112.7(h)(1) requires a quick drainage system for tank truck
loading/unloading areas where rack area drainage does not flow into a
catchment basin or treatment facility designed to handle discharges.

Valves for drainage from diked areas.  Sections 112.8(b)(2) and
112.12(b)(2) require appropriate drainage from diked areas using valves
of manual, open-and-closed design.

Drainage systems from undiked areas.  Sections 112.8(b)(3) and
112.12(b)(3) require drainage systems from undiked areas with a
potential for a discharge to flow into ponds, lagoons, or catchment
basins designed to retain oil or return it to the facility.

Requirements for pump transfer.  Sections 112.8(b)(5) and 112.12(b)(5)
require that where drainage waters are treated in more than one
treatment unit and such treatment is continuous and pump transfer is
needed, then two “lift” pumps are provided and at least one of the
pumps is permanently installed.

Capital and O&M Cost Estimates

	One of the final rule amendments is to provide an optional alternative
to the general secondary containment requirements for oil-filled
operational equipment that meets qualifying criteria.  For this
analysis, EPA developed new cost estimates for performing integrity
testing and for providing secondary containment at facilities with
qualified oil-filled operational equipment.  For other capital and O&M
activities, the Agency used the cost estimates developed as part of the
economic analysis in support of the 2002 SPCC rule, converted to 2005
dollars.

Integrity Testing

	EPA estimated the annualized cost of conducting integrity testing at
approximately $120 for owners and operators of Category I facilities,
$350 for owners and operators of Category II facilities, $2,640 for
owners and operators of Category III facilities, and $15,700 for owners
and operators of Category IV facilities.  The unit cost of integrity
testing was estimated based on interviews with several tank inspectors
and engineering firms.  The unit cost was estimated at $700, $1,000,
$3,000, and $10,000 per tank for owners and operators of Category I,
Category II, Category III, and Category IV facilities, respectively.
The cost of performing integrity testing could vary significantly
depending on the container type, capacity, type of oil, and other
site-specific factors.

	For this analysis, according to industry standards (e.g., API-653 and
STI SP-001), EPA assumed that tanks would be subject to inspection and
integrity testing once every 10 years.  In practice, however, the
interval between successive inspections depends on the tank and service
conditions (in particular, tank configuration, the shell thickness and
expected corrosion rate) and can exceed 10 years.  The maximum interval
between inspections under the API-653 standard is 20 years.  Therefore,
in some cases, owners or operators of facilities may perform integrity
testing less often than every 10 years.  The 2002 SPCC rule allows the
use of environmentally equivalent measures in lieu of inspection and
integrity testing, consistent with good engineering practice.  Such
measures may have lower operational costs.  For example, for shop-built
containers with a shell capacity of 30,000 gallons or under, an
environmentally equivalent measure might be to combine appropriate
visual inspection with elevation of the container such that all sides
are visible and corrosion is minimized.  As a result, EPA's analysis may
overestimate the cost of integrity testing incurred by an owner or
operator of an average facility.  EPA calculated the total cost of
integrity testing per facility by multiplying the cost for a single tank
by the number of tanks per facility.

Secondary Containment

	EPA estimated the one-time cost of implementing secondary containment
requirements at new facilities with qualified oil-filled operational
equipment at approximately $11,000, $27,500, and $60,000 per facility
respectively for owners and operators of Categories I&II, Category III,
and Category IV facilities.  The unit costs of providing secondary
containment were estimated based on an interview with a specialized
engineering firm that provides secondary containment to electrical
substations and subsequent comments provided by electric utilities.  The
cost of constructing a secondary containment structure is a one-time
capital expenditure that EPA assumed owners and operators would incur in
the first year.  Some burden is associated with maintenance of secondary
containment such as debris removal, etc.  EPA did not include a cost
estimate for this type of maintenance activity, as the Agency assumed
that the cost for these activities is embedded in the overall facility
maintenance costs and is not significant.  The Agency assumed that the
cost of providing secondary containment for facilities of other
industries would be similar to that for electrical substations.

Other Capital and O&M Activities

	As part of the economic analysis in support of the 2002 SPCC rule, EPA
estimated compliance costs associated with other capital and O&M
activities.  The estimates in   REF _Ref140571258 \h  Exhibit 5-3
present costs developed for the 2002 rule converted to 2005 dollars.
The largest component of other capital and operational costs for owners
and operators of new facilities is the costs related to the installation
of a drainage system for tank truck loading/unloading areas.  The
first-year cost to install this system is estimated at $33,800 to
$67,600 for owners and operators of Category III and IV facilities,
respectively.   The only compliance activity presented in   REF
_Ref140571258 \h  Exhibit 5-3  that is directly impacted by the 2006
SPCC final rule is the cost of providing secondary containment for
qualified oil-filled operational equipment.  Other unit cost estimates
are illustrated in   REF _Ref140571258 \h  Exhibit 5-3  for reference
only.

	  REF _Ref140571258  Exhibit 5-3  below summarizes the estimated
capital and O&M costs that owners and operators of facilities are
assumed to incur to comply with SPCC regulations.  The requirements vary
between storage and production facilities.

Exhibit   STYLEREF 1 \s  5 -  SEQ Exhibit \* ARABIC \s 1  3

Estimated Capital and O&M Costs by Facility Type

Cost Item	Categories I and II 	Category III	Category IV

New Facilities

O&M Costs

Integrity Testing	$170	$2,640	$15,700

Spill Prevention Briefing	$163	$404	$656

Capital Costs

Secondary Containment (Facilities with Oil-Filled Operational Equipment)
$11,000-$60,000

Drainage System for Tank Truck Loading/Unloading Areas	$0	$33,800
$67,600

Valves for Drainage from Diked Areas	$730	$2,300	$14,400

Drainage Systems from Undiked Areas	$2,700	$5,400	$93,100

Requirements for Pump Transfer (Storage Facilities)	$0	$3,440	$13,800

Total1 (Production Facilities)	$14,800-$63,800	$56,300-$105,000
$203,000-$252,000

Total1 (Storage Facilities)	$14,800-$63,800	$59,700-$109,000
$216,000-$265,000

Existing Facilities

O&M Costs

Integrity Testing	$170	$2,640	$15,700

Spill Prevention Briefing	$154	$380	$618

Capital Costs

Drainage System for Tank Truck Loading/Unloading Areas	$0	$69	$137

Valves for Drainage from Diked Areas	$56	$165	$931

Drainage Systems from Undiked Areas	$0	$0	$0

Requirements for Pump Transfer (Storage Facilities)	$0	$69	$274

Total1 (Production Facilities)	$389	$3,280	$17,400

Total1 (Storage Facilities)	$389	$3,350	$17,700

1 	The numbers do not add up to the total due to rounding.

Alternative Requirements Offered by the Final SPCC Rule

Oil Spill Contingency Plan for Facilities with Qualified OFE

	In its final revisions to the SPCC rule, EPA is providing owners and
operators of facilities with certain types of oil-filled operational
equipment the option of preparing an oil spill contingency plan and a
written commitment of manpower, equipment, and materials in lieu of
providing secondary containment for qualified oil-filled operational
equipment, without making an individual impracticability determination
as required in §112.7(d).

	EPA developed a unit-cost estimate for preparing an oil spill
contingency plan in 2005 to evaluate the potential impacts of the final
revisions to the SPCC rule.  A facility owner or operator, who chooses
to prepare an oil spill contingency plan instead of providing secondary
containment, would incur labor and capital costs.  This section
describes major activities involved in plan preparation and
implementation, as well as capital expenditures.

	EPA assumed that the activities associated with preparing a contingency
plan are similar to those required by a Facility Response Plan (FRP).
Therefore, the hour and cost burden estimates associated with preparing
a contingency plan are based on burden estimates developed for an FRP.
Since an FRP is more complex than an oil spill contingency plan, the FRP
cost estimates were adjusted downward to estimate the burden for the
contingency plan.  EPA assumed that the following elements would be
included in the oil spill contingency plan preparation:

Emergency Response;

Hazard Evaluation;

Discussion of Spill Scenarios;

Discharge Detection; and

Plan Implementation.

	Given the smaller requirements for a contingency plan offered by the
final SPCC rule compared to the FRP requirements, the cost associated
with each of these elements was assumed to be half the FRP cost (except
for discharge detection, which was assumed to be the same).  The cost
estimates were inflated to $2005 using the Bureau of Labor Statistics(
Producer Production Index.  EPA assumed that the managerial, technical,
and clerical percentage of the total labor burden associated with
preparing a contingency plan is the same as that for preparing a new
SPCC Plan.  The typical annual cost of preparing an oil spill
contingency plan is estimated at $818.

	Another labor component associated with the contingency plan option
involves training facility personnel for future amendments to the
contingency plan.  Using best professional judgment, EPA estimated that
it would take approximately five hours of technical personnel’s time
to perform contingency plan training at a typical facility.

	The capital expenditures associated with contingency plan preparation
and implementation consist of two major items, upgrading hand-held
communication equipment and providing response equipment.  A typical
upgrade of communication equipment would require purchasing six two-way
radios, five for facility personnel and one for a response coordinator.
Based on comparable market prices, EPA estimated the cost of two-way
radios at $50 each.  Response equipment required as part of the
contingency plan varies across facilities depending on industry profile
and size.  In its estimation of a typical cost of response equipment,
EPA assumed that a facility owner or operator would need to provide
approximately 100 feet of containment boom.  The total cost for response
equipment consists of (1) a 95-gallon Overpack Spill Response Kit,
estimated at $495, (2) oil containment boom, estimated at $621, and (3)
an oil skimmer, estimated at $1,000.     REF _Ref140571323  Exhibit 5-4
presents the hour and cost burden estimated for a typical oil spill
contingency plan.

Exhibit   STYLEREF 1 \s  5 -  SEQ Exhibit \* ARABIC \s 1  4

Estimated Cost of Preparing a Typical Contingency Plan

Activity	Burden Hours	O&M Costs	Total Cost

	Management

($55.7/hr)	Technical

($47.9/hr)	Clerical

($25.3/hr)	Total Labor Hours

Prepare a contingency plan	2.5	12	4	18	-	$815

Train personnel for contingency plan amendment	-	5	-	5	-	$240

Upgrade hand-held communication equipment	-	-	-	-	$300	$300

Response equipment (site-specific)	-	-	-	-	$2,120	$2,120

Total1	2.5	17	4	23	$2,420	$3,470

  1 	The numbers do not add up to the total due to rounding.

State Overlap

	Each state has its own regulations regarding the storage, handling, and
containment of oil.  In some cases, the effort required by these state
regulations may be similar to or the same as what is required by the
SPCC rule.  Without taking into account similar requirements imposed by
state regulations, the cost of compliance and cost savings associated
with the regulatory changes could be overestimated.

	The economic analysis of the 2002 SPCC rule attempted to account for
overlap between the state requirements and that rule.    SEQ CHAPTER \h
\r 1 The analysis revealed that 19 states had prevention planning
requirements pursuant to state law.  In certain cases, state regulations
closely track or incorporate by reference federal SPCC requirements.  In
other cases, the degree of overlap is less complete but is still
substantial.  Based on a comparison of state regulations with a list of
major SPCC planning requirements, EPA divided the 19 states into three
overlap groups (complete, substantial, or partial), depending on the
degree of overlap between the federal and state requirements.  Based on
the findings from the 19 states, EPA developed a nation-wide estimate
for the degree of overlap between federal and state requirements.    REF
_Ref140571355  Exhibit 5-5  presents the estimated percentage reduction
on total burden attributed to overlap in requirements between the SPCC
rule and state regulations.

Exhibit   STYLEREF 1 \s  5 -  SEQ Exhibit \* ARABIC \s 1  5

Estimated Percentage Reduction in Total Burden Due to State Overlap

Degree of Overlap	Categories I and II	Category III	Category IV	Total

Complete Overlap	4.4%	11.2%	15.1%	5.9%

Substantial Overlap	3.1%	7.8%	10.8%	4.2%

Partial Overlap	2.1%	5.3%	7.6%	2.8%

Total	9.6%	24.2%	33.4%	13.0%

	As part of the regulatory analysis for the 2005 proposed SPCC
amendments, EPA studied the overlap of state regulations to determine
whether to adjust the estimate to account more accurately for recent
changes in state requirements and/or refine the previously generated
estimates.  As a result of this review, the Agency concluded that there
was non-compelling evidence to adjust the overlap estimate between the
SPCC final rule and state regulations.  When assessing cost savings
resulted from the reduced SPCC requirements, EPA takes into account the
estimated degree of overlap to avoid double counting.  However, the
overlap estimates are applicable only to the regulatory relief options
that involve the total cost of compliance, such as reduced requirements
for motive power.  The reduced burden due to state overlap was estimated
by applying the percentages presented in   REF _Ref140571355  Exhibit
5-5  to the total burden associated with each paperwork compliance
activity.

Annualizing Estimated Changes in Compliance Costs

	Changes in compliance costs presented in subsequent chapters (Chapter
REF _Ref140640019 \r  6  through Chapter   REF _Ref140640034 \r  9 ) are
estimated in annualized net present values over a ten-year period.
First, EPA calculated the net present value of a projected stream of
future cost savings using the 3 and 7 percent discount rates.  EPA
defined the ten-year period of analysis as 2008 through 2017.  The net
present value of a projected stream of cost savings is calculated by
multiplying the estimated savings in each year by a time-dependent
weight, dt, and adding all of the weighted values as follows:

After the present value of costs is calculated using the NPV formula
above, this present value is then annualized according to the following
formula:

Note that the annualized cost is the amount one would have to pay at the
end of each period to add up to the same cost in present value terms as
the stream of costs being annualized.

  SEQ CHAPTER \h \r 1 Qualified Facilities

EPA is amending the Oil Pollution Prevention regulation (40 CFR part
112) to provide an option to the owner or operator of a facility that
meets specific qualifying criteria (hereafter referred to as a
“qualified facility”) to self-certify his/her SPCC Plan in lieu of
certification by a PE.  The eligibility criteria are included in a new
section of the rule at §112.3(g).  According to §112.3(g), the
self-certification option is available to the owners and operators of
those facilities that (1) have had no single discharge as described in
§112.1(b) greater than 1,000 gallons or no two discharges as described
in §112.1(b) each greater than 42 gallons within any 12-month period
during the three years prior to the SPCC Plan self-certification date,
or since becoming subject to 40 CFR part 112 if the facility has been in
operation for less than three years; and (2) have 10,000 gallons or less
in aggregate aboveground oil storage capacity.

