moneys would be taken form some other vital service. That is why it is a question of relative priorities. I can tell you it is of high priority, but I cannot tell you that it has a higher priority than providing the city of New York with potable water or collecting the garbage or providing police protection, and so forth. We have a question of priorities here, but I doubt that the city of New York is impacting on the State of Delaware. Your people and our people work out water releases from the Delaware River, and I think it is workable. We try to be good neighbors, but I do not think the New York dumpsite, which is used by New Jersey, Nassau, and Westchester, is a problem connected with your fishing interests in the Delaware Bay, for the reason that it has not been connected with problems in the Rockaways, which are only 11 miles from the site. This thing must be placed in perspective. Mr. HUGHES. Would the gentleman yield for just a minute? Mr. HUGHES. Have you seen the General Accounting Office assessment of the damage that has been done in the New York Bight areas as well as other areas from the dumping of sludge, particularly the mercury and the cadmium levels? Mr. Low. Yes. We think those are much higher priorities to stop, stop now. Mr. HUGHES. I beg to differ with you. It was directly related to the sludge; and, in fact, the prior site just off of Cape May some 3 years after abandonment had cadmium and mercury levels many times above the acceptable levels set by EPA. And the New York Bight was 100 times that level. Mr. Low. I agree, sir. The dump sites for those toxic substances deserve a higher priority, by far, than the elimination of the sludge dump site. Now, that does not mean to say, and I continue to repeat, that we do not want to end ocean disposal; we do. But these other sites that have been authorized by Federal agencies, it seems to me, ought to be terminated a lot sooner than maybe is now envisioned, because they are creating problems. No one considers those problems in its studies as well as does the Federal EPA, but it has not been the sludge dump site that has been associated with those problems. Mr. EVANS. I might just say that it depends on who is examining the evidence as to what harm is being done, and what cumulative impact is done. Have you had any help from the State of New York? If you do not have the land in the city, have you discussed this with the State? Mr. Low. We have had ongoing talks with some people in Columbia County, which is due north of the city, between the Hudson and the Connecticut line, maybe the Massachusetts line. We find, however, that when programs like these become known, where New York City is going to export its residue, whether solid waste or sludge, that there comes a time when political opposition arises, and it becomes very difficult. We are looking into several possibilities for exporting sludge, but I do not know if any will be successful. You know, a lot of our solid wastes are disposed of in New Jersey, in the Meadowlands, by private cargo, and there was an effort to terminate that. That created quite a problem, because then we had no place to go with our solid waste. I have said, Mr. Chairman, before other committees of this Congress, that this problem of waste, whether it is solid or liquid, requires an investment on the part of the Nation far beyond the discussions of the sums of money that we are talking about here. The metropolitan areas of this country are suffocating in their waste. We should be able to recycle them, to look upon these wastes as precious resources that can be used, but the technology is not always there, and we really need help. It is a national problem that requires a national solution, whether it is solid waste problems or the problem of disposing of our sewage sludge. The problem today is nothing like what it is going to be, as you said, when the quantity of sludge in the New York-New Jersey area is doubled within the next 20 or 25 years. Mr. EVANS. Commissioner, you know the city of Camden is complying as of November of this year, and I would suggest that perhaps some of the same problems that you have in New York exist in the city of Camden as far as the availability of land. I am not going to say here that you must do it today, because we are trying to be reasonable and we are trying to be fair. But I think that complying by 1981 gives you a little more than 4 years and I do not think that that is unreasonable. One question, if I might, Mr. Chairman. Mr. BREAUX. We have another witness. Mr. EVANS. Could I ask Mr. Diamond a question and I recognize that you are acting as counsel for the city of Philadelphia and you suggest that your bond rating would be affected. I suggest to you that our bond rate in Delaware is not very good when you continue to dump off our shores. Are you going to pay the $225,000 fine that was