Economic and   SEQ CHAPTER \h \r 1 Supporting Analyses

Short Term Regulatory Changes to the Lead and Copper Rule

Prepared by:

Environomics, Inc.

4405 East West Highway, Suite 307

Bethesda, MD 20814

And

HDR/EES

500 108th Ave NE, Suite 1200

Bellevue, WA 98004

EPA Contract Number 68-C-02-042

Work Assignment 4-13

EPA Work Assignment Manager

Kira Smith

U.S. Environmental Protection Agency

Office of Ground Water and Drinking Water

Washington, DC

Draft: March 30, 2007

CONTENTS

  TOC \o "1-2" \h \z \t "section,1,subsection,2"    HYPERLINK \l
"_Toc162867958"  1	Introduction	  PAGEREF _Toc162867958 \h  4

  HYPERLINK \l "_Toc162867959"  1.1     Summary of Changes	  PAGEREF
_Toc162867959 \h  4

  HYPERLINK \l "_Toc162867960"  1.2	 Summary of Differences With the EA
for the Proposed Rule	  PAGEREF _Toc162867960 \h  5

  HYPERLINK \l "_Toc162867961"  1.3	 Document Organization	  PAGEREF
_Toc162867961 \h  5

  HYPERLINK \l "_Toc162867962"  2	Need for the Rule	  PAGEREF
_Toc162867962 \h  6

  HYPERLINK \l "_Toc162867963"  2.1	 Public Health Concerns Related to
Lead and Copper Exposure	  PAGEREF _Toc162867963 \h  6

  HYPERLINK \l "_Toc162867964"  2.2	  Regulatory History	  PAGEREF
_Toc162867964 \h  7

  HYPERLINK \l "_Toc162867965"  2.3	 Comprehensive Review of the LCR
PAGEREF _Toc162867965 \h  10

  HYPERLINK \l "_Toc162867966"  2.4 	Rationale for the Regulation
PAGEREF _Toc162867966 \h  17

  HYPERLINK \l "_Toc162867967"  3	Regulatory Changes and Alternatives
Considered	  PAGEREF _Toc162867967 \h  18

  HYPERLINK \l "_Toc162867968"  3.1 	Regulatory change III.A - Minimum
number of samples required	  PAGEREF _Toc162867968 \h  18

  HYPERLINK \l "_Toc162867969"  3.2 	Regulatory change III.B -
Definitions for compliance and monitoring periods	  PAGEREF
_Toc162867969 \h  20

  HYPERLINK \l "_Toc162867970"  3.3 	Regulatory change III.C - Reduced
monitoring criteria	  PAGEREF _Toc162867970 \h  21

  HYPERLINK \l "_Toc162867971"  3.4 	Regulatory change III.D - Advanced
notification and approval requirement	  PAGEREF _Toc162867971 \h  22

  HYPERLINK \l "_Toc162867972"  3.5 	Regulatory change III.E -
Requirement to provide sampling results to consumers	  PAGEREF
_Toc162867972 \h  24

  HYPERLINK \l "_Toc162867973"  3.6 	Regulatory change III.F – Public
education requirements	  PAGEREF _Toc162867973 \h  25

  HYPERLINK \l "_Toc162867974"  3.7 	Regulatory change III.G -
Reevaluation of Lead Service Lines deemed replaced.	  PAGEREF
_Toc162867974 \h  29

  HYPERLINK \l "_Toc162867975"  4	Costs of Regulatory Changes	  PAGEREF
_Toc162867975 \h  30

  HYPERLINK \l "_Toc162867976"  4.1	 Overall Cost Methodologies and
Assumptions	  PAGEREF _Toc162867976 \h  31

  HYPERLINK \l "_Toc162867977"  4.2 	Direct Costs Associated with
Regulatory Change III.A	  PAGEREF _Toc162867977 \h  35

  HYPERLINK \l "_Toc162867978"  4.3    Direct Costs Associated with
Regulatory Change III.B	  PAGEREF _Toc162867978 \h  39

  HYPERLINK \l "_Toc162867979"  4.4 	Direct Costs Associated with
Regulatory Change III.C	  PAGEREF _Toc162867979 \h  40

  HYPERLINK \l "_Toc162867980"  4.5 	Direct Costs Associated with
Regulatory Change III.D	  PAGEREF _Toc162867980 \h  43

  HYPERLINK \l "_Toc162867981"  4.6 	Direct Costs Associated with
Regulatory Change III.E	  PAGEREF _Toc162867981 \h  47

  HYPERLINK \l "_Toc162867982"  4.7	Direct Costs Associated with
Regulatory Change III.F	  PAGEREF _Toc162867982 \h  50

  HYPERLINK \l "_Toc162867983"  4.8 	Direct Costs Associated with
Regulatory Change III.G	  PAGEREF _Toc162867983 \h  62

  HYPERLINK \l "_Toc162867984"  4.9	Summary of Average Annual Costs
PAGEREF _Toc162867984 \h  65

  HYPERLINK \l "_Toc162867985"  4.10 	Costs to Review and Implement
Regulatory Changes	  PAGEREF _Toc162867985 \h  66

  HYPERLINK \l "_Toc162867986"  5	Indirect Cost and Health Risk
Reduction Implications of Rule Changes	  PAGEREF _Toc162867986 \h  68

  HYPERLINK \l "_Toc162867987"  6	Administrative Requirements	  PAGEREF
_Toc162867987 \h  73

  HYPERLINK \l "_Toc162867988"  6.1 	Executive Order 12866:  Regulatory
Planning and Review	  PAGEREF _Toc162867988 \h  73

  HYPERLINK \l "_Toc162867989"  6.2 	Paperwork Reduction Act	  PAGEREF
_Toc162867989 \h  73

