[Federal Register: January 12, 2001 (Volume 66, Number 9)]
[Proposed Rules]               
[Page 2959-3008]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr12ja01-37]                         
 

[[Page 2959]]

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Part II





Environmental Protection Agency





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40 CFR Parts 122 and 412



National Pollutant Discharge Elimination System Permit Regulation and 
Effluent Limitations Guidelines and Standards for Concentrated Animal 
Feeding Operations; Proposed Rule


[[Page 2960]]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 122 and 412

[FRL-6921-4]
RIN 2040-AD19

 
National Pollutant Discharge Elimination System Permit Regulation 
and Effluent Limitations Guidelines and Standards for Concentrated 
Animal Feeding Operations

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: Today the Environmental Protection Agency proposes to revise 
and update two regulations that address the impacts of manure, 
wastewater, and other process waters generated by concentrated animal 
feeding operations (CAFOs) on water quality. These two regulations are 
the National Pollutant Discharge Elimination System (NPDES) provisions 
that define which operations are CAFOs and establish permit 
requirements, and the Effluent Limitations Guidelines for feedlots 
(beef, dairy, swine and poultry subcategories), which establish the 
technology-based effluent discharge standards for CAFOs. EPA is 
proposing revisions to these regulations to address changes that have 
occurred in the animal industry sectors over the last 25 years, to 
clarify and improve implementation of CAFO permit requirements, and to 
improve the environmental protection achieved under these rules.
    Environmental concerns being addressed by this rule include both 
ecological and human health effects. Manure from stockpiles, lagoons, 
or excessive land application can reach waterways through runoff, 
erosion, spills, or via groundwater. These discharges can result in 
excessive nutrients (nitrogen, phosphorus, and potassium), oxygen-
depleting substances, and other pollutants in the water. This pollution 
can kill fish and shellfish, cause excess algae growth, harm marine 
mammals, and contaminate drinking water.
    Today's action co-proposes two alternatives for how to structure 
the revised NPDES program for CAFOs; the alternatives offer comparable 
environmental benefits but differ in their administrative approach. EPA 
also requests comment on two other alternatives that the Agency is 
considering and may pursue after evaluating the comments.
    EPA is also proposing to revise effluent guidelines applicable to 
beef, dairy, swine, and poultry operations that are defined as CAFOs, 
pursuant to the NPDES revisions. The proposed effluent guidelines 
include regulations for both new and existing animal feeding operations 
that meet the definition of a CAFO. Today's effluent guidelines 
revisions do not alter the requirements for horses, ducks, sheep or 
lambs.

DATES: Comments must be received or postmarked on or before midnight 
May 2, 2001.

ADDRESSES: Public comments regarding this proposed rule should be 
submitted by mail to: Concentrated Animal Feeding Operation Proposed 
Rule, Office of Water, Engineering and Analysis Division (4303), USEPA, 
1200 Pennsylvania Avenue, NW., Washington, DC 20460. Hand deliveries 
(including overnight mail) should be submitted to the Concentrated 
Animal Feeding Operation Proposed Rule, USEPA, Waterside Mall, West 
Tower, Room 611, 401 M Street, SW., Washington, DC 20460. You also may 
submit comments electronically to CAFOS.comments@epa.gov. Please submit 
any references cited in your comments. Please submit an original and 
three copies of your written comments and enclosures. For additional 
information on how to submit comments, see ``SUPPLEMENTARY INFORMATION, 
How May I Submit Comments?''

FOR FURTHER INFORMATION CONTACT: For additional technical information 
contact Karen Metchis or Jan Goodwin at (202) 564-0766.

SUPPLEMENTARY INFORMATION:

What Entities Are Potentially Regulated by This Action?

    This proposed rule would apply to new and existing animal feeding 
operations that meet the definition of a concentrated animal feeding 
operation, or which are designated by the permitting authority as such. 
Concentrated animal feeding operations are defined by the Clean Water 
Act as point sources for the purposes of the NPDES program. (33 U.S.C. 
Sec. 1362).
    The following table lists the types of entities that are 
potentially subject to this proposed rule. This table is not intended 
to be exhaustive, but rather provides a guide for readers regarding 
entities likely to be regulated by this action. Other types of entities 
not listed in the table could also be regulated. To determine whether 
your facility would be regulated by this action, you should carefully 
examine the applicability criteria proposed at Sec. 122.23(a)(2) of the 
rule. If you have questions regarding the applicability of this action 
to a particular entity, consult one of the persons listed for technical 
information in the preceding FOR FURTHER INFORMATION CONTACT section.

----------------------------------------------------------------------------------------------------------------
                                        Examples of regulated         North American        Standard Industrial
              Category                         entities            Industry Code  (NAIC)   Classification Codes
----------------------------------------------------------------------------------------------------------------
Federal, State and Local Government
Industry...........................  ...........................  See below.............  See below
                                     Operators of animal
                                      production operations that
                                      meet the definition of a
                                      concentrated animal
                                      feeding operation.
                                       Beef cattle feedlots.....  112112................  0211
                                       Hogs.....................  11221.................  0213
                                       Sheep and goats..........  1241, 11242...........  0214
                                       General livestock, except  11299.................  0219
                                      dairy and poultry.
                                       Dairy farms..............  112111, 11212.........  0241
                                       Broilers, fryers, and      11232.................  0251
                                      roaster chickens.
                                       Chicken eggs.............  11231.................  0252
                                       Turkey and turkey eggs...  11233.................  0253
                                       Poultry hatcheries.......  11234.................  0254
                                       Poultry and eggs, NEC....  11239.................  0259
                                       Ducks....................  112390................  0259
                                       Horses and other equines.  11292.................  0272

[[Page 2961]]


                                     Meat packing or poultry
                                      processing companies that
                                      may be a potential co-
                                      permittee because of
                                      substantial operational
                                      control over a CAFO.
                                       Animal Slaughtering and    3116..................  02
                                      Processing.
                                     Owners or operators of crop
                                      production operations that
                                      may receive CAFO manure
                                      for use as a fertilizer
                                      substitute.
                                       Crop Production..........  111...................  01
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How May I Review the Public Record?

    The record (including supporting documentation) for this proposed 
rule is filed under docket number OW-00-27 (proposed rule). The record 
is available for inspection from 9 a.m. to 4 p.m. on Monday through 
Friday, excluding legal holidays, at the Water Docket, Room EB 57, 
USEPA Headquarters, 401 M Street, SW, Washington, DC 20460. For access 
to docket materials, please call (202) 260-3027 to schedule an 
appointment during the hours of operation stated above.

How May I Submit Comments?

    To ensure that EPA can read, understand, and therefore properly 
respond to comments, the Agency requests that you cite, where possible, 
the paragraph(s) or sections in the preamble, rule, or supporting 
documents to which each comment refers. You should use a separate 
paragraph for each issue discussed.
    If you want EPA to acknowledge receipt of your comments, enclose a 
self-addressed, stamped envelope. No faxes will be accepted. Comments 
may also be submitted electronically to CAFOS.comments@epa.gov. 
Electronic comments must be submitted as an ASCII, WordPerfect 5.1, 
WP6.1, or WP8 file avoiding the use of special characters and forms of 
encryption. Electronic comments must be identified by the docket number 
OW-00-27. EPA will accept comments and data on disks in WordPerfect 
5.1, 6.1, or 8 format or in ASCII file format. Electronic comments on 
this notice may be filed on-line at many Federal depository libraries.

Table of Contents

I. Legal Authority.
II. Purpose and Summary of the Proposed Regulation.
III. Background.
    A. The Clean Water Act.
    B. History of EPA Actions to Address CAFOs.
    C. Which Requirements Apply to CAFOs.
    D. How Do Today's Proposed Revisions Compare to the Unified 
National AFO Strategy?
IV. Why is EPA Changing the Effluent Guidelines for Feedlots and the 
NPDES CAFO Regulations?
    A. Main Reasons for Revising the Existing Regulations.
    B. Water Quality Impairment Associated with Manure Discharge and 
Runoff.
    C. Recent Changes in the Livestock and Poultry Industry.
    D. Improve Effectiveness of Regulations.
V. What Environmental and Human Health Impacts are Potentially 
Caused by CAFOs?
    A. Which Pollutants Do CAFOs Have the Potential to Discharge and 
Why are They of Concern?
    B. How Do These Pollutants Reach Surface Waters?
    C. What are the Potential and Observed Impacts?
VI. What are Key Characteristics of the Livestock and Poultry 
Industries?
    A. Introduction and Overview.
    B. Beef Subcategory.
    C. Dairy Subcategory.
    D. Hog Subcategory.
    E. Poultry Subcategory.
VII. What Changes to the NPDES CAFO Regulations are Being Proposed?
    A. Summary of Proposed NPDES Regulations.
    B. What Size AFOs Would be Considered CAFOs?
    C. Changes to the NPDES Regulations.
    D. Land Application of CAFO-generated Manure.
    E. What are the Terms of an NPDES Permit?
    F. What Type of NPDES Permit is Appropriate for CAFOs?
VIII.What Changes to the Feedlot Effluent Limitations Guidelines are 
Being Proposed?
    A. Expedited Guidelines Approach.
    B. Changes to Effluent Guidelines Applicability.
    C. Changes to Effluent Limitations and Standards.
IX. Implementation of Revised Regulations.
    A. How do the Proposed Changes Affect State CAFO Programs?
    B. How Would EPA's Proposal to Designate CAFOs Affect NPDES 
Authorized States?
    C. How and When Will the Revised Regulations be Implemented?
    D. How Many CAFOs are Likely to be Permitted in Each State and 
EPA Region?
    E. Funding Issues.
    F. What Provisions are Made for Upset and Bypass?
    G. How Would an Applicant Apply for Variances and Modifications 
to Today's Proposed Regulation?
X. What are the Costs and Economic Impacts of the Proposed 
Revisions?
    A. Introduction and Overview.
    B. Data Collection Activities.
    C. Method for Estimating Compliance Costs.
    D. Method for Estimating Economic Impacts.
    E. Estimated Annual Costs of the Proposed Regulatory Options/
Scenarios.
    F. Estimated Economic Impacts of the Proposed Regulatory 
Options/Scenarios.
    G. Additional Impacts.
    H. Cost-Effectiveness Analysis.
    I. Cost-Benefit Analysis.
    J. Initial Regulatory Flexibility Analysis.
XI. What are the Environmental Benefits of the Proposed Revisions?
    A. Non-Water Quality Environmental Impacts.
    B. Quantitative and Monetized Benefits.
XII. Public Outreach.
    A. Introduction and Overview.
    B. Joint USDA/EPA Unified AFO Strategy Listening Sessions.
    C. Advisory Committee Meeting.
    D. Farm Site Visits.
    E. Industry Trade Associations.
    F. CAFO Regulation Workgroup.
    G. Small Business Advocacy Review Panel.
XIII. Administrative Requirements.
    A. Executive Order 12866: ``Regulatory Planning and Review''.
    B. Regulatory Flexibility Act (RFA) as Amended by the Small 
Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), 5 
U.S.C. 601 et seq.
    C. Unfunded Mandates Reform Act.
    D. Executive Order 13045: ``Protection of Children from 
Environmental Health Risks and Safety Risks''.
    E. Executive Order 13084: Consultation and Coordination with 
Indian Tribal Governments.
    F. Paperwork Reduction Act.
    G. Executive Order 13132: ``Federalism''.
    H. Executive Order 12898: ``Federal Actions to Address 
Environmental Justice in Minority Populations and Low-Income 
Populations''.
    I. National Technology Transfer and Advancement Act.
XIV. Solicitation of Comments.
    A. Specific Solicitation of Comment and Data.
    B. General Solicitation of Comment.

I. Legal Authority

    Today's proposed rule is issued under the authority of sections 
301, 304, 306, 307, 308, 402, and 501 of the Clean

[[Page 2962]]

Water Act (CWA), 33 U.S.C. 1311, 1314, 1316, 1317, 1318, 1342, and 
1361.

