[Federal Register: October 6, 2004 (Volume 69, Number 193)]
[Rules and Regulations]
[Page 59810-59812]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr06oc04-18]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 35
[OW-2004-0034; FRL-7825-2]
Revised Allotment Formula for Interstate Monies Appropriated
Under Section 106 of the Clean Water Act
AGENCY: Environmental Protection Agency (EPA).
ACTION: Final rule.
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SUMMARY: This regulation revises the allotment formula for allotting
funds appropriated under section 106 of the Clean Water Act (CWA) to
interstate agencies for use in implementing specific elements of Clean
Water Act programs. Section 106 of the CWA authorizes the Environmental
Protection Agency (EPA) to provide grants to states, interstate
agencies, and Indian tribes qualified under CWA section 518(e) to
assist them in administering programs for the prevention, reduction,
and elimination of water pollution. The allotment formulas for the
state and tribal portions of the CWA section 106 Grant Program are not
affected by this action.
DATES: This regulation is effective October 6, 2004.
ADDRESSES: EPA has established a docket for this action under Docket ID
No. OW-2004-0034. All documents in the docket are listed in the EDOCKET
Index at http://www.epa.gov/edocket. Although listed in the index, some
information is not publicly available, i.e., confidential business
information (CBI) or other information whose disclosure is restricted
by statute. Certain other material, such as copyrighted material, is
not placed on the internet and will be publicly available only in hard
copy form. Publicly available docket materials are available either
electronically in EDOCKET or in hard copy at the Water Docket in the
EPA Docket Center (EPA/DC) EPA West, Room B102, 1301 Constitution Ave.,
NW., Washington, DC. The EPA Docket Center Public Reading Room is open
from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal
holidays. The telephone number for the Public Reading Room is (202)
566-1744, and the telephone number for the Water Docket is (202) 566-
2426.
FOR FURTHER INFORMATION CONTACT: Carol Crow, Office of Wastewater
Management (4201M), 1200 Pennsylvania Avenue, NW., Washington, DC
20460. The telephone number is (202) 564-0644; facsimile number (202)
501-2399; and e-mail address is crow.carol@epa.gov.
SUPPLEMENTARY INFORMATION: CWA section 106(a) provides general
authority for grants to states, interstate agencies, and Indian tribes
qualified under CWA section 518(e) to assist them in administering
programs for the prevention, reduction, and elimination of water
pollution. Section 106(b) of the CWA directs the EPA Administrator to
make allotments from sums appropriated by Congress in each fiscal year
``on the basis of the extent of the pollution problem in the respective
states.'' National data quantifying the extent of the pollution problem
in each state have increased in reliability and availability since the
first CWA section 106 grants to states and interstates were made in
1972. To reflect this improvement, the formulae for making state and
interstate allocations on the basis of the extent of the pollution
problem underwent several revisions. The most recent revision was
published
[[Page 59811]]
as a final rule in the May 3, 1999, Federal Register (64 FR 23734). To
prevent sudden fluctuations in annual state section 106 grant funding
that could compromise the effectiveness of state programs, the revised
formula for allotting funds to the states established a funding floor
based on each state's previous level of funding. This ``hold harmless''
provision ensures that unless there is a decrease in the CWA section
106 state appropriation, each state will receive at least the same
level of funding as the previous year.
The state funding floor is adjusted for inflation when the funds
appropriated for states under the Water Pollution Control State grant
program increase from the preceding fiscal year. These adjustments are
made on the basis of the cumulative change in the Consumer Price Index
(CPI), published by the U.S. Department of Labor, since the most recent
year in which Water Pollution Control State grant funding increased.
Inflation adjustments for states are capped at the lesser of the
percentage of change in appropriated funds or the cumulative percentage
change in the inflation rate.
