NFW-44-07-00041-P Regulation of Water and Wastewater Treatment and Distribution System in Niagara Falls

10/31/07 N.Y. St. Reg. NFW-44-07-00041-P

NEW YORK STATE REGISTER

VOLUME XXIX, ISSUE 44

October 31, 2007

RULE MAKING ACTIVITIES

NIAGARA FALLS WATER BOARD

PROPOSED RULE MAKING

HEARING(S) SCHEDULED

 

I.D No. NFW-44-07-00041-P

Regulation of Water and Wastewater Treatment and Distribution System in Niagara Falls

PURSUANT TO THE PROVISIONS OF THE State Administrative Procedure Act, NOTICE is hereby given of the following proposed rule:

Proposed action:

Amendment of Part 1960 of Title 21 NYCRR.

Statutory authority:

Public Authorities Law, section 1230-f

Subject:

Regulation of water and wastewater treatment and distribution system in Niagara Falls.

Purpose:

To regulate non-storm water discharges to the MS4.

Public hearing(s) will be held at:

5:30 p.m., Dec. 17, 2007 at Niagara Falls Water Board, 5815 Buffalo Ave., Niagara Falls, NY.

Accessibility:

All public hearings have been scheduled at places reasonably accessible to persons with a mobility impairment.

Interpreter Service:

Interpreter services will be made available to deaf persons, at no charge, upon written request submitted within reasonable time prior to the scheduled public hearing. The written request must be addressed to the agency representative designated in the paragraph below.

Substance of proposed rule (Full text is posted at the following State website: www.nfwb.org):

Water Board regulations contained in Part 1960 of Title 21 NYCRR provides for the beneficial use of the Board's System through the regulation of connection to sewer and storm water facilities and water use, as well as for the Board's equitable recovery of the cost of the System. This proposal amends Part 1960 of Title 21 NYCRR to allow the Water Board to comply with New York State Department of Environmental Conservation (“NYSDEC”) mandatory permit requirements for the management of storm water in the Water Board's System. The Water Board owns and manages a non-traditional Municipal Separate Storm Sewer System (“MS4”) that is subject to New York State permit requirements pursuant to General Permit No. GP-02-02 (“Permit”).

Pursuant to the Permit, MS4s are required to develop, implement, and enforce a storm water management program (“SWMP”) designed to reduce the discharge of pollutants from small MS4s to the maximum extent practicable to protect water quality and to satisfy the appropriate water quality requirements of the federal Clean Water Act and of the Environmental Conservation Law.

The amendments and changes to the Water Board regulations proposed herein are designed to meet SWMP and permit requirements and are based on NYSDEC's “Model Law Law To Prohibit Illicit Discharges, Activities and Connections to Separate Storm Sewer System” (“Model Law”) and will only affect storm water within the Water Board's System. NYSDEC intended its Model Law to be used as a tool for communities that are responsible for meeting the Phase II storm water management requirements of the National Pollutant Discharge Elimination System (“NPDES”) regulations, administered by New York State through the State Pollutant Discharge Elimination System (“SPDES”) regulations. The purpose of the Model Law is to assist communities in adopting provisions of local law to meet the new federal and state guidelines for prohibiting illicit discharges to municipal separate storm sewer systems. It is the combination of these amendments and changes to the Water Board regulations and the adoption of NYSDEC's Model Law provisions by the City of Niagara Falls that will provide for the complete management of storm water for the entire MS4 area within the City of Niagara Falls.

While the proposed changes to the regulations includes minor typographical changes throughout, the major substantive proposed changes to Part 1960 of Title 21 NYCRR include the following sections:

Section 1960.1, as amended, reconciles differences between existing Part 1960 definitions and the definitions in NYSDEC's Model Law. Where terms were defined in both Part 1960 and the Model Law, the definitions in Part 1960 were made to mirror those contained in the Model Law. In cases where defined terms existed in the Model Law, but not Part 1960, the defined terms were added to Part 1960. All defined terms in Part 1960 have been capitalized to denote that they are defined terms.

Section 1960.2, as amended, clarifies that the general provisions of Part 1960 apply to the Water Board's MS4.

Section 1960.3, as amended, expands the connections provisions to the Water Board MS4.

Section 1960.4, as amended, addresses appropriate use of the Water Board POTW and MS4.

Section 1960.5, as amended, describes the conditions to use the Water Board's POTW and MS4.