II. Purpose and Summary of the Proposed Regulation

    Today, the Environmental Protection Agency proposes to revise and 
update two regulations that address the impacts on water quality from 
manure, wastewater, and other process waters generated by concentrated 
animal feeding operations (CAFOs). The National Pollutant Discharge 
Elimination System (NPDES) provisions in 40 CFR Part 122 define which 
operations are CAFOs and establish permit requirements for those 
operation. The Effluent Limitations Guidelines (ELG), or effluent 
guidelines, for feedlots in 40 CFR Part 412 establish technology-based 
effluent discharge standards that are applied to CAFOs. Both 
regulations were originally promulgated in the 1970s. EPA is proposing 
revisions to these regulations to address changes that have occurred in 
the animal industry sectors over the last 25 years, to clarify and 
improve implementation of CAFO permit requirements, and to improve the 
environmental protection achieved under these rules.
    Environmental concerns being addressed by this rule include both 
ecological and human health effects. Manure from stockpiles, lagoons, 
or excessive land application rates can reach waterways through runoff, 
erosion, spills, or via groundwater. These discharges can result in 
excessive nutrients (nitrogen, phosphorus, and potassium), oxygen-
depleting substances, and other pollutants in the water. This pollution 
can kill fish and shellfish, cause excess algae growth, harm marine 
mammals, and contaminate drinking water.
    On October 30, 1989, Natural Resources Defense Council, Inc., and 
Public Citizen, Inc., filed an action against EPA in which they 
alleged, among other things, that EPA had failed to comply with CWA 
section 304(m). Natural Resources Defense Council, Inc., et al. v. 
Reilly, Civ. No. 89-2980 (RCL) (D.D.C.). Plaintiffs and EPA agreed to a 
settlement of that action in a consent decree entered on January 31, 
1992. The consent decree, which has been modified several times, 
established a schedule by which EPA is to propose and take final action 
for eleven point source categories identified by name in the decree and 
for eight other point source categories identified only as new or 
revised rules, numbered 5 through 12. After completing a preliminary 
study of the feedlots industry under the decree, EPA selected the swine 
and poultry portion of the feedlots industry as the subject for New or 
Revised Rule #8, and the beef and dairy portion of that industry as the 
subject for New or Revised Rule #9. Under the decree, as modified, the 
Administrator was required to sign a proposed rule for both portions of 
the feedlots industry on or before December 15, 2000, and must take 
final action on that proposal no later than December 15, 2002. As part 
of EPA's negotiations with the plaintiffs regarding the deadlines for 
this rulemaking, EPA entered into a settlement agreement dated December 
6, 1999, under which EPA agreed, by December 15, 2000, to also propose 
to revise the existing NPDES permitting regulations under 40 C.F.R. 
part 122 for CAFOs. EPA also agreed to perform certain evaluations, 
analyses or assessments and to develop certain preliminary options in 
connection with the proposed CAFO rules. (The Settlement Agreement 
expressly provides that nothing in the Agreement requires EPA to select 
any of these options as the basis for its proposed rule.)
    The existing regulation defines facilities with 1,000 animal units 
(``AU'') or more as CAFOs. The regulation also states that facilities 
with 300-1000 AU are CAFOs if they meet certain conditions. The term AU 
is a measurement established in the 1970 regulations that attempted to 
equalize the characteristics of the wastes among different animal 
types.
    Today's proposals presents two alternatives for how to structure 
the revised NPDES program for CAFOs. The first alternative is a ``two-
tier structure'' that simplifies the definition of CAFOs by 
establishing a single threshold for each animal sector. This 
alternative would establish a single threshold at the equivalent of 500 
AU above which operations would be defined as CAFOs and below which 
facilities would become CAFOs only if designated by the permit 
authority. The 500 AU equivalent for each animal sector would be as 
follows.

500 cattle excluding mature dairy or veal cattle
500 veal cattle
350 mature dairy cattle (whether milked or dry)
1,250 mature swine weighing over 55 pounds
5,000 immature swine weighing 55 pounds or less
50,000 chickens
27,500 turkeys
2,500 ducks
250 horses
5,000 sheep or lambs

    The second proposal would retain the ``three-tier structure'' of 
the existing regulation. Under this alternative, all operations with 
1,000 AU or more would be defined as CAFOs; those with 300 AU to 1,000 
AU would be CAFOs only if they meet certain conditions or if designated 
by the permit authority; and those with fewer than 300 AU would only be 
CAFOs if designated by the permit authority. These conditions are 
detailed in section VII of this preamble and differ from those in the 
current rule. Facilities with 300 AU to 1,000 AU would certify that 
they do not meet the conditions for being defined as a CAFO or apply 
for a permit. The 300 AU and 1,000 AU equivalent number of animals for 
each sector would be as follows:

------------------------------------------------------------------------
                                             1,000 AU         300 AU
                                            equivalent      equivalent
               Animal type                    (no. of         (no. of
                                             animals)        animals)
------------------------------------------------------------------------
Cattle excluding mature dairy or veal              1,000             300
 cattle.................................
Veal....................................           1,000             300
Mature Dairy Cattle.....................             700             200
Swine weighing more than 55 pounds......           2,500             750
Swine weighing 55 pounds or less........          10,000           3,000
Chickens................................         100,000          30,000
Turkeys.................................          55,000          16,500
Ducks...................................           5,000           1,500
Horses..................................             500             150
Sheep or Lambs..........................          10,000           3,000
------------------------------------------------------------------------


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    The Agency is also taking comment on two other alternatives that 
the Agency is considering and may pursue after evaluating comments.
    Today's proposal would also expand the regulatory definition of 
CAFOs to include all types of poultry operations regardless of the type 
of manure handling system or watering system they use, and also would 
include standalone immature swine and heifer operations.
    Under the two-tier proposal, EPA is proposing to simplify the 
criteria for being designated as a CAFO by eliminating two specific 
criteria that have proven difficult to implement, the ``direct 
contact'' criterion and the ``man made device'' criterion. Under the 
three-tier proposal, EPA is proposing to retain those criteria for 
designating operations which have less than 300 AU. Both proposals 
retain the existing requirement for the permit authority to consider a 
number of factors to determine whether the facility is a significant 
contributor of pollution to waters of the U.S., and the requirement for 
an on-site inspection prior to designation. EPA is also proposing to 
clarify that EPA has the authority to designate CAFOs both in states 
where EPA is the permit authority and in States with NPDES authorized 
programs.
    EPA is proposing to eliminate the 25-year, 24-hour storm event 
permit exclusion and to impose a broader, more explicit duty for all 
CAFOs to apply for a permit (with one exception as described below). 
Under the current regulations, facilities are excluded from being 
defined as, and thus subject to permitting as, CAFOs if they discharge 
only in the event of a 25-year, 24-hour storm. This exclusion has 
proven to be problematic in practice, as described below, and 
ultimately unnecessary. There are many operations that currently may be 
avoiding permitting by an inappropriate reliance on this exclusion. The 
Agency believes there is no reason to retain this exclusion from the 
definition of a CAFO. However, EPA is proposing to retain the 25-year, 
24-hour storm standard as a design standard in the effluent guidelines 
for certain sectors (specifically, the beef and dairy sectors). CAFOs 
in those sectors would need to obtain permits, but the permits would 
allow certain discharges as long as the facility met the 25-year, 24-
hour storm design standard.
    In sum, under today's proposal, all operations that meet the 
definition of a CAFO under either of the two alternative structures (as 
well as all operations that are designated as CAFOs) would be required 
to apply for a permit. There would, however, be one exception to this 
requirement, as described in more detail below: If the operator could 
demonstrate to the permitting authority that the facility has ``no 
potential to discharge,'' then a permit application and a permit would 
not be required.
    Under the two-tier structure, the net effect of the revisions for 
determining which facilities are CAFOs is to require approximately 
26,000 operations to apply for a NPDES permit. Under the three-tier 
structure, EPA estimates that approximately 13,000 operations would be 
required to apply for a permit, and an additional 26,000 operations 
could either certify that they are not a CAFO or apply for a permit. 
Under the existing regulation, EPA estimates that about 12,000 
facilities should be permitted but only 2,530 have actually applied for 
a permit.
    Today's proposal would clarify the definition of a CAFO as 
including both the production areas (animal confinement areas, manure 
storage areas, raw materials storage areas and waste containment areas) 
and the land application areas that are under the control of the CAFO 
owner or operator. As the industry trend is to larger, more specialized 
feedlots with less cropland needing the manure for fertilizer, EPA is 
concerned that manure is being land applied in excess of agricultural 
uses and, therefore, being managed as a waste product, and that this 
practice is causing runoff or leaching to waters of the U.S. The permit 
would address practices at the production area as well as the land 
application area, and would impose record keeping and other 
requirements with regard to transfer of manure off-site.
    EPA is further proposing to clarify that entities that exercise 
``substantial operational control'' over the CAFO are ``operators'' of 
the CAFO and thus would need to obtain a permit along with the CAFO 
owner or operator. The trend toward specialized animal production under 
contract with processors, packers and other integrators has 
increasingly resulted in concentrations of excess manure beyond 
agricultural needs in certain geographic areas. Especially in the 
poultry and swine sector, the processor provides the animals, feed, 
medication and/or specifies growing practices. EPA believes that 
clarifying that both parties are liable for compliance with the terms 
of the permit as well as responsible for the excess manure generated by 
CAFOs will lead to better management of manure.
    The proposed effluent guidelines revisions would apply only to 
beef, dairy, swine, poultry and veal operations that are defined or 
designated as CAFOs under either of the two alternative structures and 
that are above the threshold for the effluent guideline. For those 
CAFOs below the threshold for being subject to the effluent guidelines, 
the permit writer would use best professional judgment (BPJ) to develop 
the site-specific permit conditions.
    Today's proposed effluent guidelines revisions would not alter the 
existing effluent guideline regulations for horses, ducks, sheep or 
lambs. In these sectors, only facilities with 1,000 AU or more are 
subject to the effluent guidelines. Permits for operations in these 
subcategories with fewer than 1,000 AU would continue to be developed 
based on the best professional judgement of the permit writer.
    The proposed effluent guidelines regulations for beef, dairy, 
swine, poultry and veal operations will establish the Best Practicable 
Control Technology (BPT), Best Conventional Pollutant Control 
Technology (BCT), and the Best Available Technology (BAT) limitations 
as well as New Source Performance Standards, including specific best 
management practices which ensure that manure storage and handling 
systems are inspected and maintained adequately. A description of these 
requirements is in Section III.
    Under the BPT requirements for all of the subcategories, EPA is 
proposing to require zero discharge from the production area except 
that an overflow due to catastrophic or chronic storms would be allowed 
if the CAFO met a certain design standard for its containment 
structures. If a CAFO uses a liquid manure handling system, the storage 
structure or lagoon would be required to be designed, constructed and 
maintained to capture all process wastewater and manure, plus all the 
storm water runoff from the 25-year, 24-hour storm.
    The proposed BPT limitations also include specific requirements on 
the application of manure and wastewater to land that is owned or under 
the operational control of the CAFO. EPA is proposing to require that 
CAFOs apply their manure at a rate calculated to meet the requirements 
of the crop for either nitrogen or phosphorus (depending on the soil 
conditions for phosphorus). Livestock manure tends to be phosphorus 
rich, meaning that if manure is applied to meet the nitrogen 
requirements of a crop, then phosphorus is being applied at rates 
higher than needed by the crop. Repeated application of manure on a 
nitrogen basis may build up phosphorus levels in

[[Page 2964]]

the soil, and potentially result in saturation, thus contributing to 
the contamination of surface waters through erosion, snow melt and 
rainfall events. Therefore, EPA is also proposing that manure must be 
applied to cropland at rates not to exceed the crop requirements for 
nutrients and the ability of the soil to absorb any excess phosphorus. 
BPT establishes specific record keeping requirements associated with 
ensuring the achievement of the zero discharge limitation for the 
production area and that the application of manure and wastewater is 
done in accordance with land application requirements. EPA also 
proposes to require the CAFO operator to maintain records of any excess 
manure that is transported off-site.
    BAT limitations for the beef and dairy subcategories would include 
all of the BPT limitations described above and, in addition, would 
require CAFOs to achieve zero discharge to ground water beneath the 
production area that has a direct hydrologic connection to surface 
water. In addition, the proposed BAT requirements for the swine, veal 
and poultry subcategories would eliminate the provision for overflow in 
the event of a chronic or catastrophic storm. CAFOs in the swine, veal 
and poultry subcategories typically house their animals under roof 
instead of in open areas, thus avoiding or minimizing the runoff of 
contaminated storm water and the need to contain storm water.
    EPA is also proposing to revise New Source Performance Standards 
(NSPS) based on the same technology requirements as BAT for the beef 
and dairy subcategories. For the swine, veal and poultry subcategories, 
EPA proposes revised NSPS based on the same technology as BAT with the 
additional requirement that there be no discharge of pollutants through 
ground water beneath the production area that has a direct hydrological 
connection to surface waters. Both the BAT and NSPS requirements have 
the same land application and record keeping requirements as proposed 
for BPT.
    Today's proposal would make several other changes to the existing 
regulation, which would:
     require the CAFO operator to develop a Permit Nutrient 
Plan for managing manure and wastewater at both the production area and 
the land application area;
     require certain record keeping, reporting, and monitoring;
     revise the definition of an animal feeding operation (AFO) 
to more clearly exclude areas such as pastures and rangeland that 
sustain crops or forage during the entire time that animals are 
present;
     eliminate the mixed-animal type calculation for 
determining which AFOs are CAFOs; and
     require permit authorities to include the following 
conditions in permits to:
    (1) require retention of a permit until proper facility closure; 
(2) establish the method for operators to calculate the allowable 
manure application rate; (3) specify restrictions on timing and methods 
of application of manure and wastewater to assure use for an 
agricultural purpose (e.g., certain applications to frozen, snow 
covered or saturated land) to prevent impairment of water quality; (4) 
address risk of contamination via groundwater with a direct 
hydrological connection to surface water; (5) address the risk of 
improper manure application off-site by either requiring that the CAFO 
operator obtain from off-site recipients a certification that they are 
land applying CAFO manure according to proper agricultural practices or 
requiring the CAFO to provide information to manure recipients and keep 
appropriate records of off-site transfers, or both; and (6) establish 
design standards to account for chronic storm events.
    Today's proposal would also:
     clarify EPA's interpretation of the agricultural storm 
water exemption and its implications for land application of manure 
both at the CAFO and off-site; and
     clarify application of the CWA to dry weather discharges 
at AFOs.
    EPA is seeking comment on the entire proposal. Throughout the 
preamble, EPA identifies specific components of the proposed rule on 
which comment is particularly sought.