The section 106 interstate formula historically has not used a
funding floor to allocate funds. However, due to fluctuations in
interstate allocations since the implementation of the most recent
section 106 state and interstate formula revisions, and in response to
a request from eligible interstate agencies, EPA is modifying the
interstate allotment formula to incorporate a funding floor and an
inflation factor so that it is consistent with the current state
allocation formula. This ``hold harmless'' provision will ensure that
unless there is a decrease in the CWA section 106 state appropriation,
each interstate agency will receive, at a minimum, the same level of
section 106 funding received in the previous fiscal year.
The funding floor will be adjusted for inflation when the funds
appropriated for states under the Water Pollution Control State grant
program increase from the preceding fiscal year. These adjustments will
be made on the basis of the cumulative change in the CPI, published by
the U.S. Department of Labor, since the most recent year in which the
Water Pollution Control State grant funding increased. Inflation
adjustments to the interstate agency funding floor will be capped at
the lesser of the percentage of change in appropriated funds or the
cumulative percentage change in the inflation rate. Any section 106
appropriated funds allocated to the interstate agencies through the
interstate set-aside above the amount needed to meet the funding floor
described above will be distributed based on ``the extent of the
pollution problem in the respective states.'' Specifically, in the case
of interstate agencies, this additional allotment will be based on the
extent of the pollution problem in those states within the drainage
basin or watershed area covered by the compact of each interstate
agency. This variable component of the current interstate allotment
formula remains unchanged by this action.
Regulated Entities: The six interstate agencies eligible to receive
grants under section 106 of the Clean Water Act are regulated by this
rule. They are: the New England Interstate Water Pollution Control
Commission; Interstate Environmental Commission; Interstate Commission
of the Potomac River Basin; Delaware River Basin Commission;
Susquehanna River Basin Commission; and the Ohio River Valley Water
Sanitation Commission.
Background: The current CWA section 106 interstate agency allotment
formula was finalized in FY 1999. Since FY 1999, the interstate set-
aside has been set at the level of 2.6 percent of the total funds
appropriated for states under the CWA Section 106 Grant Program. The
current section 106 interstate agency allotment formula consists of two
parts: (1) a base allotment; and (2) a variable allotment. See, 40 CFR
35.162(c)(1) and (2).
The base allotment of the current formula ensures that each
interstate agency receives a minimum base allotment of $125,000 to
provide for coordination activities among its member states. However,
no more than 50 percent of the total funding available through the
interstate set-aside may be allocated as part of the base allotment.
If, given the 50 percent limitation placed on the base allotment, the
amount of funding available through the interstate set-aside is
insufficient to provide each interstate agency with $125,000, then each
interstate agency receives a base allotment equal to 50 percent of the
total interstate set-aside divided by six; the number of interstate
agencies.
The variable allotment provides for funds to be allocated to
interstate agencies on the basis of ``the extent of the pollution
problem in the respective States;'' specifically, in the case of the
allotment to interstate agencies, those states within the drainage
basin or watershed area covered by the compact of each interstate
agency. Funds not allotted under the base allotment are allocated to
interstate agencies based on each interstate agency's share of their
member states' section 106 allotment ratios. The state allotment ratios
for those states involved in compacts with more than one interstate
agency are allocated among such interstate agencies based on the
percentage of each state's territory that is situated within the
drainage basin or watershed area covered by each compact. Updates to
the data sources used to determine the state allotments under the CWA
section 106 state allocation formula automatically result in
corresponding updates to the variable allotment to the interstate
agencies.
While the current interstate ``base allotment'' ensures a minimum
$125,000 base level of funding for all interstate agencies, increases
in funding available to interstate agencies since the formula revisions
in 1999 have increased each interstate agency's total allotment. As a
result, the base allotment level of funding is no longer sufficient to
protect each interstate agency from potentially significant
fluctuations in total funding resulting from the regularly scheduled
updates to the support data for the section 106 state formula. This has
resulted in unexpected decreases in funding for some interstates and
has impacted their ability to plan for and implement their program
activities. This revision is meant to protect the interstate agencies
from the most detrimental impacts of such adjustments in the allocation
of section 106 funds.
