EPA determined that it should adopt modifications to the 2000 rule as well as several 

additional modifications resulting from additional analyses in the organics subcategory. In December 2003, EPA 

finalized an Amendment to the CWT regulations which deleted certain pollutants from those subject to effluent 

limitations guidelines and standards (68 FR 71014, December 22, 2003). A summary list of changes follows: 
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April 12, 2011December 2010 13

 First, the changes deleted the selenium limitations and standards from sections of the Metals Treatment 

and Recovery subcategory and deleted the barium, molybdenum, antimony, and titanium limitations and 

standards from the Oils Treatment and Recovery subcategory. EPA learned that, under certain 

circumstances, the treatment technologies used as the basis for the December 2000 limitations and 

standards did not remove the pollutants as expected.

 Second, the amendments deleted the molybdenum, antimony, aniline, and 2,3-dichloroaniline limitations 

and standards from the Organics Treatment and Recovery subcategory. EPA learned that these four 

pollutants did not meet the criteria for regulation that was used in the December 2000 rule.

 Third, the amendments reflected the changes in the Multiple Wastestreams subcategory, which covers 

facilities that treat or recover some combination of metal-bearing, oily, and organic waste receipts.

 Finally, the amendments revised a direct discharge BOD5 daily maximum limitation in the Multiple 

Wastestreams subcategory for combined metals and organics waste receipts to correct a publication error 

in the December 2000 rule.

4.3 The 2003 and 2006 “Frequently Asked Questions” Documents

EPA, in an effort to assist small entities with implementation of the CWT rule, has produced two supplemental 

sets of “Frequently Asked Questions” documents (FAQs) - the first in 2003 and the second in 2006. These 

documents are basically collections of questions with associated answers that EPA believes would be useful 

information for the regulated entities. The FAQs represent addendums to Chapter 10, Questions and Answers, of 

the 2001 Small Entity Compliance Guide for CWTs.

The November 6, 2003 FAQs document (available at 

http://water.epa.gov/scitech/wastetech/guide/treatment/upload/2006_12_28_guide_cwt_faqs.pdf) primarily 

outlined a series of scenarios which differentiates an existing discharger from a new discharger. It highlights the 

degree to which an existing facility might alter its current waste stream treatment technology or accept new waste 

sources and still be considered an existing source versus triggering new source standards. Additional questions 

discussed the implementation of the provision in the CWT rule that provides permit writers the ability to establish 

alternative limitations in cases where the CWT receives wastewater that has a constant profile on a continuous 

basis from five or fewer generators. If these conditions are met, the permitting authority may apply the CWT rule 

or set limits on wastewater received by the facility based not on the CWT regulation but on the relevant existing 

source effluent limitation guideline. The FAQs also dealt with issues concerning the compliance schedule for 

new wastestreams, what subcategory should be applied to automotive ethylene glycol coolant, and the 

applicability of the combined wastestream formula and the multiple wastestreams subcategory.

The December 2006 Frequently Asked Questions (available at 

http://water.epa.gov/scitech/wastetech/guide/treatment/upload/2006_12_28_guide_cwt_faqs-200612.pdf) provide 

updated overall guidance on evaluating the applicability of the CWT rule as well as specific guidance on various 

newly raised applicability questions. In particular the FAQs offer a list of questions that both regulators and 

potential CWT facilities should use in order to determine if the CWT rule is applicable. These five questions 

listed below if answered positively would indicate that the CWT rule is applicable.

1. Does the discharging facility accept wastes, wastewater, or used materials from off-site for treatment 

and/or recovery?

2. Is the activity appropriately considered treatment and recovery?

3. Are the off-site wastes generated from industrial applications?
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4. Are the types of pollution removed and the treatment technologies employed similar to those evaluated 

during development of the CWT rule?

5. Are resulting wastewaters discharged directly to waters of the U.S. or indirectly to a Publicly Owned 

Treatment Works (POTW)?

The document goes on to answer specific applicability questions with regard to:

 mobile activities such as power or truck washing, carpet cleaning, or heat ventilation/air conditioning 

servicing;

 oil or antifreeze change out at gas stations or oil change facilities;

 railroad line maintenance operations (including spill clean-up from railroad operations) at a railroad line 

maintenance facility;

 emergency response or environmental clean-up/remediation;

 ion exchange or resin regenerations;

 off-site medical/hospital sterilization; and

 POTW sludge processing
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5 CWT Overlap and Conflict with Other Government Regulations

EPA is unaware of any significant overlap or conflict with other government regulations. EPA specifically asked 

for comment in April 2010 (75FR 21882, April 26, 2010) on the issue of CWT regulatory overlap and conflicts 

and received no comments from the public. 

During development of the final rulemaking, EPA recognized there were circumstances when a CWT facility 

could also generate and discharge wastewater associated with other activities subject to other categorical effluent 

guidelines: for example, manufacturing facilities which process their own, on-site generated process wastewater 

along with wastewater received from off-site. EPA developed the applicability of the final rule to clearly 

differentiate whether the CWT rule would apply, the other ELG would apply or both. In sum, such manufacturing 

facilities are not considered to be CWT facilities if the only off-site waste treated is from the same industry (other 

than the CWT industry) and of a similar nature to the waste generated on site. In that case, the applicable ELG for 

the manufacturing discharges would apply only. However, if the off-site wastewater is not similar and compatible 

(or from the same industry) with the on-site generated wastewater, then the CWT ELG would apply to discharges 

of the off-site treated wastewater and the other applicable ELG would apply to discharges of the on-site generated 

wastewater. Section 4 of the SECG provides a summary table and EPA's determinations of the applicability of 

the CWT ELG in relation to various other categorical ELGs and Section 14 of the Final Technical Development 

Document describes how to calculate discharge limitations where more than one ELG applies.

In addition, certain facilities whose treatment of off-site generated wastewater is not compatible with the 

treatment of wastewater generated on-site may nevertheless be subject to ELGs based on other categorical ELGs. 

The final CWT rule included a provision giving permitting authorities the flexibility to develop alternative CWT 

limitations and standards for certain discharges in a narrow set of circumstances. Under this approach, rather than 

applying the CWT ELGs, the permit writer could require manufacturing facilities that treat non-similar off-site 

generated wastewaters to meet all otherwise-applicable ELGs for the industries in which the wastewater was 

generated. This approach is limited to facilities that receive continuous flows of relatively consistent pollutant 

profiles from off-site from no more than five customers. See Chapter 3.1.1 of the Final Technical Development 

Document for more information on how this provision would be used to determine discharge limitations.

Most CWT effluent is discharged to POTWs which are covered by the technology requirements (i.e., secondary 

treatment) specified in the CWA (40 CFR 133), and are not considered CWT facilities within the scope of the 

rule. However, EPA has promulgated regulations at 40 CFR Part 403 (General Pretreatment Regulations for 

Existing and New Sources of Pollution) that establish pretreatment standards and requirements that apply to any 

source introducing pollutants from a non-domestic source into a POTW. These standards include a general 

prohibition on the introduction of any pollutant that might pass through or interfere as well as prohibitions on 

specific pollutants such as those that may create a fire or explosion hazard or corrosive structural damage. EPA 

has also promulgated national effluent pretreatment standards (like the pretreatment standards promulgated for the 

CWT industry) for specific industry categories as separate regulations at 40 CFR subchapter N.

The POTW pretreatment programs mandated under Part 403 must require compliance with all applicable 

pretreatment standards and requirements by industrial users of the POTW (see 40 CFR 403.8(f)(ii)). Furthermore, 

each POTW developing a pretreatment program must develop and enforce specific local limits to implement the 

general and specific prohibition against pass-through and interference (see 40 CFR 403.5(c)). Thus, any POTW 

subject to the requirement to develop a pretreatment program that accepts waste that does not comply with a 

general or specific prohibition or with national effluent pretreatment standards is in violation of the regulations.