Section 1960.9, as amended, makes clear that administrative powers already afforded to the Director for the Water Board's POTW also apply to the Water Board's MS4, including inspection and enforcement, program goals and requirements, application of Best Management Practices, and addressing illicit discharges in emergency situations.

Text of proposed rule and any required statements and analyses may be obtained from:

Gerald Grose, Executive Director, Niagara Falls Water Board, 5815 Buffalo Ave., Niagara Falls, NY 14304, [phone], ext. 104, e-mail: [e-mail]

Data, views or arguments may be submitted to:

John J. Ottaviano, Ottaviano & Sansone, LLP, P.O. Box 1230, 172 East Ave., Lockport, NY 14095, [phone], ext. 203, e-mail: [e-mail]

Public comment will be received until:

five days after the last scheduled public hearing required by statute.

Regulatory Impact Statement

1. Statutory Authority: New York State Public Authorities Law Section 1230-f (7) authorizes the Niagara Falls Water Board (the “Board”), to make and amend rules and Regulations (the “Regulations”) governing the exercise and enforcement of its powers and the fulfillment of the purposes of the Niagara Falls Public Water Authority Act, Title 10-B of the Public Authorities Law (the “Act”).

2. Legislative Objectives: The legislature has granted the Board jurisdiction, control, possession, supervision and use of the water, wastewater and storm water facilities located in the City of Niagara Falls and related service area (collectively referred to as the “System”). Promulgation of these Regulations are in furtherance of such legislative grant and provide the means whereby the Board can deliver services to persons served by the System, and enables the Board to keep the System in good repair and working order. In addition, promulgation of these Regulations enables the Board to comply with applicable laws of the United States, and the State of New York (the “State”) and the rules, regulations, permits and orders of their regulatory agencies.

3. Needs and Benefits: The Board operates, maintains and manages the System. It provides potable water, and receives and treats discharges of wastewater for approximately 55,000 persons who reside or work in the City of Niagara Falls and the adjacent areas served by the System. The Board's Regulations establish a comprehensive program to enable the Board to operate, maintain, repair and manage the System to ensure the uninterrupted delivery of such water and wastewater services.

The Board Water Regulations at Part 1950 provide for the beneficial use of the Board's water facilities through the regulation of connections and water use, as well as for the Board's equitable recovery of the cost of the System. The Regulations generally require every dwelling, house or other building that uses water to be supplied from the water mains of the Board through a separate service. The Board regulates all connections to the System to ensure that only qualified personnel, typically licensed plumbers or qualified employees of the Board, make such connections. In addition, no work or improvements to supply water maybe performed without obtaining a permit from the Board.

Except in unique circumstances, all water is furnished to users of the System through a metered service only. The Regulations make provisions for the size and location of the meters within dwelling houses and other buildings that are served by the System. All meters remain the property of the Board and the Board has the obligation to repair, except in limited circumstances, such meters without cost to the property owner. All persons who use the System for potable water and for wastewater are charged, except in certain circumstances, based upon the metered usage of water.

The Board has established a policy to protect the public water supply against actual and potential contamination that may occur because of unauthorized cross-connection of plumbing systems. Also, the Regulations are designed to work in coordination with the Niagara County Health Department and the State Sanitary Code.

The Board Wastewater Regulations at Part 1960 provide for the maximum possible beneficial use of the Board's publicly owned treatment works through the regulation of construction, sewer use and wastewater discharges, and provide criteria for equitable distribution of the cost of the Board's publicly owned treatment works. The Regulations establish provisions to prevent the introduction of pollutants which may interfere with the operation of the Board's treatment works, pass through the treatment works to waters of the State or otherwise contaminate the Board's treatment works' sludge. The Regulations also govern sewer connections, control of quantity and quality of discharges, wastewater pretreatment, establish criteria for the use of the Board's treatment works capacity, and for the issuance of discharge permits to significant industrial users and industrial commercial users.

The Regulations also regulate industrial discharges and significant industrial users as to the quantity and quality of their discharges and for the pretreatment of industrial wastewater. Certain discharges are expressly prohibited, and are set forth in the Regulations with incorporation by reference to federal Regulations established by the United States Environmental Protection Agency. In addition, the Board has established local limits in accordance with the provisions of 40 C.F.R. Part 403.

The Board also has authorization pursuant to the Act Section 1230-g to engage in special enforcement powers with respect to its wastewater facilities and to otherwise undertake enforcement activity for persons who violate the Regulations with administrative and civil penalties.