  HYPERLINK \l "_Toc162867990"  6.3 	Regulatory Flexibility Act
PAGEREF _Toc162867990 \h  76

  HYPERLINK \l "_Toc162867991"  6.4 	Unfunded Mandates Reform Act
PAGEREF _Toc162867991 \h  81

  HYPERLINK \l "_Toc162867992"  6.5 	Executive Order 13132:  Federalism
 PAGEREF _Toc162867992 \h  82

  HYPERLINK \l "_Toc162867993"  6.6 	Executive Order 13175:
Consultation and Coordination With Indian Tribal Governments	  PAGEREF
_Toc162867993 \h  83

  HYPERLINK \l "_Toc162867994"  6.7 	Executive Order 13045:  Protection
of Children from Environmental Health Risks and Safety Risks	  PAGEREF
_Toc162867994 \h  83

  HYPERLINK \l "_Toc162867995"  6.8	 Executive Order 13211:  Actions
Concerning Regulations That Significantly Affect Energy Supply,
Distribution, or Use	  PAGEREF _Toc162867995 \h  84

  HYPERLINK \l "_Toc162867996"  6.9 	National Technology Transfer and
Advancement Act	  PAGEREF _Toc162867996 \h  84

  HYPERLINK \l "_Toc162867997"  REFERENCES	  PAGEREF _Toc162867997 \h
86

 LIST OF EXHIBITS

  TOC \h \z \t "Exhibit" \c    HYPERLINK \l "_Toc162864267"  Exhibit
ES-2:  Summary of Annual Direct Costs to Systems and States from
Regulatory Changes	  PAGEREF _Toc162864267 \h  2

  HYPERLINK \l "_Toc162864268"  Exhibit ES-3: Summary of One-Time Direct
Costs	  PAGEREF _Toc162864268 \h  3

  HYPERLINK \l "_Toc162864269"  Exhibit 1: Systems Exceeding the Lead
Action Level Since 2003	  PAGEREF _Toc162864269 \h  13

  HYPERLINK \l "_Toc162864270"  Exhibit 2: Systems Exceeding the Lead
Action Level Since 2000	  PAGEREF _Toc162864270 \h  14

  HYPERLINK \l "_Toc162864271"  Exhibit 3: Lead 90th Percentile Levels
for 166 Large Water Utilities - Then and Now	  PAGEREF _Toc162864271 \h
15

  HYPERLINK \l "_Toc162864272"  Exhibit 4: Summary of Direct and
Indirect Implications of the LCR Short Term Regulatory Changes	  PAGEREF
_Toc162864272 \h  30

  HYPERLINK \l "_Toc162864273"  Exhibit 5: Number of Systems by Size
Category and Type Subject to the LCR	  PAGEREF _Toc162864273 \h  33

  HYPERLINK \l "_Toc162864274"  Exhibit 6:  Direct Costs Associated with
Regulatory Changes	  PAGEREF _Toc162864274 \h  34

  HYPERLINK \l "_Toc162864275"  Exhibit 7:  Number of NTNCWSs and CWSs
in 11 States that Favored 1 Sample Per Tap in Comments on Proposed Rule
plus Alaska	  PAGEREF _Toc162864275 \h  36

  HYPERLINK \l "_Toc162864276"  Exhibit 8:  Number of NTNCWSs with Fewer
Than 5 Taps in 11 States	  PAGEREF _Toc162864276 \h  37

  HYPERLINK \l "_Toc162864277"  Exhibit 9: Summary of Estimated Direct
Costs to Systems and State/Primacy Agencies Associated with Regulatory
Change III.A	  PAGEREF _Toc162864277 \h  38

  HYPERLINK \l "_Toc162864278"  Exhibit 10: Number of Systems Exceeding
Annually	  PAGEREF _Toc162864278 \h  40

  HYPERLINK \l "_Toc162864279"  Exhibit 11: Summary of Estimated Direct
Costs to Systems and State/Primacy Agencies Associated with Regulatory
Change III.C	  PAGEREF _Toc162864279 \h  42

  HYPERLINK \l "_Toc162864280"  Exhibit 12: Estimated Direct Costs to
Systems and State/Primacy Agencies Associated with Regulatory Change
III.D	  PAGEREF _Toc162864280 \h  46

  HYPERLINK \l "_Toc162864281"  Exhibit 13: Summary of Direct Costs
Associated with Regulatory Change III.E	  PAGEREF _Toc162864281 \h  49

  HYPERLINK \l "_Toc162864282"  Exhibit 14: Number of Systems Exceeding
Annually	  PAGEREF _Toc162864282 \h  50

  HYPERLINK \l "_Toc162864283"  Exhibit 15: Summary of Direct Costs
Associated with Regulatory Change III.F(a)(1)	  PAGEREF _Toc162864283 \h
 51

  HYPERLINK \l "_Toc162864284"  Exhibit 16: Summary of Direct Costs
Associated with Regulatory Change III.F(b)(1)	  PAGEREF _Toc162864284 \h
 52

  HYPERLINK \l "_Toc162864285"  Exhibit 17: Assumptions Used to Derive
System Costs for III.F(b)(2)	  PAGEREF _Toc162864285 \h  54

  HYPERLINK \l "_Toc162864286"  Exhibit 18: Summary of Cost Per System
for Activities III.F(b)(2)(i)-(viii)	  PAGEREF _Toc162864286 \h  55

  HYPERLINK \l "_Toc162864287"  Exhibit 19: Summary of Direct Costs
Associated with Regulatory Change III.F(b)(2)	  PAGEREF _Toc162864287 \h
 55

  HYPERLINK \l "_Toc162864288"  Exhibit 20: Summary of Direct Costs
Associated with Regulatory Change III.F(c)(1)	  PAGEREF _Toc162864288 \h
 56