EPA is amending §112.6 of the rule to outline the requirements that
apply to qualified facilities with 10,000 gallons or less in aggregate
oil storage capacity.

The rest of this chapter is organized as follows:

Section   REF _Ref140641465 \r  6.1  summarizes the changes in
regulatory requirements applicable to qualified facilities.

Section   REF _Ref140641473 \r  6.2  describes the projected universe of
affected facilities.

Section   REF _Ref140641482 \r  6.3  provides an estimate of cost
savings resulting from the rule changes.

Changes in Regulatory Requirements

In §112.6(b), EPA describes the requirements applicable to qualified
facilities (those that have 10,000 gallons or less in storage capacity).
 Owners or operators of qualified facilities have the option of
self-certifying the SPCC Plan for their facility.  Self-certified Plans
for these facilities may include “environmentally equivalent”
deviations to required Plan elements, as provided in §112.7(a)(2), or
impracticability determinations with respect to any secondary
containment requirements as provided in §112.7(d).  However, such
deviations or determinations must be reviewed and certified in writing
by a PE.  EPA outlines the requirements for PE certification of parts of
a self-certified plan in §112.6(b)(4).

The option to self-certify a facility-specific SPCC Plan according to
the requirements in §112.6(b) is available to any qualified facility
having 10,000 gallons or less in storage capacity.  EPA assumed that
owners and operators of all new qualified facilities with storage
capacity of less than 10,001 gallons would self-certify the Plan instead
of having it certified by a PE.  The Agency also assumed that under the
new requirements, owners and operators of all existing qualified
facilities would not use a PE to certify a technical amendment to their
Plan.

Universe of Affected Facilities

EPA estimated that approximately 327,000 facilities with oil storage
capacities of 10,000 gallons or less would be subject to SPCC in the
first year of the amended rule.  Over the next 10 years, approximately
345,000 facilities with storage capacities of 10,000 gallons or less
will be subject to SPCC each year on average.

  REF _Ref140571458  Exhibit 6-1  and   REF _Ref140571505  Exhibit 6-2
present the projected number of existing and new qualified facilities
from 2008 through 2017, respectively.  The projected average annual
numbers of existing and new qualified facilities are 337,000 and 7,260,
respectively.  The presented values in exhibits of this and subsequent
chapters were not rounded to preserve the precision of the estimates
that do not show a substantial change from year to year.

Exhibit   STYLEREF 1 \s  6 -  SEQ Exhibit \* ARABIC \s 1  1

Projected Total Number of Existing Qualified Facilities by Year and
Industry Sector1

Industry	Number of Existing Facilities	Ten-Year Average

	2008

Year 1	2009

Year 2	2010

Year 3	2011

Year 4	2012

Year 5	2013

Year 6	2014

Year 7	2015 Year 8	2016

Year 9	2017

Year 10

	Oil Production	      23,500 	      24,700 	    26,400 	    27,500
28,300 	    29,500 	    30,700 	    31,900 	    33,100 	    34,600
29,000

Farms	    141,000 	    141,000 	  140,000 	  140,000 	  139,000
138,000 	  138,000 	  137,000 	  136,000 	  136,000 	  139,000

Electric Utility Plants	      20,600 	      21,300 	    22,000
22,700 	    23,400 	    24,100 	    24,900 	    25,700 	    26,500
27,400 	    23,900

Petroleum Refining and Related Industries	            85 	            85
	          86 	          86 	          87 	          87 	          88
        88 	          89 	          89 	          87

Chemical Manufacturing	       1,050 	       1,050 	     1,050
1,050 	     1,060 	     1,060 	     1,060 	     1,070 	     1,070
1,070 	     1,060

Food Manufacturing	       1,670 	       1,680 	     1,690 	     1,700
   1,710 	     1,720 	     1,740 	     1,750 	     1,760 	     1,770
  1,720

Manufacturing Facilities Using and Storing AFVO	       2,580
2,590 	     2,600 	     2,620 	     2,630 	     2,640 	     2,650
2,660 	     2,670 	     2,680 	     2,630

Metal Manufacturing	       1,630 	       1,640 	     1,650 	     1,650
    1,660 	     1,670 	     1,680 	     1,680 	     1,690 	     1,700
   1,660

Other Manufacturing	       8,760 	       8,750 	     8,730 	     8,720
    8,700 	     8,690 	     8,670 	     8,660 	     8,640 	     8,620
   8,690

Real Estate Rental and Leasing	      24,100 	      24,600 	    25,100
  25,700 	    26,200 	    26,700 	    27,300 	    27,800 	    28,400
 29,000 	    26,500

Retail Trade	      14,100 	      14,100 	    14,100 	    14,200
14,200 	    14,200 	    14,300 	    14,300 	    14,400 	    14,400
14,200

Contract Construction	      11,100 	      11,300 	    11,500 	    11,700
	    11,900 	    12,200 	    12,400 	    12,600 	    12,900 	    13,100
    12,100

Wholesale Trade	       9,410 	       9,420 	     9,430 	     9,440
9,450 	     9,460 	     9,470 	     9,480 	     9,490 	     9,500
9,460

Other Commercial	      11,200 	      11,700 	    12,200 	    12,700
13,300 	    13,900 	    14,500 	    15,100 	    15,800 	    16,500
13,700

Transportation	       8,080 	       8,280 	     8,480 	     8,690
8,900 	     9,120 	     9,340 	     9,570 	     9,800 	    10,000
9,030

Arts Entertainment & Recreation	      11,800 	      12,100 	    12,400
   12,800 	    13,100 	    13,500 	    13,800 	    14,200 	    14,600
  15,000 	    13,300

Other Services (Except Public Administration)	       6,280 	       6,340
	     6,390 	     6,450 	     6,500 	     6,560 	     6,620 	     6,670
     6,730 	     6,790 	     6,530

Education 	       1,880 	       1,970 	     2,050 	     2,140
2,230 	     2,330 	     2,430 	     2,540 	     2,650 	     2,760
2,300

Petroleum Bulk Stations and Terminals	          467 	          441
   417 	        393 	        372 	        351 	        331 	        313
        295 	        279 	        366

Hospitals & Other Health Care	       5,300 	       5,370 	     5,450
  5,530 	     5,600 	     5,680 	     5,760 	     5,840 	     5,930
 6,010 	     5,650

Accommodation and Food Services	       4,530 	       4,590 	     4,660
    4,720 	     4,790 	     4,860 	     4,920 	     4,990 	     5,060
   5,130 	     4,830

Fuel Oil Dealers	          303 	          300 	        296 	        293
        290 	        287 	        284 	        281 	        277
274 	        289

Gasoline stations 	       1,870 	       1,850 	     1,830 	     1,810
   1,790 	     1,770 	     1,750 	     1,730 	     1,710 	     1,700
  1,780

Information Finance and Insurance	       3,500 	       3,580 	     3,670
	     3,760 	     3,850 	     3,940 	     4,030 	     4,130 	     4,230
     4,330 	     3,900

Mining	       1,270 	       1,270 	     1,270 	     1,270 	     1,270
   1,270 	     1,270 	     1,260 	     1,260 	     1,260 	     1,270

Religious Organizations	       1,450 	       1,470 	     1,490
1,520 	     1,540 	     1,560 	     1,590 	     1,610 	     1,630
1,660 	     1,550

Warehousing and Storage	          928 	       1,060 	     1,210
1,390 	     1,580 	     1,810 	     2,070 	     2,360 	     2,700
3,090 	     1,820

Military Installations	          152 	          155 	        157
 159 	        162 	        164 	        167 	        169 	        172
      174 	        163

Pipelines	          673 	          665 	        657 	        649
 641 	        633 	        625 	        618 	        610 	        603
      637

Government	          569 	          577 	        586 	        595
  604 	        613 	        622 	        631 	        641 	        651
       609

Total	    320,000 	    324,000 	  328,000 	  331,000 	  335,000
339,000 	  343,000 	  347,000 	  351,000 	  356,000 	  337,000

1	The level of precision of the numeric values reflects underlying data.

Exhibit   STYLEREF 1 \s  6 -  SEQ Exhibit \* ARABIC \s 1  2

Projected Total Number of New Qualified Facilities by Year and Industry
Sector1

Industry	Number of New Facilities	Ten-Year Average

	2008

Year 1	2009

Year 2	2010

Year 3	2011

Year 4	2012

Year 5	2013

Year 6	2014

Year 7	2015

Year 8	2016

Year 9	2017

Year 10

	Oil Production	       1,220 	       1,720 	     1,080 	        804
 1,160 	     1,200 	     1,250 	     1,140 	     1,560 	     1,020
1,220

Farms	       1,270 	       1,260 	     1,260 	     1,250 	     1,250
  1,240 	     1,240 	     1,230 	     1,230 	     1,220 	     1,240

Electric Utility Plants	          679 	          701 	        723
  746 	        770 	        795 	        820 	        846 	        873
       901 	        786

Petroleum Refining and Related Industries	              2
2 	            2 	            2 	            2 	            2
  2 	            2 	            2 	            2 	            2

Chemical Manufacturing	            26 	            26 	          26
      26 	          26 	          26 	          27 	          27
   27 	          27 	          26

Food Manufacturing	            40 	            40 	          41
  41 	          41 	          41 	          42 	          42
42 	          42 	          41

Manufacturing Facilities Using and Storing AFVO	            62
   62 	          62 	          62 	          63 	          63
63 	          63 	          64 	          64 	          63

Metal Manufacturing	            24 	            25 	          25
   25 	          25 	          25 	          25 	          25
25 	          25 	          25

Other Manufacturing	          208 	          208 	        207
207 	        206 	        206 	        206 	        205 	        205
     205 	        206

Real Estate Rental and Leasing	          532 	          543 	        554
	        565 	        577 	        589 	        601 	        613
 626 	        639 	        584

Retail Trade	          333 	          334 	        335 	        336
    337 	        337 	        338 	        339 	        340 	        341
	        337

Contract Construction	          322 	          328 	        334
341 	        347 	        354 	        360 	        367 	        374
     381 	        351

Wholesale Trade	          195 	          196 	        196 	        196
       196 	        196 	        197 	        197 	        197
197 	        196

Other Commercial	          517 	          540 	        564 	        589
        615 	        642 	        671 	        700 	        731
764 	        633

Transportation	          256 	          263 	        269 	        276
      282 	        289 	        296 	        303 	        311
318 	        286

Arts Entertainment & Recreation	          325 	          334
343 	        352 	        362 	        372 	        382 	        392
     402 	        413 	        368

Other Services (Except Public Administration)	          121
122 	        123 	        124 	        125 	        126 	        127
     128 	        129 	        130 	        125

Education 	            86 	            89 	          93 	          97
      101 	        106 	        110 	        115 	        120
125 	        104

Petroleum Bulk Stations and Terminals	              8 	              7
           7 	            6 	            6 	            6 	            5
	            5 	            5 	            5 	            6

Hospitals & Other Health Care	            76 	            77
78 	          79 	          81 	          82 	          83 	          84
	          85 	          86 	          81

Accommodation and Food Services	            77 	            78
 79 	          80 	          82 	          83 	          84
85 	          86 	          87 	          82

Fuel Oil Dealers	              5 	              5 	            5
     5 	            5 	            5 	            5 	            5
       5 	            5 	            5

Gasoline stations 	            20 	            19 	          19
  19 	          19 	          19 	          18 	          18
18 	          18 	          19

Information Finance and Insurance	            97 	            99
 101 	        104 	        106 	        109 	        111 	        114
      117 	        119 	        108

Mining	            19 	            19 	          19 	          19
    19 	          19 	          19 	          19 	          19
 19 	          19

Religious Organizations	            22 	            23 	          23
       23 	          24 	          24 	          24 	          25
    25 	          25 	          24

Warehousing and Storage	          155 	          177 	        202
  231 	        264 	        302 	        345 	        394 	        451
       515 	        303

Military Installations	              2 	              2 	            2
           2 	            2 	            3 	            3 	            3
	            3 	            3 	            3

Pipelines	              6 	              6 	            6 	            6
	            6 	            5 	            5 	            5
5 	            5 	            6

Government	              9 	              9 	            9
9 	            9 	            9 	          10 	          10
10 	          10 	            9

Total	       6,720 	       7,310 	     6,780 	     6,630 	     7,100
  7,280 	     7,460 	     7,510 	     8,080 	     7,710 	     7,260

1	The level of precision of the numeric values reflects underlying data.

The facility estimates presented in   REF _Ref140571458  Exhibit 6-1
and   REF _Ref140571505  Exhibit 6-2  above represent the projected
number of facilities that could potentially be “qualified
facilities” based on their storage capacity alone.  Eligibility for
the alternative rule requirements, however, also considers the
facility’s discharge history.  In the amended rule, a qualified
facility cannot have had a single discharge (as defined in §112.1(b))
greater than 1,000 gallons or two discharges each greater than 42
gallons during any 12-month period in the past three years.

To evaluate the extent to which qualified facilities might not be
eligible for relief, EPA examined National Response Center (NRC) spill
data to identify oil discharges involving storage tanks of at least 55
gallons, and where the volume spilled was at least 42 gallons but not
more than 10,000 gallons.  Since NRC does not record the total oil
storage capacity of the facility involved in a reported discharge, EPA
developed estimates based on the assumptions that 25 percent, 50
percent, and 75 percent of discharges greater than or equal to 42
gallons, and less than or equal to 10,000 gallons, were from qualified
facilities.    REF _Ref140571754  Exhibit 6-3  presents the estimated
number of potential qualified facilities that reported discharges over
the last three years, based on the NRC data.

Exhibit   STYLEREF 1 \s  6 -  SEQ Exhibit \* ARABIC \s 1  3

Estimated Number of Facilities with Oil Discharges within the Last Three
Years

Percentage of Qualified Facilities	Number of Facilities with Oil
Discharges	Percent of Facilities with Oil Discharges1

Total in NRC Database	593	0.47%

25% Scenario	148	0.12%

50% Scenario	297	0.23%

75% Scenario	445	0.35%

1 	Calculated percentages are based on the number of existing facilities
only, since new facilities do not yet have a three-year discharge
history.

Because the NRC database does not provide information on the aggregate
aboveground storage capacity of facilities, and the number of facilities
with oil discharges of 10,000 gallons or less represents a small
percentage of potential qualified facilities, EPA ultimately decided not
to adjust the estimated number of existing and new facilities with
10,000 gallons or less of oil that could potentially qualify for this
relief based on the NRC spill data.    REF _Ref140571783  Exhibit 6-4
presents the projected 10-year average numbers of existing and new
qualified facilities used in the remainder of this analysis.