4. Costs:

Costs to Regulated Persons: The Regulations obligate all users of the System to pay and be liable to pay the Board for such fees, rates and other charges as the Board may establish from time to time. A schedule of such fees, rates and charges is set forth in Section 1950.20 and also in several provisions of Part 1960. These rates, fees and other charges include a range from initial tapping and permit application fees, to consumption charges for each calendar quarter, termination fees and other usage fees. Each year, the Board, with the assistance of Black & Veatch New York, LLP, as rate consultant, establishes a budget based on its projected expenses, including, among other things, labor, property maintenance, equipment purchases and maintenance, supplies, capital improvements and debt service. The schedule that the Board develops is designed to enable the Board to pay for these expenses as well as to maintain various covenants with its bondholders.

Rates for water usage and wastewater discharges are based on several factors and are set forth in Section 1950.20. Rates are established based on cubic feet of water consumed for each three months (calendar quarter), with a progressive rate so that the rate decreases per 100 cubic feet for increased consumption. For example, in 2003, consumption of the first 20,000 cubic feet was charged at $ 1.95 per 100 cubic feet, while the next succeeding 60,000 cubic feet in the same three month period would be charged $ 1.70 per 100 cubic feet, the next succeeding 120,000 cubic feet in the same three month period would be charged $ 1.43 per 100 cubic feet and any usage in excess of 200,000 cubic feet for the same three month period would be charged $ 1.19 per 100 cubic feet. The minimum charge for water consumed in any premises within the City for any calendar quarter, or portion thereof is $ 25.35. These rates increase for persons and properties located outside of the City of Niagara Falls based on the additional cost that is incurred in the pumping and maintenance of the System beyond the City line.

In addition, sewer rates for Commercial Small Industrial Residential Users (CSIRU) and Significant Industrial Users (SIU) are also determined by total metered consumption in each quarter. These rates are set forth in Part 1950.20. Sewer rates for the SIU class of users in each quarter are based on measured quantities of actual discharge parameters: flow, suspended solids and soluble organic carbon. The Regulations authorize the Board to make determinations as to these parameters and provide for five representative 24 hour composite samples taken quarterly, at locations that are adequate for and accessible to the Board representatives. A separate schedule of charges is established for conventional pollutant parameters and for SlUs with discharges that contain substances of concern as set forth in Schedule III of Section 1950.20. In addition to its analysis of the budget to operate and maintain the System, the Board will also seek to recover its real costs which mean the total direct and indirect costs of labor, material, equipment and handling, including overhead costs that it incurs in delivery of special services to individual users.

Costs to the Board, the State and Local Governments: The implementation and continuation of the Regulations should not impose any costs upon the State. The Board will continue to work with the City of Niagara Falls and use various employees of the City for, among other things, billing and collection of the rates, charges and fees. In addition, the Board has reserved the right to use the office of the corporation counsel to assist in the enforcement of any Regulations, permits or orders that have been violated by users of the System. The Board has provided for such expenses in its budget and has sought to recover such expenses as part of its rate structure referenced above. The Board will reimburse the City of Niagara Falls for the use of any employees and equipment to undertake such activities. Also the Board will continue employment of approximately 9.4 persons (measured in person hours) to administer the Board's wastewater pretreatment program.

Cost Methodology: The Board has retained the services of Black & Veatch New York LLP as its rate consultant. Periodically, and at least annually, Black & Veatch will perform a rate study to ensure that the Board rates, fees and other charges will be sufficient to provide for a balanced budget in light of anticipated and estimated expenses as referenced above. Black & Veatch is a recognized expert rate consultant which serves several municipalities and other agencies in the State that provide water and wastewater services to the public.

5. Local Government Mandates: The Regulations will not impose any new program, services, duties or responsibilities upon any county, city, town, village, school district, fire district or any other special district. The Niagara County Health Department will continue to assist the Board, as it has previously assisted the City, with respect to certain certifications for back flow prevention and compliance with the County Health Law and the State Sanitary Code.

6. Paperwork: The Regulations continue the existing regulatory program that was previously employed by the City of Niagara Falls. No additional or new reporting requirements or paperwork requirements are established for persons regulated by the Board. The Regulations continue to employ application forms for water and wastewater discharge permits, tapping application and the like. In addition, CSIRU's and SIU's will continue to provide monitoring reports, and when served with notices of violations, or administrative orders, such users will be required to provide additional documentation to correct and otherwise address such violations and orders.