  HYPERLINK \l "_Toc162864289"  Exhibit 21: Summary of Direct Costs
Associated with Regulatory Change III.F(c)(2)	  PAGEREF _Toc162864289 \h
 57

  HYPERLINK \l "_Toc162864290"  Exhibit 22: Summary of Direct Costs
Associated with Regulatory Change III.F(c)(3)	  PAGEREF _Toc162864290 \h
 58

  HYPERLINK \l "_Toc162864291"  Exhibit 23: Summary of Direct Costs
Associated with Regulatory Change III.F(e)(1)	  PAGEREF _Toc162864291 \h
 59

  HYPERLINK \l "_Toc162864292"  Exhibit 24: Summary of Direct Costs to
Systems Associated with Regulatory Change III.F	  PAGEREF _Toc162864292
\h  60

  HYPERLINK \l "_Toc162864293"  Exhibit 25: Summary of Direct Costs to
States Associated with Regulatory Change III.F(7)	  PAGEREF
_Toc162864293 \h  61

  HYPERLINK \l "_Toc162864294"  Exhibit 26: Summary of Direct Costs
Associated with Regulatory Change III.G	  PAGEREF _Toc162864294 \h  64

  HYPERLINK \l "_Toc162864295"  Exhibit 27:  Summary of Annual Direct
Costs to Systems and States from Regulatory Changes	  PAGEREF
_Toc162864295 \h  65

  HYPERLINK \l "_Toc162864296"  Exhibit 28: Summary of Direct Costs
Associated with One-Time Costs	  PAGEREF _Toc162864296 \h  67

  HYPERLINK \l "_Toc162864297"  Exhibit 29: Summary of Preliminary Cost
and Health Risk Reduction Implications of the LCR Short Term Rule
Changes	  PAGEREF _Toc162864297 \h  69

  HYPERLINK \l "_Toc162864298"  Exhibit 30: Summary of the Total Burden
and Costs from September 2007 through September 2010 for the Regulatory
Changes	  PAGEREF _Toc162864298 \h  75

  HYPERLINK \l "_Toc162864299"  Exhibit 31: A Summary of the Burden and
Costs by Year for the Regulatory Changes – Lower Bound Estimate
PAGEREF _Toc162864299 \h  75

  HYPERLINK \l "_Toc162864300"  Exhibit 32: A Summary of the Burden and
Costs by Year for the Regulatory Changes – Upper Bound Estimate
PAGEREF _Toc162864300 \h  75

  HYPERLINK \l "_Toc162864301"  Exhibit 33: The Number of Small Systems
Affected by the Final Rule Changes	  PAGEREF _Toc162864301 \h  77

  HYPERLINK \l "_Toc162864302"  Exhibit 34: The Number of Small Systems
Affected by Each Regulatory Change	  PAGEREF _Toc162864302 \h  77

  HYPERLINK \l "_Toc162864303"  Exhibit 35: Total Annual Small System
Costs	  PAGEREF _Toc162864303 \h  80

  HYPERLINK \l "_Toc162864304"  Exhibit 36: Total One-Time Small System
Costs	  PAGEREF _Toc162864304 \h  80

 Economic and   SEQ CHAPTER \h \r 1 Supporting Analyses

Short Term Regulatory Changes to the Lead and Copper Rule

Executive Summary

	The Environmental Protection Agency (EPA) is making seven targeted
regulatory changes to the national primary drinking water regulations
(NPDWR) for lead and copper. The intended effect of these regulatory
changes is to strengthen the implementation of the Lead and Copper Rule
(LCR) in the areas of monitoring, customer awareness, and lead service
line replacement. Some of these changes clarify the intent of the LCR
for provisions that have generated questions. Other provisions
reconsider LCR requirements in light of recent experiences regarding
implementation of the rule. These changes are expected to ensure and
enhance more effective protection of public health through the reduction
of lead exposure. The changes included in today’s action do not affect
the lead or copper maximum contaminant level goals, the Action Levels,
or the basic regulatory requirements.

	This Economic Analysis describes the estimates of annual costs for the
seven regulatory changes to utilities and States, including costs
associated with administrative, monitoring, sampling, reporting, and
public notification activities. One-time, upfront costs of rule review
and rule implementation are also estimated. There are two types of
annual costs that may result from the rule changes – direct and
indirect. Direct costs are from those activities that are specified by
the rule change, such as costs for additional monitoring or distribution
of consumer notices. A second type of cost may also result when systems
and States use the information generated by directly–related rule
activities to modify or enhance practices to reduce lead levels. These
indirect costs, and related health risk reductions, are not quantified
for the purposes of this analysis, but are described qualitatively in
Section 5. Exhibit ES-1 summarizes the expected direct and indirect cost
impacts for the seven regulatory changes.

Exhibit ES-1: Summary of Direct and Indirect Implications of the LCR
Short Term Rule Changes

Rule Change #	Rule Change Description	Direct Cost Implications	Indirect
Cost and Health Risk Implications

III.A	Number of samples	Yes	Yes

III.B	Monitoring period	Unquantified	None

III.C	Reduced monitoring criteria	Yes	Yes

III.D	Advanced notification and approval 	Yes	Yes

III.E	Consumer notice of Lead results	Yes	Yes

III.F	Public Education	Yes	Yes

III.G	Reconsideration of lead service lines	Yes	Yes

	Six rule changes are expected to result in direct costs: Regulatory
Changes III.A, III.C, III.D, III.E, III.F, and III.G. For these
potential rule changes, costs could be incurred in the areas of system
reporting, tap water monitoring and public education for systems, and
State review and public education for States/Primacy Agencies. Exhibit
ES-2 summarizes the annual direct costs estimated for each rule change.
Exhibit ES-3 summarizes the one-time direct costs associated with
implementing the rule changes.