Exhibit   STYLEREF 1 \s  6 -  SEQ Exhibit \* ARABIC \s 1  4

Projected Number of Existing and New Qualified Facilities

(10-Year Average)

Qualified Facilities	Total

Existing	337,000

New	7,260

Total	345,000

As with all of the options considered in developing amendments to the
rule, facility owners or operators would have the choice of complying
with the existing SPCC rule (as amended in 2002) or taking advantage of
the offered requirements for qualified facilities outlined in §112.6.
EPA does not know how many facility owners or operators will choose to
avail themselves of the “qualified facility” options.  EPA assumed
that owners or operators would likely choose the alternative
requirements if their facility met the qualifying criteria because it
would be less costly than following the requirements that apply to all
other facilities.  In this analysis, EPA assumed that owners and
operators of all facilities that meet the qualified facilities criteria
would take advantage of the relief provided in these amendments.

Compliance Cost Savings

To assess the impact of §112.6, EPA estimated the difference in
compliance costs for owners and operators of qualified facilities
between the 2002 SPCC rule and the final rule amendments.

Based on the different compliance requirement options available to
owners and operators of qualified facilities, EPA estimated that annual
cost savings for owners and operators of existing and new qualified
facilities would be $72.30 and $1,880, respectively.    REF
_Ref140634087  Exhibit 6-5  itemizes the individual cost components
owners and operators of qualified facilities could be required to
fulfill based on the current SPCC requirements and the compliance cost
savings associated with the lessened requirements of the final rule.
These costs are averaged over all qualified facilities, accounting for
the probability that owners and operators of individual facilities will
incur the cost in a particular year.  As a result, low probability costs
(e.g., complying with §112.4(c)) distributed across owners and
operators of many facilities yield only nominal per-facility costs.

Exhibit   STYLEREF 1 \s  6 -  SEQ Exhibit \* ARABIC \s 1  5

Annual Compliance Costs and Potential Compliance Cost Savings per
Qualified Facility

Compliance Requirements	Annual Cost1	Annual Cost Savings  of SPCC Rule
without PE Certification Requirements

	2002 SPCC Rule	SPCC Rule without PE Certification Requirements

	Existing Qualified Facilities

Five -Year Review - 112.5(b)	$46.4	$41.9	$4.50

Oil Discharge – 112.4(c)	$0.17	$0.17	-

Modification of Plan - 112.4(a) and 112.5(a)	$89.6	$21.8	$67.8

Recordkeeping	$89.8	$89.8	-

Total paperwork-related	$226	$154.0	$72.3

Integrity Testing	$119	$119	-

Other Capital	$206	$206	-

Total Capital	$325	$325	-

Total	$552	$479	$72.3

New Qualified Facilities

New Plan - 112.3(a)	$3,320	1,520 	$1,810

Oil Discharge - 112.4(c)	$0.17	$0.17	-

Modification of Plan - 112.5(a)	$89.6	$21.8	$67.8

Recordkeeping	$130	$130	-

Total paperwork-related	$3,540	$1,670	$1,880

Integrity Testing	$119	$119	 -

Other Capital	$3,590	$3,590	 -

Secondary Containment	$4,000	$4,000	 -

Total Capital	$7,710	$7,710	-

Total	$11,300	$9,380	$1,880

1    These cost estimates only reflect major compliance activities and
do not account for all costs associated with the SPCC requirements.

EPA calculated the total compliance cost savings for owners and
operators of qualified facilities using the projected number of existing
and new qualified facilities and their corresponding per-facility
compliance cost savings estimates.  The estimation process is summarized
in the following equation:

Using the equation above, EPA estimated that the final SPCC rule would
reduce compliance costs by $37.9 million and $37.7 million per year,
discounted at 3 percent and 7 percent, respectively.    REF
_Ref140572429  Exhibit 6-6  presents the annual, total, and annualized
cost savings for qualified facilities each year.

Exhibit   STYLEREF 1 \s  6 -  SEQ Exhibit \* ARABIC \s 1  6

Total Projected Compliance Cost Savings for Qualified Facilities

	Projected Annual Compliance Cost Savings	Ten-Year Average	Annualized

	2008 Year 1	2009 Year 2	2010 Year 3	2011 Year 4	2012 Year 5	2013 Year 6
2014 Year 7	2015 Year 8	2016 Year 9	2017

Year 10

Total - not discounted	35.8	37.1	36.4	36.4	37.5	38.2	38.8	39.2	40.6	40.2
380.2	38.0

Total - 3% discounted	34.7	35.0	33.3	32.3	32.4	32.0	31.5	30.9	31.1	29.9
323.3	37.9

Total - 7% discounted	33.4	32.4	29.7	27.8	26.8	25.4	24.2	22.8	22.1	20.4
265.0	37.7

Alternative Considered

In November 2005, EPA proposed to amend the SPCC rule to provide an
option to allow the owner or operator of a facility that meets the
qualifying criteria to self-certify his/her SPCC Plan in lieu of
certification by a PE.  Under the proposed amendment, a qualified
facility would have been a facility subject to the SPCC rule that (1)
had an aggregate facility oil storage capacity of 10,000 gallons or
less; and (2) had no discharges as described in §112.1(b) during the 10
years prior to self-certification or since becoming subject to SPCC
requirements if it had been in existence less than 10 years.  Facilities
subject to SPCC for less than 10 years, including new facilities, would
have needed to demonstrate no discharges as described in §112.1(b) only
for the period of time they had been subject to the SPCC regulation.
Self-certified Plans would not have been able to include
“environmentally equivalent” deviations to required Plan elements as
provided in §112.7(a)(2), or impracticability determinations with
respect to any secondary containment requirements as provided in
§112.7(d).  However, flexibility would have been provided for the
security (§112.7(g)) and integrity testing (§§112.8(c)(6) and
112.12(c)(6)) provisions of the rule.

The projected reduction in compliance costs associated with this
proposed amendment for owners and operators of qualified facilities was
based on an average of an estimated 324,000 qualified facilities being
eligible for the self-certification option and reduced integrity testing
requirements.  EPA estimated that compliance costs for owners and
operators of qualified facilities would have decreased by $36.3 million
and $36.2 million based on the relief offered to the owners and
operators by not requiring PE certification of their Plans and providing
lessened requirements for integrity testing, discounted at 3 percent and
7 percent, respectively.

Facilities with Qualified Oil-Filled Operational Equipment

EPA is amending the Oil Pollution Prevention regulation (40 CFR part
112) to provide a definition of oil-filled operational equipment (OFE)
and an optional alternative to the general secondary containment
requirements for oil-filled operational equipment that meets qualifying
criteria (hereafter referred to as "qualified oil-filled operational
equipment").  Section 112.7(k) of the final rule allows owners and
operators of facilities with qualified oil-filled operational equipment
to prepare an oil spill contingency plan and a written commitment of
manpower, equipment, and materials to expeditiously control and remove
any oil discharged that may be harmful, without having to make an
individual impracticability determination as required in §112.7(d).
Owners or operators who pursue this alternative are required to
establish and document an inspection or monitoring program to detect
equipment failure and/or a discharge from this qualified oil-filled
operational equipment, in lieu of providing secondary containment.

EPA is adding §112.7(k)(1) to define the eligibility criterion that
oil-filled operational equipment must meet in order to be considered
qualified.  This criterion specifically prohibits an owner or operator
from pursuing the option if the facility has had a single discharge as
described in §112.1(b) from any oil-filled operational equipment
exceeding 1,000 U.S. gallons or two discharges as described in
§112.1(b) from any oil-filled operational equipment each exceeding 42
U.S. gallons within any twelve month period in the three years prior to
the SPCC Plan certification date, or since becoming subject to 40 CFR
part 112 if the facility has been in operation for less than three
years.

Universe of Affected Facilities

The final changes for qualified oil-filled operational equipment address
such items as hydraulic systems, lubricating systems (e.g., those for
pumps, compressors, pumpjacks, and other rotating equipment including
pumpjack lubrication systems), gear boxes, machining coolant systems,
heat transfer systems, transformers, circuit breakers, electrical
switches, and other systems that contain oil to enable operation of the
devices.

EPA does not have data on the number of facilities with oil-filled
operational equipment.  To estimate the number of facilities affected by
§112.7(k), EPA compiled a list of sectors using oil-filled operational
equipment based on a review of the type of equipment covered by the
definition and professional judgment regarding sectors that commonly use
this equipment.  EPA estimated the number of facilities in the electric
utility sector, all of which are assumed to have oil-filled operational
equipment, using data on the number of power plants provided by the EIA
and the number of substations listed by each major utility reporting to
the Federal Energy Regulatory Commission (FERC).

EPA assumed that existing SPCC-regulated facilities with qualified
oil-filled operational equipment would already have secondary
containment installed or a determination of the impracticability of
secondary containment in accordance with §112.7(d).  In such cases,
owners and operators of facilities would not benefit from the reduced
requirements.

EPA estimated that the total number of new facilities with oil-filled
operational equipment would be approximately 7,410 in the first year.
Over the next 10 years, an average of approximately 7,960 new facilities
with OFE is projected to become regulated each year.    REF
_Ref140572497  Exhibit 7-1  presents the projected number of new
SPCC-regulated facilities each year by industry sector.  To estimate the
number of facilities within these sectors that have OFE, EPA arbitrarily
developed three scenarios whereby 25 percent, 50 percent, and 75 percent
of the facilities in sectors thought to have oil-filled operational
equipment may be affected by the 2006 rule amendments.  EPA estimated
that over the next 10 years, on average approximately 3,570 new
facilities would have oil-filled equipment under the 25-percent
scenario; 5,040 facilities under the 50-percent scenario; and 6,500
facilities under the 75-percent scenario.    REF _Ref140572497  Exhibit
7-1  also presents the projected annual number of new SPCC-regulated
facilities expected under each of these scenarios by industry sector.

Exhibit   STYLEREF 1 \s  7 -  SEQ Exhibit \* ARABIC \s 1  1

Projected Number of New Facilities with Oil-Filled Operational Equipment
by Industry Sector1

Industry	Annual Number of New Facilities	10–Year Average

	2008

Year 1	2009

Year 2	2010

Year 3	2011

Year 4	2012

Year 5	2013

Year 6	2014

Year 7	2015

Year 8	2016

Year 9	2017

Year 10	All Fac.	25% of Fac.	50% of Fac.	75% of Fac.

Electric Utility Plants2	1,820	1,880	1,940	2,000	2,070	2,130	2,200	2,270
2,350	2,420	2,110	2,110	2,110	2,110

 Oil Production3	1,020	998	976	956	935	915	896	877	858	840	927	232	463
695

Farms4	1,340	1,330	1,330	1,320	1,310	1,310	1,300	1,300	1,290	1,280	1,310
328	655	983

Petroleum Refining and Related Industries	37	37	37	37	38	38	38	38	38	39
38	9	19	28

Chemical Manufacturing	64	64	64	64	64	65	65	65	65	65	65	16	32	48

Food Manufacturing	84	85	85	86	86	87	87	88	89	89	87	22	43	65

Manufacturing Facilities Using and Storing AFVO	180	181	181	182	183	184
185	185	186	187	183	46	92	138

Metal Manufacturing	41	41	41	42	42	42	42	42	42	43	42	10	21	31

Other Manufacturing	368	368	367	366	366	365	364	364	363	362	365	91	183
274

Contract Construction	454	463	472	481	490	499	509	519	529	539	495	124
248	372

Other Commercial	698	729	761	795	830	866	905	945	987	1,030	854	214	427
641

Transportation	443	453	464	476	487	499	511	524	536	549	494	124	247	371

Arts Entertainment & Recreation	363	373	383	394	404	415	426	438	449	461
411	103	205	308

Education 	341	356	371	388	404	422	440	459	479	500	416	104	208	312

Hospitals & Other Health Care	97	98	100	101	103	104	105	107	108	110	103
26	52	78

Mining	47	47	47	47	47	47	47	47	47	47	47	12	24	35

Pipelines	6	6	6	6	6	5	5	5	5	5	6	1	3	4

Government	9	9	9	9	9	9	10	10	10	10	9	2	5	7

Total5	7,410	7,520	7,630	7,750	7,880	8,010	8,140	8,280	8,430	8,580	7,960
3,570 	5,040 	6,500

1    The level of precision of the numeric values reflects underlying
data.

2 	EPA assumed that all facilities with all oil-filled equipment in the
Electrical Utility Plant sector would be affected by this rule.  The 25,
50 and 75 percent scenarios 	do not apply to this industry.

3 	The number of oil production facilities was obtained from U.S. Energy
Information Administration’s Distribution and Production of Oil and
Gas Wells by State
(http://www.eia.doe.gov/pub/oil_gas/petrosystem/petrosysog.html).  EPA
assumed that each facility has four oil wells.

4 	Growth rates for farms are based on data from U.S. Department of
Agriculture.

5 	The numbers do not add up to the total due to rounding.

The main benefit of §112.7(k), described earlier in this section, is
to allow owners or operators of certain facilities to avoid the costs of
secondary containment for OFE without the need for an impracticability
determination.  EPA recognizes that some owners and operators of new
facilities will need to make an impracticability determination for their
facilities due to oil storage other than their OFE storage.  For owners
and operators of these facilities, the cost savings will be lower, since
they will be avoiding only an impracticability determination rather than
secondary containment.  EPA does not know what fraction of facilities
falls into this category, and has decided not to incorporate this
scenario in the analysis.  As a result, EPA's analysis may overestimate
the cost savings to owners and operators of facilities from the final
rule amendments.

Compliance Cost Savings

To assess the impact of §112.7(k), EPA estimated the cost of the
contingency plan and of a written commitment of the manpower, equipment,
and materials that owners or operators of affected facilities would
develop in lieu of providing secondary containment.  A contingency plan
prepared in accordance with 40 CFR 112.7(d) defines procedures and
tactics for responding to discharges of oil into navigable waters or
adjoining shorelines of the United States.  The contingency plan is
implemented whenever a discharge of oil has reached, or threatens,
navigable waters or adjoining shorelines.  EPA included the following
elements in the cost estimate for a contingency plan: emergency
response, hazard evaluation, discharge detection, discussion of spill
scenarios, and plan implementation.  The Agency estimated the total cost
of a contingency plan at $3,470, which includes the costs of
paperwork-related activities, such as Plan preparation, and capital
investments, such as equipment purchase and upgrade.