III. Background

A. The Clean Water Act

    Congress passed the Federal Water Pollution Control Act (1972), 
also known as the Clean Water Act (CWA), to ``restore and maintain the 
chemical, physical, and biological integrity of the nation's waters.'' 
(33 U.S.C. Sec. 1251(a)). The CWA establishes a comprehensive program 
for protecting our nation's waters. Among its core provisions, the CWA 
prohibits the discharge of pollutants from a point source to waters of 
the U.S. except as authorized by a National Pollutant Discharge 
Elimination System (NPDES) permit. The CWA establishes the NPDES permit 
program to authorize and regulate the discharges of pollutants to 
waters of the U.S. EPA has issued comprehensive regulations that 
implement the NPDES program at 40 CFR Part 122. The CWA also provides 
for the development of technology-based and water quality-based 
effluent limitations that are imposed through NPDES permits to control 
discharges of pollutants.
1. The National Pollutant Discharge Elimination System (NPDES) Permit 
Program
    Under the NPDES permit program, all point sources that directly 
discharge pollutants to waters of the U.S. must apply for a NPDES 
permit and may only discharge pollutants in compliance with the terms 
of that permit. Such permits must include any nationally established, 
technology based effluent discharge limitations (i.e., effluent 
guidelines) (discussed below, in subsection III.A.2). In the absence of 
national effluent limitations, NPDES permit writers must establish 
technology based limitations and standards on a case-by-case basis, 
based on their ``best professional judgement (BPJ).''
    Water quality-based effluent limits also are included in a permit 
where technology-based limits are not sufficient to ensure compliance 
with State water quality standards that apply to the receiving water or 
where required to implement a Total Maximum Daily Load (TMDL). Permits 
may also include specific best management practices to achieve effluent 
limitations and standards, typically included as special conditions. In 
addition, NPDES permits normally include monitoring and reporting 
requirements, and standard conditions (i.e., conditions that apply to 
all NPDES permits, such as the duty to properly operate and maintain 
equipment and treatment systems).
    NPDES permits may be issued by EPA or a State, Territory, or Tribe 
authorized by EPA to implement the NPDES program. Currently, 43 States 
and the Virgin Islands are authorized to administer the base NPDES 
program (the base program includes the federal requirements applicable 
to AFOs and CAFOs). Alaska, Arizona, the District of Columbia, Idaho, 
Maine, Massachusetts, New Hampshire, and New Mexico are not currently 
authorized to implement the NPDES program. In addition, Oklahoma, while 
authorized to administer the NPDES program, does not have CAFO 
regulatory authority. No tribe is currently authorized.
    A NPDES permit may be either an individual permit tailored for a 
single facility or a general permit applicable to multiple facilities 
within a specific category. Prior to the issuance of an individual 
permit, the owner or operator submits a permit application with 
facility-specific information to the

[[Page 2965]]

permit authority, who reviews the information and prepares a draft 
permit. The permit authority prepares a fact sheet explaining the draft 
permit, and publishes the draft permit and fact sheet for public review 
and comment. Following consideration of public comments by the permit 
authority, a final permit is issued. Specific procedural requirements 
apply to the modification, revocation and reissuance, and termination 
of a NPDES permit. NPDES permits are subject to a maximum 5-year term.
    General NPDES permits are available to address a category of 
discharges that involve similar operations with similar wastes. General 
permits are not developed based on facility-specific information. 
Instead, they are developed based on data that characterize the type of 
operations being addressed and the pollutants being discharged. Once a 
general permit is drafted, it is published for public review and 
comment accompanied by a fact sheet that explains the permit. Following 
EPA or State permit authority consideration of public comments, a final 
general permit is issued. The general permit specifies the type or 
category of facilities that may obtain coverage under the permit. Those 
facilities that fall within this category then must submit a ``notice 
of intent'' (NOI) to be covered under the general permit to gain permit 
coverage. [Under 40 CFR 122.28(b)(2)(vi), the permit authority also may 
notify a discharger that it is covered under a general permit even 
where that discharger has not submitted a notice of intent to be 
covered by the permit.] EPA anticipates that the Agency and authorized 
States will use general NPDES permits to a greater extent than 
individual permits to address CAFOs.
2. Effluent Limitation Guidelines and Standards
    Effluent limitation guidelines and standards (which we also refer 
to today as ``effluent guidelines'' or ``ELG'') are national 
regulations that establish limitations on the discharge of pollutants 
by industrial category and subcategory. These limitations are 
subsequently incorporated into NPDES permits. The effluent guidelines 
are based on the degree of control that can be achieved using various 
levels of pollution control technology, as outlined below. The effluent 
guidelines may also include non-numeric effluent limitations in the 
form of best management practices requirements or directly impose best 
management practices as appropriate.
    a. Best Practicable Control Technology Currently Available (BPT)--
Section 304(b)(1) of the CWA. In the guidelines for an industry 
category, EPA defines BPT effluent limits for conventional, toxic, and 
non-conventional pollutants. In specifying BPT, EPA looks at a number 
of factors. EPA first considers the cost of achieving effluent 
reductions in relation to the effluent reduction benefits. The Agency 
also considers the age of the equipment and facilities, the processes 
employed and any required process changes, engineering aspects of the 
control technologies, non-water quality environmental impacts 
(including energy requirements), and such other factors as the Agency 
deems appropriate (CWA 304(b)(1)(B)). Traditionally, EPA establishes 
BPT effluent limitations based on the average of the best performances 
of facilities within the industry of various ages, sizes, processes or 
other common characteristics. Where existing performance is uniformly 
inadequate, EPA may require higher levels of control than currently in 
place in an industrial category if the Agency determines that the 
technology can be practically applied.
    b. Best Available Technology Economically Achievable (BAT)--Section 
304(b)(2) of the CWA. In general, BAT effluent limitations represent 
the best existing economically achievable performance of direct 
discharging plants in the industrial subcategory or category. The 
factors considered in assessing BAT include the cost of achieving BAT 
effluent reductions, the age of equipment and facilities involved, the 
processes employed, engineering aspects of the control technology, 
potential process changes, non-water quality environmental impacts 
(including energy requirements), and such factors as the Administrator 
deems appropriate. The Agency retains considerable discretion in 
assigning the weight to be accorded to these factors. An additional 
statutory factor considered in setting BAT is economic achievability. 
Generally, the achievability is determined on the basis of the total 
cost to the industrial subcategory and the overall effect of the rule 
on the industry's financial health. BAT limitations may be based on 
effluent reductions attainable through changes in a facility's 
processes and operations. As with BPT, where existing performance is 
uniformly inadequate, BAT may be based on technology transferred from a 
different subcategory within an industry or from another industrial 
category. BAT may be based on process changes or internal controls, 
even when these technologies are not common industry practice.
    c. Best Conventional Pollutant Control Technology (BCT)--Section 
304(b)(4) of the CWA. The 1977 amendments to the CWA required EPA to 
identify effluent reduction levels for conventional pollutants 
associated with BCT technology for discharges from existing industrial 
point sources. BCT is not an additional limitation, but replaces Best 
Available Technology (BAT) for control of conventional pollutants. In 
addition to other factors specified in Section 304(b)(4)(B), the CWA 
requires that EPA establish BCT limitations after consideration of a 
two part ``cost-reasonableness'' test. EPA explained its methodology 
for the development of BCT limitations in July 1986 (51 FR 24974). 
Section 304(a)(4) designates the following as conventional pollutants: 
biochemical oxygen demand (BOD5), total suspended solids 
(TSS), fecal coliform, pH, and any additional pollutants defined by the 
Administrator as conventional. The Administrator designated oil and 
grease as an additional conventional pollutant on July 30, 1979 (44 FR 
44501).
    d. New Source Performance Standards (NSPS)--Section 306 of the CWA. 
NSPS reflect effluent reductions that are achievable based on the best 
available demonstrated control technology. New facilities have the 
opportunity to install the best and most efficient production processes 
and wastewater treatment technologies. As a result, NSPS should 
represent the greatest degree of effluent reduction attainable through 
the application of the best available demonstrated control technology 
for all pollutants (i.e., conventional, non-conventional, and priority 
pollutants). In establishing NSPS, EPA is directed to take into 
consideration the cost of achieving the effluent reduction and any non-
water quality environmental impacts and energy requirements.

B. History of EPA Actions to Address CAFOs

    EPA's regulation of wastewater and manure from CAFOs dates to the 
1970s. The existing NPDES CAFO regulations were issued on March 18, 
1976 (41 FR 11458). The existing national effluent limitations 
guideline and standards for feedlots were issued on February 14, 1974 
(39 FR 5704).
    By 1992, it became apparent that the regulation and permitting of 
CAFOs needed review due to changes in the livestock industry, 
specifically the consolidation of the industry into fewer, but larger 
operations. In 1992, the Agency established a workgroup

