THE 

ENVIRONMENTAL

COUNCIL OF

THE STATES

----------------------------

50 F Street NW

Suite 350

Washington, D.C. 20001

-----------------------------

Tel: (202) 266-4920

Fax: (202) 266-4937

Email: ecos@ecos.org

Webpage: www.ecos.org

-------------------------------------

Richard Opper

 Director, Montana Department of

 Environmental Quality

 PRESIDENT

Thomas Burack

 Commissioner, New Hampshire

 Department of Environmental Services

 VICE PRESIDENT

Teresa Marks

 Director, Arkansas Department of 

 Environmental Quality

 SECRETARY-TREASURER

Michael Linder

 Director, Nebraska Department of

 Environmental Quality

 PAST PRESIDENT

 

_____________

R. Steven Brown

Executive Director

July 15, 2011

Submitted via http://www.regulations.gov

EPA Docket Center (EPA/DC)

U.S. Environmental Protection Agency

Mailcode: 2822T

1200 Pennsylvania Avenue, NW

Washington, DC 20460

Re: Docket ID No. EPA-HQ-OAR-2011-0044 (NSPS action)

Docket ID No. EPA-HQ-OAR-2009-0234 (NESHAP action)

RIN 2060-AP52

To Whom It May Concern:

On behalf of the Environmental Council of the States (ECOS), I am pleased to 

submit this comment letter to the U.S. Environmental Protection Agency (EPA) on 

its proposed new rule "National Emission Standards for Hazardous Air Pollutants 

[NESHAP] from Coal and Oil-Fired Electric Utility Steam Generating Units and 

Standards of Performance for Fossil-Fuel-Fired Electric Utility, IndustrialCommercial- Institutional, and Small Industrial-Commercial-Institutional Steam 

Generating Units" [new source performance standards (NSPS)] published in the May 

3, 2011 Federal Register. This letter provides comments to EPA on this proposed 

rule for both the NESHAP and NSPS actions, hereafter referred to as "utility MACT 

rule." 

States are co-regulators with EPA as we jointly seek to deliver the nation's 

environmental protection system. 

States have long supported early, meaningful, and substantial state involvement in 

the development and implementation of environmental statutes and related rules. 

Further, states have called on EPA to consult integrally with the states’ 

environmental agencies as EPA's offices conduct these efforts in preference to after

these efforts have been discussed and drafted.

States appreciate EPA's commitment through its revised 2008 guidance to consult 

with states if a proposed regulatory action is estimated to have an annual effect on 

state or local governments of $25 million or more in aggregate. EPA’s commitment 

exceeds the requirements of the Unfunded Mandates Reform Act of 1995 (UMRA) 

as well as Executive Order 12866 – Regulatory Planning and Review (1993) and 

Executive Order 13132 – Federalism (1999) to consult on proposed regulatory 

actions that are expected to exceed $100 million or more.

EPA estimates that the proposed utility MACT rule will result in expenditures 

exceeding $100 million by state and local governments in aggregate in any one year,

and as such, the proposed rule is considered a significant regulatory action. 
ECOS comment to docket RIN 2060-AP52, July 15, 2011, page 2

In the proposed rule under "D. Unfunded Mandates Reform Act of 1995, 5. Consultation With 

Government," EPA notes that it held a consultation meeting with state, local and tribal governments on 

October 27, 2010. At this meeting, the proposed rule references that officials at the meeting expressed 

uncertainty "with regard to the potential burden associated with implementing the rule on state and local 

entities (i.e., burden to re-permit affected EGUs or update existing permits)." 

In the proposed rule under "E. Executive Order 13132, Federalism," EPA notes that in its March 2011 

Regulatory Impact Analysis (RIA), that the option may impose annual "direct compliance costs on an 

estimated 97 state or local governments. Specifically, we estimate that there are 81 municipalities, 5 

states, and 11 political subdivisions ... that may be directly impacted by today's proposed rule."

In the proposed rule's RIA, Chapter 10 discusses statutory and executive order impact analyses. Section 

10.2 addresses UMRA. EPA notes that it identified state and municipality owned utilities and 

subdivisions that would be affected by the rule. EPA further notes that "after identifying the potentially 

affected government entities, EPA estimated the impact of the proposed rule in 2015 based on the 

following:

 Total impacts of compliance on government entities and 

 Ratio of government entity impacts to revenues from electricity generation."

EPA's Table 10-3 summarizes capital costs plus operating costs, fuel costs, and change in revenue to 

reach a total estimated cost of $571 million in 2015 to state and local governments and sub-divisions. 

Beyond these direct compliance costs to government-owned utilities, no further discussion of costs to 

states nor any reference to implementation or administrative costs to states can be found in the RIA. 