EPA calculated cost savings based on the assumption that owners and
operators of new facilities with qualified oil-filled operational
equipment would save the difference between the cost of secondary
containment and the cost of preparing a contingency plan and a written
commitment of manpower, equipment, and materials.   EPA estimated annual
per-facility cost savings of $7,530 to $56,500 for new facilities,
depending on a facility size (Category I through IV facilities), as can
be seen in   REF _Ref140572572  Exhibit 7-2 .

Exhibit   STYLEREF 1 \s  7 -  SEQ Exhibit \* ARABIC \s 1  2

Estimated Annual Affected Compliance Costs and Compliance Cost Savings
by Size Category

Activity	Burden Hours	O&M Costs	Total Cost

	Managerial

($55.7/hr)2	Technical

($47.9/hr)2	Clerical

($25.3/hr)2	Total Burden Hours	Categories I & II	Category III	Category
IV	Categories I & II	Category III	Category IV

Relief from Compliance Costs Associated with Secondary Containment (A)

Secondary containment cost savings	0.0	0.0	0.0	0.0	$11,000	$27,500
$60,000	$11,000	$27,500	$60,000

Added Compliance Costs Associated with Preparing a Contingency Plan (B)

Prepare a contingency plan	2.5	12.0	4.0	18.0	-	-	-	$815

Train personnel for contingency plan amendment	0.0	5.0	0.0	5.0	-	-	-
$240

Upgrade hand-held communication equipment	0.0	0.0	0.0	0.0	$300	$300	$300
$300

Response equipment (site-specific)	0.0	0.0	0.0	0.0	$2,120	$2,120	$2,120
$2,120

Total1	2.5	17.0	4	23.0	$2,420	$2,420	$2,420	3,470	3,470	3,470

Compliance Cost Savings per Facility with Qualified Oil-Filled
Operational Equipment  (equals A – B)1	$7,530	$24,000	$56,500

1 	The numbers do not add up to the total due to rounding.

2 	Wage rates are taken from the U.S. Department of Labor’s Employment
Cost Indexes and Levels, available at:
http://www.bls.gov/news.release/ecec.t11.htm.  Wage rates include wages
and salaries; benefit costs include paid leave, supplemental pay,
insurance, retirement and savings, legally required benefits, severance
pay, and supplemental unemployment benefits.  Overhead costs are
computed separately from BLS data and assumed to be an additional 17% of
the total wage rate, which comprises direct wages and salaries and
employee benefits, as reported by BLS.  The Employment Cost Index (ECI)
was used to adjust labor rates to current dollars (September 2005$).

To estimate the total compliance cost savings, EPA used the following
formula:

EPA calculated total compliance cost estimates based on the three
arbitrarily developed scenarios whereby 25 percent, 50 percent, and 75
percent of the facilities in sectors with oil-filled operational
equipment may be affected by the final rule.  The projected number of
new facilities under these three scenarios by facility size is shown in
 REF _Ref140572608  Exhibit 7-3 .  EPA applied the cost savings
presented in   REF _Ref140572572  Exhibit 7-2  to the universe of
affected facilities (  REF _Ref140572608  Exhibit 7-3 ) to calculate the
total cost savings for each scenario (  REF _Ref140572663  Exhibit 7-4
).

Exhibit   STYLEREF 1 \s  7 -  SEQ Exhibit \* ARABIC \s 1  3

Projected Number of New Facilities with Qualified Oil-Filled Operational
Equipment by Size Category

	Annual Number of New Facilities	10-Year Average

	2008

Year 1	2009

Year 2	2010

Year 3	2011

Year 4	2012

Year 5	2013

Year 6	2014

Year 7	2015

Year 8	2016

Year 9	2017

Year 10

	Category I & II Facilities

25% Scenario	2,600	2,650	2,710	2,770	2,830	2,890	2,960	3,020	3,090	3,170
2,870

50% Scenario	3,830	3,900	3,960	4,030	4,110	4,190	4,270	4,350	4,440	4,530
4,160

75% Scenario	5,060	5,140	5,220	5,300	5,390	5,480	5,580	5,680	5,780	5,890
5,450

Category III Facilities

25% Scenario	607	622	639	656	673	691	710	729	749	770	684

50% Scenario	762	779	797	816	835	855	875	896	918	941	848

75% Scenario	918	937	956	976	997	1,020	1,040	1,060	1,090	1,110	1,010

Category IV Facilities

25% Scenario	19	19	20	20	21	21	22	22	23	23	21

50% Scenario	27	28	28	29	29	30	31	31	32	33	30

75% Scenario	36	36	37	37	38	39	39	40	41	42	38

Exhibit   STYLEREF 1 \s  7 -  SEQ Exhibit \* ARABIC \s 1  4

Projected Annual Compliance Cost Savings

	Total Cost Savings (Million $)

	2008

Year 1	2009

Year 2	2010

Year 3	2011

Year 4	2012

Year 5	2013

Year 6	2014

Year 7	2015

Year 8	2016

Year 9	2017

Year 10	10-year Total	Annualized

Not Discounted

25% Scenario	$35.2	$36.0	$36.9	$37.7	$38.6	$39.6	$40.5	$41.5	$42.6	$43.7
$392	$39.2

50% Scenario	$48.7	$49.6	$50.6	$51.6	$52.7	$53.7	$54.9	$56.0	$57.3	$58.5
$534	$53.4

75% Scenario	$62.2	$63.2	$64.3	$65.5	$66.7	$67.9	$69.2	$70.6	$72.0	$73.4
$675	$67.5

3% discounted

25% Scenario	$34.2	$33.9	$33.7	$33.5	$33.3	$33.1	$33.0	$32.8	$32.6	$32.5
$333	$39.0

50% Scenario	$47.3	$46.8	$46.3	$45.8	$45.4	$45.0	$44.6	$44.2	$43.9	$43.6
$453	$53.1

75% Scenario	$60.4	$59.6	$58.9	$58.2	$57.5	$56.9	$56.3	$55.7	$55.1	$54.6
$573	$67.2

7% discounted

25% Scenario	$32.9	$31.5	$30.1	$28.8	$27.5	$26.4	$25.2	$24.2	$23.2	$22.2
$272	$38.7

50% Scenario	$45.5	$43.3	$41.3	$39.4	$37.5	$35.8	$34.2	$32.6	$31.2	$29.8
$371	$52.8

75% Scenario	$58.1	$55.2	$52.5	$50.0	$47.5	$45.3	$43.1	$41.1	$39.1	$37.3
$470	$66.8

Under the 25-percent scenario, EPA estimated that the amendments to
§112.7(k) could reduce compliance costs by as much as $39.0 million and
$38.7 million per year, discounted at 3 percent and 7 percent,
respectively.  Under the scenario where owners and operators of 50
percent of the facilities in industries identified as having oil-filled
equipment will take advantage of the exemption, compliance costs would
decrease by $53.1 million and $52.8 million per year, discounted at 3
percent and 7 percent, respectively.  Under the 75-percent scenario,
annual compliance costs would decrease by $67.2 million and $66.8
million, discounted at 3 percent and 7 percent, respectively.

Alternatives Considered

In the proposed SPCC rule, EPA considered allowing owners and operators
of facilities with qualified oil-filled operational equipment to prepare
an oil spill contingency plan and a written commitment of manpower,
equipment, and materials to expeditiously control and remove any oil
discharged that may be harmful, without having to make an individual
impracticability determination as required in §112.7(d).  The proposed
rule contained an eligibility criterion that restricted exemptions to
owners and operators of facilities that had no reportable discharges
from oil-filled operational equipment within 10 years prior to the SPCC
plan certification date.  For the 2006 final rule, EPA narrowed this
restriction to owners and operators of facilities that have not had a
1,000-gallon discharge or two 42-gallon discharges (as described in
§112.4(a)) within 12 months in the last three years.

The projected reduction in compliance costs associated with this
proposed exemption for qualified oil-filled operational equipment was
based on the estimated cost savings for a projected 2,450 new electric
utility facilities expected to become regulated each year.  The cost
savings that EPA estimated in the proposed SPCC rule were as high as
$60.9 million and $60.1 million, discounted at 3 percent and 7 percent,
respectively.  The projected cost savings under the proposed rule were
estimated only for owners and operators of facilities in the electric
utility sector.  When estimating compliance cost savings for the 2006
final rule, EPA included facilities using oil-filled operational
equipment from other industry sectors.

By extending the proposed exemption for oil-filled operational equipment
to all potentially affected industries, EPA estimated changes in
compliance cost savings under the 25 percent, 50 percent, and 75 percent
scenarios.  Under the 25-percent scenario, cost savings are expected to
decrease by $21.9 million to $21.4 million discounted at 3 percent and 7
percent, respectively.  Under the 50-percent scenario, cost savings are
expected to decrease by $7.77 million and $7.36 million discounted at 3
and 7 percent, respectively.  Under the 75-percent scenario, cost
savings are expected to increase by $6.33 million and $6.69 million
discounted at 3 and 7 percent, respectively.

Facilities with Motive Power Containers

EPA is amending the Oil Pollution Prevention regulation (40 CFR part
112) to exempt motive power containers, defined as “onboard bulk
storage containers used solely to power the movement of a motor vehicle,
or ancillary onboard oil-filled operational equipment used solely to
facilitate its operation.”  This definition includes only motor
vehicles that have the ability to move (provide propulsion) to another
physical location.  Examples of motive power containers include fuel
tanks that provide fuel for a motor vehicle’s movement, or the
oil-filled containers that provide the hydraulic and lubrication
ancillary functions of a motor vehicle.  This definition does not
include oil drilling or workover equipment.  Specifically, it does not
apply to the drilling or workover rigs themselves; however, other
earthmoving equipment (such as a bulldozer) located at a drilling or
workover facility is included in the scope of the definition.

	Although EPA has no empirical data on the amount of such oil storage at
facilities regulated by the SPCC rule, EPA has little or no reason to
suspect that many facility owners and operators with existing SPCC Plans
have included motive power containers in their oil storage capacity
calculations and their Plans.  For those who have considered motive
power storage, EPA assumed that the volume that would be exempt under
the final rule would not represent a large fraction of the facility’s
aggregate capacity.

Universe of Affected Facilities

	To identify industries that are potentially affected by motive power
exemptions, EPA started with information from industry comments to the
2002 SPCC rule.  Commenters from the crop production, forestry/logging,
and utilities industries indicated that they had motive power equipment.
 EPA identified additional industry categories by examining industries
targeted by major motive power equipment manufacturers such as
Caterpillar Inc., Deere & Company, Kubota Corporation, Joy Global Inc.,
CNH Global NV, and Terex Corporation.  Each of these companies lists the
industries targeted by their products.  EPA used these listings as the
basis for classifying industries likely to have motive power containers.

	EPA does not have data on the number of facilities with motive power
containers with oil storage capacity of 55 gallons or greater.  To
estimate the number of facilities affected by the “motive power”
final rule, EPA arbitrarily developed three scenarios whereby 10
percent, 25 percent, and 50 percent of the facilities in sectors with
motive power containers may be affected by the final rule amendments.
EPA estimated that over the next 10 years, on average approximately
29,100 facilities would have “motive power” oil storage under the
10-percent scenario; 72,600 facilities under the 25-percent scenario;
and 145,000 facilities under the 50-percent scenario.  This represents
an increase of approximately one percent over estimates used in the
November 2005 proposed rule RIA and is due to adjustments made in the
SPCC universe estimates (as described earlier under Chapter   REF
_Ref140640052 \r  4  of this analysis).    REF _Ref140572923  Exhibit
8-1  presents the projected number of existing and new SPCC-regulated
facilities with motive power containers whose owners and operators of
are expected to take advantage of the final action.

Exhibit   STYLEREF 1 \s  8 -  SEQ Exhibit \* ARABIC \s 1  1

Projected Number of Existing and New Facilities with Motive Power
Containers (10-Year Average)1

Industry	Existing	New	Total

	Total	10% of Fac.	25% of Fac.	50% of Fac.	Total	10% of Fac.	25% of Fac.
50% of Fac.	Total	10% of Fac.	25% of Fac.	50% of Fac.

Farms	147,000	14,700	36,800	73,700	1,310	131	328	655	149,000	14,900
37,200	74,300

Contract Construction	17,500	1,750	4,380	8,760	495	50	124	248	18,000
1,800	4,500	9,010

Gasoline Stations 	3,700	370	924	1,850	38	4	10	19	3,740	374	934	1,870

Transportation	16,100	1,610	4,020	8,040	494	49	124	247	16,600	1,660
4,140	8,290

Real Estate Rental and Leasing	30,800	3,080	7,690	15,400	663	66	166	332
31,400	3,140	7,860	15,700

Electric Utility Plants	66,200	6,620	16,600	33,100	2,110	211	527	1,060
68,300	6,830	17,100	34,200

Mining	3,140	314	785	1,570	47	5	12	24	3,190	319	797	1,590

Pipelines	643	64	161	321	6	1	1	3	648	65	162	324

Total	285,000	28,500	71,400	143,000	5,160	516	1,290	2,580	291,000	29,100
72,600	145,000

1    The level of precision of the numeric values reflects underlying
data.Compliance Cost Savings

	The main benefit of the 2006 rule amendments would be to provide
greater clarity of EPA’s regulatory intent.  EPA estimated that the
final rule would reduce compliance costs by $1.07 million and $1.07
million per year, discounted at 3 percent and 7 percent, respectively,
which were calculated using the equation below.

	EPA assumed that owners and operators of up to 10 percent of the
facilities in industries identified as having motive power storage might
take advantage of the exemption.  Other facilities could also have
motive power storage; EPA expects, however, that owners and operators of
those facilities have not considered such storage as part of their
compliance with the SPCC rule.  Because EPA expects most facilities with
motive power storage to meet the SPCC rule’s oil storage thresholds
regardless of oil storage for motive power, EPA assumed that the cost
savings from the exemption would be modest (perhaps five percent
compliance cost savings).  As a result of the changes, owners and
operators of existing and new facilities with motive power containers
would save approximately five percent of the major compliance costs,
which are presented in   REF _Ref140572998  Exhibit 8-2 .