[[Page 2966]]

composed of representatives of State agencies, EPA regional staff and 
EPA headquarters staff to address issues related to CAFOs. The 
workgroup issued The Report of the EPA/State Feedlot Workgroup in 1993. 
One of the workgroup's recommendations was that the Agency should 
provide additional guidance on how CAFOs are regulated under the NPDES 
permit program. The Agency issued such guidance, entitled Guide Manual 
On NPDES Regulations For Concentrated Animal Feeding Operations, in 
December 1995.
    Massive spills of hog manure (see Section V.B.1.c) and Pfiesteria 
outbreaks (see Section V.C.1.a.), continued industry consolidation, and 
increased public awareness of the potential environmental and public 
health impacts of animal feeding operations resulted in EPA taking more 
comprehensive actions to improve existing regulatory and voluntary 
programs. In 1997, dialogues were initiated between EPA and the poultry 
and pork livestock sectors. On December 12, 1997, the Pork Dialogue 
participants, including representatives from the National Pork 
Producers Council (NPPC) and officials from EPA, U.S. Department of 
Agriculture (USDA), and several States, issued a Comprehensive 
Environmental Framework for Pork Production Operations. Continued 
discussions between EPA and the NPPC led to development of a Compliance 
Audit Program Agreement (CAP Agreement) that is available to any pork 
producer who participates in NPPC's environmental assessment program. 
The CAP Agreement for pork producers was issued by the Agency on 
November 24, 1998. Under the agreement, pork producers that voluntarily 
have their facilities inspected are eligible for reduced penalties for 
any CWA violations discovered and corrected. The Poultry Dialogue 
produced a report in December 1998 that established a voluntary program 
focused on promoting protection of the environment and water quality 
through implementation of litter management plans and other actions: 
Environmental Framework and Implementation Strategy: A Voluntary 
Program Developed and adopted by the Poultry Industry, Adopted at the 
December 8-9, 1998 meeting of the Poultry Industry Environmental 
Dialogue (U.S. Poultry and Egg Association).
    President Clinton and Vice President Gore announced the Clean Water 
Action Plan (CWAP) on February 19, 1998. The CWAP describes the key 
water quality problems our nation faces today and suggests both a broad 
plan and specific actions for addressing these problems. The CWAP 
indicated that polluted runoff is the greatest source of water quality 
problems in the United States today and that stronger polluted runoff 
controls are needed. The CWAP goes on to state that one important 
aspect of such controls is the expansion of CWA permit controls, 
including those applicable to large facilities such as CAFOs.
    The CWAP included two key action items that address animal feeding 
operations (AFOs). First, it stated that EPA should publish and, upon 
considering public comments, implement an AFO strategy for important 
and necessary EPA actions on standards and permits. EPA published a 
Draft Strategy for Addressing Environmental and Public Health Impacts 
from Animal Feeding Operations in March 1998 (draft AFO Strategy). In 
accordance with EPA's draft AFO Strategy, EPA's Office of Enforcement 
and Compliance Assurance (OECA) also issued the Compliance Assurance 
Implementation Plan for Animal Feeding Operations in March 1998. This 
plan describes compliance and enforcement efforts being undertaken to 
ensure that CAFOs comply with existing CWA regulations. Second, the 
CWAP stated that EPA and USDA should jointly develop a unified national 
strategy to minimize the water quality and public health impacts of 
AFOs. EPA and USDA jointly published a draft Unified National Strategy 
for Animal Feeding Operations (hereinafter Unified National AFO 
Strategy) on September 21, 1998 and, after sponsoring and participating 
in 11 public listening sessions and considering public comments on the 
draft strategy, published a final Unified National AFO Strategy on 
March 9, 1999. This joint strategy was generally consistent with and 
superceded EPA's draft AFO Strategy.
    The Unified National AFO Strategy establishes national goals and 
performance expectations for all AFOs. The general goal is for AFO 
owners and operators to take actions to minimize water pollution from 
confinement facilities and land where manure is applied. To accomplish 
this goal, the AFO Strategy established a national performance 
expectation that all AFOs should develop and implement technically 
sound, economically feasible, and site-specific comprehensive nutrient 
management plans (CNMPs) to minimize impacts on water quality and 
public health.
    The Unified National AFO Strategy identified seven strategic issues 
that should be addressed to better resolve concerns associated with 
AFOs. These include: (1) fostering CNMP development and implementation; 
(2) accelerating voluntary, incentive-based programs; (3) implementing 
and improving the existing regulatory program; (4) coordinating 
research, technical innovation, compliance assistance, and technology 
transfer; (5) encouraging industry leadership; (6) increasing data 
coordination; and (7) establishing better performance measures and 
greater accountability. Today's proposed rule primarily addresses 
strategic issue three: implementing and improving the existing AFO 
regulatory program.
    The Unified National AFO Strategy observed that, for the majority 
of AFOs (estimated in the AFO Strategy as 95 percent), voluntary 
efforts founded on locally led conservation, education, and technical 
and financial assistance would be the principal approach for assisting 
owners and operators in developing and implementing site-specific CNMPs 
and reducing water pollution and public health risks. Future regulatory 
programs would focus permitting and enforcement priorities on high risk 
operations, which were expected to constitute the remaining 5 percent. 
EPA estimates that today's proposal would result in permit coverage for 
approximately 7 percent of AFOs under the two-tier structure, and 
between 4.5 percent and 8.5 percent of AFOs under the three-tier 
structure.
    Following publication of the Unified National AFO Strategy, EPA 
issued on August 6, 1999 the Draft Guidance Manual and Example NPDES 
Permit for CAFOs for a 90-day public comment period. EPA undertook 
development of this new guidance manual in order to provide permit 
writers with improved guidance on applying the existing regulations to 
a changing industry. While the guidance manual has not been finalized, 
many of the issues discussed in the draft guidance manual are also 
addresses in today's preamble. EPA expects to issue final, revised 
permitting guidance to reflect the revised CAFO regulations when they 
are published in final form.

C. What Requirements Apply to CAFOs?

    The discussion below provides an overview of the scope and 
requirements imposed under the existing NPDES CAFO regulations and 
feedlot effluent limitations guidelines. It also explains the 
relationship of these two regulations, and summarizes other federal and 
State regulations that potentially affect AFOs.

[[Page 2967]]

1. What are the Scope and Requirements of the Existing NPDES 
Regulations for CAFOs?
    Under existing 40 CFR 122.23, an operation must be defined as an 
animal feeding operation (AFO) before it can be defined as a 
concentrated animal feeding operation (CAFO). The term ``animal feeding 
operation'' is defined in EPA regulations as a ``lot or facility'' 
where animals ``have been, are, or will be stabled or confined and fed 
or maintained for a total of 45 days or more in any 12 month period and 
crops, vegetation[,] forage growth, or post-harvest residues are not 
sustained in the normal growing season over any portion of the lot or 
facility.'' This definition is intended to enable the NPDES authorized 
permitting authority to regulate facilities where animals are stabled 
or confined and waste is generated.
    Once a facility meets the AFO definition, its size, based upon the 
total numbers of animals confined, is a key factor in determining 
whether it is a CAFO. To define these various livestock sectors, EPA 
established the concept of an ``animal unit'' (AU), which varies 
according to animal type. Each livestock type, except poultry, is 
assigned a multiplication factor to facilitate determining the total 
number of AU at a facility with more than one animal type. These 
multiplication factors are as follows: Slaughter and feeder cattle--
1.0, Mature dairy cattle--1.4, Swine weighing over 25 kilograms 
(approximately 55 pounds)--0.4, Sheep--0.1, Horses--2.0. There are 
currently no animal unit conversions for poultry operations. The 
regulations, however, define the total number of animals (subject to 
waste handling technology restrictions) for specific poultry types that 
make these operations subject to the regulation. (40 CFR Part 122, 
Appendix B).
    Under the existing regulations, an animal feeding operation is a 
concentrated animal feeding operation if it meets the regulatory CAFO 
definition or if it is designated as a CAFO. The regulations 
automatically define an AFO to be a CAFO if either more than 1,000 AU 
are confined at the facility, or more than 300 AU are confined at the 
facility and: (1) pollutants are discharged into navigable waters 
through a manmade ditch, flushing system, or other similar man-made 
device; or (2) pollutants are discharged directly into waters that 
originate outside of and pass over, across, or through the facility or 
come into direct contact with the confined animals. However, no animal 
feeding operation is defined as a CAFO if it discharges only in the 
event of a 25-year, 24-hour storm event (although it sill may be 
designated as a CAFO). Although they are not automatically defined as a 
CAFO, facilities still may be designated as a CAFO even if they 
discharge only in a 25-year, 24-hour storm event.
    An AFO can also become a CAFO through designation. The NPDES 
permitting authority may, on a case-by-case basis, after conducting an 
on-site inspection, designate any AFO as a CAFO based on a finding that 
the facility ``is a significant contributor of pollution to the waters 
of the United States.'' (40 CFR 122.23(c)). Pursuant to 40 CFR 
122.23(c)(1)(i)-(v) the permitting authority shall consider several 
factors making this determination, including: (1) the size of the 
operation, and amount of waste reaching waters of the U.S.; (2) the 
location of the operation relative to waters of the U.S.; (3) the means 
of conveyance of animal waste and process waste waters into waters of 
the U.S.; and (4) the slope, vegetation, rainfall and other factors 
affecting frequency of discharge. A facility with 300 animal units or 
less, however, may not be designated as a CAFO unless pollutants are 
discharged into waters of the U.S. through a man-made ditch, flushing 
system, or other similar man-made device, or are discharged directly 
into waters of the U.S. which originate outside of the facility and 
pass over, across or through the facility or otherwise come into direct 
contact with the animals confined in the operation.
    Once defined or designated as a CAFO, the operation is subject to 
NPDES permitting. As described above, a permit contains the specific 
technology-based effluent limitations (whether based on the effluent 
guidelines or BPJ); water quality-based limits if applicable; specific 
best management practices; monitoring and reporting requirements; and 
other standard NPDES conditions.
2. What are the Scope and Requirements of the Existing Feedlot Effluent 
Guidelines?
    In 1974, EPA promulgated effluent limitations guidelines applicable 
to CAFOs (40 CFR Part 412) and established in those regulations the 
technology-based effluent discharge standards for the facilities 
covered by the guidelines. The effluent guidelines for the feedlots 
point source category have two subparts: Subpart B for ducks, and 
Subpart A for all other feedlot animals. Under the existing regulation, 
Subpart A covers: beef cattle; dairy cattle; swine; poultry; sheep; and 
horses. Further, the effluent guidelines apply only to facilities with 
1,000 AU or greater. Today's revisions to the effluent guidelines 
affect only the guidelines for the beef, dairy, swine, poultry and veal 
subcategories, while the NPDES revisions are applicable to all confined 
animal types.
    The current feedlot effluent guidelines based on BAT prohibit 
discharges of process wastewater pollutants to waters of the U.S. 
except when chronic or catastrophic storm events cause an overflow from 
a facility designed, constructed, and operated to hold process-
generated wastewater plus runoff from a 25-year, 24-hours storm event. 
Animal wastes and other wastewater that must be controlled include: (1) 
spillage or overflow from animal or poultry watering systems, washing, 
cleaning, or flushing pens, barns, manure pits, or other feedlot 
facilities, direct contact swimming, washing, or spray cooling of 
animals, and dust control; and (2) precipitation (rain or snow) which 
comes into contact with any manure, litter, or bedding, or any other 
raw material or intermediate or final material or product used in or 
resulting from the production of animals or poultry or direct products 
(e.g., milk or eggs). 40 CFR 412.11.
    As described above, in those cases where the feedlot effluent 
guidelines do not apply to a CAFO (i.e., the operation confines fewer 
than 1,000 animal units), the permit writer must develop, for inclusion 
in the NPDES permit, technology-based limitations based on best 
professional judgement (BPJ).
3. What Requirements May be Imposed on AFOs Under the Coastal Zone Act 
Reauthorization Amendments of 1990 (CZARA)?
    In the Coastal Zone Act Reauthorization Amendments of 1990 (CZARA), 
Congress required States with federally-approved coastal zone 
management programs to develop and implement coastal nonpoint pollution 
control programs. Thirty-three (33) States and Territories currently 
have federally approved Coastal Zone Management programs. Section 
6217(g) of CZARA called for EPA, in consultation with other federal 
agencies, to develop guidance on ``management measures'' for sources of 
nonpoint source pollution in coastal waters. In January 1993, EPA 
issued its Guidance Specifying Management Measures for Sources of 
Nonpoint Pollution in Coastal Waters which addresses five major source 
categories of nonpoint pollution: urban runoff, agriculture runoff, 
forestry runoff, marinas and recreational boating, and 
hydromodification.

