Kevin C. Klein

Homeowners in the State of Rhode Island, and across the country, rely heavily on individual sewage disposal systems (ISDSs) for the treatment and disposal of domestic wastewater. In 1968 the State of Rhode Island began regulating these systems to minimize human health, environmental and economic risks associated with poor performance of ISDSs. Regulation of the design, construction, siting and installation of these systems has progressed as a greater understanding of septic systems processes has been acquired. However, regulation falls short with respect to providing homeowners with incentives to take necessary maintenance measures and repair or replace antiquated systems. In 1987 enabling legislation was passed allowing municipalities to implement Wastewater Management Districts. The Department of Environmental Management hopes to push the implementation of WWMDs in Rhode Island communities as a means of regulating homeowner maintenance. There are several limitations to a regulatory approach of this sort. A conceptual framework for an alternative regulatory approach, an insurance requirement, is presented. A comparative analysis was completed to illustrate the advantages and disadvantages of each strategy. The criteria for evaluation includes the effectiveness, efficiency, ideological concerns, and political feasibility of each approach. In terms of effectiveness, WWMDs have proven their ability to insure adequate homeowner maintenance, while little "real world" experience with market-based approaches like an insurance requirement is available. An economic analysis shows the potential of incentive-based regulatory approaches to achieve regulatory goals in a cost-effective manner. Ideologically, each strategy presents merits. Command and control techniques such as WWMDs explicitly state the goals and objectives of regulation, while incentive-based pricing has the potential to align our economic system with an ecologically sound "land ethic." With respect to political feasibility, WWMDs while unpopular at the local level, stand a good chance of being implemented across the state. Alternative regulatory approaches are being increasingly studied and experimented with, but the likelihood of implementing an insurance requirement is slim. Upon completion of this analysis a hybrid regulatory approach was designed in an attempt to incorporate the advantages of each option into a single regulatory approach. It is recommended that DEM continue encouraging communities to implement WWMDs with an incentive-based pricing schedule similar to that which an insurance requirement would provide.