Exhibit   STYLEREF 1 \s  8 -  SEQ Exhibit \* ARABIC \s 1  2

Estimated Annual Compliance Costs1

Compliance Item	Annual Hours Burden	Total Burden Hours	Capital/ O&M
Costs	PE Cost	No Exemption

	Management

($55.7/hr)	Technical

($47.9/hr)	Clerical

($25.3/hr)

Existing Facilities

Five -Year Review - 112.5(b)	0.20	0.59	0.11	0.89	$0.00	$4.50	$46.4

Oil Discharge - 112.4(c)	0.00	0.00	0.00	0.00	$0.02	$0.00	$0.18

Modification of Plan - 112.4(a) and 112.5(a)	0.00	0.41	0.09	0.50	$0.00
$67.8	$89.6

Recordkeeping	0.00	1.64	0.45	2.09	$0.00	$0.00	$89.8

Total Paperwork-Related	0.20	2.63	0.65	3.48	$0.02	$72.3	$226

O&M Costs: Integrity Testing	-	-	- 	- 	- 	- 	$119

Capital Costs	 -	 -	- 	- 	- 	- 	$206

Total O&M and Capital Costs	 -	- 	- 	- 	- 	- 	$325

Total	- 	- 	- 	- 	- 	- 	$552

New Facilities

New Plan - 112.3(a)	5.43	23.4	3.62	32.4	$0.00	$1,810	$3,320

Oil Discharge - 112.4(c)	0.00	0.00	0.00	0.00	$0.02	$0.00	$0.18

Modification of Plan - 112.5(a)	0.00	0.41	0.09	0.50	$0.00	$67.8	$89.6

Recordkeeping	0.00	1.64	0.45	2.09	$40.0	$0.00	$130

Total Paperwork-Related	5.43	25.4	4.16	35.0	40.0	$1,880	$3,540

Integrity Testing	-	 -	- 	- 	 -	- 	$119

Other Capital	 -	 -	 -	 -	 -	 -	$3,590

Secondary Containment	 -	 -	 -	 -	 -	 -	$4,000

Total O&M and Capital Costs	-	-	-	-	-	-	$7,710

Total	5.43	25.4	4.16	35.0	$40.0	$1,880	$11,300

1 	Estimates are based on   REF _Ref140571179  \* MERGEFORMAT  Exhibit
5-2  and   REF _Ref140571258  \* MERGEFORMAT  Exhibit 5-3 .  These cost
estimates only reflect major compliance activities and do not account
for all costs associated with the SPCC requirements.

	Based on these total annual compliance costs, the estimated
per-facility cost savings associated with the final amendments are $28
for owners and operators of existing facilities and $563 for owners and
operators of new facilities.  The cost savings for owners and operators
of new facilities are higher than those for owners and operators of
existing facilities because of greater expenses associated with
preparing a new SPCC Plan and initial start-up and capital costs.

	Under the scenario where owners and operators of 25 percent of
industries identified as having motive power storage would take
advantage of the exemption, compliance costs would decrease by $2.69
million and $2.68 million per year, discounted at 3 percent and 7
percent, respectively.  Under the 50-percent scenario, annual compliance
costs would decrease by $5.37 million and $5.35 million, discounted at 3
percent and 7 percent, respectively.

Facilities with Mobile Refuelers

	EPA is amending the Oil Pollution Prevention regulation to exempt
mobile refuelers from the specifically sized bulk storage secondary
containment requirements of §§112.8(c)(2) and (11).  EPA defines a
mobile refueler as a “bulk storage container onboard a vehicle or
towed, that is designed or used solely to store and transport fuel for
transfer into or from an aircraft, motor vehicle, locomotive, vessel,
ground service equipment, or other oil storage container.”  The
general secondary containment requirements of §112.7(c) will still
apply to these mobile refuelers and to the transfers associated with
this equipment.  Since mobile refuelers are mobile or portable bulk
storage containers, the other provisions of §112.8(c) still apply.

	The industry sector most frequently associated with mobile refuelers is
the aviation industry.  EPA researched the regulatory compliance of
airports with SPCC requirements for secondary containment, and found
that some airports do not have sized secondary containment in place.
EPA found that secondary containment for mobile refuelers is not a
common practice and that mobile refuelers rarely have a designated area
to park.  Factors such as the land value at many commercial airports
prohibits a single, designated parking area for mobile refuelers.
Additionally, members of the regulated community have expressed concern
that requiring sized secondary containment for airport mobile refuelers
is not practical for safety and security reasons.

	EPA analyzed potential cost savings to all affected industries using an
assumption that owners and operators of new facilities would have to
provide sized secondary containment in accordance with §§112.8(c)(2)
and (11) for mobile refuelers.  Therefore, the estimated annual cost
savings consist of the avoided potential expenditures of providing sized
secondary containment for new mobile refuelers.

Universe of Affected Facilities

	For the aviation industry sector, EPA estimated the total number of new
airports would be approximately 515 in the first year.  Over the next 10
years, approximately 575 new airports are expected to be added annually
on average.  EPA does not have empirical data on the number of
facilities with mobile refuelers with oil storage capacity of 55 gallons
or greater outside the aviation industry sector.  To identify industries
besides aviation that will be potentially affected by the mobile
refueler exemption, EPA started with information from industry comments
in response to the SPCC rule.  Commenters from the following industry
categories indicated that they may have mobile refuelers at their
facilities: agriculture, automotive, chemical, construction, food,
military, paper/forestry, petroleum, railroad, retail fuel delivery,
transport/trucking, utilities, and waste management.  EPA identified and
confirmed additional industry sectors most likely to have mobile
refuelers based on information provided by manufacturers of mobile
refuelers and mobile refueling equipment, and from personal
communication with the Fire Marshalls’ offices in Henderson, NV, and
Houston, TX, which both require permits for mobile refueling activities.

	To estimate the number of facilities within non-aviation industry
sectors affected by the “mobile refuelers” amendment of the final
rule, EPA arbitrarily developed three scenarios whereby 25 percent, 50
percent, and 75 percent of the facilities in other identified sectors
with mobile refuelers may be affected by the 2006 final rule.  EPA
projected that over the next 10 years, on average there would be
approximately 1,760 new facilities with “mobile refuelers” under the
25-percent scenario; 2,940 new facilities under the 50-percent scenario;
and 4,130 new facilities under the 75-percent scenario.    REF
_Ref140573110  Exhibit 9-1  presents the projected number of new
SPCC-regulated facilities whose owners and operators are expected to
take advantage of the “mobile refuelers” amendment of the final
rule.

Exhibit   STYLEREF 1 \s  9 -  SEQ Exhibit \* ARABIC \s 1  1

Projected Number of New Facilities with Mobile Refuelers (10-Year Annual
Average)

Industry	Projected Number of New Facilities

	Total	25%	50%	75%

Airports1	575	575	575	575

Farms	1,310	328	655	983

Transportation	494	124	247	371

Chemical Manufacturing	65	16	32	48

Contract Construction	495	124	248	372

Food Manufacturing	87	22	43	65

Government	9	2	5	7

Military Installations	12	3	6	9

Mining	47	12	24	35

Petroleum Bulk Stations and Terminals	70	17	35	52

Gasoline Stations	38	10	19	29

Electric Utility Plants	2,110	527	1,060	1,580

Total	5,310	1,760	2,940	4,130

1 	Airports are the only industry for which EPA has empirical evidence
to support the number 	of mobile refuelers per facility.  Other
potentially impacted industries were considered 	based on an arbitrary
range of scenarios (25%, 50%, and 75%) of affected facilities.

Compliance Cost Savings

To assess the impact of giving owners and operators of facilities an
exemption from sized secondary containment for mobile refuelers, EPA
estimated the compliance cost associated with providing sized secondary
containment to an individual mobile refueler.  Because insufficient data
are available to differentiate cost estimates for sized versus unsized
secondary containment, EPA used a general cost estimate for secondary
containment of $6,500 per mobile refueler at an average size facility.
For both the aviation and other industry sectors, EPA estimated that
each facility has two mobile refuelers based on the assumption that
there are one to three mobile refuelers per airport.  To estimate the
total cost savings, the Agency multiplied the number of projected new
facilities believed to have mobile refuelers by the cost of providing
sized secondary containment, which is $13,000 per facility, as presented
in the following equation:

EPA calculated total compliance cost estimates based on the three
arbitrarily developed scenarios whereby 25 percent, 50 percent, and 75
percent of the facilities in sectors with mobile refuelers may be
affected by the final rule.  EPA applied the $13,000 per facility cost
savings to the projected universe of new affected facilities under these
three scenarios to calculate the total cost savings for each scenario.
Then the Agency annualized the total cost savings over the ten-year
analytical period using the method described in Chapter   REF
_Ref140640066 \r  3  of this analysis, as shown in   REF _Ref140573157
Exhibit 9-2 .

Exhibit   STYLEREF 1 \s  9 -  SEQ Exhibit \* ARABIC \s 1  2

Estimated Annual Compliance Cost Savings

	Total Cost Savings (Million $)

	2008

Year 1	2009

Year 2	2010

Year 3	2011

Year 4	2012

Year 5	2013

Year 6	2014

Year 7	2015

Year 8	2016

Year 9	2017

Year 10	10-year Total	Annualized

Not Discounted

25% Scenario	16.0	16.2	16.5	16.8	17.1	17.4	17.7	18.0	18.3	18.7	172.7
$17.3

50% Scenario	32.0	32.5	33.0	33.6	34.2	34.8	35.4	36.0	36.7	37.3	345.4
$34.5

75% Scenario	48.0	48.7	49.5	50.4	51.2	52.1	53.1	54.0	55.0	56.0	518.0
$51.8

3% discounted

25% Scenario	15.5	15.3	15.1	14.9	14.7	14.6	14.4	14.2	14.1	13.9	146.7
$17.2

50% Scenario	31.0	30.6	30.2	29.8	29.5	29.1	28.8	28.4	28.1	27.8	293.4
$34.4

75% Scenario	46.6	45.9	45.3	44.8	44.2	43.7	43.1	42.6	42.2	41.7	440.0
$51.6

7% discounted

25% Scenario	14.9	14.2	13.5	12.8	12.2	11.6	11.0	10.5	10.0	9.49	120.1
$17.1

50% Scenario	29.9	28.4	27.0	25.6	24.4	23.2	22.0	21.0	19.9	19.0	240.2
$34.2

75% Scenario	44.8	42.6	40.4	38.4	36.5	34.7	33.0	31.4	29.9	28.5	360.4
$51.3

	Under the 25-percent scenario, EPA estimated that the 2006 rule
amendments would reduce compliance costs by $17.2 million and $17.1
million per year, discounted at 3 percent and 7 percent, respectively,
which EPA calculated assuming that owners and operators of all airports
and approximately 25 percent of the facilities in non-aviation
industries identified as having mobile refuelers might take advantage of
the exemption.  Under the scenario where owners and operators of 50
percent of the facilities in industries identified as having mobile
refuelers would take advantage of the exemption, compliance costs would
decrease by $34.4 million and $34.2 million per year, discounted at 3
percent and 7 percent, respectively.  Under the 75 percent scenario,
annual compliance costs would decrease by $51.6 million and $51.3
million, discounted at 3 percent and 7 percent, respectively.

Alternatives Considered

In the December 2005 proposed revisions to the Oil Pollution Prevention
Regulation, EPA proposed to exempt airport mobile refuelers from the
specifically sized bulk storage secondary containment requirements of
§§112.8(c)(2) and (11).  EPA’s definition of an airport mobile
refueler is a “vehicle with an onboard bulk storage container designed
for, or used to, store and transport fuel for transfer into or from
aircraft or ground service equipment.”

The proposed reduction in compliance costs associated with this
exemption for airport mobile refuelers was based on estimates of
approximately 535 new airports added annually, and the assumption that
each airport would have an average of two mobile refuelers.  The
estimated reductions in compliance costs that correspond to these cost
savings are $6.92 million and $6.86 million, discounted at 3 percent and
7 percent, respectively.  Based on adjustments in the universe of
affected airports and estimated growth rates used in this analysis, EPA
estimated that approximately 575 new airports would be added annually on
average over the next 10 years, an increase of 7.5 percent (40 airports)
over earlier estimates used in the November 2005 regulatory impact
analysis of the proposed rule.

Upon receipt and review of public comments on the proposed changes to
sized bulk storage secondary containment requirements of §§112.8(c)(2)
and (11) for mobile refuelers, EPA agreed with stakeholders’ argument
that similar equipment and intra-facility operations merit the same
consideration and that the changes be extended beyond airports.  As
described earlier under Section   REF _Ref140641538 \r  9.1 , EPA
evaluated other forms and use of mobile refuelers at mining sites,
chemical complexes, construction sites, seaport terminals, facilities
with tank truck home base operations, and other scenarios.  By extending
the proposed exemption for airport mobile refuelers to all industries
with mobile refuelers, EPA estimated an increase in the reduction of
compliance costs beyond those proposed, ranging from $10.3 million to
$44.7 million discounted at 3 percent, and $10.2 million to $44.4
million discounted at 7 percent.  These estimates used for comparison
assume that owners and operators of all airports, and approximately 25
percent of the facilities in non-aviation industries identified as
having mobile refuelers, might take advantage of the exemption.

EPA also considered extending sized bulk storage secondary containment
relief to certain other mobile portable containers such as rail cars and
towed Ground Service Equipment (GSE) that are not themselves
self-powered.  However, no convincing justification could be made to
differentiate railcars used at non-transportation facilities as bulk
storage containers from other bulk storage containers.  EPA determined
that it is reasonable to plan and provide for the same level of
secondary containment in these situations.

Projected Impacts on Human Health, Welfare, and the Environment

The purpose of this chapter is to qualitatively describe the anticipated
environmental and socioeconomic impacts (Section   REF _Ref140641596 \r
\* MERGEFORMAT  10.1 ), benefits (Section   REF _Ref140641611 \r  \*
MERGEFORMAT  10.2 ), and distributional impacts (Section   REF
_Ref140641626 \r  \* MERGEFORMAT  10.3 ) of the SPCC rule.

Environmental and Socioeconomic Impacts of Oil Spills

Discharges of both petroleum and non-petroleum oils into the nation's
marine and freshwater environments can cause damage to public health and
welfare, and to the environment.  Discharges from SPCC facilities can
occur whenever oil is handled, stored, produced, transferred, used, or
disposed.  Causes of discharges include human error (e.g., overfilling
tanks during transfer operations), equipment failure (e.g., deteriorated
seals and ruptured pipes or tanks), and improper storage or abandonment.

