to other disposal options open to generators. The industry is judged capable of expanding over time to accept most the Nation's hazardous

wastes. Hazardous waste management system costs are significant. Estimates made by EPA indicate that investments of about $940 million and operating costs (including capital recovery) of about $620 million per year will be required to implement a nationwide hazardous waste management system which combines on-site (point of generation) treatment of some wastes, off-site (central facility) treatment for hazard elimination and recovery, and secure land disposal of residues which remain hazardous after treatment.

... The private sector appears capable of responding to a regulatory program. Indications are that private capital will be available for the creation of capacity and that generators of waste will be able to bear the costs of management under new and more exacting rules. Private sector response to a demand created by a regulatory program cannot be well defined, however, and the characteristics of the resulting hazardous waste management system cannot be definitely prescribed Uncertainties inherent in a private sector system include

Availability of capital for facility construction and operation in a timely manner for all regions of the Nation,

Adequacy of facility locations realtive to waste generators such as to minimize environmental hazard and maximize use,

Reasonableness of facility use charges in relation to cost of

services,

Long term care of hazardous waste storage and disposal facilities i.e., that such facilities will be adequately secured for the life of the waste, irrespective of economic pressures on private site operators.

... Several alternatives for government action are available if such actions are subsequently determined to be required. If capital flow were very slow and adverse environmental effects were resulting from the investment rate, financial assistance is possible in indirect forms such as loans, loan guarantees or investment credits, or direct forms such as construction grants. If facility location or user charge problems arose, the Government could impose a franchise system with territorial limits and user charge rate controls. Long term care of hazardous waste storage and disposal facilities could be assured by mandating use of Federal or State land for such facilities.

Recommendations

Based on the above, it is recommended that... Congress enact National legisaltion mandating safe and environmentally sound hazardous waste management.

The Environmental Protection Agency has proposed such legislation to Congress, embodying the conclusions of studies carried out under Section 212 of the Solid Waste Disposal Act.

The proposed Hazardous Waste Management Act of 1973 calls for authority to regulate the treatment and disposal of hazardous wastes. A copy of the proposed Act is presented in Appendix G. The key provisions of the proposed legislation are the following:

(1) Authority to designate hazardous wastes by EPA.

(2) Authority to regulate treatment/disposal of selected waste categories by the Federal Government at the discretion of the Administartor of the Environmental Protection Agency.

(3) Authority for the setting of Federal treatment/disposal standards for designated waste categories.

(4) State implementation of the regulatory program subject to Federal standards in most cases.

(5) Authority for coordination and conduct of research, surveys, development and public education.

EPA believes that no further Government intervention is appropriate at this time. It is EPA's intention to carry on its studies and analyses; and EPA may make further recommendations based on these continuing analyses.

2. U.S.E.P.A., "Environmental Impact Statement on Hazardous Waste Management Act (H.R. 4873)" (1973), pp. 6-8, 11-14, 19–27:

BACKGROUND OF THE PROPOSED LEGISLATION

1. Introduction.-Hazardous wastes present a significant threat to man and his environment because of their intrinsic properties, quantities, and distribution. Trends indicate that the amounts of hazardous waste produced will increase substantially in the next decade. Present management practices for hazardous wastes are as inadequate as they are unsafe and environmentally unacceptable. The sources of hazardous wastes are numerous and widely scattered throughout the nation. Sources consist of the Federal Government (mainly the AEC and DOD), industry, agriculture, and various institutions (such as hospitals and laboratories). Due to the concentration of industry, the majority of hazardous wastes are generated in the northeastern and the Gulf Coast areas of the United States.

Hazardous wastes are being generated at a rate of approximately 10 million tons annually. About 75 percent of these wastes are inorganic materials, 25 percent are organics; the bulk of the waste occurs in liquid or semi-liquid form. Generation of these wastes is growing as a result of a number of factors-increasing consumption rates, air and water pollution control (which transfers hazardous wastes from other media to land), bans and cancellations of toxic substances, energy requirements (which lead to radioactive waste generation at higher rates), and denial of heretofore acceptable methods of disposal such as ocean dumping. Current expenditures by generators for the treatment and disposal of such wastes are low relative to what is required for adequate treatment/disposal. Ocean dumping and simple land disposal costs are on the order of $3 per ton whereas environmentally adequate management will require upward of $75 per ton. Hazardous waste generators, however, are under little or no pressure to expend resources for the adequate management of their hazardous wastes. Their economic incentives (given the very high costs of adequate management compared to costs of current practice) are to continue to dispose of wastes in inadequate ways.