Exhibit ES-2:  Summary of Annual Direct Costs to Systems and States from
Regulatory Changes

(4th Qtr 2006$)

Regulatory Change	Annual Direct Costs to Systems	Annual  Direct Costs to
States	Total Annual Direct Costs

	Reporting	Monitoring	Customer Notification	Total

III.A	-	-	-	-	-	-

III.B	-	-	-	-	-	-

III.C	$61,000	$2,635,000	-	$2,696,000	$82,000	$2,778,000

III.D Low

III.D High	$506,000

$765,000	-	-	$506,000

$765,000	$163,000

$348,000	$669,000

$1,113,000

III.E	$136,000	-	$1,112,000	$1,248,000	$163,000	$1,411,000

III.F	$34,000	-	$825,000	$859,000	$63,000	$922,000

III.G	-	$110,000	-	$110,000	-	$110,000

TOTAL Low

TOTAL High	$736,000

$995,000	$2,745,000	$1,938,000	$5,418,000

$5,677,000	$471,000

$657,000	$5,890,000

$6,335,000

Note:  Totals may not add due to rounding.

Exhibit ES-3: Summary of One-Time Direct Costs

(4th Qtr 2006$)

One Time  Costs

Costs to Systems

Review & Communication	$10,971,000

	III.A	$104,000

Total System Costs	$11,075,000

Costs to State/Primacy Agencies

	Regulation Adoption 	$1,488,000

	III.A	$162,000

Total State Costs	$1,650,000

Note:  Totals may not add due to rounding.

With regards to potential benefits resulting from the changes, the
intent of this rulemaking is to improve implementation of the lead and
copper regulations by clarifying monitoring, reporting, and notification
requirements, and modifying the lead service line test-out procedure.
The revisions do not affect the action levels, treatment techniques such
as corrosion control requirements, or other provisions in the existing
rule that directly determine the degree to which the rule reduces risks
from lead and copper.

However, the increase in administrative activities that will result from
the revisions will result in the generation of new information (e.g.,
more monitoring data, some of which may show exceedances), and may
prompt some systems or individuals to respond to this new information by
taking measures to abate lead and copper exposures and thus reduce the
associated risk. Also, the requirement that treatment changes be
approved by the primacy agency prior to implementation will provide an
additional opportunity to identify possible adverse impacts due to
treatment changes, which may lower the risk to consumers. Because the
precise impact of these revisions on the behavior of individuals and
systems is not known, EPA has not quantified the changes in health
benefits associated with these revisions. EPA does expect that overall
benefits from the LCR will increase, as a result of the indirect effect
of the revisions on the actions of individual consumers and systems.

1	Introduction

	This document presents an analysis of the costs and potential impacts
of the Short Term Regulatory Changes to the Lead and Copper Rule.

	This section provides a summary of the regulatory changes in Section
1.1. Section 1.2 outlines the organization of this document.

1.1 Summary of Changes

	The seven targeted regulatory changes to the Lead and Copper Rule (LCR)
that are the focus this document are summarized below.

Summary of Short Term Targeted Regulatory Changes

#	Revision	Purpose of Revision

Monitoring

III.A	Minimum number of samples required	To address confusion about
sample collection

III.B	Definitions for compliance and monitoring periods	To clarify when
compliance and monitoring periods begin and end

III.C	Reduced monitoring criteria	To prohibit systems that exceed the
lead Action Level from initiating or remaining on reduced monitoring
based solely on results of water quality parameter monitoring

Treatment Processes

III.D	Advanced notification and approval requirement for water systems
that intend to make any change in water treatment or add a new source of
water that could affect the system’s optimal corrosion control	To
require systems to obtain state approval to add a new source of water or
change a treatment process prior to implementation

Customer Awareness

III.E	Notification of sampling results	To require utilities to provide
sampling results to consumers who are occupants of homes or buildings
that are tested for lead and copper, as part of the utility’s
monitoring program

III.F	Public Education Requirements	To modify public education
requirements by changing the content of the message to be provided to
consumers, how the materials are delivered to consumers, and the
timeframe for delivery

Lead Service Line Replacement

III.G	Reconsideration of lead service lines deemed replaced through
testing	To require that systems reevaluate lead service lines classified
as “replaced” through testing if the system resumes a lead service
line replacement program

1.2		Summary of Differences With the EA for the Proposed Rule

	This EA reflects the final version of the Short Term Changes to the
Lead and Copper Rule.  In comparison with the EA that accompanied the
proposed Rule, the costs in the EA for the Final Rule have been updated
to reflect a 4th Quarter 2006 price level.  In addition, some burden and
cost estimates have been revised based on feedback received in comments
on the proposed Rule.  Finally, the burden and cost estimates for some
of the regulatory changes have been modified to reflect specific changes
to the requirements.  The differences between the Final Rule and the
proposed Rule are summarized in the Appendix L.

1.3		Document Organization

	The rest of this document is organized into the following sections:

Section 2 identifies public health concerns addressed by the rule and
provides a summary of the regulatory history of lead in drinking water,
including the recent review of national implementation of the LCR. It
also explains the statutory authority for promulgating the rule changes
and economic rationale for choosing a regulatory approach.

Section 3 describes the changes in greater detail and reviews
alternative approaches considered.

Section 4 presents an estimate of the direct costs of implementing the
rule changes to utilities and State/Primacy Agencies.

Section 5 discusses the potential indirect cost and health risk impacts
that may result from the rule changes.

Section 6 discusses analyses performed to evaluate the effects of the
rule as specified by various administrative requirements.