The impact of such discharges into either the marine or freshwater
environment can be devastating in the short term, and some effects may
last for years or even decades.  Although studies have documented
nature's ability to recover over time from the damage caused by a large
oil discharge, both the extent of biological damage and the speed of
recovery depend on many factors, including the geographic location,
quantity of oil discharged, characteristics of the area affected,
weather conditions, the season, the type of oil, and the nature of the
response.

Physical, chemical, and biological transformations of discharged oil
begin immediately upon the oil’s introduction to marine or freshwater
environments.  The rate and degree of transformation depend on several
factors related to advective and spreading processes.  Advection is
caused by the influence of overlying winds and underlying currents on
the oil, while spreading results from the interplay among the forces of
gravity, inertia, friction, viscosity, and surface tension.

The toxicity of a discharge depends on the type of oil.  Freshly
discharged crude is more acutely toxic than weathered oil because of the
presence of the more toxic volatile constituents, which quickly
evaporate or dissolve.  Similarly, lighter refined products (e.g.,
diesel fuel and gasoline) are more acutely toxic than crude but
dissipate more rapidly.

The extent of environmental damage caused by an oil discharge also
depends on the physical, chemical, and biological characteristics of the
surrounding ecosystem.  These characteristics influence the intensity,
time, and spatial extent of contact of aquatic organisms with the oil
products.  In general, oil discharges that affect biologically sensitive
areas (e.g., near-shore areas that have high concentrations of aquatic
organisms, or provide spawning and nursing areas for fish, and nesting
habitat for birds or critical habitats for rare species) will have
greater ecological impacts than, for example, offshore spills.

Oil discharges can be particularly damaging to estuarine environments.
Unlike ocean discharges that are dispersed by wind and wave action, oil
discharged near the shoreline

typically concentrates and mixes with near-shore waters or collects
along shorelines.  As a result, wetlands, seagrass beds, beaches, rocky
habitats, coral reefs, inter-tidal areas, and terrestrial ecosystems may
be damaged.  Oil deposited in near-shore sediments persists longer than
in ocean sediments.  Oil is particularly persistent in low-energy,
wetland habitats.

To varying degrees, coastal marine and freshwater environments
throughout the United States serve as breeding and nursing areas for
resident and migratory species of fish and aquatic birds.  Fish can be
affected through ingestion of oil or oiled prey and uptake of dissolved
petroleum compounds through the gills, or by changes in the ecosystem.
Damage to fish eggs and larvae also may occur.  Aquatic birds,
especially diving birds, are highly vulnerable to oil discharged in
coastal areas.  Feathers that are coated with oil become water-logged
and lose their insulating properties.  As a result, birds may drown or
die of hypothermia.

Oil discharges may also disrupt the structure and function of aquatic
ecosystems.  For example, oil spills may cause long-term damage to
wetlands by adversely affecting the root system of wetland vegetation.
As a result, wetlands may not be able to provide suitable habitat for
fish and birds.  Differential rates of mortality resulting from oil
discharges also shift food web relationships.  Changes in resource
availability, competition, and predation affect individual organisms.
Populations of species that are dependent on affected prey or habitats
(e.g., wetlands) will decline, while opportunistic species may increase.
 Rare species, small local populations, or species that are seasonally
concentrated in the impacted habitat are the most likely to decline as a
result of an oil discharge.

Coastal marine and freshwater environments also provide a variety of
resources and services to the public.  The public uses some of these
resources and services directly (e.g., the aesthetic qualities of the
waterfront, recreational fishing, swimming, boating, picnicking, and
waterfowl hunting) while others are useful indirectly.  These indirect
uses may include many ecological functions provided by wetlands (e.g.,
flood control, and the support of fish and wildlife habitats that in
turn have recreational uses).  Still other environmental resources and
services may support non-use values to the public (e.g., knowledge that
endangered species continue to exist, or that aquatic environments
provide healthy habitat to fish).

In response to oil spills, local authorities could close recreational
areas for several weeks, which may lead to significant welfare losses to
recreational users.  In addition to these welfare losses resulting from
lost user days, significant welfare effects may also be associated with
lost use and non-use values of the affected aquatic resources.  Consider
for example, the period over which environmental services provided by
wetlands are lost, which could be several years for areas of moderate to
heavy oil contamination and several months for lightly oiled wetlands.
Although some of the wetlands affected by oil discharges may recover
over time, others may require restoration.  Returning the set of injured
resources to pre-spill conditions may be costly.  For example, the cost
per acre to plant new wetlands ranges from $2,000 to $4,200.

Oil pollution in aquatic environments can also pose risk to human
health.  The main concern regarding the risk to humans is the known
carcinogenicity of several oil components, and the exposure to toxic
elements in oil through direct exposure or through oil-tainted food.
The most likely pathway for people to be exposed to oil contaminants is
by direct contact with bare skin.  Children may be at increased risk of
exposure to oil contaminants while playing.  In addition, oil
contaminants can adhere to the fur of pets, and the contamination can be
transferred to people who touch or groom their pets.  Human health risks
also include hazards encountered by workers during cleanup operations.
Prolonged dermal contact with crude oil and petroleum products can cause
skin erythema (reddening), edema, and burning.  The dermal effects can
be exacerbated by subsequent exposure to ultraviolet light from the sun.
 Human epidemiological studies have shown that high-dose, chronic,
occupational exposure to mineral oils can cause skin cancer.  An
increased risk of skin cancer, sinonasal cancer, gastrointestinal
cancer, and bladder cancer have been reported in occupations with
prolonged contact with mineral oils.

Additionally, oil dischargers may impact drinking water and industrial
water intakes.  Thick oil may clog the equipment.  Other oil types could
make the source water unusable for drinking or other uses.

Benefits of the Final Regulation

The main benefit of the final rule is lower compliance costs for owners
and operators of certain types of facilities and equipment.  EPA expects
these reduced expenditures to translate to net social benefits.  These
benefits may be partially offset by potential increases in risk of oil
discharges due to the final rule’s having less-stringent requirements
than the existing SPCC rule.  For example, owners and operators of
qualified oil-filled operational equipment that implement a contingency
plan and a written commitment of manpower, equipment, and materials,
instead of implementing preventive measures such as secondary
containment, could see an increase in the risk of discharges.
Nevertheless, it is reasonable to assume that any non-compliance with
SPCC regulations is at least partially attributable to the costs of
compliance.  To the extent that this is true, reducing the costs of
complying with SPCC requirements may induce owners and operators of some
previously non-compliant facilities to implement oil pollution
prevention measures – thereby reducing risk of discharge.

EPA has designed the final rule to minimize increases in environmental
risk.  For example, regulatory relief for owners and operators of
qualified facilities focuses on facilities that store relatively small
amounts of oil and demonstrate that they have had no discharge greater
than 1,000 gallons or no two discharges greater than 42 gallons in a
12-month period during the past three years.  Furthermore, EPA allows
owners and operators of qualified facilities the option of avoiding PE
certification, but maintains that any decision to apply environmental
equivalence or pursue an impracticability claim still requires PE
certification.

For qualified oil-filled operational equipment, EPA believes the
complexity and the nature of the equipments’ use may not lend itself
to traditional secondary containment methods for bulk storage
containers.  Flexibility for such equipment is appropriate in this area,
and may improve compliance with oil pollution prevention measures.  Most
facilities where these units are located will have general secondary
containment to help prevent discharges as described in §112.1(b).  In
summary, although the final rule may increase the risk of discharge by
an unknown magnitude, EPA believes that any environmental impact will be
minimal, and will be offset by the benefits of increased compliance with
the SPCC rule.

Distributional Analysis

The SPCC rule results in direct and indirect effects that may
precipitate the transfer of economic benefits among various industry
sectors.  One direct impact of the rule is the alternative offered to
owners and operators of qualified facilities that allows them to avoid
using a licensed PE to certify their Plans.  Additionally, facilities
that store oil solely for motive power are no longer regulated, while
owners and operators of facilities with oil storage in addition to
motive power containers will incur lower compliance costs.  This revised
SPCC rule also allows greater use of contingency plans with a written
commitment of manpower, equipment, and materials without requiring an
impracticability determination as an alternative to secondary
containment for qualified oil-filled operational equipment.  Finally,
the rule allows mobile refuelers to fall under a facility's general
secondary containment requirements rather than requiring specific sized
secondary containment.

Indirect effects of the rule include changes in demand for secondary
containment for mobile refuelers as well as the reduced plan
certification requirements.  The reduction in demand for secondary
containment results in a transfer of income from suppliers to owners and
operators of facilities with mobile refuelers.  In the same way the fee
that was previously charged by professional engineers for Plan
certification is instead transferred back to owners and operators of
qualified facilities who choose self certification. The net impact on a
comprehensive measure of social welfare such as social cost has not been
estimated.

Another aspect of the distributional analysis is the spatial impact of
the rule with respect to the location of industry-wide regulated
facilities.  EPA’s technique for estimating the SPCC universe
described in Chapter   REF _Ref140640080 \r  4  limits the capacity to
meaningfully consider the spatial distribution of SPCC-regulated
facilities.  However, EPA acknowledges that clustering of SPCC-regulated
facilities exists (such as oil production facilities in the Gulf of
Mexico coastal states), and, therefore, nationally estimated impacts on
owners and operators of regulated facilities may be spatially
disproportional.

  SEQ CHAPTER \h \r 1 Small Business Analysis

The Regulatory Flexibility Act (RFA) requires federal agencies to
determine whether their regulatory actions will have a significant
economic impact on a substantial number of small entities.  If an agency
does not or cannot certify that a final regulation will not have a
significant economic impact on a substantial number of small entities,
it must prepare a regulatory flexibility analysis and examine
alternatives to the regulation that may reduce adverse economic effects
on significantly impacted small entities.

	In 1996, Congress enacted the Small Business Regulatory Enforcement
Fairness Act (SBREFA), which amended the RFA to strengthen its
analytical and procedural requirements and to expedite Congressional
review of rules.  SBREFA amended the RFA to reference the definition of
a “small entity” found in the Small Business Act, which itself
authorizes the Small Business Administration (SBA) to further define
“small business” by regulation.  The SBA’s small business
definitions are codified at 13 CFR 121.601 and the SBA reviews and
reissues these definitions every year.

In determining whether a rule has a significant economic impact on a
substantial number of small entities, the impact of concern is any
significant adverse economic impact on small entities, since the primary
purpose of the regulatory flexibility analyses is to identify and
address regulatory alternatives "which minimize any significant economic
impact of the final rule on small entities." 5 U.S.C. 603 and 604.
Thus, an agency may certify that a rule will not have a significant
economic impact on a substantial number of small entities if the rule
relieves regulatory burden, or otherwise has a positive economic effect
on all of the small entities subject to the rule.

	The amendments to the SPCC rule reduce the burden on small businesses
to the extent that these businesses are eligible for reduced regulatory
requirements for qualified facilities, facilities with qualified
oil-filled operational equipment, facilities with motive power
containers, and facilities with mobile refuelers.  Because the SPCC rule
categorizes affected entities based on oil storage capacity while SBA
defines small businesses based on the business’ total number of
employees or total annual revenue, EPA does not know how many
SPCC-regulated facilities are also SBA-defined small businesses.
Nevertheless, given their resource constraints, owners and operators of
small businesses are likely to take advantage of and benefit from the
regulatory burden relief offered by the current amendments.

  REF _Ref140573259  Exhibit 11-1  summarizes cost savings for these
rule components for owners and operators of Category I facilities
(10,000 gallons or less).  Because some facilities fall into more than
one rule component category, the number of facilities and cost savings
across rule categories are not additive.  The cost saving estimates
presented for each of these components are based on the estimated number
of Category I affected facilities described in Chapter   REF
_Ref140640093 \r  4 , which are mapped into the rule categories for
which they are eligible, and the unit cost estimates for affected
compliance activities described in Chapter   REF _Ref140640103 \r  5  of
this report.  Thus, the Agency concludes that the final amendments to
the 2002 SPCC rule provide regulatory relief for relatively small
entities based on oil storage capacity, and therefore do not have any
adverse impact on small businesses.

Exhibit   STYLEREF 1 \s  11 -  SEQ Exhibit \* ARABIC \s 1  1

Estimated Cost Savings for Category I SPCC-Regulated Facilities

Rule Component	Number of Facilities

(10-Year Average)	Total Cost Savings (millions $, discounted 3%)	Total
Cost Savings

(millions $, discounted 7%)

	Existing	New	Total

Qualified Facilities	       337,000 	           7,260 	       345,000
37.9	37.7

Qualified OFE	 N/A 	           2,580 	           2,580 	31.2	31.0

Motive Power	         21,700 	              329 	         22,000 	1.1
1.1

Mobile Refuelers	 N/A 	           1,400 	           1,400 	34.4	34.2

Total	       359,000 	         11,600 	       371,000 	105.0	104.0

	It is important to note that cost savings for owners and operators of
Category I facilities under the amendments to the SPCC rule (  REF
_Ref140573259  Exhibit 11-1 ) represent a higher level of overall
savings as compared to the proposed rule for two primary reasons.
First, this regulatory impact analysis used the most currently available
data to estimate a larger number of SPCC-regulated facilities than the
analysis conducted for the proposed rule.  Second, the final SPCC
amendments offer a greater degree of regulatory relief to owners and
operators of SPCC-regulated facilities than the proposed revisions.

  SEQ CHAPTER \h \r 1 Limitations and Key Assumptions

According to Executive Order 12866, agencies are required to assess all
costs and benefits of regulatory activities, including quantitative and
qualitative measures.  The Executive Order also requires assessment of
social benefits and costs including but not limited to those related to
the environment, public health and safety, distributive impacts, and
issues of equity.

This regulatory impact analysis estimates the reductions in compliance
costs resulting from the final rule.  The benefits of the major
components of the final rule are assessed qualitatively and limited to
reductions in expenditures accruing from lower compliance costs.  The
Agency also considered whether the streamlined requirements in the final
rule might increase the risk of discharges, with adverse consequences
for the environment, human health, and welfare.  Because EPA has
designed the final rule to minimize increases in environmental risk, the
frequency of oil spills is not expected to increase.  While this
regulatory impact analysis provides an assessment of projected impact on
human health, welfare, and the environment, as well as estimated
reductions in compliance costs, it is not a full accounting of all
social costs and benefits as required by Executive Order 12866.