Regarding the October 2010 meeting and the uncertainty expressed by officials regarding potential 

burden of state administrative costs to implement the rule, no response was found to this potential 

burden in the May 2011 Federal Register notice of proposed rule-making.

The Unfunded Mandates Reform Act of 1995 directs federal agencies to include a number of statements 

to accompany significant regulatory actions in a notice of proposed rulemaking.

EPA in its proposed rule seems to have addressed UMRA Section 202 (a)(3)(a), which states that “the 

agency shall prepare a written statement containing... estimates... of the future compliance costs of the 

Federal mandate."

However, EPA in its proposed rule does not appear to have addressed the statement in UMRA Section 

202 (a)(2) that “the agency shall prepare a written statement containing... a qualitative and quantitative 

assessment of the anticipated costs and benefits of the Federal mandate, including the costs and benefits 

to State... governments." 

In Executive Order 12866 for significant regulatory actions (unless prohibited by law), Section 6 

(a)(3)(C)(ii) specifies that agencies should have developed “[a]n assessment, including the underlying 

analysis, of costs anticipated from the regulatory action (such as, but not limited to, the direct cost ... to 

the government in administering the regulation [emphasis added] ...” as part of its decision-making 

process. Section 6(a)(3)(E)(i) directs that this information be made available to the public. 
ECOS comment to docket RIN 2060-AP52, July 15, 2011, page 3

EO 12866 further provides direction in Section 1(a) that "[c]osts and benefits should be understood to 

include both quantifiable measures (to the fullest extent that these can be usefully estimated) and 

qualitative measures of costs and benefits that are difficult to quantify, but nevertheless essential to 

consider." 

UMRA and EO 12866 are clear in directing federal agencies to consider direct state administrative costs 

and to make this information available to the public. This information does not appear to be included in 

the proposed rule or in underlying supporting documents made available for this rule. 

In Executive Order 13132 on Federalism, Section 6.(b)(2)(B) directs that EPA provide to the Office of

Management and Budget a federalism summary impact statement (FSIS) containing a number of 

elements, including “a statement of the extent to which the concerns of State and local officials have 

been met.” States continue to remain uncertain of the extent to which EPA is considering state 

administrative costs, including state administrative costs for this proposed utility MACT rule.

ECOS and state environmental agencies have discussed with the EPA Office of Policy a number of 

categories of state implementation costs as a result of implementing new rules. For each new EPA rule, 

states may incur slightly different implementation costs. Cost categories may differ from state to state 

depending on legislative and regulated community differences. States ask that EPA consider as 

appropriate state costs for a wide range of implementation start-up and recurring activities in its 

implementation cost estimation for this rule, as well as for other rules, using the attached checklist (see 

Attachment). ECOS requests that EPA consider this full range of implementation cost items in its 

estimations for this rule before the final rule takes effect. ECOS also requests that EPA seek to secure 

federal funding for the states to cover the customary portion of the costs associated with the state 

implementation of this federal rule and consider the availability of funding support in its planning for 

new rule adoption schedules and other implementation activities following new rule issuance. 

Start-up and recurring implementation costs to the states as a result of this rule are detailed in the 

attachment to this letter and may include, for example: obtaining additional delegated authority; 

attending EPA training; developing a system for monitoring affected entities; purchasing new equipment 

to enforce the new regulation; providing compliance assistance; conducting ongoing public outreach and 

education programs (to the regulated communities) on how to comply with the state agency’s 

implementation of the rule; collecting and reviewing data from monitoring, recording, and storing data; 

and conducting enforcement inspections and follow-up actions.

We seek to ensure here that all pertinent costs are included in any estimate the agency produces. Failure 

to include an accurate assessment of the implementation costs may result in a rule that is not 

implemented properly or in a timely manner, which may adversely affect human health.

ECOS requests that EPA concurrently publish implementation guidance for this rule to states at the time 

of new rule issuance. Timely issuance of implementation guidance would facilitate state adoption of the 

new rule as well as increase state and EPA staff resource efficiency in completing activities related to 

new rule adoption.

States have shared with EPA on a number of occasions the importance of having information about the 

costs to implement and administer new federal rules to share with the U.S. Congress and state 

legislatures and to use for planning resource needs. Costs of implementation of the rule can be covered 

two ways. The first is through U. S. Congressional appropriations. The other is through increases in 

permit fees allowed for Title V activities in the Clean Air Act. It may however, not be expedient to 
ECOS comment to docket RIN 2060-AP52, July 15, 2011, page 4

receive state legislative approval for permit fee increases. If EPA estimated state administrative costs 

along with state direct compliance costs, the estimates might assist both the EPA in justifying their 

request for appropriations and states in justifying permit fee increases. States continue to request that 

EPA consider state administrative costs and make this information available as directed in UMRA, EO 

12866 and EO 13132.