2	Need for the Rule

	The purpose of the Lead and Copper Rule (LCR) is to protect populations
from exposure to lead in drinking water to reduce potential health risks
associated with lead. Recent highly publicized incidences of elevated
drinking water lead levels prompted EPA to review and evaluate the
implementation and effectiveness of the LCR on a national basis. As a
result of this multi-part review EPA identified the targeted rule
changes that are the subject of this Economic Analysis. These targeted
changes are intended to strengthen the implementation of the LCR in the
areas of monitoring, customer awareness, and lead service line
replacement. Some of the changes clarify the intent of the LCR for
provisions that have generated questions. Other provisions reconsider
LCR requirements in light of recent experience. These changes are
expected to ensure and enhance more effective protection of public
health through the reduction in lead exposure.

	The following section more fully discusses the need for the targeted
rule changes by first summarizing the health effects associated with
exposure from lead to emphasize the on-going need for reducing that
exposure. Next, context on the regulatory history of the LCR is
provided. EPA’s recent review of the LCR that resulted in the
identification of the targeted rule changes (among other actions) is
described. The section concludes with a description of the regulatory
authority and economic rationale for the regulation.

2.1		Public Health Concerns Related to Lead and Copper Exposure

		Although lead is a naturally occurring metal, the highest
concentrations of lead are a result of human activities (ATSDR, 1999).
For example, sources of lead include lead-based paint, contaminated
soil, contaminated water, lead crystal or lead-glazed pottery or
porcelain, and industrial processes burning lead-based materials. Lead
exposure can cause many serious health effects, especially for children.
For this reason, EPA places a high priority on reducing lead blood
levels (Grumbles, 2004).

		Lead can enter the body if it swallowed or inhaled. If contaminated
food, drink, soil, lead-based paint chips, or other objects covered in
lead dust are ingested, lead will be delivered to the stomach. After
reaching the stomach, a small portion of lead will enter the
bloodstream, while the other portion will be excreted in urine or feces.
In general, a higher portion of lead will enter the bloodstream for
children than for adults (ATSDR, 1999). Once in the blood stream, lead
can be deposited in soft tissues, bones, and/or teeth. If lead particles
or dust are inhaled, lead will first enter the lungs and then be
delivered to the bloodstream.

		Lead exposure can result in the following health effects: lead can
damage the brain and kidneys, cause infertility in both men and woman,
increase blood pressure in adults, and harm the nervous system causing
nerve disorders and muscle and joint pain. Life long exposure to lead
above the Maximum Contaminant Level (MCL) may lead to strokes and kidney
disease.

		Certain populations are at higher risk because they are exposed to
lead more often and/or because they are more sensitive to the same
exposure than an average individual. Children are more vulnerable to
lead exposure because they are both typically exposed to lead more often
and because they are more sensitive to lead. Children are more likely to
be exposed to lead since they often place their hands on many objects,
such as toys, which might be covered in lead dust, and then place their
hands in their mouths. Infants can also be exposed through an exposed
mother’s breast milk. Children are more sensitive to lead because
children’s bodies absorb more of the ingested lead than adults (ATSDR,
1999). In addition, lead exposure can result in greater health risks in
children as their nervous system is still developing. Health effects in
children may include delayed mental and physical development, decreased
IQ, and slight deficits in attention span, hearing, and learning
(Grumbles, 2004). During 1999-2000, approximately 2 percent of children
between the ages of 1 and 5 have blood levels that exceeded CDC’s
level of concern, 10 mg/dL (CDC, 2003).

		Reducing lead exposure for pregnant women is another primary concern
for EPA (Grumbles, 2004). If a mother is exposed to lead, that lead can
be passed on to the developing fetus. Because their nervous systems are
just beginning to develop, fetuses are especially vulnerable to lead
exposure.

		The Maximum Contaminant Level Goal (MCLG) describes the lowest level
of exposure to a contaminant that does not cause any potential health
problems. EPA determined that the MCLG for lead should be zero, since
there is no known safe level of lead in blood (EPA, 2005). Thus, any
exposure to lead, at any concentration, is considered harmful,
especially for young children and pregnant women.

		The rule changes are needed to continue the health protection afforded
by the LCR though more timely and useful information regarding lead
exposure. These changes will also promote effective implementation of
the LCR provisions that protect citizens from lead in drinking water.

2.2		 Regulatory History

		The following section provides a chronology and overview of regulatory
actions affecting the permitable level of lead and copper in drinking
water.

		Drinking Water Regulations Enacted Prior to 1991

		As required by the Safe Drinking Water Act (SDWA), EPA set the
National Interim Primary Drinking Water Regulation for lead in drinking
water to 50 parts per billion (ppb) in 1975. This standard was not
enforceable and did not require utilities to sample at taps to determine
if they were in compliance.

		To limit the amount of lead reaching customer’s taps, Amendments to
SDWA in 1986 banned the installation or repair of lead pipes, fixtures,
solders, and fluxes in any facility that provides water for human
consumption. As defined in section 1417 (d), “lead free” solders and
fluxes may not contain more than 0.2 percent lead and “lead free”
pipes, pipe fittings, and well pumps may not contain more than 8.0
percent lead. In addition, the 1986 SDWA Amendments directed EPA to
revise the regulations for lead and copper in drinking water. In
response to this directive, the Agency proposed revisions in 1988, and
issued the Lead and Copper Rule in 1991.

		To limit lead exposure to one of the most sensitive populations,
children, the Lead Contamination Control Act (LCCA) in 1988 required
schools to test drinking water and recall drinking water coolers that
leached lead. Furthermore, the LCCA banned new drinking water coolers
with lead parts.

		Lead and Copper Rule 1991

		On June 7, 1991, EPA promulgated the Lead and Copper Rule (56 FR
26460; LCR), which set the maximum contaminant level goals (MCLGs) and
national primary drinking water regulations (NPDWRs) for lead and
copper. The rule aimed to maximize human health protection by reducing
lead and copper levels at consumers’ taps as close to the MCLG, 0 for
lead and 1.3 ppm for copper, as is technologically possible. Since
limited technology and resources made the MCLG unfeasible, EPA set
Action Levels at 0.015 mg/L for lead and 1.3 mg/L for copper. Compliance
is based on the 90th percentile of tap water samples.