Adequate treatment and disposal technology are available to treat most hazardous waste streams by physical, chemical, biological meth

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ods and ultimate disposal processes. In the absence of treatment processes, storage of wastes on land is possible using methods that minimize hazard to the public and the environment (engineered storage, membrane landfills). Use of such treatment/disposal processes is costly, ranging from a low of $1.40/ton for carbon absorption, $10/ ton for neutralization/precipitation, $13.60/ton for chemical oxidation, to $95, ton for residue incineration. Several unit processes are usually required for complete treatment/disposal of a given waste stream. A private hazardous waste management industry has emerged in the last decade, offering treatment/disposal services to generators. The industry has capital investments of $70 million and a capacity to handle 840 thousand tons of hazardous materials yearly. The industry is operating at 25 percent capacity. The low level of utilization of this industry's plant and equipment is the result of the absence of legislative incentives which require generators to manage their hazardous wastes in an environmentally sound manner. Consequently, generators do not take full advantage of the services offered by this industry— services which normally cost more than other disposal avenues available to the generators.

2. Inadequacy of Existing Legislation.-Federal, state and local legislation dealing with the management of hazardous waste is spotty or non-existent. Approximately 15 States have some sort of hazardous waste disposal regulations; at the Federal level, 15 laws deal in a peripheral manner with the management of hazardous wastes. The Expiring Solid Waste Disposal Act of 1965 (P.L. 89-272), as amended by the Resource Recovery Act of 1970 (P.L. 91-512), has no regulatory thrust, as Section 212 of the Resource Recovery Act only directs EPA to study the feasibility of a system of national disposal sites for hazardous wastes. As stringent standards for the protection of water quality from toxic pollutants are developed under Sec. 307 of the Water Pollution Control Act (FWPCA) of 1972 (P.L. 92-500), and as controls on hazardous air pollutants are tightened pursuant to Sec. 212 of the Clean Air Act (P.L. 91-604), there will be an increasing tendency on the part of the nation's hazardous waste generators to look to land disposal, either surface or underground, as an alternative to incineration or surface water disposal.

ENVIRONMENTAL IMPACT OF THE PROPOSED LEGISLATION

1. Background.-Three major strategic alternatives available for achieving adequate hazardous waste management nation-wide are (a) the use of fiscal incentives only; (b) the use of regulatory incentives only; and (c) a combination of fiscal and regulatory incentives. Evaluation of these three strategic alternatives indicated that the "regulatory only" approach for treatment and disposal would be best for the achievement of hazardous waste management objectives consistent with low costs, equitable cost distribution, and maximum resource recovery. A regulatory approach, with enforcement the primary responsibility of the States, will ensure maximum protection of the public and the environment. It will result in the creation of treatment/ disposal capacity by the private sector without public funding. It will

result in the mandatory use of such facilities. Costs of management will be borne by those who generate the hazardous wastes rather than the public at large and thus cost distribution will be equitable, and private sector management of the wastes in a competitive environment will result in the reduction of waste at the source and promote maximum resource recovery at economic levels.

Under a regulatory-only strategy, total treatment/disposal will take place and public spending per ton of waste will be equivalent to $1 per ton-the administrative, R&D, enforcement, and other costs of the regulatory program. And, the public funding required for implementation of this program would be $100 million over ten years. All of the program options will result in the creation of approximately 20 to 25 treatment/disposal facilities across the nation. Five of these would be very large regional facilities treating 1.2 million tons yearly, and 18 to 20 would be medium size facilities treating 150,000 tons annually. An estimated 8.6 million tons of hazardous wastes would be treated, disposed of away from the point of generation (off-site); 1.4 million tons would be treated on-site, with residues transported to treatment/ disposal facilities. Finally, capital requirements to create the system described above would range from $995 million under a public funding approach to $925 million under the best regulatory approach with investment provided entirely by the private sector.

