Nature of Activity: U.S. EPA, with the aid of the Pennsylvania Department of Environmental Protection, sponsored a project that simulated the creation of four trading programs in Pennsylvania. The project aimed to gain experience in developing trading programs and to help agencies that might consider initiating or participating in trading programs. Of the simulations that were performed, the one with the most potential to become a real trade involves a POTW expansion in Westfalls Township, PA. Westfalls is planning a significant expansion of its POTW that discharges to the Delaware River. The Delaware River Basin Commission has designated this area of the river as Special Protection Waters, in which any new or significantly expanding discharger may not effect a "measurable change" in existing water quality. Moreover, new or significantly expanding POTWs are prohibited from discharging until they have exhausted "load reduction" options. The DRBC requires expanding plants to offset both direct and indirect loads generated by their expansion. The Westfalls POTW may seek offsets by financing improvements at a POTW in Port Jervis, NY and/or by financing BMPs and installation of sewer connections to replace failing septic systems.

Environmental Problem: The area has been classified by the DRBC as having "exceptionally high scenic, recreational, and ecological values." The Special Protection Waters Designation is aimed at protecting the area’s water quality and places very stringent restrictions on new discharges.

Pollutant(s) / Pollution Type(s): CBOD, total suspended solids, ammonia, phosphorus and nitrogen

Trade Types: The trade could potentially involve point/point and point/nonpoint reductions.

Stage of Implementation: The DRBC created the Special Protection Waters classification in 1992 and amended the regulations in 1994. The simulation group met several times during the Spring and Summer of 1999, however actual investigation into potential trades has not begun in earnest.

Relation to TMDL: These waters meet all applicable standards and no TMDL is planned. The intent of the offset requirement is to protect these high quality waters.

Number of Potential Participants: POTWs of West Fall and Port Jervis, NY DEP and PA DEP, U.S. EPA, DRBC, various landowners.

Trading Ratios: Ratios would be decided case-by-case and pollutant-by-pollutant. The simulation group concluded that a minimum ratio of 1.1:1 would be desirable to achieve environmental benefits.

Estimated Cost Savings: Unknown.

Available Written Information: The DRBC Water Quality Regulations are available from the DRBC. A final report on the simulation project was submitted to EPA in late 1999.

Innovative Aspects: The trade would be designed to offset both the POTW’s direct discharge and any new, indirect discharge(such as storm water) from the growth that the expanded POTW would serve. Moreover, the trade would be designed to offset a broad set of pollutants, rather than just one pollutant or class of pollutants. This is one of very few potential trades involving requirements intended to protect high quality waters rather than requirements intended to improve degraded waters. Finally, if Port Jervis, NY is involved, the trade would be an interstate trade.

Obstacles: Coordinating between the State, Federal, and Basin regulatory agencies over many pollutants may prove difficult.

Web Sites: http://www.epa.gov/surf2/hucs/02040104/

Contacts: Charles Marshall, Philip Services Corporation, (215) 643-5466, cmarshall@philipinc.com

Paul Scally, Delaware River Basin Commission. (609) 883-9500, pscally@drbc.state.nj.us