Proposed NPDES Permit Fee Incentive for CWA S106 Grants

Highlights

This proposed rulemaking, not to be effective prior to fiscal year 2008, will amend the State Section 106 allotment formula to incorporate financial incentives for States to utilize an adequate fee program when implementing an authorized NPDES permit program.

Eligibility for this set-aside is limited to only those States authorized by EPA to implement the NPDES program by the first day of the fiscal year (October 1) for which funds are appropriated by Congress.

Eligible States must submit annually, by October 1, a certification to EPA that meets two additional requirements (specifically referenced within the actual rule). Ultimately, in its certification, a State must inform EPA of the total percentage of NPDES program costs recovered by the State through permit fee collections during the most recently completed State fiscal year, and a statement that the amount of permit fees collected is used by the State to defray NPDES program costs. EPA will use the information from this certification to determine any additional amount a State would receive in its Section 106 grant based on this financial incentive allotment formula.

After EPA determines the number of eligible States, each State will be eligible to receive up to a full share of the set-aside amount (capped at 50 percent of the State's Section 106 grant allotment in the previous year). EPA will determine the amount of a full share by dividing the set-aside amount by the number of eligible States. A full share will be the same amount for each eligible State. The percent of a full share that each eligible State will receive, however, will be determined by the following formula.

A State will receive 25 percent of a full share if that State has collected permit fees that equal or exceed 75 percent of total State NPDES program costs; or

A State will receive 50 percent of a full share if that State has collected permit fees that equal or exceed 90 percent of total NPDES program costs; or

A State will receive a full share if that State has collected permit fees that equal 100 percent of total NPDES program costs.