		To reduce lead and copper concentrations below the Action Level, the
LCR specified that community water systems (CWSs) and non-transient
non-community water systems (NTNCWSs) must conduct periodic monitoring
at the tap and reduce water corrosivity, since corrosive water can
increase the amount of lead and copper that is leached from service
lines and plumbing materials made of lead and/or copper. The rule also
required the following.

Public notification when lead in treated drinking water exceed the lead
Action Level

Treatment of source water if it significantly contributed to high levels
of lead or copper

Replacement of lead service lines in the distribution system if lead
levels continued to exceed the Action Level

Implementation of this rule was phased in based on system size, whereby
the largest systems began monitoring in 1992, and the smallest systems
began monitoring in 1993.

		Proposed Changes to the Lead and Copper Rule 1996

		On April 12, 1996, EPA published a set of proposed minor revisions to
improve implementation of the Lead and Copper Rule. Many of the changes
were based upon recommendations made by a work group composed of
Headquarters and Regional EPA staff, and State drinking water officials.
Other changes were a result of legal challenges to the 1991 Lead and
Copper Rule brought on by the American Water Works Association (AWWA)
and the Natural Resources Defense Council (NRDC).

		The goal of the proposed changes was to promote consistent, national
implementation of the LCR, and streamline and reduce reporting burden.
Proposed changes included optimizing corrosion control, streamlining
monitoring processes, guidance for site selection, requirements for
public education, guidance for analytical processes, and clarification
of reporting requirements. In addition, EPA requested comments on
paperwork burden reductions, many of which were previously suggested,
but EPA did not have sufficient time to consider for LCR 1991.

		The minor revisions to the LCR that were ultimately adopted are
discussed below under “Lead and Copper Rule Minor Revisions 2000.”

		Safe Drinking Water Act 1996

		The 1996 Amendments to SDWA added that “lead free” plumbing
fittings and fixtures must meet standards established under section
1417(e) (42 U.S.C. 300g–6(e)). Section 1417(e) of the SDWA says that
either a voluntary standard must be accepted within a year or EPA must
issue a regulation within two years. Furthermore, if a voluntary
standard is to be accepted, the Administrator must provide technical
assistance to a qualified third-party in the development of the
voluntary standard and associated testing protocols for examining lead
leaching from new plumbing fittings and fixtures.

		In response, EPA published in the Federal Register (FR Vol. 62, No.
163, 44684, Aug. 22, 1997) their view that NSF 61, Section 9 satisfies
the requirement of Section 1417(e). Specifically, EPA felt that NSF 61,
Section 9 is an established voluntary standard and therefore, the
obligation to issue a new regulation was not triggered. As a result, any
new plumbing fitting and fixtures must be NSF certified.

		Lead and Copper Rule Minor Revisions 2000

		On January 12, 2000, EPA published final minor revisions to the Lead
and Copper Rule (LCRMR) based on the comments and discussions of the
proposed revisions in 1996. The minor revisions streamline requirements,
promote consistent national implementation, and in many cases, reduce
the burden for CWSs and NTNCWSs water systems. The changes fall into the
following categories: demonstration of optimal corrosion control, lead
service line replacement requirements, public education requirements,
monitoring requirements, analytical methods, reporting and record
keeping requirements, and special primacy considerations.

		EPA also accepted the definition of “lead free” as defined in the
SDWA.

		The LCRMR did not change the Action Levels, MCLGs, or the rule’s
basic treatment requirements.

2.3		Comprehensive Review of the LCR

		The minor changes to the Lead and Copper Rule described in this
document were identified through a comprehensive national review of
compliance and implementation of the Lead and Copper Rule. The review
was initiated in response to high profile Action Level exceedances
experienced by the District of Columbia Water and Sewer Authority (DC
WASA). The purpose of the review was to answer three questions with
regards to lead in drinking water:

Is this a national problem? Does a large percent of the population
receive water that exceeds the lead Action Level? Do a large number of
systems fail to meet the lead Action Level?

How well has the rule worked to reduce lead levels in systems over the
past 12 years, particularly in systems that had demonstrated high lead
levels in the initial rounds of sampling?

Is the rule being effectively implemented today, particularly with
respect to monitoring and public education requirements?

		The comprehensive review consisted of several elements, including a
series of workshops designed to elicit issues, comments, and suggestions
from stakeholders on particular topics, a review of data to evaluate the
effectiveness of the rule, and a review of LCR implementation by States
and utilities. The following section summarizes the DC WASA situation
that prompted the comprehensive review, describes in greater detail the
elements of the review, and presents EPA’s findings and next steps
resulting from the review.

		DC WASA’s Experience with Elevated Lead Levels in Drinking Water

		DC WASA is a utility that distributes drinking water to over 500,000
residential, commercial, and governmental customers in the District of
Columbia. The water that DC WASA distributes is purchased from and
treated by the Washington Aqueduct, a division of the US Army Corps of
Engineers.

		From 1994 through 1999, DCWASA met the Action Level for lead under the
LCR and went on reduced monitoring. In August 2002, DCWASA reported to
EPA that the 90th percentile of 53 tap water samples for the compliance
period of July 1, 2001- June 30, 2002 exceeded the Action Level of 15
ppb, at a value of 75 ppb. Subsequent tap sampling also indicated Action
Level exceedances for the period of January - June of 2003 (40 ppb 90th
percentile from 104 samples) and July - December of 2003 (63 ppb 90th
percentile from 108 samples). As per the LCR, the Action Level
exceedances triggered DC WASA to undertake tap monitoring on a regular
(i.e., not reduced) schedule, public education, and lead service line
replacement.