7. Duplication: The City of Niagara Falls continues to have on its records, Water Ordinances and Wastewater Ordinances as part of its City Code upon which the Board Regulations are modeled. The Regulations have been established in substantial conformance with such ordinances. It is anticipated that the City will, in the coming year, cancel such ordinances.

8. Alternatives: The Board did not give any consideration to other alternative proposals to the Regulations before deciding to promulgate them.

9. Federal Standards: The Regulations do not exceed any minimum standards of the federal government for the same or similar subject area. The wastewater pretreatment Regulations embodied in 40 C.F.R. Part 403 authorize the Board to establish local limits that may be different than those prescribed generally by these federal regulations. The local limits are set forth in Part 1960.5.

10. Compliance Schedule: The Board has promulgated the Regulations in substantial conformance to the Water and Wastewater Ordinances that have been previously in effect by the City of Niagara Falls for all persons who are served by the System. The Board has not adopted any significant changes and, therefore, it does not anticipate any additional time necessary to require regulated persons to achieve compliance with the Regulations.

Regulatory Flexibility Analysis

1. Effect of Rule: When the Board acquired the System on September 25, 2003 it established by emergency procedure the Regulations in substantial conformance with the Water and Wastewater Ordinances that were previously in effect in the City of Niagara Falls. Accordingly, the Board continued the same regulatory program that was in effect, previously administered by the City, prior to the Board's takeover of the System as of such acquisition date. No new regulation or requirements were established as part of the Board's adoption of the Regulations. Based on the disclosures by the City to the Board as part of the acquisition, the System serves a population of approximately 55,000 persons according to the 2000 census. This includes approximately 19,220 residential, industrial, commercial and governmental accounts. Water consumption and wastewater discharges can be classified pursuant to consumption of water as follows: residential/commercial users, 18,894; industrial users, 272; significant industrial users, 26; and non-resident users, 28. Of these accounts, approximately 275 constitute small businesses within the definition of the State Administrative Procedure Act (“SAPA”). In addition, the System serves the public buildings of the City of Niagara Falls and the Niagara Falls School District and several public buildings of Niagara County. It also provides wastewater services through mutual service agreements to limited portions of the Town of Niagara.

2. Compliance Requirement: No new reporting, recordkeeping or other affirmative acts are required by small business or local governments as a result of the Board's adoption of the Regulations. The same reporting, recordkeeping and actions that were previously required of small businesses and local governments prior to the Board's adoption continue after the Board's adoption of these Regulations. These requirements have included completion of application forms for contractors who need or desire to tap into the System for purposes of construction, repair or rehabilitation of water and wastewater pipes and other appurtenances, and applications for discharge permits into the wastewater System. Significant industrial users and other commercial and industrial users that are subject to the pretreatment requirements of the Regulations are required to continue to produce monitoring reports, and as necessary pursuant to administrative orders, provide specific periodic monitoring reports including laboratory analyses of their wastewater discharges.

3. Professional Services: No new professional services are required of small businesses or local governments by virtue of the Board's adoption of the Regulations. Again, as in the ordinances that have been in effect in the City of Niagara Falls, industrial users and significant industrial users may need the assistance of consulting engineers, or experts in water and wastewater Systems with respect to the repair, replacement and monitoring of their facilities and discharges.

4. Compliance Costs: No initial or new capital costs will be incurred by regulated businesses, industry or local governments to comply with these Regulations. The Board has adopted the Regulations that have been in effect as ordinances in the City of Niagara Falls. It is difficult to estimate the annual cost for continuing compliance with the Regulations for small business. The compliance cost may vary depending upon the type and/or size of such business and the complexity of its discharges. Moreover, the costs for the Board's pretreatment program are factored into the sewer rates the Board charges all industrial and commercial users and are set forth in Part 1950.20. It is not anticipated that any changes will occur in the compliance cost for local governments as a result of the Board's Regulations. The Regulations continue the same compliance requirements that were in effect before the Board acquired the System on September 25, 2003. There is no change in the economic and technological feasibility of compliance required for small businesses and local governments by virtue of the Board's adoption of these Regulations. There is no additional technology required for small businesses.