levied? Mr. DIAMOND. The $225,000 fine, Mr. Evans, has been recommended by adjudicatory hearing officer to the regional administrator of EPA. The regional administrator has not levied a fine, so we have not gotten a piece of paper saying you are fined $225,000. I might correct one statement. I may have misled the chairman by my perhaps cavalier characterization of the city's effort. We are not getting out easy by 1980. It is an enormous effort but it can be done. I misled you if I said it is easy. Mr. EVANS. We recognize that. Mr. BREAUX. I want to thank both panels, all four of you gentlemen, for being with us. You provided some very helpful information in your testimony this afternoon. Thank you very much. Mr. Low. Mr. Chairman, if I may, I am going to submit to you a revised paragraph with respect to those penalties so that it is certainly clear for the consideration of the committee. I believe my language was poorly drafted. Mr. BREAUX. That will be made a matter of the record. [The following was received for the record:] PENALTY FEE AS CONDITION TO INTERIM PERMITS FOR OCEAN DUMPING OF SLUDGE The principal object of this hearing is the effect the penalty fee of H.R. 5851 will have on municipalities' efforts to meet the 1981 deadline to terminate the use of the off shore ocean waters for sewage sludge disposal. On its face, a large penalty fee might be expected to spur activity towards a desired end. This device works well in such areas as construction contracts. We believe, however, that if applied to the municipalities presently disposing of sewage sludge in the coastal waters, it would be patently unfair and work a severe economic hardship on the municipalities, especially the City of New York with its current financial difficulties. If the penalty fee were to be applied to the development of land-based alternatives, pursuant to the waiver provision, a crash program might ensue, and as with all crash programs, it would surely be wasteful. The City now spends about 2.5 million dollars per year disposing of its sewage sludge at sea. At present, there are no proven practical means of disposing of the City's huge quantities (105,000 dry tons per year) of sewage sludge on land. Alternatives must be developed carefully, in accordance with good engineering practices. The Interstate Sanitation Commission, with pollution control jurisdiction over the waterways in the New York, New Jersey, Connecticut area, under a Federal grant of 1.2 million dollars contracted with a consultant to investigate land disposal techniques. The costs of the proposals ranged from 22 to 5 times more than ocean dumping, and none of the recommendations can be applied today to New York City's sludge despite the claims to the contrary which are based upon very limited small scale operations. Dewatering is a prerequisite to land disposal, whether composting, incinerating, or by pyrolysis. The City of Detroit, which operates one of the world's largest sewage treatment plants, has incinerated the primary sludge generated at this plant for years. Now that the plant is being upgraded and more of its sludge is derived from secondary treatment processes, they find it virtually impossible to dewater this sludge in preparation for incineration. All of New York City's sludge results from secondary treatment and we are forewarned from the Detroit experience that only decisions based upon careful research must be made with regard to the dewatering of our sludge. This proposed amendment would mean that the City will be fined millions of dollars each year for disposing of sludge in the ocean from the date of enactment of the amendment. As pointed out above, the cost to the City today of ocean disposal is approximately $2.5 million per year. The Interstate Sanitation Commission estimated the cost of composting at $6.15 million per year. If the Federal EPA determined that composting were to be feasible, which would mean that the problem of removal of heavy metals and dewatering had been solved, then the City would be obligated to pay a penalty of $3.65 million per year or a total of $14.6 million over a four year period. The Interstate Sanitation Commission estimated the cost of pyrolysis to be about $12.5 million per year. If the Federal EPA determined pryolysis to be a feasible land-base alternative, the penalty would be $10. per year or a total of $40 million over a four-year period. The City's option to the payment of these horrendous penalties would be to embark upon a crash design and construction program of land-based facilities through the use of federal funding under Public Law 92-500. But even this approach would not automatically entitle the City to a waiver because under the language of the amendment it is the permittee-the City-that must make the expenditure equal to the difference between present disposal and land-based disposal. To qualify for the waiver under