Statutory and Executive Order Reviews: Under Executive Order 12866
(58 FR 51735, October 4, 1993), this regulation is not a ``significant
regulatory action'' and is therefore not subject to OMB review. Because
this grant regulation is not subject to notice and comment requirements
under the Administrative Procedures Act or any other statute, it is not
subject to the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) or
sections 202 and 205 of the Unfunded Mandates Reform Act of 1999 (UMRA)
(Pub. L. 104-4). In addition, this regulation does not significantly or
uniquely affect small governments. This regulation does not have tribal
implications, as specified in Executive Order 13175 (63 FR 67249,
November 9, 2000). This regulation will not have federalism
implications, as specified in Executive Order 13132 (64 FR 43255,
August 10, 1999). This regulation is not subject to Executive Order
13211, ``Actions Concerning Regulations that Significantly Affect
Energy Supply, Distribution, or Use'' (66 FR 28355, May 22, 2001),
because it is not a significant regulatory action under Executive Order
12866. This regulation does not involve technical standards; thus, the
[[Page 59812]]
requirements of section 12(d) of the National Technology Transfer and
Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. This
regulation does not impose an information collection burden under the
provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et
seq.).
The Congressional Review Act, 5 U.S.C. 801 et seq., generally
provides that before a rule may take effect, the agency promulgating
the rule must submit a rule report, which includes a copy of the rule,
to each House of the Congress and to the Comptroller General of the
United States. Since this final grant rule contains legally binding
requirements, it is subject to the Congressional Review Act, 5 U.S.C.
801 et seq., and EPA will submit this rule in its report to Congress
under the Act.
List of Subjects in 40 CFR Part 35
Environmental protection, Administrative practices and procedures,
Environmental program grants, Water pollution control.
Dated: September 30, 2004.
Mike O. Leavitt,
Administrator.
0
EPA amends 40 CFR part 35 as follows:
0
1. The authority citation for part 35, subpart A continues to read as
follows:
Authority: 42 U.S.C. 7401 et seq.; 33 U.S.C. 1251 et seq.; 42
U.S.C. 300f et seq.; 42 U.S.C. 6901 et seq.; 7 U.S.C. 136 et seq.;
15 U.S.C. 2601 et seq.; 42 U.S.C. 13101 et seq.; Pub. L. 104-134,
110 Stat. 1321, 1321-299 (1966); Pub. L. 105-65, 111 Stat. 1344,
1373 (1997).
Subpart A--Amended
0
2. Section 35.162 is amended by revising paragraphs (c) introductory
text and (c)(1) to read as follows:
Sec. 35.162 Basis for allotment.
* * * * *
(c) Interstate allotment formula. EPA will set-aside 2.6 percent of
the funds appropriated for the Water Pollution Control State grant
program for interstate agencies. The interstate agency Water Pollution
Control grant allotment formula consists of two parts: a funding floor
with provisions for periodic adjustments for inflation, and a variable
allotment.
(1) Funding Floor. A funding floor is established for each
interstate agency. Each interstate's funding floor for FY 2005 will be
at least equal to its FY 2003 allotment. Beginning in FY 2006, the
interstate funding floor will ensure that unless there is a decrease in
the CWA section 106 state appropriation, each interstate will receive
at a minimum, the same level of funding received in the previous fiscal
year. The funding floor for each interstate agency will be adjusted for
inflation when the funds appropriated for states under the Water
Pollution Control State grant program increase from the preceding
fiscal year. These adjustments will be made on the basis of the
cumulative change in the Consumer Price Index (CPI), published by the
U.S. Department of Labor, since the most recent year in which Water
Pollution Control State grant funding increased. Inflation adjustments
to the interstate agency funding floor will be capped at the lesser of
the percentage of change in appropriated funds or the cumulative
percentage change in the inflation rate. If the appropriation for
states under the Water Pollution Control State grant program decreases
in future years, the funding floor will be disregarded and all
interstate agency allotments will be reduced by an equal percentage.
* * * * *
[FR Doc. 04-22523 Filed 10-6-04; 8:45 am]
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