Many of the assumptions as well as the estimates of unit cost savings
and the number of affected facilities presented in this RIA are
inherently uncertain.  EPA made the best use of the available data to
make informed decisions regarding assumptions used in the analysis.  To
address major uncertainties involved in estimating the total cost
savings from the final SPCC rule, the Agency examined up to three
scenarios for various components of the final rule to provide a
sensitivity approach to estimating the range of cost savings.  Major
limitations of the analysis are described in this chapter.  In Section
REF _Ref140641641 \r  12.6 , a potential impact of technology
innovations is described in relation to compliance requirements of the
SPCC rule.

General Limitations

Estimated Number of Facilities

  SEQ CHAPTER \h \r 1 One of the main limitations of the regulatory
analysis is EPA’s lack of data on facilities regulated under the SPCC
rule.  The rule does not include a notification requirement and, with
certain exceptions, regulated entities do not need to submit any
information to EPA.  Without conducting a statistically valid survey,
EPA is limited to data already collected by state or federal agencies or
by proprietary sources.  Such data are collected for diverse purposes
and are not ideal for identifying SPCC-regulated facilities, as the data
do not normally provide information on smaller storage tanks or
non-petroleum oil.  Therefore, evaluating regulatory changes involves
some uncertainties because the collected data often omit portions of the
regulated universe or lack sufficient detail to ascertain the impacts of
changes in certain requirements.

Estimated Cost of Compliance

Compliance costs incurred by owners and operators of facilities in the
baseline depend not only on the volume of oil stored and handled, but
also on the types of oil at a site, the number of tanks (and their
volume), and the locations of the tanks across the site.  Given a wide
range of industries and facility sizes affected by the SPCC rule – as
well as geographical and climatic conditions that affect facility’s
configuration and operation patterns – a realistic baseline against
which regulatory changes are measured cannot be reliably determined.
Therefore, uncertainty is involved in estimating the changes in
compliance costs that could occur under final regulatory actions.

M  SEQ CHAPTER \h \r 1 any of the cost estimates used in the regulatory
analysis are based on interviews with a limited number of PEs.  The data
provided by these PEs represent anecdotal information and are not
statistically valid, so they cannot be reliably extrapolated to a larger
universe.  In addition, the PEs were hesitant to provide “typical”
costs when the costs of compliance depend significantly on site-specific
factors.  Ideally, a regulatory analysis would explicitly account for
such variability in costs.  However, in this analysis EPA was unable to
differentiate compliance costs due to the lack of information on site
characteristics of entities affected by the final SPCC rule.

Qualified Facilities

Estimated Number of Qualified Facilities

As described in Chapter   REF _Ref140640118 \r  6 , to identify
facilities with total storage capacity of 10,000 gallons or less that
had reportable discharges in the past three years, EPA used National
Response Center (NRC) Incident Data.  The main limitation of the NRC
database for this analysis is the lack of information on the total
amount of oil stored at a facility, whose owner or operator reported an
oil discharge.  The Agency identified individual facilities whose owner
or operator reported oil discharges of 10,000 gallons or less and used
that figure as a proxy for the number of facilities with total storage
capacity of 10,000 gallons or less.  This approach likely results in
overestimating the number of facilities with total storage capacity of
10,000 gallons or less that have had reportable discharges in the past
three years, given that most facilities are not expected to discharge
their total oil storage capacity.  That is a portion of the discharges
at 10,000 gallons or less could have been from facilities with much
larger oil storage capacities.  Because it is not feasible to establish
a relationship between the amount of oil discharged and total storage
capacity at a facility, EPA examined three scenarios  SEQ CHAPTER \h \r
1 : 25 percent, 50 percent, and 75 percent of facilities that reported
oil discharges of 10,000 gallons or less have total oil storage capacity
of 10,000 gallons or less.

Facilities with Qualified Oil-Filled Equipment

Estimated Number of Facilities with Qualified Oil-Filled Equipment

The availability of data on facilities with oil-filled operational
equipment regulated under the SPCC rule was significantly limited.
Facility owners or operators are not required to report the number of
oil-filled operational equipment pieces they possess, or the oil storage
capacity of their oil-filled operational equipment.

	Because self-reported data were not available, EPA relied on available
data sources to estimate the number of facilities that have oil-filled
operational equipment on site.  A list of industries using oil-filled
operational equipment was determined, based on a review of the type of
equipment covered by the definition of oil-filled operational equipment,
and on EPA’s expectations regarding the industries that commonly use
this equipment.  Thus, the industries included in the universe of
facilities with oil-filled operational equipment were determined using
professional judgment rather than industry data.

The number of SPCC-regulated facilities within each industry was
estimated as part of the SPCC universe research described in Chapter
REF _Ref140640131 \r  4 .  Those data represent the estimated number of
SPCC-regulated facilities in each industry sector, and not the actual
number of facilities that use oil-filled operational equipment.  As a
result, EPA   SEQ CHAPTER \h \r 1 examined the impact of the final SPCC
rule changes for the facilities with oil-filled operational equipment
under the three possible scenarios: 25 percent, 50 percent, and 75
percent of facilities in the industries identified as having oil-filled
operational equipment will obtain regulatory relief.  The number of
facilities with oil-filled operational equipment that EPA presents in
the RIA may overestimate or underestimate actual figures.  This
uncertainty causes similar imprecision in the estimates for the total
cost savings associated with the final rule changes for owners and
operators of facilities with qualified oil-filled operational equipment.

Estimated Cost Savings for Owners and Operators of Facilities with
Qualified OFE

	In the final SPCC rule, EPA is providing owners and operators of
facilities with certain types of oil-filled operational equipment the
option of preparing an oil contingency plan and a written commitment of
manpower, equipment, and materials in lieu of providing secondary
containment.  EPA acknowledges that in the absence of the final rule,
some fraction of new facilities would, according to the 2002 SPCC rule
requirements, provide an impracticability determination with a
contingency plan and a written commitment of manpower, equipment, and
materials, rather than pursue secondary containment.  In these cases,
the cost savings resulting from the final rule would be lower, since
owners and operators would be avoiding only an impracticability
determination rather than secondary containment.  EPA does not know the
fraction of facilities that falls into this situation, and did not
incorporate this scenario in the analysis.  As a result of this
limitation, the RIA may overestimate the cost savings to owners and
operators of facilities with qualified oil-filled operational equipment
resulting from the final action.  On the other hand, uncertainties
associated with the unit cost saving estimates for owners and operators
of facilities with oil-filled operational equipment may cause
underestimation of the total cost savings.

  SEQ CHAPTER \h \r 1   SEQ CHAPTER \h \r 1

Motive Power

	Since owners and operators of facilities are not required to report the
number of oil storage tanks or storage capacity of their motive power
equipment, the availability of data on SPCC-regulated facilities with
motive power equipment is limited.    SEQ CHAPTER \h \r 1 To identify
industries that are potentially affected by the motive power exemption,
EPA used the information from industry comments for the NODA submitted
to EPA as well as from research on equipment manufacturers.  Commenters
from the crop production, forestry/logging, and utilities industries
indicated that they had motive power equipment.  EPA identified
additional industry categories by examining sectors targeted by the
major motive power equipment manufacturers such as Caterpillar, Deere &
Company, Kubota Corporation, Joy Global Inc., CNH Global NV, and Terex
Corporation.  EPA used the industries targeted by these manufacturers as
the basis for classifying industries likely to have motive power
containers.

	The number of SPCC-regulated facilities within each industry was
estimated as part of the SPCC universe research described in Chapter
REF _Ref140640143 \r  4  of this report.  Those data represent the
estimated number of SPCC-regulated facilities in each industry sector
and not the actual number of facilities with motive power containers.
Since EPA had no empirical data on the fraction of facilities with
motive power containers with oil storage capacity of 55 gallons or
greater, it estimated the number of affected facilities by examining
three scenarios: 10 percent, 25 percent, and 50 percent of the
facilities in sectors with motive power containers will be affected by
the final regulatory action.  Therefore, the universe of facilities with
motive power containers presented in the RIA may overestimate or
underestimate the actual numbers.  This uncertainty causes similar
imprecision in the estimated cost savings resulting from the final rule
changes.

Mobile Refuelers

	Aside from the aviation industry, EPA had limited data regarding
industries with mobile refuelers on site that fall under EPA's
jurisdiction.  To identify potentially affected industries, EPA used the
following data sources: (1) NODA comments submitted to EPA; (2) publicly
available information on manufacturers of mobile refueling equipment;
and (3) state fire marshall offices that require permits for mobile
refueling activities.  The Agency used the estimated number of
SPCC-regulated facilities within each industry, as described in Chapter
 REF _Ref140640154 \r  4 .

	However, no data were available on the number of facilities within
these industry sectors that actually have mobile refuelers.  As an
alternative, EPA examined three potential scenarios: owners and
operators of 25 percent, 50 percent, and 75 percent of facilities in the
affected industries would take advantage of the regulatory action.  The
three scenarios are designed to yield a reasonable range of estimates
and help EPA evaluate the range of cost savings that could occur as a
result of the final rule changes.  Each of these scenarios could result
in an under- or overestimate of the affected number of facilities with
mobile refuelers.

	An additional uncertainty comes from the possibility that owners and
operators of facilities in many industries have adjusted their processes
in order to avoid falling under EPA's jurisdiction (O'Neil, 2006).  For
example, a construction company may have changed its practices so that
multiple job sites are serviced by one or more mobile refuelers rather
than having an individual refueler at each job site.  For this company,
all but one site, where the refuelers are parked, will be covered under
the Department of Transportation's jurisdiction, with only the single
site being covered under the SPCC rule.

Impact of Technological Innovations

	OMB’s guidance to federal agencies on the development of regulatory
analysis recommends that estimates of costs should be based on credible
changes in technology over time.  The estimates presented in this report
are based on currently available technologies.  The figures do not
capture possible cost savings from implementing new future technologies
or the reduction in costs due to greater market penetration of existing
technologies.  Because the final SPCC rule allows owners and operators
of facilities to choose alternative requirements that primarily involve
paperwork-related activities over capital-intensive compliance measures
(e.g., providing secondary containment), the nature of evolving
technology could affect the estimated cost savings.  For example, if new
technologies were to lower the cost of capital-intensive compliance
measures, the cost savings attributed to the final rule would decrease.

	As a performance-based regulation, the SPCC rule provides facility
owners and operators significant flexibility in the methods, equipment,
and procedures they implement to comply with the rule requirements.
Most rule requirements are written in terms of their ultimate goal of
preventing oil discharges from reaching navigable waters, giving
facility owners and operators considerable leeway in the selection and
specific design of spill prevention measures implemented at the
facility.

	The rule provides further flexibility by allowing the use of
alternative measures that provide equivalent environmental protection
for most provisions, with the exception of secondary containment
requirements.  Finally, rather than incorporating specific industry
standards or procedures, the rule relies on the application of good
engineering judgment in determining appropriate, and cost effective,
methods for preventing oil discharges.  Industry standards and good
engineering practice evolve over time to incorporate new technologies,
which can lower the cost of preventing discharges.

	For example, the cost of integrity testing for bulk storage containers,
as required under §112.8(c)(6), may decrease as new non-destructive
evaluation technologies are developed.  The development of robotic
inspection technologies may enable tank owners or operators to assess
the tank floor’s condition without taking the tank out of service and
cleaning it for safe confined space entry.  These technologies not only
reduce the health and safety hazards and the amount of waste generated
by the cleanup operations (and therefore the cost), but also avoid the
two to six weeks of downtime that are sometimes required to complete
cleanup and inspection.  A recent study performed for the New York State
Energy Research and Development Authority (NYSERDA) favorably compared
the results of conventional tank floor inspections with robotic
inspections, and concluded that the use of robotic inspections could
achieve significant cost savings. Companies that currently use such
techniques report savings of $500,000 to over $3 million, depending on
the number, size, and contents of the tanks.  Robotic inspection
technologies are currently being used on a limited basis and may in time
become more widely available – and cheaper.

Key Assumptions

EPA made three key assumptions in the analysis.  First, the Agency
assumed cost minimization behavior applied to owners or operators of all
facilities that qualify for reduced regulatory requirements, whereby all
those affected would seek burden relief.  Second, EPA assumed that
owners or operators of existing SPCC-regulated facilities would forgo
alternative compliance activities that required capital investments
because they would have already incurred a one-time cost.  For example,
a facility owner or operator, who had secondary containment for
qualified oil-filled operational equipment in place, would not take
advantage of the provided alternative to prepare a contingency plan
instead.  Third, EPA assumed compliance was nationally consistent
despite variability in state regulations, political climate, and the
distribution of affected facilities.

  SEQ CHAPTER \h \r 1 Conclusions

Under Executive Order 12866 (58 FR 51735, October 4, 1993), EPA must
determine whether a regulatory action is “significant” and therefore
subject to Office of Management and Budget (OMB) review and the
requirements of the Executive Order.  The order defines “significant
regulatory action” as one that is likely to result in a rule that may:

Have an annual effect on the economy of $100 million or more or
adversely affect in a material way the economy, a sector of the economy,
productivity, competition, jobs, the environment, public health or
safety, or state, local, or tribal governments or communities;

Create a serious inconsistency or otherwise interfere with an action
taken or planned by another agency;

Materially alter the budgetary impact of entitlements, grants, user
fees, or loan programs or the rights and obligations of recipients
thereof; or

Raise novel legal or policy issues arising out of legal mandates, the
President’s priorities, or the principles set forth in the Executive
Order.

The final rule is expected to have an annual effect on the economy of
$100 million or more and, therefore, is considered economically
significant.  For such rules, the Executive Order requires an
“assessment of the potential costs and benefits of the regulatory
action, including an explanation of the manner in which the regulatory
action is consistent with a statutory mandate and, to the extent
permitted by law, promotes the President's priorities and avoids undue
interference with state, local, and tribal governments in the exercise
of their governmental functions.”

EPA performed a regulatory impact analysis in accordance with Executive
Order 12866 (and OMB Circular A-4) requirements to the fullest extent
possible; however, the study is not a comprehensive analysis of the
social benefits and costs.  Many of the assumptions presented throughout
this regulatory analysis are inherently uncertain, as are many of the
estimates of unit cost savings and the number of affected facilities.
EPA made the best use of the available data to make informed decisions
regarding assumptions used.  To address major uncertainties involved in
estimating the total cost savings from the final SPCC rule, the Agency
examined up to three scenarios for various components of the final rule
to provide a sensitivity approach to estimating the range of cost
savings.

Data limitations prevented the analysis from complying with the "good
practices" outlined in OMB Circular A-4 guidance for regulatory analyses
of social benefits and costs.  However, EPA believes the analytical
technique and results generated are useful, informative, and based on
the best available information given time and resource constraints
associated with the final rulemaking schedule.