the amendment, the City would have to spend a minimum of $3.6 m. on a land-based alternative within the first year ("effective period of the permit") and succeeding years, employing only City funds ("the permittee will expend") in a manner acceptable to federal E.P.A. ("to the satisfaction of the Administrator"). These requirements would necessitate a crash program on land-based alternatives of questionable worth and at great cost to the City. The City is embarked on a $2.8 m. sludge alternative study, approved and funded (872) by the Federal E.P.A. It is doubtful that the Federal E.P.A. would continue its financial share of the program because of the inherently bad planning which such a crash program inevitably produces. Further, there is no need for a crash program. As I mentioned in my last appearance before this committee, sewage sludge disposal in the ocean comprises but 10 percent of the total pollutant load to the New York Bight. These is, therefore, no emergency need, we believe to eliminate the ocean dumping of sludge before the end of 1981. The imposition of the penalty or waiver provision will be counter productive. The loss of these funds and the Federal funding can only have negative effects upon the treatment of sewage in the City while scarcely enhancing the progress of the land-based disposal of sludge. Mr. BREAUX. Our next witness is Mr. Kenneth Kamlet, on behalf of the National Wildlife Federation. We welcome you again. We have a detailed copy of your statement. It will appear in the record and, if you will, we would encourage you to summarize it so that we can get in some questions. [The following was received for the record:] STATEMENT OF KENNETH S. KAMLET ON BEHALF OF THE NATIONAL WILDLIFE FEDERATION Thank you, Messrs. Chairmen and Subcommittee members, for the invitation to appear once again before this panel on the subject of ocean dumping. My name is Kenneth S. Kamlet and I am here on behalf of the country's largest private conservation organization-and the one which has taken a conspicuous leadership role in keeping tabs on the Federal Government's ocean dumping regulatory activities-the National Wildlife Federation (“NWF"). The purpose of this hearing is primarily to consider H.R. 5851 (H.R. 4715), a bill to amend the Marine Protection, Research, and Sanctuaries Act of 1972 regarding the issuance of interim permits for ocean dumping, and for other purposes. The Committee's invitation letter specified four issues as to which the Federation's comments were particularly desired. These issues are: 1. The effect of the bill's penalty fee on municipalities' efforts to meet the 1981 phase-out deadline; 2. The pros and cons of transferring responsibility for research into landbased alternatives from NOAA to EPA; 3. Our further views regarding the December 31, 1981 deadline; and 4. Additional comments and suggestions concerning amendments to the 1972 Act. Having carefully reviewed the proposed Committee Print of H.R. 5851, I will address each of these issues in turn. THE PENALTY FEE PROVISIONS OF H.R. 5851 Section 2 of H.R. 5851 would add several new paragraphs dealing with penalty fees to Section 102(a) of the Marine Protection, Research, and Sanctuaries Act ("MPRSA"). Paragraph (5)(A)(v) would condition the issuance of "interim" ocean dumping permits for wastes which do not meet the ocean dumping criteria on the permittee's payment of a "penalty fee." Paragraph (5)CXi) would specify that the amount of the penalty fee is to be based upon five factors: "the characteristics of the material to be dumped, the dumping location, the physical, chemical, and toxicological properties of the material, and the probable effect of the disposal on the marine food chain." Paragraph (5)CXi) would also require that any penalty fee be no less than the cost savings realized by the permittee from the use of ocean dumping rather than appropriate land-based methods. Finally, Paragraph (5)C)(ii) would allow the Administrator to waive all or part of any penalty fee if the permittee will expend an equivalent amount "on the development, demonstration, or implementation of a land-based disposal method . . . ." The objective of these penalty fee provisions seems clearly to be to eliminate the economic incentive which most ocean dumpers now have to continue ocean dumping as long as possible, and to stimulate those dumpers who cannot meet EPA's ocean dumping criteria to phaseout their ocean dumping as rapidly as possible. This is an objective which NWF can and does support whole-heartedly. The fact is that the vast majority of sewage sludge and industrial waste oceandumped since the MPRSA's effective date in 1973 has been dumped under so-called "interim" permits, in violation of the numerical limits of EPA's ocean dumping criteria. For example, a recent General Accounting Office report, problems and Progress in Regulating Ocean