Consequently, POTWs with pretreatment programs that receive wastestreams from CWT facilities that are both 

subject to and not regulated by national effluent standards and limitations must ensure the wastestreams do not
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16 December 2010

violate the requirements of the CWT rule, other national effluent categorical standards, or the requirements under 

Part 403. 
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6 CWT Industry Conditions Since Promulgation of the 2000 Final CWT 

Rule 

For the cost and economic analysis for the 2000 Final CWT Rule, EPA relied almost exclusively on information 

received via the 1990 industry survey and comment responses to its 1996 NODA. Without a new survey or 

additional data supplied by the CWT industry in response to EPA’s April 2010 Federal Register request for 

comment on this RFA 610 review, EPA was not able to assess current CWT industry conditions and the impact of 

the 2000 Final CWT Rule on small entities with the same level of precision employed for the analysis conducted 

for the 2000 Final CWT Rule. Nevertheless, the Agency believes that it was able to make an adequate assessment 

of CWT industry conditions, by relying on publicly available data. 

The data used for the analysis of the 2000 Final CWT Rule and the publicly available data EPA used for this RFA 

610 review of the final rule cannot be directly compared because they either have different sources or, in the case 

of demand for CWT services, the scope of collected data has changed over the years (even though the data 

sources are the same).

7 Consequently, to assess the potential impact of the 2000 Final CWT Rule on the CWT 

industry in general and small CWT firms in particular, the Agency could not simply compare the economic, 

financial, and/or operational metrics from the 2000 analysis to values based on recent publicly available data. 

Instead, EPA looked at the changes over-time in selected metrics using publicly available data for early to late 

1990s through the most recent year with available data. At the time of this analysis the Statistics of U.S. 

Businesses (SUSB) data and most data EPA used from the U.S. Census Bureau were available through 2007; firm 

receipt size data also published by the U.S. Census Bureau were available only through 2002, while TRI and Risk 

Management Association (RMA) data were available through 2008. By capturing a short period of time before the 

promulgation year – i.e., 2000 – the comparison supports an assessment of whether trends observed after 

promulgation of the 2000 Final CWT Rule were already present in the industry before rule promulgation, and 

therefore may not be attributed to the 2000 Final CWT Rule. 

The following sections review a number of metrics that provide insight into the performance of the CWT industry 

and its key operating segments with the objective of understanding the potential effect of the CWT rule on the 

economic viability and performance of small businesses in the CWT industry. The categories of information 

reviewed include:

 Demand for CWT services

 Numbers of CWT facilities and firms – both in aggregate and by business size

 Employment size of CWT firms

 Market structure and competitiveness in the CWT industry and segments

 Economic and financial performance of the CWT industry and segments. 

At the time of this analysis only limited information was available to assess potential effects specifically on small 

businesses in the CWT industry; to a large degree, the following assessment looks at information without regard 

to business size. However, given that the industry is largely comprised of small businesses (see Section 6.2.3, 

below, which indicates that 80 to over 90 percent of CWT industry firms, by segment, are small according to the 

current SBA criteria), an assessment of industry performance, regardless of business size, is informative of 

performance and conditions applying to small businesses, specifically. In addition, findings that indicate that the 

2000 Final CWT Rule has had little or no apparent adverse effect on the industry, as a whole, would also indicate 

that the rule has likewise not had an adverse effect on small businesses in the CWT industry. 

 

7 To assess demand for the CWT services EPA used TRI data for both sets of analysis. However, the data are not comparable because 

of changes to the TRI reporting requirements; in particular, a large number of industries were added in addition to general changes to 

the database structure and data retrieval options. 
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Overall, this review indicates that there is no basis for concluding that the CWT rule has had an adverse effect on 

the viability and performance of small businesses in the CWT industry. 

6.1 Demand for CWT Services

While some non-CWT facilities may offer services similar to those provided by CWT facilities, these services are 

generally not perfect substitutes.8 Nevertheless, it is possible that an increase in the price of CWT services as the 

result of compliance requirements of the 2000 Final CWT Rule might have caused some customers to substitute 

services from non-CWT facilities for those otherwise provided by CWT facilities. Further, over time, customers 

might have modified their waste generation processes to reduce their demand for CWT altogether. 

EPA reviewed data on demand for CWT services as one of several indicators of overall business conditions in the 

CWT industry. While these demand data cannot be differentiated by large vs. small business facilities, they 

provide insight into whether business conditions may have declined overall in the CWT industry, as a result of the 

2000 Final CWT Rule. To the extent that demand for CWT services declined and business conditions deteriorated 

in the industry, because of the CWT rule, this decline could signal the potential for adverse impact on small 

entities operating in the CWT industry. 

For this assessment, EPA closely followed the methodology used to capture demand for CWT services for the 

2000 Final CWT Rule. In particular, EPA used the amount of waste transfers to non-POTW off-site locations, as 

reported in TRI, as an indicator of the demand for CWT services.9,10 According to TRI data reported in Table 6-1, 

between 1998 and 2008, the demand for CWT services fluctuated in all four demand segments: Disposal, 

Treatment, Energy Recovery, and Recycling. Overall, between 1998 and 2008, the demand for all CWT services, 

except Disposal, decreased, with the largest decline (51.5 percent) occurring in the Energy Recovery segment. For 

the Disposal services segment, demand increased marginally (3.4 percent) over the total period 1998-2008, but 

decreased by 7.2 percent between 2000 (i.e., promulgation year) and 2008.11 In all demand segments except 

Treatment, the largest drop in demand occurred in 2008, which likely results from declining manufacturing 

production due to the recent recession. The biggest decrease in demand for Treatment occurred in 1999. Demand 

for chemical waste treatment in the Energy Recovery segment declined almost steadily, while demand in the 

Treatment, Recycling, and Disposal segments declined irregularly throughout the analysis period. Overall, EPA 

observes no systematic difference in trends before and after promulgation of the 2000 Final CWT Rule, which 

suggests that any declines in demand for CWT services over this timeframe cannot be solely attributed to this 

rule.

 

8

For example, some non-CWT facilities may build on-site waste treatment units. Further, certain activities not subject to the CWT rule, 

such as underground injection wells, may be substituted for CWT services. 

9

Since the 2000 Final CWT Rule analysis was conducted, the Office of Solid Waste (OSW) changed its definition of hazardous waste 

to identify oily wastes as non-hazardous; consequently, unlike TRI data reported in Table 2-2, TRI data reported in Table 6-1 do not 

include oily wastes.

10 A facility is required to report hazardous and non-hazardous chemicals to TRI if the facility meets the following criteria: 1) 

falls within a TRI reportable sector or are federal facilities, 2) has 10+ employees, and 3) manufactures, processes or otherwise uses

certain hazardous and/or nonhazardous chemicals above threshold amounts. A list of TRI reportable industry sectors is available 

online at http://www.epa.gov/tri/report/rfi/ry2010rfi_010511.pdf.