[[Page 2968]]

    Within the agriculture runoff nonpoint source category, the EPA 
guidance specifically included management measures applicable to all 
new and existing ``confined animal facilities.'' The guidance 
identifies which facilities constitute large and small confined animal 
facilities based solely on the number of animals or animal units 
confined (the manner of discharge is not considered). Under the CZARA 
guidance: a large beef feedlot contains 300 head or more, a small 
feedlot between 50-299 head; a large dairy contains 70 head or more, a 
small dairy between 20-69 head; a large layer or broiler contains 
15,000 head or more, a small layer or broiler between 5,000-14,999 
head; a large turkey facility contains 13,750 head or more, a small 
turkey facility between 5,000-13,749 head; and a large swine facility 
contains 200 head or more, a small swine facility between 100-199 head.
    The thresholds in the CZARA guidance for identifying large and 
small confined animal facilities are lower than those established for 
defining CAFOs under the current NPDES regulations. Thus, in coastal 
States the CZARA management measures potentially apply to a greater 
number of small facilities than the existing CAFO definition. Despite 
the fact that both the CZARA management measures for confined animal 
facilities and the NPDES CAFO regulations address similar operations, 
these programs do not overlap or conflict with each other. Any CAFO 
facility, defined by 40 CFR Part 122, Appendix B, that has a NPDES CAFO 
permit is exempt from the CZARA program. If a facility subject to CZARA 
management measures is later designated a CAFO by a NPDES permitting 
authority, the facility is no longer subject to CZARA. Thus, an AFO 
cannot be subject to CZARA and NPDES permit requirements at the same 
time.
    EPA's CZARA guidance provides that new confined animal facilities 
and existing large confined animal facilities should limit the 
discharge of facility wastewater and runoff to surface waters by 
storing such wastewater and runoff during storms up to and including 
discharge caused by a 25-year, 24-hour frequency storm. Storage 
structures should have an earthen or plastic lining, be constructed 
with concrete, or constitute a tank. All existing small facilities 
should design and implement systems that will collect solids, reduce 
contaminant concentrations, and reduce runoff to minimize the discharge 
of contaminants in both facility wastewater and in runoff caused by 
storms up to and including a 25-year, 24-hour frequency storm. Existing 
small facilities should substantially reduce pollutant loadings to 
ground water. Both large and small facilities should also manage 
accumulated solids in an appropriate waste utilization system. Approved 
State CZARA programs have management measures in conformity with this 
guidance and enforceable policies and mechanisms as necessary to assure 
their implementation.
    In addition to the confined animal facility management measures, 
the CZARA guidance also includes a nutrient management measure that is 
intended to be applied by States to activities associated with the 
application of nutrients to agricultural lands (including the 
application of manure). The goal of this management measure is to 
minimize edge of field delivery of nutrients and minimize the leaching 
of nutrients from the root zone.
    The nutrient management measures provide for the development, 
implementation, and periodic updating of a nutrient management plan. 
Such plans should address: application of nutrients at rates necessary 
to achieve realistic crop yields; improved timing of nutrient 
application; and the use of agronomic crop production technology to 
increase nutrient use efficiency. Under this management measure, 
nutrient management plans include the following core components: farm 
and field maps showing acreage, crops, and soils; realistic yield 
expectations for the crops to be grown; a summary of the nutrient 
resources available to the producer; an evaluation of field limitations 
based on environmental hazards or concerns; use of the limiting 
nutrient concept to establish the mix of nutrient sources and 
requirements for the crop based on realistic crop expectations; 
identification of timing and application methods for nutrients; and 
provisions for proper calibration and operation of nutrient application 
equipment.
4. How Are CAFOs Regulated By States?
    NPDES permits may be issued by EPA or a State authorized by EPA to 
implement the NPDES program. Currently, 43 States and the Virgin 
Islands are authorized to administer the NPDES program. Oklahoma, 
however, has not been authorized to administer the NPDES program for 
CAFOs.
    To become an authorized NPDES state, the State's requirements must, 
at a minimum, be as stringent as the requirements imposed under the 
federal NPDES program. States, however, may impose requirements that 
are broader in scope or more stringent than the requirements imposed at 
the federal level. In States not authorized to implement the NPDES 
program, the appropriate EPA Regional office is responsible for 
implementing the program.
    State efforts to control pollution from CAFOs have been 
inconsistent to date for a variety of reasons. Many States have only 
recently focused attention on the environmental challenges posed by the 
emergence of increasing consolidation of CAFOs into larger and larger 
operations. Others have traditionally viewed AFOs as agriculture, and 
the reluctance to regulate agriculture has prevented programs from 
keeping pace with a changing industry. Many states have limited 
resources for identifying which facilities are CAFOs, or which may be 
inappropriately claiming the 25-year, 24-hour storm permit exclusion. 
Some states with a large number of broiler and laying operations do not 
aggressively try to permit these facilities under NPDES because the 
technology requirements for these operations in the existing regulation 
are outdated.
    Another reason States may not have issued NPDES permits to CAFOs is 
the concern over potentially causing operations to lose cost-share 
money available under EPA's Section 319 Nonpoint Source Program and 
other assistance under USDA's Environmental Quality Incentive Program 
(EQIP). Once a facility is considered a point source under NPDES, the 
operation is not eligible for cost sharing under the Section 319 
nonpoint source program. The USDA EQIP program, however, is available 
to most facilities, and being a permitted CAFO is not a reason for 
exclusion from the EQIP program. Although EQIP funds may not be used to 
pay for construction of storage facilities at operations with greater 
than 1,000 USDA animal units (USDA uses a different definition of 
animal units than EPA); EQIP is available to these facilities for 
technical assistance and financial assistance for other practices.
    To gather information on State activities concerning AFOs, EPA 
assembled information into a report entitled, ``State Compendium: 
Programs and Regulatory Activities Related to Animal Feeding 
Operations, Final Report,'' dated December 1999, and continues to 
update information concerning state operations (see ``Profile of NPDES 
Permits and CNMP Permit Requirements for CAFOs,'' updated 
periodically). The following discussion draws on information from these 
reports.
    EPA estimates that, under the existing EPA regulations, 
approximately 9,000 operations with more than 1,000 AU are CAFOs and 
should be permitted, and

[[Page 2969]]

approximately 4,000 operations with 300 AU to 1,000 AU should be 
permitted. However, only an estimated 2,520 CAFOs are currently covered 
under either a general permit or an individual permit. The 43 states 
authorized to implement the NPDES program for CAFOs have issued 
coverage for approximately 2,270 facilities, of which about 1,150 
facilities are under general permits and about 1,120 facilities are 
under individual permits. Of these states, 32 states administer their 
NPDES CAFO program in combination with some other State permit, 
license, or authorization program. Often, this additional State 
authorization is a construction or operating permit. Eight of the 
states regulate CAFOs exclusively under their State NPDES authority, 
while three others have chosen to regulate CAFOs solely under State 
non-NPDES programs. EPA information indicates that, as of December, 
1999, seventeen of the 43 states authorized to administer the NPDES 
program for CAFOs have never issued an NPDES permit to a CAFO.
    Of the seven states not authorized to administer the NPDES program, 
four rely solely on federal NPDES permits to address CAFOs. As of 
December 1998, EPA has issued coverage for approximately 250 facilities 
under general NPDES permits.
    Virtually all NPDES authorized states use the federal CAFO 
definition in their State NPDES CAFO program. Most states also use the 
federal definition for State non-NPDES CAFO programs. Five States, 
however, have developed unique definitions for their non-NPDES 
livestock regulatory programs that do not follow the federal 
definition. These five States typically base their definition on the 
number of animals confined, weight of animals and design capacity of 
waste control system, or gross income of agricultural operation. For 
example, Alabama's new general State NPDES permit covers all operations 
with at least 250 animal units. Similarly, Minnesota issues State (non-
NPDES) feedlot permits to facilities with more than 10 animal units. 
Minnesota also issues individual NPDES permits to CAFOs as defined 
under the existing federal regulations.
    The regulation of CAFOs is challenging, in part, because of the 
large number of facilities across the country. There are approximately 
376,000 AFOs. Regulating, for example, 5 percent of AFOs would result 
in some 18,800 permittees. One way of reducing the administrative 
burden associated with permitting such large numbers of facilities is 
through the use of general permits. NPDES regulations provide that 
general permits may be issued to cover a category of dischargers that 
involves similar operations with similar wastes. Operations subject to 
the same effluent limitations and operating conditions, and requiring 
similar monitoring are the types of facilities most appropriately 
regulated under a general permit. EPA and some authorized States are 
using general permits to regulate CAFOs, and this trend appears to be 
increasing.
    As mentioned, seventeen of the 43 States authorized to issue NPDES 
CAFO permits have never issued an NPDES permit to a CAFO, although many 
regulate CAFOs under non-NPDES programs. Under current regulations, an 
animal feeding operation that discharges only in the event of a 25-
year, 24-hour storm event is not considered to meet the definition of a 
CAFO (although it may still be designated as a CAFO). EPA believes that 
many of these facilities have in fact discharged in circumstance other 
than the 25-year/24-hour storm and should be required to obtain a 
permit.
    The number of non-NPDES permits issued to AFOs greatly exceeds the 
number of NPDES permits issued. Although the information may be 
incomplete on the number of state permits issued, more than 45,000 non-
NPDES permits or formal authorizations are known to have been issued 
through state AFO programs. The non-NPDES State authorizations often 
are only operating permits or approvals required for construction of 
waste disposal systems. While some impose terms and conditions on 
discharges from the CAFO, EPA believes that many would not meet the 
standards for approval as NPDES permits. Because these are not NPDES 
permits, none meet the requirement for federal enforceability.
    Minnesota alone has issued nearly 25,000 State feedlot permits. 
Kansas has issued more than 2,400 State permits, of which 1,500 have 
been to facilities with more than 300 animal units. Indiana has issued 
more than 4,000 letters of approval to AFOs within the State. South 
Carolina has issued 2,000 construction permits.
    With regard to the discharge standards included in permits, 28 
NPDES authorized States have adopted the federal feedlot effluent 
guidelines, while five authorized States use a more stringent limit. 
These more stringent limits partially or totally prohibit discharges 
related to storm events. For example, Arkansas regulations prohibit 
discharges from liquid waste management systems, including those 
resulting from periods of precipitation greater than the 25-year, 24-
hour storm event. In addition, California and North Carolina rules 
provide for no discharge from new waste control structures even during 
100 year storms. Numerous State CAFO permit programs also impose 
requirements that are broader in scope than the existing federal CAFO 
regulations.
    Twenty-two States have adopted laws that their environmental 
regulations cannot be more restrictive than the specific requirements 
in the federal regulations. Should any of these states experience 
environmental problems with CAFOs, they must rely on appropriate state 
regulations no more stringent than the federal rules.
    Thirty-four States explicitly impose at least some requirements 
that address land application of manure and wastewater as part of 
either their NPDES or non-NPDES program. The most common requirements 
among these States is that CAFO manure and wastewater, when managed 
through land application, be land applied in accordance with agronomic 
rates and that the operator develop and use a waste management plan. 
Although some States do not address how agronomic rates should be 
determined, many base it on the nitrogen needs of crops, while some 
require consideration of phosphorus as well. The complexity of waste 
management plans also varies between states. Some states have very 
detailed requirements for content of waste management plans, while 
others do not. Generally, CAFO operators are asked to address estimates 
of annual nutrient value of waste, schedules for emptying and applying 
wastes, rates and locations for applying wastes, provisions for 
determining agronomic rates, and provisions for conducting required 
monitoring and reporting.
    Although data was not available for all States, State agency staff 
dedicated to AFOs has increased over the last five years. In general, 
State staff dedicated to AFOs is relatively small, with average staff 
numbers being below four full-time employees. Several States do not 
have any staff specifically assigned to manage water quality impacts 
from AFOs. However, States such as Arkansas, Minnesota, Wisconsin, and 
Nebraska doubled their staff commitment to AFOs within the last five 
years. The most notable increases in State staff assigned to address 
AFOs were in Iowa and North Carolina. Kansas, Minnesota, and North 
Carolina have the largest AFO staffs in the country, with each having 
more than 20 full time employees.
    One indication that States have an increasing interest in expanding 
their efforts to control water quality impacts from AFOs is the 
promulgation of new

[[Page 2970]]

State AFO regulations and program initiatives. At least twelve states 
have developed new regulations related to AFOs since 1996. (AL, IN, KS, 
KY, MD, MS, NC, OK, PA, VT, WA, WY). Kansas, Kentucky, North Carolina, 
and Wyoming passed legislation regarding swine facilities, with 
Kentucky and North Carolina imposing moratoriums on the expansion of 
hog AFOs until State management/regulatory plans could be developed. 
Similarly, Mississippi also has imposed a 2-year moratorium on any new 
CAFOs. Alabama's recent efforts include developing an NPDES general 
permitting rule and a Memorandum of Agreement with EPA outlining State 
agency responsibilities as they relate to CAFOs. Washington's Dairy Law 
subjects all dairy farms with more than 300 animal units to permitting 
and requires each facility to develop nutrient management plans 
approved by the National Conservation Resource Service. Indiana's 
Confined Feeding Control Law also requires AFOs to develop waste 
management plans and receive State approval for operating AFOs.
    In conclusion, the implementation of CAFO programs varies from 
state-to-state, as does the implementation of NPDES programs for CAFOs 
by NPDES authorized states. As animal production continues to become 
more industrialized nationwide, a coherent and systematic approach to 
implementing minimum standards is needed to ensure consistent 
protection of water quality. Today's proposal will continue to promote 
a systematic approach to establishing industry standards that are 
protective of human health and the environment.