Overall, the analysis concluded that the SPCC amendments will result in
significant compliance cost savings to industry as compared to the 2002
rule, by reducing regulatory requirements for owners and operators of
qualified facilities, qualified oil-filled operational equipment, motive
power storage, and mobile refuelers.    REF _Ref140573363  Exhibit 13-1
summarizes the estimated annualized compliance cost savings resulting
from the SPCC amendments, using 3 and 7 percent discount rates.  The
amendments are expected to yield annualized cost savings of roughly $38
million for owners and operators of qualified facilities, $39 to $67
million for owners and operators of qualified oil-filled equipment, $1
to $5 million for owners and operators of facilities with motive power
containers, and $17 to $52 million for owners and operators of
facilities with mobile refuelers.  These estimates are not necessarily
additive, given that they do not account for interactions among the
various components of the amendments.  EPA improved the estimation
methodology and refined main assumptions used in the analysis for the
proposed rule.  The comparison of the estimated cost savings between the
proposed and the final rule are presented in Appendix E.

Exhibit   STYLEREF 1 \s  13 -  SEQ Exhibit \* ARABIC \s 1  1

Summary of Estimated Cost Savings Associated with the 2006 Final Rule
Amendments

($2005 Millions)

Rule Component/Scenario1	Annualized Cost Savings (3%)	Annualized Cost
Savings (7%)

Qualified Facilities	$37.9 	$37.7

Qualified OFE

25%	$39.0 	$38.7

50%	$53.1 	$52.8

75%	$67.2 	$66.8

Motive Power

10%	$1.07 	$1.07

25%	$2.69 	$2.68

50%	$5.37 	$5.35

Mobile Refuelers

25%	$17.2 	$17.1

50%	$34.4 	$34.2

75%	$51.6 	$51.3

1 	Estimated savings are presented for final rule components and
scenarios as discussed in this report.

EPA is aware of industry concerns regarding potential non-compliance
among certain facility sizes or sectors, although no reliable empirical
data exist to assess the scope and magnitude of such non-compliance.
Even if facilities that should have been in compliance with SPCC
requirements – dating back to 1973, if applicable – EPA acknowledged
that they have already effectively incurred the costs of meeting SPCC
requirements given the active status of the rule for these facilities.
In other words, facilities that are currently non-compliant are merely
postponing the actual expenditures of compliance.  Therefore, facilities
that are currently non-compliant will incur expenditures associated with
coming into compliance, but these costs, to the extent that they are
attributable to the 2002 SPCC rule, are not attributable to the current
rulemaking.

The main benefit of the final rule is lower compliance costs for owners
and operators of certain types of facilities and equipment, which EPA
expects will yield net social benefits.  However, as discussed in
Chapter   REF _Ref140640170 \r  10  of this report, these benefits may
be partially offset by potential increases in oil discharge risk
pursuant to the less stringent requirements of the current rulemaking as
compared to those of the existing 2002 SPCC rule.  At the same time, by
reducing the costs of complying with SPCC requirements, the current
rulemaking may induce owners and operators of previously non-compliant
facilities to conform to SPCC requirements, thereby lowering oil
discharge risk.  While quantifying net social benefits precisely is not
possible due to these unknown future impacts of the rule, EPA believes
that cost reductions resulting from the amendments will not be offset by
any significant losses in environmental protection.

Bibliography

5 USC Sec. 603. Initial regulatory flexibility analysis.

5 USC Sec. 604. Final regulatory flexibility analysis.

Andrews, Block.  2004.  Personal communication.  Aquila, Inc.  October.

Baker, Jim.  2004.  Personal communication.  Colonial Group, Inc.
October.

Bergman, Brad.  2004.  Personal communication.  Sun Ray Energy, Co.
October.

Boley, Gary.  2004.  Personal communication.  InterSpec, LLC.  February.

Caterpillar, Inc.  2006.  List of Industries Served.

Available at: http://www.cat.com/cda/layout?m=37403&x=7

Chaet, Wayne.  2005.  Personal communication.  Core Engineered
Solutions.  March.

CNH Global NV.  2006.  Lines of Business.  Available at:   HYPERLINK
"http://www.cnh.com/home.asp"  http://www.cnh.com/home.asp

Comprehensive Environmental Response, Compensation, and Liability Act,
42 U.S.C. s/s 9601 et seq. (1980)

Dawg, Inc.  2006.

Available at:   HYPERLINK
"http://www.dawginc.com/spill-kits/spill-kit-95-gallon-overpack.php"
http://www.dawginc.com/spill-kits/spill-kit-95-gallon-overpack.php

Deere & Company.  2006.  List of Industries Served.

Available at: http://www.deere.com/en_US/deerecom/usa_canada.html

Dun and Bradstreet (D&B).  2005.  Market Spectrum Data on New
Businesses.

Dun and Bradstreet (D&B).  2005.  Market Spectrum.

Available at: http://www.dnb.com/us/

England, Mark.  2005.  Personal communication.  Texas Railroad
Commission. May.

Executive Order 11548, Delegating Functions of the President under the
Federal Water   Pollution Control Act, as Amended, 35 FR 11677; July 22,
1970.

Executive Order 12777, Implementation of Section 311 of the Federal
Water Pollution Control Act, as Amended, and Oil Pollution Act of 1990,
56 FR 54757, October 22, 1991.

Executive Order 12866, Regulatory Planning and Review, 58 FR 51735,
October 4, 1993.

Federal Energy Regulatory Commission (FERC).  2005.  Available at:
http://www.ferc.gov/

Florida Department of Environmental Protection.  2005.  “Storage Tank
Facility Information–All Locations and Tank Information.”  July 28,
2006.

      Available at:
http://www.dep.state.fl.us/waste/quick_topics/database_reports/pages/stc
m/storagetank/stcm_allti.htm

Jack Faucett Associates for SBA Office of Advocacy.  2004.  “Proposed
Reforms to the SPCC Professional Engineer Certification Requirement:
Designing a More Cost Effective Approach for Small Facilities."  June.

Joy Global, Inc.  2006.  Company Overview.

Available at: http://www.joyglobal.com/company_overview/index.jsp

Kansas Department of Health and the Environment (KDH&E).  2005.
Permitted Tanks Database.  Available at: http://www.kdheks.gov/tanks/

Key, Charles.  2006.  Personal communication.  Houston, TX Fire
Marshall’s Office.  May.

Kovatch Corporation.  Sales Department.  2006.  Personal communication.
May.

Kubota Corporation.  2006.  List of Products.

Available at: http://www.kubota.com/f/products/products.cfm

Lawson, Bill.  2005.  Personal communication.  Portland General
Electric.  July.

Lupa, Joanne. 2004.  Personal communication.  Massachusetts Electric,
Co.  October.

Mandeville, Paul, PE.  2005.  Personal communication.  SCS Engineers.
March.

Maryland Department of the Environment (MDE).  2005.  AST Oil Operations
Database.  Available at: http://www.mde.state.md.us/

Maryland Department of the Environment (MDE).  2005.  UST Oil Operations
Database.  Available at: http://www.mde.state.md.us/

Memorandum of Understanding between the Environmental Protection Agency
and the Department of Transportation, dated November 24, 1971, 36 FR
24080, December 18, 1971. (Note: portions of this MOU appear as Appendix
A to 40 CFR part 112)

Minnesota Pollution Control Agency (MnPCA).  2005.  Tanks Database.

Available at:   HYPERLINK
"http://www.pca.state.mn.us/programs/tanks_p.html"
http://www.pca.state.mn.us/programs/tanks_p.html

Morrill, Brian.  2005.  Personal communication.  GZA GeoEnvironmental,
Inc.  March.

Mullens, Kyle.  2004.  Personal communication.  Kaneb Pipe Line
Partners, L.P.  October.

New Pig.  2006.

Available at:
http://www.newpig.com/en_US/spill-absorbents/oil-spill-containment-booms
.htm;jsessionid=UU2OUIFSN11ZUCTGIQVSFEQKMZCCWJVC

New York State Department of Environmental Conservation (DEC).  2005.
Major Oil Storage Facilities Database.  Available at:
http://www.dec.state.ny.us/website/der/bulkstor/index.html

New York State Department of Environmental Conservation (DEC).  2005.
Petroleum Bulk Storage Database.  Available at:
http://www.dec.state.ny.us/website/der/bulkstor/

New York State Energy Research and Development Authority (NYSERDA).
2003.  In-Service Robotic Inspection of Petroleum Storage Tanks.
December 18, 2003.

Available at: http://www.intank.com/PDF/NYFinalReport.pdf

Oklahoma Corporation Commission (OCC).  2005.  Petroleum Storage Tank
Database.  Available at:
http://www.occ.state.ok.us/Divisions/PST/pstmain.htm

O’Neil, JT, Deputy Fire Marshall.  2006.  Personal communication.
Henderson, NV Fire Marshall’s Office.  May.

Oil Pollution Prevention, Non-Transportation Related Onshore and
Offshore Facilities, 40 CFR part 112, Final Rule, 38 FR 34164, December
11, 1973.

Oil Pollution Prevention; Spill Prevention, Control, and Countermeasure
Plan Requirements—Amendments, Proposed Rule, 70 FR 73524, December 12,
2005.

Oil Pollution Prevention and Response; Non-Transportation-Related
Onshore and Offshore Facilities, 40 CFR part 112, Notice of Data
Availability and Request for Comments, NODA Docket Number
OPA–2004–0007, 69 FR 56182, September 20, 2004.

Oil Pollution Prevention and Response; Non-Transportation-Related
Onshore and Offshore Facilities, 40 CFR part 112, Notice of Data
Availability and Request for Comments, NODA Docket Number,
OPA–2004–0008, 69 FR 56184, September 20, 2004.

Rogers, Sally.  2004.  Personal communication.  Sinclair Oil Corp.,
Casper Refinery.  October.

Scully Signal Company.  2006.  List of Industries Served Product
Transferring Equipment.  Available at:   HYPERLINK
"http://www.scully.com/is_index.html"
http://www.scully.com/is_index.html

Small Business Regulatory Enforcement Fairness Act, Pub Law No. 104-121
(1996).

Section 311(j)(1)(C) of the CWA.

Silva, Tony.  2005.  Personal communication.  ENSR International.
March.

Soy Ink.  “US Manufacturers Producing Soy Ink.”  Available at
http://www.soyink.com

SPEC Consulting.  2003.  In-Service Robotic Inspection of Petroleum
Storage Tanks.

Available at:   HYPERLINK "http://www.intank.com/PDF/NYFinalReport.pdf"
http://www.intank.com/PDF/NYFinalReport.pdf

Steckard, Jerry.  2004.  Personal communication.  Hyperion Energy.
October.

Terex Corp.  2006.  List of Industries Served.

Available at:   HYPERLINK
"http://www.terex.com/main.php?obj=industries&action=BROWSE&nav=indust&t
exsess=46f350a492cf096942b6e7c55d34e7c0"
http://www.terex.com/main.php?obj=industries&action=BROWSE&nav=indust&te
xsess=46f350a492cf096942b6e7c55d34e7c0

Townsend, Karen.  2005.  Personal communication.  Woodard & Curran.
March.

U.S. Census Bureau.  1992.  1992 Economic Census.

Available at: http://www.census.gov/epcd/www/92result.html

U.S. Census Bureau.  1997.  1997 Economic Census.

Available at: http://www.census.gov/epcd/www/econ97.html#1997

U.S. Census Bureau.  2002.  2002 Economic Census: Summary Statistics by
2002 NAICS: United States.  Available at:
http://www.census.gov/econ/census02/

U.S. Census Bureau.  2005.  “SPCC NAICS Categories.”  The North
American Industry Classification System, 1992-2002.

U.S. Coast Guard (USCG), National Response Center (NRC).  2006.
Emergency Response Notification System (ERNS).  Available at:
http://www.nrc.uscg.mil/foia.html

U.S. Department of Agriculture (USDA).  2005.

Available at:   HYPERLINK
"http://www.nass.usda.gov:8080/QuickStats/Create_Federal_All.jsp"
http://www.nass.usda.gov:8080/QuickStats/Create_Federal_All.jsp .

U.S. Department of Agriculture (USDA), National Agricultural Statistics
Service.  1982.  “County Table 6 National Agricultural Statistics
Service, County Table 6, 1982 U.S. Census of Agriculture, Volume 1.”

U.S. Department of Agriculture (USDA), National Agricultural Statistics
Service.  1997.  “1997 Census of Agriculture.”

Available at
http://www.nass.usda.gov/Census_of_Agriculture/1997/index.asp

U.S. Department of Agriculture (USDA), National Agricultural Statistical
Service.  1997.  “Gasoline, diesel, natural gas, and LP gas, oil ,
kerosene, motor oil, grease, etc. Table 49: Summary by Size of Farm.”
Petroleum Products Expenses, 1997, 1992, and 1987.

U.S. Department of Agriculture (USDA), National Agricultural Statistics
Service.  2002.  “2002 Census of Agriculture.”

Available at http://www.nass.usda.gov/Census_of_Agriculture/index.asp

U.S. Department of Agriculture (USDA), National Agricultural Statistical
Service.  2002.  “Gasoline, fuels, and oil.”  Farm Production
Expenses: 2002 and 1997.

U.S. Department of Agriculture (USDA).  2006.  “Number of Farms.“
National Agricultural Statistics Service, 1996-2005.

U.S. Department of Defense (DOD).  2005.  “Base Closures and
Realignment Report.”  Volume I Part 1 of 2: Results and Process.  May.

U.S. Department of Defense (DOD).  2005.  “Total Number of Military
Installations.”  Where We Serve: Information About Defense Department
Installations.

U.S. Department of Energy.  1991. Report to Congress on Candidate Sites
for Expansion of the Strategic Petroleum Reserve to One Billion Barrels.
 Office of Strategic Petroleum Reserve, March 1991, Document Number
DOE/FE-0221P.

U.S. Department of Labor, Bureau of Labor Statistics.  2006.  “Table
11. Private industry, by occupational group and full-time and part-time
status.”

Available at: http://www.bls.gov/news.release/ecec.t11.htm

U.S. Department of Labor, Bureau of Labor Statistics.  2005.  Employer
Costs for Employee Compensation.  December.  Available at:
http://www.bls.gov/

U.S. Department of Labor, Bureau of Labor Statistics.  2005.  The
Employment Cost Index (ECI).  Available at: http://www.bls.gov/ncs/ect/