11 TRI provides data for years prior to 1998; however, because TRI reporting requirements changed substantially during the years before 

1998 and furthermore, because the data reported for earlier years showed some anomalous year-to-year changes, which may be due to 

changes in reporting requirements, EPA decided not to include data for the earlier years in the analysis of demand for CWT services.
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Table 6-1: Transfers of Toxic Chemical Waste to Off-Site Locations Other Than POTWs (Million Lbs)

Year

Disposal Treatment Energy Recovery Recycling

Quantity 

(Million

Lbs) % Change

Quantity 

(Million

Lbs) % Change

Quantity

(Million

Lbs) % Change

Quantity 

(Million

Lbs) % Change

1998 554 na 335 na 911 na 2,117 na

1999 574 3.6% 289 -13.5% 784 -13.9% 2,219 4.8%

2000 617 7.5% 280 -3.1% 813 3.8% 2,184 -1.6%

2001 615 -0.3% 283 1.1% 842 3.5% 2,043 -6.5%

2002 597 -3.0% 277 -2.3% 810 -3.8% 2,038 -0.2%

2003 592 -0.7% 290 4.7% 716 -11.6% 1,932 -5.2%

2004 611 3.1% 327 12.9% 650 -9.1% 2,085 7.9%

2005 637 4.3% 336 2.7% 609 -6.4% 2,096 0.5%

2006 661 3.8% 329 -2.2% 555 -8.8% 2,182 4.1%

2007 676 2.2% 287 -12.7% 525 -5.4% 2,142 -1.8%

2008 572 -15.3% 255 -11.1% 442 -15.9% 1,936 -9.6%

1998 – 2008 Comparison

Total % 

Change na 3.4% na -23.7% na -51.5% na -8.5%

Average

Annual % 

Change

na 0.3% na -2.7% na -7.0% na -0.9%

2000 – 2008 Comparison

Total % 

Change na -7.2% na -9.0% na -45.7% na -11.4%

Average

Annual % 

Change

na -0.9% na -1.2% na -7.3% na -1.5%

Source: Toxic Release Data Inventory

6.2 Number of CWT Facilities and Firms

As another indicator of overall business conditions in the CWT industry in the period before and after 

promulgation of the CWT rule, EPA reviewed the change in numbers of facilities and firms over the period 1998-

2007. In the same way as described above for CWT services demand, a differential trend of a declining number of 

facilities and/or firms in the periods before and following promulgation of the final CWT rule could signal a 

potential adverse effect on the level of activity and industry structure due to the final rule, which in turn could 

lead to an adverse impact on small entities operating in the CWT industry.

6.2.1 Number of Facilities

To assess the changes in the CWT facility universe since promulgation of the 2000 Final CWT Rule, EPA relied 

on data from the Statistics of U.S. Businesses and the Economic Census published by the U.S. Census Bureau. The 

Agency identified CWT facilities by the primary SIC or North American Industry Classification System (NAICS) 

codes depending on the years for which the data are available. As discussed in Section 2, the majority of the 

survey respondents identified their industry as SIC 4953: Refuse Systems. This SIC industry sector maps onto 

five NAICS industry sectors, only three of which represent the CWT industry (highlighted in Table 6-2). Solid 

waste landfills (NAICS 562212) and solid waste combustors and incinerators (NAICS 562213) are out of scope of 

the 2000 Final CWT Rule; wastewater discharges from landfills and commercial waste combustors are regulated 

by 40 CFR Parts 444 and 445 (the Waste Combustors and Landfills Categories, respectively). For this analysis, 

EPA assumed that facilities reported in segments NAICS 562211: Hazardous Waste Treatment and Disposal, 

NAICS 562920: Materials Recovery Facilities, and NAICS 562219: Other Nonhazardous Waste Treatment and 

Disposal (CWT industry segments or CWT segments) represent the entire CWT industry and are all subject to the 

2000 Final CWT Rule. It is important to note that the three ELG facility subcategories – Metals, Oils, and 

Organics - do not align with these three CWT NAICS segments.
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Data for the earlier years are reported in the SIC framework. To ensure time-series data comparability, EPA used 

SIC-to-NAICS allocation factors provided by the Census and reported in Table 6-2.

Table 6-2: SIC-to-NAICS Allocation Factors

SIC Code SIC Code Meaning

NAICS 

Code NAICS Code Meaning

SIC-to-NAICS Allocation 

Factor

4953 Refuse Systems 562211 Hazardous Waste Treatment and Disposal 24.92%

4953 Refuse Systems 562212 Solid Waste Landfill 47.56%

4953 Refuse Systems 562213 Solid Waste Combustors and Incinerators 9.77%

4953 Refuse Systems 562219 Other Nonhazardous Waste Treatment and Disposal 6.50%

4953 Refuse Systems 562920 Materials Recovery Facilities 11.25%

Source: 1997 Economic Census Bridge Between NAICS and SIC

EPA looked at the number of establishments in the three analyzed CWT segments reported in SUSB. As reported 

in Table 6-3, the number of establishments fluctuated in all three CWT segments throughout the analysis period 

of 1998 through 2007, but increased overall. Specifically, the total number of CWT facilities increased by nearly 

30 percent, at an annual average growth rate of nearly 3 percent. Between 1998 and 2007, the total numbers of 

establishments engaged in Hazardous Waste Treatment and Disposal (NAICS 562211) and in Materials Recovery 

(NAICS 562920) increased significantly (59.4 percent and 19.3 percent, respectively), or at an annual average 

growth rate of 5.3 percent and 2.0 percent, respectively. At the same time, however, the number of establishments 

in the smallest of the CWT segments – Other Nonhazardous Waste Treatment and Disposal Services (NAICS 

562219) – dropped by 6.4 percent. 

Given the overall increase in the number of establishments in the CWT industry, the final CWT rule appears not 

to have increased CWT costs enough to force facilities out of business or to lead to an overall contraction in the 

industry. Even for the CWT segment that experienced a decline in the number of establishment – Other 

Nonhazardous Waste Treatment and Disposal Services (NAICS 562219) – this decline began prior to 

promulgation of the 2000 Final CWT Rule and therefore cannot be attributed solely, if at all, to this rule.

Table 6-3: Number of Establishments by Industry Sector and Year

Year

Hazardous Waste 

Treatment and Disposal

(NAICS 562211)

Other Nonhazardous 

Waste Treatment and 

Disposal Services 

(NAICS 562219)

Materials Recovery 

(NAICS 562920) Total CWT

Number % Change Number % Change Number % Change Number % Change

1998 520 na 299 na 874 na 1,693 na

1999 536 3.1% 280 -6.4% 837 -4.2% 1,653 -2.4%

2000 500 -6.7% 278 -0.7% 777 -7.2% 1,555 -5.9%

2001 520 4.0% 291 4.7% 736 -5.3% 1,547 -0.5%

2002 572 10.0% 292 0.3% 831 12.9% 1,695 9.6%

2003 682 19.2% 193 -33.9% 899 8.2% 1,774 4.7%

2004 687 0.7% 219 13.5% 895 -0.4% 1,801 1.5%

2005 695 1.2% 250 14.2% 884 -1.2% 1,829 1.6%

2006 882 26.9% 265 6.0% 923 4.4% 2,070 13.2%

2007 829 -11.7% 280 -14.3% 1,043 22.3% 2,152 3.1%

1998 – 2007 Comparison

Total Percent 

Change 59.4% -6.4% 19.3% 27.1%

Annual Average 

Growth Rate 5.3 -0.7% 2.0% 2.7%

2000 – 2007 Comparison

Total Percent 

Change 65.8% 0.7% 34.2% 38.4%

Annual Average 

Growth Rate 7.5% 0.1% 4.3% 4.8%

Sources: Statistics of U.S. Businesses (SUSB) Annual Data 1998-2007 
RFA Section 610 Review of the Effluent Limitations Guidelines and Standards for the CWT Industry

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6.2.2 Number of Firms

CWT parent entities have the capacity to conduct business transactions and make business decisions affecting 

facilities they own; consequently, parent entities of the CWT facilities are very likely to have experienced the 

financial impacts of the 2000 Final CWT Rule. If compliance costs were high enough, CWT firms might be 

induced to merge with other (CWT or non-CWT) firms in order to continue operating, or might be forced out of 

business altogether. Either effect would result in fewer firms in the industry. Further, high enough compliance 

costs might have become an entry barrier thereby deterring potential competitors. To assess how CWT industry 

concentration might have changed over time, EPA looked at the number of firms reported in the Statistics of U.S. 

Businesses (SUSB).

As reported in Table 6-4, similarly to the number of establishments (Table 6-3), the number of firms fluctuated in 

all three CWT segments throughout the analysis period of 1998 through 2007, but increased overall, by 13

percent, or at an annual average growth rate of nearly 2 percent. By segment, the number of firms in Hazardous 

Waste Treatment and Disposal (NAICS 562211) and in Materials Recovery (NAICS 56290) increased by 19.3

percent and 14.7 percent, respectively. Only in the smallest segment – the Other Nonhazardous Waste Treatment 

and Disposal segment (NAICS 562219) – did the number of number of firms decrease and here by only small 

amount, a 2.2 percent decrease. 