D. How Do Today's Proposed Revisions Compare to the Unified National 
AFO Strategy?

    As described in section III.B, on March 9, 1999, EPA and the U.S. 
Department of Agriculture jointly issued the Unified National Strategy 
for Animal Feeding Operations (Unified AFO Strategy), which outlined 
USDA and EPA's plans for achieving better control of pollution from 
animal agriculture under existing regulations. The following is a 
comparison chart that illustrates how the proposed rule compares to the 
Unified AFO Strategy. Table 3-1 compares the proposed CAFO rule 
requirements with the Unified AFO Strategy and identifies whether the 
proposed requirements are consistent with or not addressed by the 
Unified AFO Strategy. The table further shows that, overall, the 
proposed rule meets the intent of the Unified AFO Strategy.

                       Table 3-1.--Proposed Rule/Unified National AFO Strategy Comparison
----------------------------------------------------------------------------------------------------------------
                                                                  Not
                                                Consistent     addressed
           Summary of proposed rule            with Unified   in Unified                  Comment
                                                    AFO           AFO
                                                 Strategy      Strategy
----------------------------------------------------------------------------------------------------------------
                                     Proposed Revisions to NPDES Regulations
----------------------------------------------------------------------------------------------------------------
Definition of AFO (122.23(a)(2))--AFO                        The Unified AFO Strategy states CNMPs
 includes land application area; Clarifies                                  should address land application of
 crop language.                                                             manure. (Sec. 3.1 and 3.2)
                                                                           Crop language not explicitly
                                                                            addressed in Unified AFO Strategy.
Definition of CAFO (122.23(a)(3))--Change      ............         Alternative thresholds not explicitly
 1,000 animal unit threshold to 500.                                        addressed in Unified AFO Strategy,
                                                                            although Strategy does state EPA
                                                                            will explore alternative ways of
                                                                            defining CAFOs. (Sec. 5, Issue 3,
                                                                            Item 2.B.).
                                                                           The Unified AFO Strategy states that
                                                                            regulatory revisions will consider
                                                                            risk, burden, statutory
                                                                            requirements, enforceability, and
                                                                            ease of implementation (i.e.,
                                                                            clarity of requirements). (Sec. 5,
                                                                            Issue 3, Item 2).
                                                                           The Unified AFO Strategy states that
                                                                            5 percent of the AFOs will be
                                                                            subject to the regulatory program,
                                                                            however, this estimate is provided
                                                                            for the existing regulatory program
                                                                            (see Figure 2). No specific
                                                                            percentage is specified in the
                                                                            Strategy for the revised
                                                                            regulations.
Definition of CAFO (122.23(a)(3))--Include            ............  The Unified AFO Strategy states that
 dry poultry operations.                                                    in revising regulations EPA intends
                                                                            to consider defining ``...large
                                                                            poultry operations, consistent with
                                                                            the size for other animal sectors,
                                                                            as CAFOs, regardless of the type of
                                                                            watering or manure handling
                                                                            system.'' (Sec. 5, Issue 3, Item
                                                                            2.B.).
Definition of CAFO (122.23(a)(3))--Include     ............         Immature animals not explicitly
 immature animals.                                                          addressed in Unified AFO Strategy.
Definition of CAFO (122.23)--Removes 25 year/         ............  The Unified AFO Strategy states EPA
 24-hour storm provision from definition of                                 will consider ``requiring CAFOs to
 CAFO.                                                                      have an NPDES permit even if they
                                                                            only discharge during a 25-year, 24-
                                                                            hour or larger storm event.'' (Sec.
                                                                            5, Issue 3, Item 2.B.).
Definition of Operation (122.23(a)(5))--              ............  The Unified AFO Strategy states EPA
 Includes a person who exercises substantial                                will ``explore alternative
 operational control over a CAFO.                                           approaches to ensuring that
                                                                            corporate entities support the
                                                                            efforts of individual CAFOs to
                                                                            comply with permits and develop and
                                                                            implement CNMPs.'' (Sec. 5, Issue 3,
                                                                            Item 2.B.).
Designation as a CAFO (122.23(b))--In                 ............  The Unified AFO Strategy states EPA
 authorized States EPA may designate an AFO                                 will consider ``who may designate
 as a CAFO. No inspection required a                                        and the criteria for designating
 designate facility that was previously                                     certain AFOs as CAFOs.'' (Sec. 5,
 defined or designated as a CAFO.                                           Issue 3, Item 2.B.).
Who must apply for an NPDES permit                    ............  The Unified AFO Strategy states ``the
 (122.23(c))--CAFOs must either apply for a                                 NPDES authority will issue a permit
 permit or seek a determination of no                                       unless it determines that the
 potential to discharge.                                                    facility does not have a potential
                                                                            to discharge. (Sec. 4.2).

[[Page 2971]]


Co-Permitting (122.23(c)(3))--Operators,              ............  The Unified AFO Strategy states EPA
 including any person who exercises                                         will ``explore alternative
 substantial operational control over a CAFO,                               approaches to ensuring that
 must either apply for a permit or seek a                                   corporate entities support the
 determination of no potential to discharge.                                efforts of individual CAFOs to
                                                                            comply with permits and develop and
                                                                            implement CNMPs.'' (Sec. 5, Issue 3,
                                                                            Item 2.B.).
Issuance of permit (122.23(d))--Director must         ............  The Unified AFO Strategy states ``the
 issue permit unless s/he determines no                                     NPDES authority will issue a permit
 potential to discharge.                                                    unless it determines that the
                                                                            facility does not have a potential
                                                                            to discharge. (Sec. 4.2.).
No potential to discharge (122.23(e))--               ............  The Unified AFO Strategy establishes
 Determination must consider discharge from                                 a national performance expectation
 production area, land application area, and                                that all AFOs should develop and
 via ground waters that have a direct                                       implement CNMPs, and that such CNMPs
 hydrologic connection to surface waters.                                   should address land application of
                                                                            manure. (Sec. 3.1 and 3.2).
                                                                           The Unified AFO Strategy states ``EPA
                                                                            believes that pollution of
                                                                            groundwater may be a concern around
                                                                            CAFOs. EPA has noted in other
                                                                            documents that a discharge via
                                                                            hydrologically connected groundwater
                                                                            to surface waters may be subject to
                                                                            NPDES requirements.'' (Sec. 4.2.).
                                                                           The Unified AFO Strategy states EPA
                                                                            will consider protecting ``sensitive
                                                                            or highly valuable water bodies such
                                                                            as Outstanding Natural Resources,
                                                                            sole source aquifers, wetlands,
                                                                            ground water recharge areas, zones
                                                                            of significant ground/surface water
                                                                            interaction, and other areas.''
                                                                            (Sec. 5, Issue 3, Item 2.B.).
AFOs not defined or designated (122.23(g))--   ............         The Unified AFO Strategy states EPA
 AFOs subject to NPDES permitting                                           will consider ``clarifying whether
 requirements if they have a discrete                                       and under what conditions AFOs may
 conveyance (i.e., point source) discharge                                  be subject to NPDES requirements.''
 from production or land application that is                                (Sec. 5, Issue 3, Item 2.B.).
 not entirely storm water.
Non-AFO land application (122.23(h))--Land            ............  The Unified AFO Strategy states EPA
 application inconsistent with practices in                                 will consider ``clarifying
 412.31(b) and that result in point source                                  requirements for effective
 discharge of pollutants to Waters of the US                                management of manure and wastewater
 may be designated under 122.26(a)(1)(v).                                   from CAFOs whether they are handled
                                                                            on-site or off-site.'' (Sec. 5,
                                                                            Issue 3, Item 2. B.).
Agricultural Storm Water Exemption--                  ............  The Unified AFO Strategy states EPA
 Discharges from land application area if                                   has in the past and will in the
 manure is not applied in quantities that                                   future assume that discharges from
 exceed the land application rates calculated                               the majority of agricultural
 using one of the methods specified in 40 CFR                               operations are exempt, but that the
 412.31(b)(1)(iv).                                                          agricultural storm water exemption
                                                                            would not apply where the discharge
                                                                            is associated with the land disposal
                                                                            of manure or wastewater from a CAFO
                                                                            and the discharge is not the result
                                                                            of proper agricultural practices.
                                                                            (Sec. 4.4).
CAFO permit requirement (122.23(i)(2))--CAFOs         ............  The Unified AFO Strategy states the
 subject to effluent guidelines if applicable.                              effluent guidelines revisions will
                                                                            be closely coordinated with any
                                                                            charges to the NPDES permitting
                                                                            regulations. (Sec. 5, Issue 3, Item
                                                                            2. A.).
CAFO permit requirement (122.23(j))--                 ............  The Unified AFO Strategy provides
 Prohibits land application of manure that                                  that all AFOs should develop and
 would not serve agricultural purpose and                                   implement CNMPs, and that such CNMPs
 would likely result in pollutant discharge                                 should address land application of
 to waters of the U.S.                                                      manure to minimize impacts on water
                                                                            quality and public health. (Sec. 3.1
                                                                            and 3.2).
CAFO permit requirement (122.23(j)(4))--       ............         The Unified AFO Strategy states EPA
 Permittee must either provide information to                               will consider ``clarifying
 recipient or, under one co-proposal option,                                requirements for effective
 obtain certification that recipient will                                   management of manure and wastewater
 land apply per Permit Nutrient Plan (PNP),                                 from CAFOs whether they are handled
 obtain permit, use for other purpose, or                                   on-site or off-site.'' (Sec. 5,
 transfer to 3rd party.                                                     Issue 3, Item 2. B.).
CAFO permit requirement (122.23(j)(5))--       ............         The Unified AFO Strategy states EPA
 Permit must require specified recordkeeping.                               will consider ``establishing
                                                                            specific monitoring and reporting
                                                                            requirements for permitted
                                                                            facilities.'' (Sec. 5, Issue 3, Item
                                                                            2. B.).
                                                                           The Unified AFO Strategy provides
                                                                            records should be kept when manure
                                                                            leaves the CAFO. (Sec.3.3).
Closure (122.23(i)(3))--AFO must maintain      ............         Not explicitly addressed in Unified
 permit until it no longer has wastes                                       AFO Strategy.
 generated while it was a CAFO.

[[Page 2972]]


Public access (122.23(l)--Requires public      ............         Not explicitly addressed in Unified
 access to list of NOIs, list of CAFOs that                                 AFO Strategy.
 have prepared PNPs, and access to executive
 summary of PNP upon request.
General Permits (122.28)--Notice of Intent                   NOI requirements not explicitly
 must include topographic map and statement                                 addressed in Unified AFO Strategy.
 re PNP; additional criteria specified for                                 The Unified AFO Strategy states EPA
 when individual permits may be required.                                   will consider ``requiring individual
                                                                            permits for CAFOs in some
                                                                            situations.'' (Sec. 5, Issue 3, Item
                                                                            2. B.).
----------------------------------------------------------------------------------------------------------------
                          Proposed Revisions to Feedlot Effluent Guidelines Regulations
----------------------------------------------------------------------------------------------------------------
Production Area--Beef/Dairy (412.33(a): No                   The Unified AFO Strategy indicates
 discharge except when designed for 25 year,                                the existing effluent guidelines is
 24-hour storm, also inspect/ correct/ pump-                                no discharge when designed for 25
 out, manage mortalities. Swine/Poultry                                     year, 24-hour storm. (Sec. 5, Issue
 (412.43(a)): No discharge.                                                 3, Item 2. A).
                                                                           Strategy states that in developing
                                                                            the revised effluent guidelines EPA
                                                                            is to assess different management
                                                                            practices that minimize the
                                                                            discharge of pollutants. (Sec. 5,
                                                                            Issue 3, Item 2. A).
Land Application (412.33(b) and 412.43(b))--          ............  PNP has been identified as a specific
 Develop and Implement PNP covering the land                                subset of a CNMP applicable to AFOs
 application areas under the control of the                                 subject to the regulation. In this
 CAFO. Also include Best Management Practices.                              manner it is consistent with the
                                                                            Strategy. It also reinforces that
                                                                            the CNMP is applicable to all AFOs
                                                                            (regulatory/voluntary) while the PNP
                                                                            is only applicable to those that
                                                                            fall under the regulatory program.
                                                                            It makes a clear distinction between
                                                                            the regulatory and voluntary
                                                                            programs addressed in the Strategy.
Land Application (412.31(b)(1)(ii))--PNP              ............  The PNP is a subset of the CNMP. The
 Approved by Certified Specialist.                                          Strategy identified that CNMPs
                                                                            ``developed to meet the requirements
                                                                            of the NPDES program in general must
                                                                            be developed by a certified
                                                                            specialist, ....''. (Sec. 4.6).
New Source Performance Standards (412.35/45):         ............  Strategy states that in developing
 Various additional requirements.                                           the revised effluent guidelines EPA
                                                                            is to evaluate the need for
                                                                            different requirements for new or
                                                                            expanding operations. (Sec. 5, Issue
                                                                            3, Item 2. A).
Additional Measures (412.37)--Inspect/                ............  Strategy states that in developing
 correct/ pump-out, manage mortalities; Land                                the revised effluent guidelines EPA
 application BMPs, sampling, training,                                      is to assess different management
 recordkeeping.                                                             practices that minimize the
                                                                            discharge of pollutants. (Sec. 5,
                                                                            Issue 3, Item 2. A).
                                                                           Strategy states that the regulatory
                                                                            revision process will include the
                                                                            establishment of specific monitoring
                                                                            and reporting requirements for
                                                                            permitted facilities.
----------------------------------------------------------------------------------------------------------------