		Local media coverage of the exceedances and the results of lead
service line testing elevated the visibility of DC WASA’s lead levels.
Multiple hearings were conducted before House and Senate committees in
2004 and 2005. EPA conducted a compliance audit that resulted in an
Administrative Order that detailed alleged weaknesses in DC WASA’s
implementation of the LCR including the following.

	Failure to take samples within the monitoring period

	Failure to conduct follow-up monitoring of partially replaced lead
service lines

	Failure to comply with requirements for public service announcements

	Not using required language in written materials provided to customers

	Failure to report samples and Action Level exceedance

	Failure to perform required activities following exceedance of the Lead
Action Level in the July 2000 - June 2001 monitoring period

	Failure to report noncompliance

		DC WASA, in coordination with EPA, the Corps of Engineers, and other
groups, implemented numerous measures to address the high lead levels,
including adding orthophosphate as a corrosion control treatment,
replacing lead service lines, and conducting sampling and research.
Early results seem to indicate the effectiveness of orthophosphate in
reducing lead levels.  Preliminary analyses from an ongoing technical
review suggest potential causes of the elevated lead levels including
the following.

	Conversion from free chlorine to chloramines for final disinfection

	Detachment of lead particles from piping systems

	Galvanic corrosion of lead service lines

	Grounding currents that affect corrosion of lead bearing components

	City-Wide meter replacement program

	Distribution system pH variations

	Drought conditions and resulting effects on corrosivity of DCWASA water

		With regards to the implementation of the LCR, the DC WASA experience
highlights several areas in which the LCR could be improved, including
monitoring after lead service line replacement, defining compliance and
monitoring periods, and the impact of treatment changes.

Workshops on Lead in Drinking Water

		EPA held five workshops in 2004-2005 to elicit issues and suggestions
from stakeholders on various topics related to lead in drinking water.

	Simultaneous Compliance, May 2004, St. Louis, MO: Expert participants
from utilities, academia, state governments, and other stakeholder
groups identified issues, proposed solutions, and identified information
gaps with respect to simultaneous compliance with the LCR and other
rules such as the Total Coliform Rule, the Surface Water Treatment
Rules, and the Disinfection Byproducts Rules. Issues and suggestions
were developed for four topic areas: coagulation impacts on corrosion
control; impacts of disinfectant changes on corrosion control; corrosion
inhibitor; and distribution system management. Among the issues
identified by the group were information gaps on impacts of treatment
changes under various water quality conditions/chemistries and the need
for additional guidance on a variety of topics.

	Sampling Protocols, May 2004, St. Louis, MO: Expert participants from
utilities, academia, state governments, and other stakeholder groups
identified issues, proposed solutions, and identified information gaps
with respect monitoring and sampling under the LCR. Topic areas included
sampling frequency and triggers; sampling site selection/location;
sampling protocol; and sampling of water quality parameters. The issues
included sampling after treatment changes and Action Level exceedances
and the re-examination of flushing instructions.

	Public Education, September 2004, Philadelphia, PA: Expert participants
from utilities, governments, consumer and environmental groups, and
other stakeholder groups discussed the public education requirements
under the lead and copper rule, drinking water risk communication, and
effective communication with the public. Participants suggested ways to
improve risk communication to the public through establishing
partnerships with health departments and other groups, refining the
message content, improving delivery of the message, and spending more
time planning and evaluating the effectiveness of the risk
communication.

	Lead Service Line Replacement, October 2004, Atlanta, GA:  Expert
participants from utilities, academia, state governments, and other
stakeholder groups discussed the challenges and problems encountered by
the participants in implementing lead service line replacement, as well
as strategies and solutions for overcoming those difficulties. Specific
topic areas addressed included monitoring, customer communications,
replacement technologies, and managing inventory. Continued sampling
after lead service line replacement and the need to notify customers of
testing results were mentioned during the discussions.

	Lead in Plumbing, July 2005, Washington, DC: Expert participants from
utilities, academia, state governments, and other stakeholder groups
discussed lead in plumbing fittings and fixtures. Topic areas included
NSF standards and testing protocols, alternative materials,
national/state/local/industry/consumer practices, and miscellaneous
issues.

Review of Data to Evaluate Effectiveness of Rule

		EPA undertook a review of the lead levels in drinking water systems
serving more than 3,300 as reported in the Safe Drinking Water
Information System/Federal Version (SDWIS/FED). Since 2002, States have
been required to report to SDWIS the 90th percentile lead concentrations
for systems serving more than 3,300. At the start of the review,
SDWIS/FED had data for only 23 percent of these systems. EPA worked with
States to expedite entry of the 90th percentile lead data. The effort
was successful, with data available for 97 percent of large systems and
91 percent of medium systems as of June 1, 2004.

		The following exhibits summarize the data on medium and large public
water systems exceeding the Action Level from SDWIS/FED as of January
27, 2005.

Exhibit 1: Systems Exceeding the Lead Action Level Since 2003

	Small	Medium	Large	Total

Number of systems above Action Level	884	97	14	995

All systems with data	64,382	7,388	819	72,589

% all systems with results above the Action Level	1.4%	1.3%	1.7%	1.4%

Source: For medium and large systems, January 2005 Summary of Lead
Action Level,   HYPERLINK
"http://www.epa.gov/safewater/lcrmr/lead_data.html"
http://www.epa.gov/safewater/lcrmr/lead_data.html ; for small systems,
Summary, Lead Action Level exceedances for public water systems subject
to the Lead and Copper Rule (For data through September 13, 2004).