Given the overall increase in the number of firms in the CWT industry, the 2000 Final CWT Rule appears not to 

have increased CWT costs enough to force firms out of business, to encourage mergers and acquisitions, or to 

prevent new firms from entering the CWT industry. Even for the CWT segment that experienced a decline in the 

number of firms – Other Nonhazardous Waste Treatment and Disposal Services (NAICS 562219) – this decline 

began prior to promulgation of the 2000 Final CWT Rule and therefore cannot be attributed solely, if at all, to this 

rule.

Table 6-4: Number of Firms by Industry Segment and Year

Year

Hazardous Waste 

Treatment and Disposal 

(NAICS 562211)

Other Nonhazardous 

Waste Treatment and 

Disposal Services 

(NAICS 562219)

Materials Recovery 

(NAICS 562920) Total CWT

Number % Change Number % Change Number % Change Number % Change

1998 378 na 227 na 771 na 1,376 na

1999 398 5.3% 209 -7.9% 703 -8.8% 1,310 -4.8%

2000 384 -3.5% 198 -5.3% 653 -7.1% 1,235 -5.7%

2001 393 2.3% 219 10.6% 609 -6.7% 1,221 -1.1%

2002 402 2.3% 223 1.8% 693 13.8% 1,318 7.9%

2003 447 11.2% 164 -26.5% 785 13.3% 1,396 5.9%

2004 460 2.9% 188 14.6% 783 -0.3% 1,431 2.5%

2005 466 1.3% 191 1.6% 765 -2.3% 1,422 -0.6%

2006 471 1.1% 203 6.3% 803 5.0% 1,477 3.9%

2007 451 -4.2% 222 9.4% 884 10.1% 1,557 5.4%

1998 – 2007 Comparison

Total Percent Change 19.3% -2.2% 14.7% 13.2%

Annual Average 

Growth Rate 2.0% -0.2% 1.5% 1.4%

2000 – 2007 Comparison

Total Percent Change 17.4% 12.1% 35.4% 26.1%

Annual Average 

Growth Rate 2.3% 1.6% 4.4% 3.4%

Sources: Statistics of U.S. Businesses Annual Data 1998-2007
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6.2.3 Number of Small Firms

To assess whether small CWT firms were adversely affected by the 2000 CWT Rule, EPA looked at the number 

of small CWT firms over time to determine whether there were any significant changes in the number of small 

firms and compared the trend in the number of small firms to that of large firms.

The Small Business Administration annually provides small business size threshold guidelines; these thresholds 

define by industry (by 6-digit NAICS code) the minimum firm-level employment or revenue size, below which a 

business qualifies as a small business under SBA guidelines.12 According to the SBA size criteria, entities in the 

three analyzed industry sectors are small if their annual revenue is less than $12.5 million (the SBA annual 

revenue threshold at the time of the rulemaking analysis was $6 million). However, EPA was not able to find data 

to determine size of entities in the CWT industry based on their revenue13. Consequently, the Agency used 

number of employees data to categorize firms and determine the change in small business presence in the affected 

industry segments. EPA categorized firms as small businesses if they employed 100 or fewer employees. 

Although the employment size range doesn’t correspond specifically to the SBA revenue-based size criteria, the 

firm count data in this smaller employment size classification provides direct insight into the relative presence of 

smaller businesses in the affected industry segments.

EPA determined the employment-based threshold of 100 or fewer employees from its review of Receipts Size of 

Firms data from the Economic Census. At the time of this analysis, these data were not available from the 2007 

Economic Census; consequently, EPA used data from the 1997 and 2002 Economic Census to examine change in 

the presence of small businesses in the affected industry segments. As shown in Table 6-5, the average number of 

employees per firm increases with the receipts size category. Firms with annual receipts at $12.5 million – the 

SBA size criterion – are part of the “$10,000,000 - $24,000,000” receipts size category; for firms in this category,

the average number of employees per firm is approximately 100 across all three CWT segments for both 1997 and 

2002. Thus, EPA interprets the 100 or fewer employees firm size cut-off as providing an approximate 

correspondence to the $10,000,000 - $24,000,000 receipts range, which contains the SBA small entity criterion. 

To look at the number of small firms in each CWT segment and the CWT industry as a whole, EPA used the 

number of firms reported by employment size in the Statistics of U.S. Businesses (SUSB). 

Using the “100 or fewer employees” threshold

Table 6-6 provides the number of small and large CWT firms determined using the “100 or fewer employees”

threshold in 1998 through 2007, by CWT segment. During this time, the vast majority of entities – 80 to over 90 

percent – in all three CWT segments are small. Most of the small firms are in the Materials Recovery segment 

(NAICS 562920), followed by the Hazardous Treatment and Disposal (NAICS 562211) and Other Nonhazardous 

Treatment and Disposal (NAICS 562219) segments. This relationship remains true during the entire analysis 

period.

Between 1998 and 2007, the number of firms in the CWT industry with 100 or fewer employees increased by 

13.5 percent while the number of firms with greater than 100 employees increased by 10.1 percent. Thus, for the 

full analysis period, the presence of smaller firms (based on the “100 or fewer employees” threshold) increased

compared to larger firms. Over the period 2000 to 2007, following promulgation of the 2000 Final CWT Rule, 

this difference magnified, with the number of small firms increasing by 27.6 percent while the number of large 

firms increased by 3.5 percent. Thus, in the period following rule promulgation, the presence of small firms, 

according to the 100 employee threshold, increased by a substantially greater amount than did the number of 

 

12 The SBA website provides the most recent size thresholds at http://www.sba.gov/content/table-small-business-size-standards.

13 EPA’s original 2000 CWT rule analysis used the 1990 industry questionnaire data and material submitted during the public comment 

periods for the rule proposal and Notice of Data Availability (NODA) to determine entities’ size using revenue. This data is out of 

date and could not be used for the current effort. 
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April 12, 2011December 2010 23

firms of greater than 100 employees. These data suggest that promulgation of the 2000 Final CWT Rule did not 

lead to a reduced presence of small firms in the overall CWT industry. 

By segment, the pattern of change in the presence of small and large businesses is not consistent in the period 

1998 to 2007:

 In the Hazardous Waste Treatment and Disposal segment (NAICS 562211), the number of small firms 

increased by 26.5 percent while the number of large firms decreased by 15.4 percent. 

 In the Materials Recovery segment (NAICS 562920), the number of small firms increased by 12.8 

percent, while large firms increased by 45.5 percent. 

 In the Other Nonhazardous Waste Treatment and Disposal segment (NAICS 562219) the number of small 

entities fell by 3.9 percent while the number of large entities increased by 15.0 percent.

Consequently, while there was a shift towards small entities in the Hazardous Waste Treatment and Disposal 

segment (NAICS 562211) between 1998 and 2007, the Other Nonhazardous Waste Treatment and Disposal

segment (NAICS 562219) and the Materials Recovery segment (NAICS 562920) saw a shift towards large 

entities. 

As described above for the total CWT industry, the trends in the presence of small and large firms are different 

when looking at the changes since the 2000 Final CWT Rule came into effect (2000-2007) compared to the total 

period of 1998-2007. 

 Overall, small firms increased by 27.6 percent while large firms increased by 12.7 percent 

 In the Hazardous Waste Treatment and Disposal segment (NAICS 562211), the number of small firms 

increased by 25.3 percent while the number of large firms decreased by 19.1 percent. 

 In the Materials Recovery segment (NAICS 562920), the number of small firms increased by 33.6

percent, while large firms increased by 64.1 percent. 

 In the Other Nonhazardous Waste Treatment and Disposal segment (NAICS 562219) the number of small 

entities fell by 11.2 percent while the number of large entities increased by 21.1 percent.