IV. Why is EPA Changing the Effluent Guidelines for Feedlots and 
the NPDES CAFO Regulations?

A. Main Reasons For Revising the Existing Regulations

    Despite more than twenty years of regulation, there are persistent 
reports of discharge and runoff of manure and manure nutrients from 
livestock and poultry operations. While this is partly due to 
inadequate compliance with existing regulations, EPA believes that the 
regulations themselves also need revision. Today's proposed revisions 
to the existing effluent guidelines and NPDES regulations for CAFOs are 
expected to mitigate future water quality impairment and the associated 
human health and ecological risks by reducing pollutant discharges from 
the animal production industry.
    EPA's proposed revisions also address the changes that have 
occurred in the animal production industries in the United States since 
the development of the existing regulations. The continued trend toward 
fewer but larger operations, coupled with greater emphasis on more 
intensive production methods and specialization, is concentrating more 
manure nutrients and other animal waste constituents within some 
geographic areas. This trend has coincided with increased reports of 
large-scale discharges from these facilities, and continued runoff that 
is contributing to the significant increase in nutrients and resulting 
impairment of many U.S. waterways.
    EPA's proposed revisions of the existing regulations will make the 
regulations more effective for the purpose of protecting or restoring 
water quality. The revisions will also make the regulations easier to 
understand and better clarify the conditions under which an AFO is a 
CAFO and, therefore, subject to the regulatory requirements of today's 
proposed regulations.

B. Water Quality Impairment Associated with Manure Discharge and Runoff

    EPA has made significant progress in implementing CWA programs and 
in reducing water pollution. Despite such progress, however, serious 
water quality problems persist throughout the country. Agricultural 
operations, including CAFOs, are considered a significant source of 
water pollution in the United States. The recently released National 
Water Quality Inventory: 1998 Report to Congress was prepared under 
Section 305(b) of the Clean Water Act. Under this section of the Act, 
States report their impaired water bodies to EPA, including the 
suspected sources of those impairments. The most recent report 
indicates that the agricultural sector (including crop production, 
pasture and range grazing, concentrated and confined animal feeding 
operations, and aquaculture) is the leading contributor to identified 
water quality impairments in the nation's rivers and

[[Page 2973]]

streams, and also the leading contributor in the nation's lakes, ponds, 
and reservoirs. Agriculture is also identified as the fifth leading 
contributor to identified water quality impairments in the nation's 
estuaries. 1998 National Water Quality Inventory results are 
illustrated in table 4-1 below.

   Table 4-1.--Five Leading Sources of Water Quality Impairment in the
                              United States
------------------------------------------------------------------------
      Rank             Rivers             Lakes            Estuaries
------------------------------------------------------------------------
1..............  Agriculture (59%)  Agriculture (31%)  Municipal Point
                                                        Sources (28%)
2..............  Hydro              Hydro              Urban Runoff /
                  modification       modification       Storm Sewers
                  (20%).             (15%).             (28%)
3..............  Urban Runoff /     Urban Runoff/      Atmospheric
                  Storm Sewers       Storm Sewers       Deposition (23%)
                  (11%).             (12%).
4..............  Municipal Point    Municipal Point    Industrial
                  Sources (10%).     Sources (11%).     Discharges (15%)
5..............  Resource           Atmospheric        Agriculture (15%)
                  Extraction (9%).   Deposition (8%).
------------------------------------------------------------------------
Source: National Water Quality Inventory: 1998 Report to Congress,
  USEPA, 2000. Percentage of impairment attributed to each source is
  shown in parentheses. For example, agriculture is listed as a source
  of impairment in 59 percent of impaired river miles. The portion of
  'agricultural'' impairment attributable to animal waste (as compared
  to crop production, pasture grazing, range grazing, and aquaculture)
  is not specified in this value. Figure totals exceed 100 percent
  because water bodies may be impaired by more than one source.

    Table 4-2 presents additional summary statistics of the 1998 
National Water Quality Inventory. These figures indicate that the 
agricultural sector contributes to the impairment of at least 170,000 
river miles, 2.4 million lake acres, and almost 2,000 estuarine square 
miles. Twenty-eight states and tribes identified specific agricultural 
sector activities contributing to water quality impacts on rivers and 
streams, and 16 states and tribes identified specific agricultural 
sector activities contributing to water quality impacts on lakes, 
ponds, and reservoirs. CAFOs are a subset of the agriculture category. 
For rivers and streams, estimates from these states indicate that 16 
percent of the total reported agricultural sector impairment is from 
the animal feeding operation industry (including feedlots, animal 
holding areas, and other animal operations), and 17 percent of the 
agricultural sector impairment is from both range and pasture grazing. 
For lakes, ponds, and reservoirs, estimates from these states indicate 
that 4 percent of the total reported agricultural sector impairment is 
from the animal feeding operation industry, and 39 percent of the 
agricultural sector impairment is from both range and pasture grazing. 
Impairment due specifically to land application of manure was not 
reported.

                           Table 4-2.--Summary of U.S. Water Quality Impairment Survey
----------------------------------------------------------------------------------------------------------------
                                                                  Quantity impaired by     Quantity impaired by
        Total quantity in U.S.             Waters assessed            all sources             agriculture a
----------------------------------------------------------------------------------------------------------------
Rivers...............................  23% of total             35% of assessed          59% of impaired.
3,662,255 miles                        840,402 miles            291,263 miles            170,750 miles.
----------------------------------------------------------------------------------------------------------------
Lakes, Ponds, and Reservoirs           42% of total             45% of assessed          31% of impaired.
41.6 million acres                     17.4 million acres       7.9 million acres        2,417,801 acres.
----------------------------------------------------------------------------------------------------------------
Estuaries                              32% of total             44% of assessed          15% of impaired.
90,465 square miles                    28,687 square miles      12,482 square miles      1,827 square miles.
----------------------------------------------------------------------------------------------------------------
Source: National Water Quality Inventory: 1998 Report to Congress, USEPA, 2000.
aCAFOs are a subset of the agriculture category.

    Table 4-3 below lists the leading pollutants impairing surface 
water quality in the United States as identified in the 1998 National 
Water Quality Inventory. The animal production industry is a potential 
source of all of these, but is most commonly associated with nutrients, 
pathogens, oxygen-depleting substances, and solids (siltation). Animal 
production facilities are also a potential source of the other leading 
causes of water quality impairment, such as metals and pesticides, and 
can contribute to the growth of noxious aquatic plants due to the 
discharge of excess nutrients. Animal production facilities may also 
contribute loadings of priority toxic organic chemicals and oil and 
grease, but to a lesser extent than other pollutants.

   Table 4-3.--Five Leading Causes of Water Quality Impairment in the
                              United States
------------------------------------------------------------------------
      Rank             Rivers             Lakes            Estuaries
------------------------------------------------------------------------
1..............  Siltation (38%)..  Nutrients (44%)..  Pathogens (47%)
2..............  Pathogens (36%)..  Metals (27%).....  Oxygen-Depleting
                                                        Substances (42%)
3..............  Nutrients (29%)..  Siltation (15%)..  Metals (27%)
4..............  Oxygen-Depleting   Oxygen-Depleting   Nutrients (23%)
                  Substances (23%).  Substances (14%).
5..............  Metals (21%).....  Suspended Solids   Thermal
                                     (10%).             Modifications
                                                        (18%)
------------------------------------------------------------------------
 Source: National Water Quality Inventory: 1998 Report to Congress,
  USEPA, 2000. Percent impairment attributed to each pollutant is shown
  in parentheses. For example, siltation is listed as a cause of
  impairment in 51 percent of impaired river miles. All of these
  pollutants except thermal modifications are commonly associated with
  animal feeding operations to varying degrees, though they are also
  attributable to other sources. Figure totals exceed 100 percent
  because water bodies may be impaired by more than one source.


[[Page 2974]]

    Pollutants associated with animal production can also originate 
from a variety of other sources, such as cropland, municipal and 
industrial wastewater discharges, urban runoff, and septic systems. The 
national analyses described in Section V of this preamble are useful in 
assessing the significance of animal waste as a potential or actual 
contributor to water quality degradation across the United States. 
Section V also discusses the environmental impacts and human health 
effects associated with the pollutants found in animal manure.

C. Recent Changes in the Livestock and Poultry Industry

    EPA's proposed revisions of the existing effluent guidelines and 
NPDES regulations take into account the major structural changes that 
have occurred in the livestock and poultry industries since the 1970s 
when the regulatory controls for CAFOs were first instituted. These 
changes include:
     Increased number of animals produced annually;
     Fewer animal feeding operations and an increase in the 
share of larger operations that concentrate more animals, manure and 
wastewater in a single location;
     Geographical shifts in where animals are produced; and
     Increased coordination between animal feeding operations 
and processing firms.
1. Increased Livestock and Poultry Production
    Since the 1970s, total consumer demand for meat, eggs, milk and 
dairy products has continued to increase. To meet this demand, U.S. 
livestock and poultry production have risen sharply, resulting in an 
increase in the number of animals produced and the amount of manure and 
wastewater generated annually.
    Increased sales from U.S. farms is particularly dramatic in the 
poultry sectors, as reported in the Census of Agriculture (various 
years). In 1997, turkey sales totaled 299 million birds. In comparison, 
141 million turkeys were sold for slaughter in 1978. Broiler sales 
totaled 6.4 billion chickens in 1997, up from 2.5 billion chickens sold 
in 1974. The existing CAFO regulations effectively do not cover broiler 
operations because they exclude operations that use dry manure 
management systems. Red meat production also rose during the 1974-1997 
period. The number of hogs and pigs sold increased from 79.9 million 
hogs in 1974 to 142.6 million hogs in 1997. Sales data for fed cattle 
(i.e., USDA's data category on ``cattle fattened on grain and 
concentrates'') for 1975 show that 20.5 million head were marketed. By 
1997, fed cattle marketings totaled 22.8 million head. The total number 
of egg laying hens rose from 0.3 million birds in 1974 to 0.4 million 
birds in 1997. The number of dairy cows on U.S. farms, however, dropped 
from more than 10.7 million cows to 9.1 million cows over the same 
period.
    Not only are more animals produced and sold each year, but the 
animals are also larger in size. Efficiency gains have raised animal 
yields in terms of higher average slaughter weight. Likewise, 
production efficiency gains at egg laying and dairy operations have 
resulted in higher per-animal yields of eggs and milk. USDA reports 
that the average number of eggs produced per egg laying hen was 218 
eggs per bird in 1970 compared to 255 eggs per bird in 1997. The 
National Milk Producers Federation reports that average annual milk 
production rose from under 10,000 pounds per cow in 1970 to more than 
16,000 pounds per cow in 1997. In the case of milk production, these 
efficiency gains have allowed farmers to maintain or increase 
production levels with fewer animals. Although animal inventories at 
dairy farms may be lower, however, this may not necessarily translate 
to reduced manure volumes generated because higher yields are largely 
attributable to improved and often more intensive feeding strategies 
that may exceed the animal's ability for uptake. This excess is not 
always incorporated by the animal and may be excreted.
2. Increasing Share of Larger, More Industrialized Operations
    The number of U.S. livestock and poultry operations is declining 
due to ongoing consolidation in the animal production industry. 
Increasingly, larger, more industrialized, highly specialized 
operations account for a greater share of all animal production. This 
has the effect of concentrating more animals, and thus more manure and 
wastewater, in a single location, and raising the potential for 
significant environmental damages unless manure is properly stored and 
handled.
    USDA reports that there were 1.1 million livestock and poultry 
farms in the United States in 1997, about 40 percent fewer than the 1.7 
million farms reported in 1974. Farms are closing, especially smaller 
operations that cannot compete with large-scale, highly specialized, 
often lower cost, producers. Consequently, the livestock and poultry 
industries are increasingly dominated by larger operations. At the same 
time, cost and efficiency considerations are pushing farms to become 
more specialized and intensive. Steep gains in production efficiency 
have allowed farmers to produce more with fewer animals because of 
higher per-animal yields and quicker turnover of animals between farm 
production and consumer market. As a result, annual production and 
sales have increased, even though the number of animals on farms at any 
one time has declined (i.e., an increase in the number of marketing 
cycles over the course of the year allows operators to maintain 
production levels with fewer animals at any given time, although the 
total number of animals produced by the facility over the year may be 
greater).
    The increase in animal densities at operations is evident by 
comparing the average number of animals per operation between 1974 and 
1997, as derived from Census of Agriculture data. In the poultry 
sectors, the average number of birds across all operations is four to 
five times greater in 1997 than in 1974. In 1997, the number of 
broilers per operation averaged 281,700 birds, up from 73,300 birds in 
1974. Over the same period, the average number of egg laying hens per 
operation rose from 1,100 layers to 5,100 layers per farm, and the 
average number of turkeys per operation rose from 2,100 turkeys to 
8,600 turkeys. The average number of hogs raised per operation rose 
from under 100 hogs to more than 500 hogs between 1974 and 1997. The 
average number of fed cattle and dairy cows per operation more than 
doubled during the period, rising to nearly 250 fed cattle and 80 
milking cows by 1997.
    This trend toward fewer, larger, and more industrialized operations 
has contributed to large amounts of manure being produced at a single 
geographic location. The greatest potential risk is from the largest 
operations with the most animals given the sheer volume of manure 
generated at these facilities. Larger, specialized facilities often do 
not have an adequate land base for manure disposal through land 
application. A USDA analysis of 1997 Census data shows that animal 
operations with more than 1,000 AU account for more than 42 percent of 
all confined animals but only 3 percent of cropland held by livestock 
and poultry operations. As a result, large facilities need to store 
significant volumes of manure and wastewater which have the potential, 
if not properly handled, to cause significant water quality impacts. By 
comparison, smaller operations manage fewer animals and tend to 
concentrate less manure at a single farming location. Smaller 
operations also tend to be more diversified, engaging in both animal 
and