5. Economic and Technological Feasibility: There is no change in the economic and technological feasibility of compliance required for small businesses and local governments by virtue of the Board's adoption of these Regulations. There is no additional technology required for small businesses.

6. Minimizing Adverse Impact: The Regulations provide for the beneficial use of the Board's water and wastewater facilities for all users of the System through the regulation of connection, water use and wastewater discharges as well as for the Board's equitable recovery of costs of the operation, maintenance and management of the System. Provision is made for the confidentiality of persons who use the System and the information that they provide in accordance with the Freedom of Information Law and other applicable state and federal statutes and regulations. Generally, the Board's main function is to make sure that the users receive potable water and that wastewater discharges are conveyed and treated in a manner that protects and preserves the public health, safety and welfare and minimizes the contamination of the waters of the State. The Regulations establish compliance and reporting requirements only as necessary to comply with the Safe Drinking Water Act, the Clean Water Act and other federal and state mandates with respect to water and wastewater. Such mandates do not provide any particular exemptions or accommodations for small businesses and local governments.

7. Small Business and Local Government Participation: The Regulations were adopted by the Board on an emergency basis as authorized by SAPA. The Board is publishing the Regulations at this time with a request for comment by the general public and by persons served by the System. The Board will take into account any comments that it receives in accordance with the requirements of SAPA. The Board has conducted two public hearings with respect to its schedule of rates, fees and other charges upon public notice in accordance with the Public Authorities Law. The Board has made the Regulations available for public inspection and comment at the Board's office and at the Office of the City Clerk of Niagara Falls. It has published public notices of the availability of the Regulations for review and comment. In addition, the Board has conducted several public meetings prior to and after its acquisition of the System and has regularly provided opportunity to the public to comment on any aspects of the Board's activities, including the Regulations.

Rural Area Flexibility Analysis

The System and the Board do not serve any rural areas as defined by Subdivision 7 of Section 481 of the Executive Law. The Board serves the City of Niagara Falls and select urban areas adjacent to or near the City of Niagara Falls. Since no rural areas will be affected by the Regulations, a rural flexibility analysis is not required.

Job Impact Statement

The Regulations will not have a substantial adverse impact on jobs and employment opportunities. Therefore, a job impact statement is not required.

The City of Niagara Falls, prior to the Board's acquisition of the System, has lost a number of its largest water and wastewater customers in recent years. In 2002, the water System's three largest customers underwent significant changes. DuPont has reduced its demand for water due to the elimination of certain industrial processes. Both SGL Carbon and Carbon Graphite have shut down, the latter having filed for bankruptcy protection.

The population of the City of Niagara Falls has declined in recent years. In 1980 the population in the City was 71,384. In 1990 the population was 61,840, and in 2000 the population was 55,593 persons according to the U.S. Bureau of the Census. In addition, the annual average unemployment rate in the City in 2002 was 11.2% and in the County of Niagara the unemployment rate was 7.5% pursuant to information available from the New York State Labor Department.

Despite the customer and population losses, the City has experienced a recent positive development. In late 2002, the Seneca Indian Nation and the State entered into a compact that provides for the tribe to develop approximately 55 acres of land in the City's downtown area. The long-term plans call for a gaming casino, hotels, a retail complex, restaurants, an entertainment complex and a variety of other attractions. A temporary casino opened December 31, 2002 and currently has approximately 2,200 employees and an average of 20,000 daily visitors on the weekends.

In response to the decline in the industrial sector and the associated revenue loss, several cost saving measures have been established with regard to the System's facilities, operations and maintenance. One such measure deals with staffing. The water facilities have reduced staff levels by 24% since 2000. The 2003 budget eliminated 17 additional jobs within the water and wastewater facilities. A second measure features stringent budget cost controls that have yielded significant expenditure reductions over the last three years. On the revenue side, the Board has assumed from the City nine cellular antenna lease agreements for installation of cell towers at elevated water storage tanks. This currently generates revenue of approximately $ 168,000 per year in an effort to reduce the reliance on water rates and charges on users.

The Board also intends to conduct a comprehensive rate study for both the water System and the wastewater System. In addition to reviewing the current rate structure and the cost allocations for each customer class, the study should recognize the steady decline of the industrial user class and propose a rate structure to accommodate the changing customer base. In addition, the Board will continue to actively market its hauled waste services to expand its services to businesses that may haul wastewater to the System. The System has capacity to treat more wastewater than is currently discharged by users located in the City of Niagara Falls.