Given the overall increase in the number of small firms in the CWT industry since promulgation of the 2000 Final 

CWT Rule, the rule’s requirements appear not to have adversely affected small firms, defined as firms with 100 

or fewer employees, in the CWT industry. Even for the CWT segments where the increase in the number of small 

firms was less than the increase in the number of large firms – Materials Recovery (NAICS 562920) and Other 

Nonhazardous Waste Treatment and Disposal Services (NAICS 562219) – this trend began prior to promulgation 

of the 2000 Final CWT Rule and therefore cannot be attributed solely, if at all, to this rule.
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Table 6-5: Average Number of Employees per Firm by Receipts Size

Receipts Size

1997 2002

Number of Firms

Number of 

Employees

Ave Number of 

Employees per 

Firma Number of Firms

Number of 

Employeesa

Average Number

of Employees per 

Firm

Hazardous Waste Treatment and Disposal (NAICS 562211)

<$100,000 10 15 2 22 37 2

$100,000-$249,999 39 118 3 47 119 3

$250,000 to $499,999 36 160 4 49 179 4

$500,000 to $999,999 54 398 7 80 649 8

$1,000,000 to 

$2,499,999 50 771 15 68 903 13

$2,500,000 to 

$4,999,999 38 1,031 27 46 1,078 23

$5,000,000 to 

$9,999,999 28 1,299 46 29 1,418 49

$10,000,000 to 

$24,999,999 26 2,767 106 17 1,384 81

$25,000,000 to 

$49,999,999 15 2,500 to 4,999 167 to 333 11 2,065 188

$50,000,000 to 

$99,999,999 6 1,000 to 2,499 167 to 417 6 2,500 to 4,999 417 to 833

>=$100,000,000 4 5,295 1,324 9 10,000 to 24,999 1,111 to 2,778

Other Nonhazardous Waste Treatment and Disposal Services (NAICS 562219)

<$100,000 29 49 2 11 25 2

$100,000-$249,999 33 88 3 12 32 3

$250,000 to $499,999 30 124 4 31 149 5

$500,000 to $999,999 19 133 7 23 197 9

$1,000,000 to 

$2,499,999 40 552 14 29 344 12

$2,500,000 to 

$4,999,999 11 404 37 12 253 21

$5,000,000 to 

$9,999,999 7 250 to 499 36 to 71 5 250 to 499 50 to 100

$10,000,000 to 

$24,999,999 9 500 to 999 56 to 111 5 250 to 499 50 to 100

$25,000,000 to 

$49,999,999 1 100 to 249 100 to 249 2 100 to 249 50 to 125

$50,000,000 to 

$99,999,999 1 500 to 999 500 to 999 1 250 to 499 250 to 499

Materials Recovery (NAICS 562920)

<$100,000 51 103 2 57 107 2

$100,000-$249,999 110 332 3 112 345 3

$250,000 to $499,999 96 494 5 122 569 5

$500,000 to $999,999 94 878 9 119 900 8

$1,000,000 to 

$2,499,999 114 1,778 16 155 2,337 15

$2,500,000 to 

$4,999,999 51 1,644 32 69 2,110 31

$5,000,000 to 

$9,999,999 26 1,390 53 46 2,368 51

$10,000,000 to 

$24,999,999 10 1,000 to 2,499 100 to 250 25 2,500 to 4,999 100 to 200

$25,000,000 to 

$49,999,999 4 500 to 999 125 to 250 2 100 to 249 50 to 125

$50,000,000 to 

$99,999,999 0 0 0 1 100 to 249 100 to 249

Sources: 1997 Economic Census; 2002 Economic Census

a. “Average Number of Employees” values are reported as integers. 
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Table 6-6: Number of Firms by Employment Size, Industry Segment, and Year – Using the “100 

of Fewer Employees” SBA Size Threshold

Year

Employment 

Group

Hazardous Waste 

Treatment and Disposal 

(NAICS 562211)

Other Nonhazardous 

Waste Treatment and 

Disposal Services 

(NAICS 562219)

Materials Recovery 

(NAICS 562920) Total CWT

Number % of Total Number % of Total Number % of Total Number % of Total

1998 <100 313 83% 207 91% 727 94% 1,247 91%

>100 65 17% 20 9% 44 6% 129 9%

1999 <100 328 82% 193 92% 659 94% 1,180 90%

>100 70 18% 16 8% 44 6% 130 10%

2000 <100 316 82% 179 90% 614 94% 1,109 90%

>100 68 18% 19 10% 39 6% 126 10%

2001 <100 329 84% 199 91% 568 93% 1,096 90%

>100 64 16% 20 9% 41 7% 125 10%

2002 <100 344 86% 202 91% 653 94% 1,199 92%

>100 58 14% 21 9% 40 6% 119 8%

2003 <100 400 89% 149 91% 737 94% 1,286 92%

>100 47 11% 15 9% 48 6% 110 8%

2004 <100 412 90% 170 90% 730 93% 1,312 92%

>100 48 10% 18 10% 53 7% 119 8%

2005 <100 412 88% 173 91% 711 93% 1,296 91%

>100 54 12% 18 9% 54 7% 126 9%

2006 <100 413 88% 181 89% 740 92% 1,334 90%

>100 58 12% 22 11% 63 8% 143 10%

2007 <100 396 88% 199 90% 820 93% 1,415 91%

>100 55 12% 23 10% 64 7% 142 9%

1998 – 2007 Comparison

Total 

Percent 

Change

<100 26.5% -3.9% 12.8% 13.5%

>100 -15.4% 15.0% 45.5% 10.1%

Annual 

Average 

Growth 

Rate

<100 2.6% -0.4% 1.3% 1.4%

>100 -1.8% 1.6% 4.3% 1.1%

2000 – 2007 Comparison

Total 

Percent 

Change

<100 25.3% 11.2% 33.6% 27.6%

>100 -19.1% 21.1% 64.1% 12.7%

Annual 

Average 

Growth 

Rate

<100 3.3% 1.5% 4.2% 3.5%

>100 -3.0% 2.8% 7.3% 1.7%

Sources: Statistics of U.S. Businesses Annual Data 1998-2007

6.3 Average Employment Size of CWT Firms

Change in the average size of firms based on employment provides another indicator of relative small business 

presence in the CWT industry over the period before and after promulgation of the 2000 Final CWT Rule. 

Overall, the average size of firms in the CWT industry increased modestly over the 1998-2007 period, from an 

average of 25 employees per firm in 1998 and 26 employees per firm in 2000 (the year of CWT rule 

promulgation) to an average of 27 employees per firm in 2007. In addition, the year-to-year profile of change is 

relatively directionless, with some year-to-year changes showing modest increase and others showing modest 

decrease (Table 6-7). 

Similar, relatively directionless patterns are observed at the level of the industry segments, with the firms in the 

Hazardous Waste Treatment and Disposal segment (NAICS 562211) showing an increase in average number of 
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employees over both the 1998-2007 and 2000-2007 periods, the Other Nonhazardous Waste Treatment and 

Disposal segment (NAICS 562219) and the Materials Recovery segment (NAICS 562920) showing an increase 

over the 1998-2007 period but a decrease in the 2000-2007 period. 

Given the relatively small and/or directionless profile of changes in average number of employees per firm, there 

appears to be no systematic change in average firm size that can be attributed to the 2000 Final CWT Rule.

