Current Issues in U.S. Environmental Policy

By A. Myrick Freeman; Paul R. Portney | Go to book overview

Effective planning requires resources and time to bear fruit. The Section 208 planning process was not given high priority by EPA in the early stages of implementing the 1972 law. It was predictable that the Section 208 area-wide planning apparatus would not be developed and in place in time to have much impact on the allocation of the $18 billion in municipal grants, given the timing of the authorizations. This is perhaps another demonstration of the adage, "haste makes waste."

The 1972 amendments included two provisions regarding the financing of municipal treatment plants that are decided improvements over previous practice. First, where industrial sources make use of municipal treatment plants which were built under the treatment grant program, municipalities are required to recover the federal share of capital costs allocated to treating the industrial wastes through user charges based on quantities of waste treated. The effect of a user charge is to provide the industrial discharger with a financial incentive to reduce the volume of wastewater flows and their pollutant content. This is desirable. However the provision applies only to the federal share of capital costs, and it applies only to the allocated construction costs, not the interest cost on capital.

The second provision requires that municipalities operating federally funded plants must establish a system of user charges to recover the operating and maintenance costs from all users, domestic, commercial, and industrial. Again, the user charge provides a beneficial incentive to reduce waste flows. Many municipalities have had difficulty in implementing a system of user charges because of the lack of a capability for metering discharges. The typical solution for residential users is to base the user charge on metered water consumption. This may be unfair to many lawn waterers; but separate metering for residential sewers is probably not justifiable on cost grounds. The 1977 amendments permit municipalities to recover residential users' shares of operating and maintenance costs through ad valorem taxation of real property. But Congress wisely declined to extend this exception to major industrial and commercial users.


Conclusions

In this chapter we have discussed a number of specific issues and made recommendations for several kinds of changes in present policy. Here we attempt to summarize and synthesize these recommendations in terms of the establishment of pollution control objectives and the selection of means for achieving them.

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