2. Analysis of the "Regulatory Only" Program's Impact.(a) Capacity-The regulatory approach will create the necessary treatment and disposal facilities for the handling of hazardous wastes by creating pressures on generators to seek alternate modes of treatment/disposal. In turn, this existing hazardous waste management industry (and new entrants into the field) will respond to these demand pressures by operating existing facilities at higher capacities and by adding new services and facilities to satisfy the new industrial demand. The capacity creation potential of the "regulatory only" approach depends to a great extent on the enforcement of the regulations. This approach will require an administrative process and will be subject to political pressures, procedures, legal review, and associated delays. The approach must be implemented on a nation-wide scale to be fully effective. In the absence of such a situation, "disposal havens" are likely to be created in some areas, industry locations will shift over time to take advantage of havens, and the overall effect of the regulatory program would be spotty. This does not necessarily imply a Federal enforcement role, but it does require Federal standards to be enforced by the States, with some overall Federal enforcement authority to ensure uniform adherence to the Federal standards.

The experience of the private sector hazardous waste management industry indicates that regulatory activity makes investment in treatment/disposal facilities possible and spurs the use of such facilities. If regulatory activity forces the use of improved treatment/disposal processes, generators impacted by this requirement will begin to seek services in preference to on-site treatment; such demand will be met by the existing hazardous waste management services industry, which has already demonstrated its willingness and ability to invest capital. Where on-site treatment/disposal is more economically feasible, the generators will install such facilities under regulatory pressure.

(b) Incentives for Use of Capacity.-The main advantage of the "regulatory only" approach is that it provides legal sanctions against these hazardous waste generators who fail to use the treatment processes and disposal facilities required by the proposed legislation. To some extent, facility use will be independent of enforcement action or the level of sanctions provided. Generators can be expected to upgrade their hazardous waste management activities because they are lawabiding and will respect the spirit of the mandating law and of the regulations. Even if there is no enforcement, the cost of the regulatory program would be significantly lower for any given level of environmental benefit.

If there is some enforcement, however; if enforcement exacts very high sanctions; if the act as finally passed provides for citizen suit privileges, and combinations of these, use of facility capacity, onor off-site, is likely to be virtually total. How soon all generators will be using the available or created hazardous waste treatment/disposal capacity will depend on the level of enforcement. If enforcement is vigorous, the environmental goal will be achieved earlier than in a case where enforcement resources are limited.

*

ALTERNATIVES TO THE PROPOSED LEGISLATION

The two major strategic alternatives to the proposed "regulatory only" hazardous waste legislation involved (1) the use of fiscal incentives only, and (2) a combination of fiscal and regulatory incentives. The first alternative discussed, however, will be that of no action. 1. No action.-There are sufficient gaps in State regulatory programs, sufficient indicators of substantially increased interest in land and underground disposal of hazardous wastes, and sufficient indications of State failure to improve their hazardous waste regulatory programs to conclude that Federal inaction in this area is much less likely to lead to adequate protective measures than the program contained in the proposed legislation.

2. Fiscal incentives only.-In general, the approach which provides only fiscal incentives can create capacity, can provide incentives for use of capacity by most generators provided it is sufficiently high, does not minimize costs and distributes costs inequitably, and may or may not promote resource conservation.

(a) Capacity.-Public funding can obviously create the necessary treatment and disposal facilities by outright grants or other means. This mechanism, however implemented, will require some form of administrative process for resource allocation and will be subject to budgetary and political pressures and associated control procedures and delays. Inherent in this approach is the need for the funding organization-be it State, Federal, or other-to deal with the issues of siting, the issue of monopoly or territoriality, the consequent issue market size related to location, the issue of service fee control in a monopolistic situation and other similar issues.

This approach means that the public sector will enter into competition with the existing hazardous waste treatment/disposal industry to the detriment of the latter and, if the approach is successfully used,