Table 6-7: Average Number of Employees per Firm by CWT Segment and Year

Year

Hazardous Waste 

Treatment and Disposal 

(NAICS 562211)

Other Nonhazardous 

Waste Treatment and 

Disposal Services 

(NAICS 562219)

Materials Recovery 

(NAICS 562920) Total

Number % Change Number % Change Number % Change Number % Change

1998 45 na 19 na 16 na 25 na

1999 46 3.4% 19 2.5% 19 15.2% 27 10.9%

2000 42 -10.4% 23 19.7% 19 0.0% 26 -2.5%

2001 42 1.0% 21 -8.0% 21 13.8% 28 5.4%

2002 41 -2.2% 20 -6.5% 18 -13.4% 26 -8.4%

2003 50 21.1% 17 -16.7% 17 -5.5% 28 8.1%

2004 50 0.7% 18 8.5% 19 7.9% 29 3.9%

2005 49 -1.2% 17 -4.5% 19 2.8% 29 0.6%

2006 56 13.9% 17 0.0% 20 2.2% 31 7.5%

2007 53 -6.1% 20 16.5% 16 -16.7% 27 -11.4%

1998 – 2007 Comparison

Total Percent 

Change 17.8% 6.1% 1.4% 12.2%

Annual Average 

Growth Rate 1.8% 0.7% 0.2% 1.3%

2000 – 2007 Comparison

Total Percent 

Change 27.2% -13.6% -12.0% 3.8%

Annual Average 

Growth Rate 3.5% -2.1% -1.8% 0.5%

Sources: Statistics of U.S. Businesses Annual Data 1998-2007

6.4 Market Structure of CWT Industry Segments

As discussed in Section 2.2 of this document, in EPA’s analysis for the 2000 Final CWT Rule, because of the 

large number of the CWTs in the oils recovery and/or oily wastewater treatment markets, it was assumed that the 

CWT industry is perfectly competitive. Increasing concentration in the CWT industry segments could indicate 

that the 2000 Final CWT Rule led to reduced competitiveness in the industry, with lower viability of, and 

increased business risk to, the small businesses in the industry. 

Industry competitiveness and market concentration data are published at 5-year intervals as part of the Economic 

Census, with the most recent data being for the year 2007. Based on these data, Table 6-8 shows market 

concentration ratios by CWT segment for 1992, 1997, 2002, and 2007. Table 6-8 shows that overall CWT 

segments are not very concentrated.

14 In addition, the profile of change in concentration at the 4- and 8-firm levels 

has been inconsistent over the period 1992-2007, with concentration declining in some segments (according to 

 

14 Under current policy, the U.S. Department of Justice (DOJ) determines the degree of market concentration as measured by the 

Herfindahl-Hirschman Index (HHI) as follows: unconcentrated (HHI<1000), moderately concentrated (1000<HHI<1800), and highly 

concentrated (HHI>1800). An empirical study conducted by DOJ indicates that the 1000 and 1800 HHI thresholds approximately 

correspond to four-firm concentration ratios of 50 percent and 70 percent, respectively (see 1982 Merger Guidelines available online 

at http://www.justice.gov/atr/hmerger/11248.pdf). Accordingly, for this review, which relies on concentration data, EPA judges that 

markets with four-firm concentration ratios exceeding 70 percent are highly concentrated, and between 50 and 70 percent as 

moderately concentrated. Markets with four-firm concentration ratios below 50 percent are considered unconcentrated.
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April 12, 2011December 2010 27

some concentration measures) while increasing in others. Given the inconsistency of direction in these changes, it 

does not appear that there is any systematic trend of increasing concentration/reduced market competitiveness that 

could be attributed to the 2000 Final CWT Rule.

Table 6-8: Market Concentration Ratiosa

Industry

Year

Number of 

Firms

4 Largest 

Firms

8 Largest 

Firms

20 Largest 

Firms

50 Largest 

NAICS SIC Firms

562211 4953

1992 570 42.6 49.0 57.6 66.4

1997 362 36.1 46.2 63.7 82.0

2002 451 36.8 51.7 71.9 85.1

2007 436 44.6 59.2 75.2 87.5

562219 4953

1992 149 42.6 49.0 57.6 66.4

1997 225 54.7 65.8 80.3 91.2

2002 170 60.3 71.0 82.1 92.4

2007 179 34.7 51.9 70.5 86.9

562920 4953

1992 258 42.6 49.0 57.6 66.4

1997 697 30.6 37.2 46.9 60.8

2002 829 24.1 29.2 39.2 54.4

2007 922 33.3 38.2 47.1 59.9

Sources: Economic Census 1992; Economic Census 1997; Economic Census 2002; Economic 

Census 2007

a. Concentration ratios for 1992 are reported for SIC 4953 while 1997 and 2002 concentration ratios 

are reported for NAICS 562211, 562219, and 56920.

6.5 Economic Performance in the CWT Industry Segments

If increased costs due to the 2000 Final CWT Rule led to declines in the amount of wastes treated and/or declines 

in profitability in the CWT industry, then these declines would likely manifest as declines in industry 

employment, revenue, and other measures of economic performance. Accordingly, EPA looked at a range of 

economic activity measures for the CWT industry segments over the years before and following rule 

promulgation. The economic activity measures reported in this section are not available by business size and, as a 

result, the insights from looking at these measures apply to the industry segments regardless of business size. 

Nevertheless, if the rule led to economic declines overall, then these declines would likely have affected the small 

businesses in the CWT segments. 

6.5.1 Employment

Table 6-9 presents number of employees for the overall CWT industry and by segment for 1998 through 2007. 

Over this period, total industry employment increased substantially, by 26.9 percent, with no apparent change in 

the trend of employment growth before and after promulgation of the CWT rule. At the segment level, 

employment performance is consistent with the Hazardous Waste Treatment and Disposal segment (NAICS 

562211) and the Materials Recovery segment (NAICS 562920) showing substantial increases by 40.6 percent and 

16.3 percent, respectively, between 1998 and 2007 and by 49.4 percent and 19.1 percent, respectively, since 2000. 

In contrast, in the Other Nonhazardous Treatment and Disposal segment (NAICS 562219), the number of 

employees increased by 3.7 percent between 1998 and 2007 but decreased by 3.1 percent since 2000.

Given (1) the increase in the number of employees in the overall CWT industry since 1998 and also following 

promulgation of the final rule, (2) the inconsistency of change across industry segments, and (3) the lack of a 

systematic difference in the employment growth trends in the periods before and after rule promulgation, there is 

no basis for concluding that the rule caused contractions in activity and reduced employment in the CWT 

industry.
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Table 6-9: Number of Employees by CWT Segment and Year

Year

Hazardous Waste 

Treatment and 

Disposal (NAICS 

562211)

Other Nonhazardous 

Waste Treatment and 

Disposal Services 

(NAICS 562219)

Materials Recovery 

(NAICS 562920) Total CWT

Number % Change Number % Change Number % Change Number % Change

1998 16,976 na 4,269 na 12,485 na 33,730 na

1999 18,475 8.8% 4,030 -5.6% 13,113 5.0% 35,618 5.6%

2000 15,972 -13.5% 4,570 13.4% 12,185 -7.1% 32,727 -8.1%

2001 16,517 3.4% 4,649 1.7% 12,928 6.1% 34,094 4.2%

2002 16,526 0.1% 4,427 -4.8% 12,744 -1.4% 33,697 -1.2%

2003 22,246 34.6% 2,713 -38.7% 13,638 7.0% 38,597 14.5%

2004 23,043 3.6% 3,374 24.4% 14,673 7.6% 41,090 6.5%

2005 23,059 0.1% 3,272 -3.0% 14,744 0.5% 41,075 0.0%

2006 26,556 15.2% 3,477 6.3% 15,820 7.3% 45,853 11.6%

2007 23,869 -10.1% 4,429 27.4% 14,514 -8.3% 42,812 -6.6%

1998 – 2007 Comparison

Total Percent 

Change 40.6% 3.7% 16.3% 26.9%

Annual Average 

Growth Rate 3.9% 0.4% 1.7% 2.7%

2000 – 2007 Comparison

Total Percent 

Change 49.4% -3.1% 19.1% 30.8%

Annual Average 

Growth Rate 5.9% -0.4% 2.5% 3.9%

Sources: Statistics of U.S. Businesses Annual Data 1998-2007

6.5.2 Revenue, Employment, and Payroll in the CWT Industry Segments

EPA used data from the Economic Census for years 1997, 2002, and 2007 on revenue, employment, and payroll 

to provide additional insight into the potential effect of the rule on small businesses in the CWT industry. The 

data on employment from the Economic Census are, in concept, measuring the same value as reported in the 

preceding section. However, the employment values reported in this section differ from those reported above 

because they are not drawn from the same source.15 However, the trends over time in the employment values do 

correspond between the two data sources. 