Dumping of Sewage Sludge and Industrial Wastes (Jan. 21, 1977), found that "[a]ll sewage sludge dumped in the ocean exceeded the EPA-established safety levels for cadmium and mercury" (at 15), that "[t]he 26 municipal permit holders in the New York-northern New Jersey area were dumping sewage sludge containing either cadmium or mercury that exceeded by more than 100 times the established safety levels" (id.), and that "[a]lmost all sewage sludge and industrial wastes are being discharged into the ocean at too rapid a rate [as determined by bioassay testing], which may be causing harm to the environment" (at 17). The penalty fee provision of H.R. 5851, together with the bill's prohibition against issuing interim permits beyond 1981 (and a third provision encouraging the use of alternatives, which we recommend for addition to the bill; see below), should adequately assure the rapid phase-out of unnecessary and environmentally destructive sewage sludge and industrial waste ocean dumping. In this regard, we would call to the Committee's attention the similar approach recommended by the EPA Administrator in the context of the Federal Water Pollution Control Act, in the form of a so-called "noncompliance fee." The noncompliance fee approach, as incorporated in Section 45 of S. 1952 (a Senate-passed bill to amend the 1972 Water Act amendments), has several features worthy of special note: (1) It requires discharges as to which the Administrator intends to impose a noncompliance fee to furnish upon request "a detailed description of the control technology or system" proposed to achieve compliance with applicable regulatory requirements, including "capital costs, debt service costs, the estimated schedule of expenditures to comply with such (requirements), and the estimated annual costs of operation and maintenance of any technology or system required to maintain such compliance," together with information on "the economic value which a delay in compliance may have for the owner or operator of the discharge source. (See, proposed Section 319 (b)(1); see also, proposed Section 319 (C)(2)(B)). This approach has the significant virtue of putting the burden on the discharger to estimate the cost of compliance with regulatory requirements, thereby indirectly defining the amount of the noncompliance fee. It is likely to yield fairly reliable information given the competing thrusts of a discharger's normal tendency to exaggerate the costs of regulatory compliance and the knowledge that the higher the estimate provided, the higher will be the noncompliance fee which the discharger must pay. It also has the virtue of making clear what factors must be included in estimates of the "cost" of legal compliance (or, in the ocean dumping case, of implementing land-based alternatives). (2) It authorizes the Administrator to retain a contractor to assist in determining the fee assessment where the owner or operator of a discharge source fails to submit a calculation of the fee assessment, in which case the cost of carrying out such a contract may be added to the penalty assessed. (See, proposed Section 319(b)(2)). This provision is desirable in providing an alternative means of setting the noncompliance fee without burdening EPA with the costs (in money and manpower) of compiling and reviewing large amounts of economic data. (3) Where a penalty fee is assessed and paid and the discharge source ultimately achieves full legal compliance, it provides for reimbursement with interest for any overpayment (i.e., where the estimated cost of compliance exceeds the actual cost), and for the assessment and collection of an additional payment with interest for any underpayment (i.e., where the estimated cost of compliance was less than the actual cost). (See, proposed Section 319(i)). Such a provision is desirable as a means of correcting any error in the estimate of the penalty fee based upon actual costs. It provides an additional deterrent to a discharger's intentional underestimation of the costs of bringing its discharge into compliance. (4) It establishes procedures for expedited judicial review of a discharger's challenge to a noncompliance fee set by the Administrator. Specifically, it limits such review to thirty days from the establishment of the penalty fee (i.e., if the discharger doesn't challenge the assessment quickly, he may not do so at all); and it precludes a judicial stay of the operation of the penalty fee pending the outcome of review, except under certain circumstances where the noncompliance was "due to reasons entirely beyond the control of the owner or operator," in which case a bond or surety must be posed in an amount equal to the potential liability during the period of the stay. (See, proposed Section 319(e)). Procedures of this kind would be especially valuable in the context of H.R. 5851, since court challenges to proposed |