For the proposed utility MACT action, EPA needs to ensure that the mandate to consider state 

administrative costs as well as the mandate that this information accompany this significant regulatory 

action have both been met.

We appreciate the opportunity to offer these comments. If you have any questions, please contact Steve 

Brown, sbrown@ecos.org, 202-266-4920. 

Sincerely,

Leo M. Drozdoff

Chair, ECOS Planning Committee 

Director, Nevada Department of Conservation and Natural Resources

cc: ECOS Officers

Steve Brown, ECOS

Michael Goo, U.S. EPA Office of Policy

Bicky Corman, U.S. EPA Office of Policy

Sarah Hospodor-Pallone, U.S. EPA Office of Congressional and Intergovernmental Relations

Attachment
Attachment

Excerpt from "White Paper Recommendations for Enhancing EPA’s State Administrative Cost 

Analyses, WORKING DRAFT, August 20, 2009"

Table 3: Revised State Administrative Activity Cost Framework

Start-Up Activity Categories Specific Activities

1. Tracking EPA’s Rulemaking 

Progress

Review the Federal Register notices and/or other documents in order to decide 

whether to apply for delegated authority.

Attend EPA-sponsored meetings/conferences on the rulemaking

Attend other non-EPA meetings/conferences on the rulemaking

Provide EPA directly with comments on the proposed rule.

Provide EPA with comments on the proposed rule through a third party (e.g., 

ECOS).

Conducted other start-up activities associated with tracking EPA’s rulemaking 

process.

2. Obtaining Additional Delegated 

Authority

Work with EPA to obtain delegated authority

Amend state law to incorporate the requirements of the new regulation.

Issue new regulations in accordance with the requirements of state law1

Incur litigation costs associated with the change in state laws.

Conduct other start-up activities associated with obtaining additional delegated 

authority or the decision whether or not to obtain that authority.

3. Designing Implementation Plan 

Design alternative standards to those in the federal regulation

Perform activities related to obtaining EPA approval for the state implementation 

plan

Meet with stakeholders and respond to concerns

Conduct other start-up activities associated with designing implementation plans

4. General Start-Up Activities

Develop internal guidance and procedures for implementing the new regulation

Hire additional staff because of this rule

Attend EPA training or other non-EPA sponsored training for implementing the new 

regulations

Conduct internal training

Conduct other start-up activities

5. Compliance Assistance 

Conduct outreach programs for affected entities

Conduct public outreach and education programs to create awareness

Develop training programs to help affected entities comply with the new regulation

Conduct other start-up activities associated with compliance assistance

6. Permit Administration 

Develop additional infrastructure for permit administration because of this rule

Develop specific permit requirements

Conduct other start-up activities associated with permit administration

7. Monitoring 

Develop a system for monitoring affected entities

Purchase new equipment for monitoring purposes

Develop new infrastructure for carrying out monitoring

Conduct other start-up activities associated with monitoring

8. Inspection and Enforcement

Establish new procedures for enforcing the new regulation

Purchase new equipment for enforcing the new regulation

Conduct other start-up activities associated with enforcement

Recurring Activity Categories Specific Activities

9. Compliance Assistance 

Conduct ongoing training (in addition to the initial start-up period)

Respond regularly to letters, phone calls, emails or other inquiries in order to assist 

affected entities; respond to inquiries by the media and the public

Conduct ongoing public outreach and education programs to create awareness

Conducted other recurring activities associated with compliance assistance

10. Permit Administration 

Conduct regular reviews of submitted documents and supporting materials

Verify data sources on a regular basis

Consult with facilities regularly about permitting process

Issue notifications to affected entities about permits

Provide opportunities for the public and/or stakeholders to comment on ongoing 

permitting processes

Issue/review permits to affected entities

Conduct other recurring activities associated with permit administration
Table 3: Revised State Administrative Activity Cost Framework

11. Monitoring 

Collect data from monitoring on a continuous basis

Review collected data on a regular basis

Record and store monitoring data

Report monitoring data

Provide notifications of monitoring requirements and schedule

Conducted other recurring activities associated with monitoring.

12. Inspection and Enforcement

Conduct and review regular inspections for regulatory enforcement purposes

If a national inspection priority, conduct additional inspections as per state-region 

negotiated workplan

Respond to citizen complaints

Issue warnings and/or citations for violations

Take legal action to enforce regulation 

Collect fines for violations

Provide notifications of enforcement actions

Keep records for enforcement actions

Report enforcement activities to EPA

Conducted other recurring activities associated with enforcement

Incur additional recurring costs associated with enforcement activities

13. Other Any other types of recurring activities not categorized above

1While some states may simply incorporate federal rules by reference, others must undergo an in-depth rulemaking process involving 

public notice, impact statements, rulemaking hearings, recordkeeping and various other steps