Overall, these data continue to show a similar profile to that observed for the other data series, with increases in 

all metrics for the full CWT industry and the larger industry segments, Waste Treatment and Disposal segment 

(NAICS 562211) and the Materials Recovery segment (NAICS 562920), also showing increases. The smaller 

industry segment, Other Nonhazardous Treatment and Disposal segment (NAICS 562219), reported a decrease in 

the reported metrics. The strength of overall performance, and the generally strong performance at the segment 

level, continue to suggest that the CWT rule did not have an overall adverse effect on the industry, generally, and, 

by inference, the small business component.

As shown in Table 6-10, between 1997 and 2007, revenue, payroll, revenue less payroll (a rough measure of 

operating margin), and employment all increased16 for the total CWT industry. At the segment level, performance 

was somewhat mixed with the Waste Treatment and Disposal segment (NAICS 562211) and the Materials 

Recovery segment (NAICS 562920) showing increases in all metrics, with revenue increasing by 29.3 percent and 

 

15 Statistics of U.S. Businesses and Economic Census data may differ as a result of data collection methods and publication timing. 

SUSB data is collected by the IRS, while Census data is collected through a mail survey and is continuously updated. Different time 

frames for data publication lead to differences in the number of firms, employees, and establishments recorded and their classification 

into NAICS codes.

16 The revenue, payroll and rough operating margin values are in constant 2009 dollars, so the observed increases are not due merely to 

inflation. 
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April 12, 2011December 2010 29

74.1 percent, respectively, for the two segments; revenue less payroll also increased by 47.0 percent and 209.3 

percent, respectively. However, the Other Nonhazardous Treatment and Disposal segment (NAICS 562219) 

showed decreases with revenue and profitability declining by more than 26 percent.

The lack of true time-series data increases the degree of uncertainty of any conclusions drawn from these data

regarding the impact of the 2000 Final CWT Rule. However, based on the fact that between 1997 and 2007 both 

revenue and profitability of the CWT industry increased together with other findings presented in this Section, it 

is likely that the 2000 Final CWT Rule did not adversely affect the CWT industry as a whole or small businesses 

operating in the industry.

Table 6-10: Key Economic Performance Statistics for CWT Industry and Segments, 1997-2007

Year

Number of 

Establishments

Revenue 

(Millions; $2009)

Annual Payroll 

(Millions; $2009)

Revenue Less Payroll 

(Millions; $2009)

Number of 

Employees

Hazardous Waste Treatment and Disposal (NAICS 562211)

1997 512 $3,736 $967 $2,769 17,816

2002 696 $4,131 $1,173 $2,957 21,566

2007 779 $5,970 $1,901 $4,069 34,396

Total Percent Change 

1997-2007 52.1% 59.8% 96.5% 47.0% 93.1%

Average Annual Growth 

Rate 1997-2007 4.3% 4.8% 7.0% 3.9% 6.8%

Other Nonhazardous Waste Treatment and Disposal Services (NAICS 562219)

1997 294 $975 $218 $757 5,082

2002 199 $695 $173 $522 3,673

2007 227 $716 $161 $555 3,170

Total Percent Change 

1997-2007 -22.8% -26.6% -26.3% -26.7% -37.6%

Average Annual Growth 

Rate 1997-2007 -2.6% -3.0% -3.0% -3.1% -4.6%

Materials Recovery (NAICS 562920)

1997 765 $1,686 $368 $1,318 10,846

2002 938 $2,186 $488 $1,699 14,752

2007 1,129 $4,707 $628 $4,078 16,808

Total Percent Change 

1997-2007 47.6% 179.1% 70.8% 209.3% 55.0%

Average Annual Growth 

Rate 1997-2007 4.0% 10.8% 5.5% 12.0% 4.5%

Total CWT

1997 1,571 $6,398 $1,554 $4,844 33,744

2002 1,833 $7,012 $1,834 $5,178 39,991

2007 2,135 $11,392 $2,690 $8,702 54,374

Total Percent Change 

1997-2007 35.9% 78.1% 73.1% 79.7% 61.1%

Average Annual Growth 

Rate 1997-2007 3.1% 5.9% 5.6% 6.0% 4.9%

Sources: 1997 Economic Census; 2002 Economic Census; 2007 Economic Census

6.6 Financial Performance in the CWT Industry Segments

EPA also looked at selected financial performance metrics – pre-tax income margin, pre-tax return on assets, and 

interest coverage ratio (earnings before interest and taxes over interest payments) – as indicators of CWT industry 

segment performance before and since promulgation of the 2000 Final CWT Rule. EPA used data reported by the 

RMA for this assessment. RMA compiles and reports financial statement information by industry as provided by 

member commercial lending institutions. Because the financial statements received by RMA are for businesses 

applying for credit from member institutions, the data do not represent a random sample. In particular, the RMA 
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30 December 2010

data likely exclude representation from the financially weakest businesses, which are unlikely to seek financing 

from RMA member lending institutions. However, the RMA data offers the advantage of being available by 6-

digit NAICS codes and for quartile ranges.

Creditors and equity investors review the following three measures as criteria to determine whether and under 

what terms they will provide financing for a business; all three measures are important to financial success and 

firms’ ability to attract capital:

 Pre-Tax Income Margin (PTIM): As defined by RMA, this measure is the ratio of pre-tax income to net 

sales. This ratio measures company profitability, i.e., how much out of every dollar of sales a company 

actually keeps in earnings, independent of its tax circumstances. Profit margin is very useful when 

comparing companies in similar industries. A higher profit margin indicates a more profitable company 

that has better control over its costs compared to its competitors. The PTIM values reported by RMA and 

presented in this report are the average values from financial statements provided to RMA.

 Pre-Tax Return on Assets (PTRA): As defined by RMA, this measure is the ratio of pre-tax income to 

assets. This ratio measures the performance and profitability of a business’ assets independent of tax 

circumstances. PTRA is a comprehensive measure of a firm’s economic and financial performance. If a 

firm could not sustain a competitive PTRA on a post-CWT compliance basis, it most likely faced

difficulty financing its investments, including the outlays for compliance equipment. The PTRA values 

reported by RMA and presented in this report are the median values from financial statements provided to 

RMA.

 Interest Coverage Ratio (ICR): As defined by RMA, this measure is the ratio of earnings before interest

and taxes to interest. This ratio measures the firm’s ability to service its debt on the basis of current, 

ongoing financial performance and to borrow for capital investments. Investors and creditors will be 

reluctant to provide financing to firms whose operating cash flow does not comfortably exceed its 

contractual obligations. As ICR increases, the firm’s general ability to meet interest payments and carry 

credit increases. ICR also provides a measure of the amount of cash flow available for equity after interest 

payments. The ICR values reported by RMA and presented in this report are the median values from 

financial statements provided to RMA.