[[Page 2975]]

crop production. These operations often have sufficient cropland and 
fertilizer needs to land apply manure generated by the farm's livestock 
or poultry business, without exceeding that land's nutrient 
requirements.
    Another recent analysis from USDA confirms that as animal 
production operations have become larger and more specialized 
operations, the opportunity to jointly manage animal waste and crop 
nutrients has decreased. Larger operations typically have inadequate 
land available for utilizing manure nutrients. USDA estimates that the 
amount of nitrogen from manure produced by confinement operations 
increased about 20 percent between 1982 and 1997, while average acreage 
on livestock and poultry farms declined. Overall, USDA estimates that 
cropland controlled by operations with confined animals has the 
assimilative capacity to absorb about 40 percent of the calculated 
manure nitrogen generated by these operations. EPA expects this excess 
will need to be transported offsite.
3. Geographic Shifts in Where Animals are Raised
    During the 1970s, the majority of farming operations were 
concentrated in rural, agricultural areas and manure nutrients 
generated by animal feeding operations were readily incorporated as a 
fertilizer for crop production. In an effort to reduce transportation 
costs and streamline distribution between the animal production and 
food processing sectors, livestock and poultry operations have tended 
to cluster near slaughtering and manufacturing plants as well as near 
end-consumer markets. Ongoing structural and technological change in 
these industries also influences where facilities operate and 
contributes to locational shifts from the more traditional farm 
production regions to the more emergent regions.
    Operations in more traditional producing states tend to grow both 
livestock and crops and tend to have adequate cropland for land 
application of manure. Operations in these regions also tend to be 
smaller in size. In contrast, confinement operations in more emergent 
areas, such as hog operations in North Carolina or dairy operations in 
the Southwest, tend to be larger in size and more intensive types of 
operations. These operations tend to be more specialized and often do 
not have adequate land for application of manure nutrients. Production 
is growing rapidly in these regions due to competitive pressures from 
more specialized producers who face lower per-unit costs of production. 
This may be shifting the flow of manure nutrients away from more 
traditional agricultural areas, often to areas where these nutrients 
cannot be easily absorbed.
    As reported by Census data, shifts in where animals are grown is 
especially pronounced in the pork sector. Traditionally, Iowa has been 
the top ranked pork producing state. Between 1982 and 1997, however, 
the number of hogs raised in that state remained relatively constant 
with a year-end inventory average of about 14.2 million pigs. In 
comparison, year-end hog inventories in North Carolina increased from 
2.0 million pigs in 1982 to 9.6 million pigs in 1997. This locational 
shift has coincided with reported nutrient enrichment of the waters of 
the Pamlico Sound in North Carolina. Growth in hog production also 
occurred in other emergent areas, including South Dakota, Oklahoma, 
Wyoming, Colorado, Arizona, and Utah. Meanwhile, production dropped in 
Illinois, Indiana, Wisconsin, and Ohio.
    The dairy industry has seen similar shifts in where milk is 
produced, moving from the more traditional Midwest and Northeast states 
to the Pacific and Southwestern states. Between 1982 and 1997, the 
number of milk cows in Wisconsin dropped from 1.9 million to 1.3 
million. Milk cow inventories have also declined in other traditional 
states, including Illinois, Indiana, Iowa, Minnesota, Missouri, New 
York, Pennsylvania, Ohio, Connecticut, Maryland, and Vermont. During 
the same period, milk cow inventories in California rose from 0.9 
million in 1982 to 1.4 million in 1997. In 1994, California replaced 
Wisconsin as the top milk producing state. Milk cow inventories have 
also increased in Texas, Idaho, Washington, Oregon, Colorado, Arizona, 
Nevada, and Utah. These locational shifts have coincided with reported 
nutrient enrichment of waters, including the Puget Sound and Tillamook 
Bay in the northwest, the Everglades in Florida, and Erath County in 
Texas, and also elevated salinity levels due to excess manure near milk 
production areas in southern California's Chino Basin.
4. Increased Linkages between Animal Production Facility and Food 
Processors
    Over the past few decades, closer ties have been forged between 
growers and various industry middlemen, including packers, processors, 
and cooperatives. Increased integration and coordination is being 
driven by the competitive nature of agricultural production and the 
dynamics of the food marketing system, in general, as well as seasonal 
fluctuations of production, perishability of farm products, and the 
inability to store and handle raw farm output. Closer ties between the 
animal production facility and processing firms--either through 
contractual agreement or through corporate ownership of CAFOs--raises 
questions of who is responsible for ensuring proper manure disposal and 
management at the animal feeding site. This is especially true given 
the current trend toward larger animal confinement operations and the 
resultant need for increased animal waste management. As operations 
become larger and more specialized, they may contract out some phases 
of the production process.
    Farmers and ranchers have long used contracts to market 
agricultural commodities. However, increased use of production 
contracts is changing the organizational structure of the individual 
industries. Under a production contract, a business other than the 
feedlot where the animals are raised and housed, such as a processing 
firm, feed mill, or animal feeding operation, may own the animals and 
may exercise further substantial operational control over the 
operations of the feedlot. In some cases, the processor may specify in 
detail the production inputs used, including the genetic material of 
the animals, the types of feed used, and the production facilities 
where the animals are raised. The processor may also influence the 
number of animals produced at a site. In general, these contracts do 
not deal with management of manure and waste disposal. Recently, 
however, some processors have become increasingly involved in how 
manure and waste is managed at the animal production site.
    The use of production contracts in the livestock and poultry 
industries varies by commodity group. Information from USDA indicates 
that production contracts are widely used in the poultry industry and 
dominate broiler production. Production contracting is becoming 
increasingly common in the hog sector, particularly for the finishing 
stage of production in regions outside the Corn Belt.
    Production contracting has played a critical role in the growth of 
integrators in the poultry sectors. Vertical integration has progressed 
to the point where large, multifunction producer-packer-processor-
distributor firms are the dominant force in poultry and egg production 
and marketing. Data from USDA on animal ownership at U.S. farms 
illustrates the use of production contracts in these sectors. In 1997, 
USDA reported that 97 percent of all broilers raised on U.S. farms were 
not owned by the farmer. In the turkey and

[[Page 2976]]

egg laying sectors, use of production contracts is less extensive since 
70 percent and 43 percent of all birds in these sectors, respectively, 
were not owned by the farmer. In the hog sector, data from USDA 
indicate that production contracting may account for 66 percent of hog 
production among larger producers in the Southern and Mid-Atlantic 
states. This differs from the Midwest, where production contracting 
accounted for 18 percent of hog production in 1997.
    By comparison, production contracts are not widely used in the beef 
and dairy sectors. Data from USDA indicate that less than 4 percent of 
all beef cattle and 1 percent of all milking cows were not owned by the 
farmer in 1997. However, production contracts are used in these 
industries that specialize in a single stage of livestock production, 
such as to ``finish'' cattle prior to slaughter or to produce 
replacement breeding stock. However, this use constitutes a small share 
of overall production across all producers.
    To further examine the linkages between the animal production 
facility and the food processing firms, and to evaluate the 
geographical implications of this affiliation, EPA conducted an 
analysis that shows a relationship between areas of the country with an 
excess of manure nutrients from animal production operations and areas 
with a large number of meat packing and poultry slaughtering 
facilities. This manure--if land applied--would be in excess of crop 
uptake needs and result in over application and enrichment of 
nutrients. Across the pork and poultry sectors, this relationship is 
strongest in northwest Arkansas, where EPA estimates a high 
concentration of excess manure nutrients and a large number of poultry 
and hog processing facilities. By sector, EPA's analysis shows that 
there is excess poultry manure nutrients and a large number of poultry 
processing plants in the Delmarva Peninsula in the mid-Atlantic, North 
Carolina, northern Alabama, and also northern Georgia. In the hog 
sector, the analysis shows excess manure nutrients and a large number 
of meat packing plants in Iowa, Nebraska and Alabama. The analysis also 
shows excess manure nutrients from hogs in North Carolina, but 
relatively fewer meat packing facilities, which is likely explained by 
continuing processing plant closure and consolidation in that state. 
More information on this analysis is provided in the rulemaking record.

D. Improve Effectiveness of Regulations

    As noted in Section IV.B, reports of continued discharges and 
runoff from animal production facilities have persisted in spite of 
regulatory controls that were first instituted in the 1970s. EPA is 
proposing to revise the effluent guidelines and NPDES regulations to 
improve their effectiveness by making the regulations simpler and 
easier to understand and implement. Another change intended to improve 
the effectiveness of the regulations is clarification of the conditions 
under which an AFO is a CAFO and is, therefore, subject to the NPDES 
regulatory requirements. In addition, EPA is revising the existing 
regulation to remove certain provisions that are no longer appropriate.
    The existing regulations were designed to prohibit the release of 
wastewater from the feedlot site, but did not specifically address 
discharges that may occur when wastewater or solid manure mixtures are 
applied to crop, pasture, or hayland. The proposed regulations address 
the environmental risks associated with manure management. The proposed 
revisions also are more reflective of current farm production practices 
and waste management controls.
    Today's proposed revised regulations also seek to improve the 
effectiveness of the existing regulations by focusing on those 
operations that produce the majority of the animal manure and 
wastewater generated annually. EPA estimates that the proposed 
regulations will regulate, as CAFOs, about 7 to 10 percent of all 
animal confinement operations nationwide, and will capture between 64 
percent and 70 percent of the total amount of manure generated at CAFOs 
annually, depending on the proposed regulatory alternative (discussed 
in more detail in Section VI.A). Under the existing regulations, few 
operations have obtained NPDES permits. Presently, EPA and authorized 
States have issued approximately 2,500 NPDES permits. This is less than 
1 percent of the estimated 376,000 animal confinement operations in the 
United States. EPA's proposed revisions are intended to ensure that all 
CAFOs, as defined under the proposed regulations, will apply for and 
obtain a permit.

V. What Environmental and Human Health Impacts Are Potentially 
Caused by CAFOs?

    The 1998 National Water Quality Inventory, prepared under Section 
305(b) of the Clean Water Act, presents information on impaired water 
bodies based on reports from the States. This recent report indicates 
that the agricultural sector (wh