Nature of Activity: A watershed-wide pilot trading project is being developed in the Rock River Basin as part of the State of Wisconsin’s program to investigate trading. The Rock River Watershed Partnership, a stakeholder group in the Basin, is spearheading the program. The Partnership is not a legal entity, thus the POTWs in the basin that may need to achieve nutrient load reductions formed a separate group to raise funds to conduct studies. The Partnership includes the POTWs but represents a broader group. A Partnership committee has examined nearly fifty separate issues concerning trading. In 1997 the Partnership entered into a Memorandum of Understanding (MOU) with the Wisconsin DNR that stated, among other things, that the DNR will not pursue point sources for additional reductions in loadings of phosphorus or other pollutants if the reductions can be achieved more cost-effectively through control strategies for non-point sources. The MOU also called for investigating effluent trading as a possible approach for achieving reduced nutrient loads.

Environmental Problem: General water quality in the basin.

Pollutant(s) / Pollution Type(s): Currently phosphorus is the pollutant being studied, however, a successful program may encourage development of trading for other pollutants.

Trade Types: Both point/point and point/nonpoint trades are being investigated, though the latter seem most promising.

Stage of Implementation: Development of the program began in 1996 when the Partnership was formed by several municipalities that were evaluating phosphorus control measures in the basin. In January, 1996, the WI DNR concluded a MOU with the World Resources Institute to study the basin. In January, 1997, the Partnership entered into an MOU with the WI DNR to find solutions to water quality issues. Modeling and monitoring have been underway for approximately a year. Each of the POTWs must decide before May, 2000, whether it will participate in a trade. Those that participate must complete a trade before 2002; those that decide not to participate must upgrade their facilities by October, 2002.

Relation to TMDL: TMDL development for some segments of the basin will commence within two years. There is no explicit relationship now between the trading program that is being explored and the plans for TMDLs. The Rock River Partnership’s meeting notes reflect some concern about how trading contracts and obligations may be affected if they predate TMDL obligations.

Number of Potential Participants: Over sixty participants had committed to the program as of late 1999; of these, 24 are POTWs and the remainder are counties, industries and environmental groups.

Trading Ratios: A range of ratios from 1.6:1.0 to 3.7:1.0 will be employed depending on a variety of factors such as location and impact on the receiving waters.

Estimated Cost Savings: Potential cost savings are being analyzed. WRI found that effluent trading had the potential to be very cost-effective, but studies of savings to specific POTWs or from specific BMPs have not yet been conducted.

Available Written Information: The first and second annual reports to the Governor from the Wisconsin DNR are available. Several updates on the Rock River program are available from the Partnership.

Innovative Aspects: The Partnership has explicit goals, including identifying the least-cost-mix of solutions. Participants are being asked to help pay for modeling and monitoring to "buy in" to the trading program. Active participation in the program allows permitted facilities to defer upgrades.

Obstacles: The costs for the studies were more substantial than originally anticipated and securing funding has been difficult. Establishing the trading ratios was difficult as well.

Web Sites: Crawfish: http://www.epa.gov/surf2/hucs/07090002/

Contacts: Mary Anne Lowndes, WI DNR, (608) 261-6420, lowndm@dnr.state.wi.us

Suzanne Wade, Rock River Partnership (920) 674-8972, sswade@facstaff.wisc.edu