To assess the change in financial conditions over time, and assess trends in the three CWT industry segments 

before and following promulgation of the 2000 Final CWT Rule, EPA looked at RMA data for 1997 through 

2008, when possible. Unfortunately, RMA data were not available in a consistent framework for the three CWT 

segments, for the full analysis period. For 1997 through 2002, RMA data are reported in the SIC framework for 

SIC 4953: Refuse Systems. As mentioned earlier in this document, in addition to the three CWT industry 

segments, this SIC industry sector also maps onto NAICS 562212: Solid Waste Landfills and NAICS 562213: 

Solid Waste Combustors and Incinerators. After 2002, RMA data are reported in the NAICS framework. Given 

this inconsistency in the data series over time, EPA organized the data in two ways:

1. Data in the SIC framework are reported for the years 1997-2002 as provided by RMA. To provide a 

consistent time series of the SIC-framework data for the years following 2002, EPA generated an SIC 

4953-equivalent data series after 2002 by aggregating the data reported for the 6-digit CWT and nonCWT NAICS, weighted by the 2007 value of shipments from the 2007 Economic Census. Because RMA 

does not provide data for NAICS 562213: Solid Waste Combustors and Incinerators, the SIC 4953-

equivalent data series reported after 2002 include only the three CWT industry segments and NAICS 

562212: Solid Waste Landfills. This data series shows the financial performance for the larger Refuse 

Systems industry (SIC 4953), including both the CWT segments and the non-CWT segment. 

2. Data are also reported in the NAICS framework beginning with 2002. These data apply to the three 

specific NAICS segments in the CWT industry as discussed elsewhere in this report. 
RFA Section 610 Review of the Effluent Limitations Guidelines and Standards for the CWT Industry

April 12, 2011December 2010 31

As shown in Figure 6-1, the SIC 4953: Refuse Systems industry experienced minor fluctuations in profitability,

as measured by pre-tax income margin, throughout the analysis period of 1997 through 2008. While profitability 

experienced a slight drop in 2001, i.e., the first year after promulgation, the industry rebounded in 2002 and 

generally experienced growth in profitability through 2007. In 2007, profitability declined significantly, likely 

resulting from the general slowdown in the U.S. economy. During this year profitability dropped to approximately 

the pre-promulgation level. The same pattern generally holds for the other two financial metrics – pre-tax return 

on assets and interest coverage ratio – except that (1) the decline in both ratios begins in 2006, also likely due to 

the general economic decline, as opposed to 2007; and (2) these ratios did not decline to the same extent relative 

to pre-promulgation levels, as the profitability metric.

Financial performance of all three CWT industry segments after the 2000 Final CWT Rule promulgation 

generally followed that of the Refuse Systems industry (SIC 4953). Consequently, according to these financial 

performance metrics, the 2000 Final CWT Rule does not appear to have adversely affected financial performance 

of the CWT industry, either overall, or in the individual CWT segments.

RMA also provides financial data by revenue size category, but for the analyzed CWT industry segments, these 

data are not sufficiently complete to assess financial performance over-time for the small entities only. However, 

based on the reported number of RMA respondents with revenue less than $12.5 million, at least half of the 

providers of the data presented in Figure 6-1 would be small according to the SBA criterion (see Table 6-11). 

Consequently, the RMA data include a substantial presence of small businesses, and the financial performance 

data reported in Figure 6-1 are largely indicative of small business performance. 
RFA Section 610 Review of the Effluent Limitations Guidelines and Standards for the CWT Industry

32 December 2010

Figure 6-1: Pre-Tax Income Margin, Pre-Tax Return on Assets, and Interest Coverage Ratios by CWT Segmenta

Pre-Tax Income Margin

 

0

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

199719981999200020012002200320042005200620072008

NAICS 562211

NAICS 562219

NAICS 562920

SIC 4953

Pre-Tax Return on Assets

4

5

6

7

8

9

10

11

12

13

14

15

199719981999200020012002200320042005200620072008

NAICS 562211

NAICS 562219

NAICS 562920

SIC 4953

Interest Coverage Ratio

NAICS

SIC

NAICS

SIC
RFA Section 610 Review of the Effluent Limitations Guidelines and Standards for the CWT Industry

April 12, 2011December 2010 33

 

0

1

2

3

4

5

6

7

8

9

10

199719981999200020012002200320042005200620072008

NAICS 562211

NAICS 562219

NAICS 562920

SIC 4953

Sources: Risk Management Association; 2002 Economic Census

a From 1997 through 2002 the data are reported for SIC 4953: Refuse Systems. From 2002 through 2008 the data are reported for NAICS 562211: 

Hazardous Waste Treatment and Disposal, NAICS 562219: Other Nonhazardous Treatment and Disposal, and NAICS 562920: Materials Recovery 

Facilities. The SIC-equivalent data reported for 2002 through 2008 were estimated as value of shipments-weighted pre-tax income margin, interest coverage,

and pre-tax return on assets values reported for CWT NAICS 562211: Hazardous Waste Treatment and Disposal, CWT NAICS 562219: Other 

Nonhazardous Treatment and Disposal, CWT NAICS 562920: Materials Recovery Facilities NAICS 562211 and non-CWT NAICS 562212: Solid Waste 

Landfill, all of which map onto SIC 4953: Refuse Systems according to the 1997 Economic Census Bridge Between NAICS and SIC.

Table 6-11: Number of RMA Respondents by CWT Segment and Year: 1997 - 2008

Year

Total Number of RMA Respondents Percent of Potentially Small RMA Respondents

NAICS SIC NAICS SIC

562211 562219 562920 562212 4953 562211 562219 562920 562212 4953

1997 na na na 271 271 na na na na 72%

1998 na na na 278 278 na na na na 68%

1999 na na na 244 244 na na na na 71%

2000 na na na 247 247 na na na na 70%

2001 na na na 232 232 na na na na 68%

2002 22 na 31 218 271 na na 67% 67% 67%

2003 29 na 46 193 268 na na 64% 66% 66%

2004 45 16 40 185 286 56% na 74% 62% 63%

2005 32 14 42 169 257 68% na 69% 60% 63%

2006 49 22 56 131 258 57% na 63% 56% 58%

2007 65 23 63 121 272 52% na 57% 53% 54%

2008 65 39 87 134 325 52% 45% 63% 53% 55%

Source: Risk Management Association

SIC

NAICS
RFA Section 610 Review of the Effluent Limitations Guidelines and Standards for the CWT Industry

34 December 2010

7 Conclusion

As described in the preceding sections, this assessment finds that the CWT industry overall has shown favorable 

economic and financial performance according to a range of metrics. Performance at the level of the individual 

industry segments is more variable, with two of the three CWT segments – Hazardous Waste Treatment and 

Disposal segment (NAICS 562211) and the Materials Recovery segment (NAICS 562920) – showing generally 

favorable performance, and the third segment Other Nonhazardous Treatment and Disposal segment (NAICS 

562219) showing somewhat weaker performance. However, the third CWT segment is the smallest segment 

within the CWT industry. Moreover, in several instances, trends of declining revenue or other business 

performance metrics that are apparent after promulgation of the final rule had begun before the rule, and thus 

cannot be attributed to the CWT rule.

More specifically, revenue, profitability, number of employees, and number of CWT facilities increased for the 

two larger industry segments. In addition, the total number of CWT firms as well as the number of small firms 

increased in all three CWT segments. Finally, financial performance measured in pre-tax profit margin, pre-tax 

return on assets, and interest coverage ratio generally improved for the CWT industry as a whole.

As described in the introduction to Section 6, much of this review considered the industry or its segments in 

aggregate, regardless of business size – given the data limitations. However, because the CWT industry, overall, 

is comprised substantially of small businesses, information and related findings that are descriptive of the 

industry, as a whole, are also generally applicable to the small business component of the industry. 

Given these findings, EPA sees no basis for concluding that the CWT rule has caused deterioration in the CWT 

industry, or specifically the viability and performance of the industry’s small business component. EPA has also 

provided numerous small business tools to help small entities understand and comply with the CWT effluent 

guidelines limitations and pretreatment standards (Section 4, above). The Agency believes there is still a need for 

the CWT Rule and that it does not overlap or conflict significantly with other government regulations. Also, EPA

received no public comments on the section 610 review Federal Register Notice, published in April 2010.

Therefore, EPA has determined that the Effluent Limitations Guidelines for the Centralized Waste Treatment 

Category (40 CFR Part 437) as promulgated in 2000 and amended in 2003 should be left unchanged as of the date 

of this analysis, December 2010.