Exhibit 2: Systems Exceeding the Lead Action Level Since 2000

	Small	Medium	Large	Total

Number of systems above Action Level	2,663	305	37	3,005

Systems with monitoring results since 2000	N/A	7,388	819	8,207

% of Systems with monitoring results since 2000 over AL	N/A	4.1%	4.5%
4.2%

Source: For medium and large systems, January 2005 Summary of Lead
Action Level,   HYPERLINK
"http://www.epa.gov/safewater/lcrmr/lead_data.html"
http://www.epa.gov/safewater/lcrmr/lead_data.html ; for small systems,
Summary, Lead Action Level exceedances for public water systems subject
to the Lead and Copper Rule (For data through September 13, 2004).

		Based on the data, 95.8 percent of medium and large systems reporting
data since 2000 have 90th percentile values below the Action Level.
Since 2003, it appears that number is slightly higher, with 96.9 percent
of medium and large systems under the Action Level. EPA concluded from
this data: “There does not appear to be a widespread problem with
elevated lead levels across the country comparable to that currently
being observed in the District of Columbia.”

		EPA also compared Action Level exceedances for 166 large systems
serving over 50,000 from immediately after the adoption of the LCR
(1992/1993) to the current monitoring results (2000-2004), summarized in
Exhibit 3. In 1992/1993, all 166 of these systems exceeded the Action
Level. In 2000-2004, only 15 of these systems had 90th percentiles that
exceeded the Action Level, “...demonstrating that corrosion control
efforts taken by the utilities have largely been effective in
controlling lead levels.”

Exhibit 3: Lead 90th Percentile Levels for 166 Large Water Utilities -
Then and Now

			Source:
http://www.epa.gov/safewater/lcrmr/reductionplan_comparison.html

		In 2004, EPA carried out a review of the implementation of LCR
requirements by States. EPA asked State programs, who have primary
oversight responsibility, a number of questions about how they implement
different aspects of the LCR. The questions were centered on the
following general categories: sampling issues, calculation of the 90th
percentile value, treatment issues, lead service line replacement,
public education and enforcement.

		Generally, the State responses to the survey indicate that the States
are following the minimum state requirements of the LCR. However, the
information provided to EPA indicates that many States may not be taking
full advantage of the opportunities to oversee implementation of the
rule. Also, the States’ responses did highlight a few areas in which
there is some confusion about the requirements of the rule as well as
areas in which some States are going above and beyond the minimum
obligations.

		Drinking Water Lead Reduction Plan

		As a result of the previous activities, EPA determined that the
current approach of the LCR has been effective in reducing drinking
water lead levels in the nation’s public water systems and that there
does not appear to be a widespread problem associated with high lead
levels in drinking water. However, EPA identified opportunities to
improve and clarify specific areas of the LCR and guidance materials.
The seven targeted rule changes that are the subject of this document
are key elements of the Drinking Water Lead Reduction Plan.

		It should be noted that EPA has also identified a number of issues
that require longer-term consideration that will continue to be reviewed
as part of potential, more comprehensive revisions to the rule or
guidance. In many cases, these issues require additional data
collection, research, and analysis to fill critical data gaps. Also,
some issues require full stakeholder involvement to support decisions.
Issues that are the subject of longer-term consideration include the
following.

Requirements for consecutive systems

Broader revisions to monitoring and lead service line replacement
requirements

Revision to lead content in plumbing fittings and fixture requirements

Short-term Regulatory Revisions and Clarifications to the Lead and
Copper Rule Workgroup

	In May 2005, EPA formed a work group to consider issues related to the
regulatory changes, called the Short-term Regulatory Revisions and
Clarifications to The Lead & Copper Rule Workgroup (LCRSTR Workgroup).
The LCRSTR Workgroup included EPA staff from a variety of Headquarters
and Regional offices, as well as representatives from State drinking
water lead programs. The LCRSTR Workgroup identified alternatives,
drafted regulatory language, and discussed issues related to the
changes.

National Drinking Water Advisory Committee Working Group on Public
Education Requirements of the Lead and Copper Rule

As part of the review of the LCR, EPA identified a number of issues
relating to the public education requirements of the LCR. In order to
address these concerns, the National Drinking Water Advisory Council
(NDWAC), EPA’s advisory body on the Safe Drinking Water Act, formed a
working group to consider possible revisions to the public education
requirements.   SEQ CHAPTER \h \r 1 The charge for the NDWAC Working
Group was to 1) review the current public education requirements for
lead in drinking water to make recommendations for improvements; 2)
develop recommended revised language for communicating to the public the
risk of lead in drinking water and how affected persons should respond;
and 3) review and make recommendations for changes to the means of
delivery of lead information to the public.

The NDWAC Working Group met in person four times between October 2005
and April 2006. The Working Group was comprised of 16 individuals
representing an array of backgrounds and perspectives. Collectively,
these individuals brought into the discussion the perspectives of State
drinking water agencies, environmental and consumer groups, drinking
water utilities, small system advocates, State health officials, and
risk communication experts. The recommendations from the NDWAC Working
Group form the basis of the regulatory changes on public education
(III.F).

2.4 	Rationale for the Regulation

		This section discusses the statutory authority of EPA to regulate lead
in drinking water and the economic rationale for choosing a regulatory
approach.

		EPA derives its statutory authority to regulate contaminants in
drinking water through the Safe Drinking Water Act. Section 1412(b) (1)
(A) of the SDWA requires EPA to establish National Primary Drinking
Water Regulations for contaminants that may have an adverse public
health effect; that are known to occur or that present a substantial
likelihood of occurring once in public water systems (PWSs), at a
frequency and level of public concern; and that present a meaningful
opportunity for health risk reduction for persons served by PWSs.

		This section addresses the economic rationale for choosing a
regulatory approach as described in Executive Order Number 12866,
Regulatory Planning and Review (USEPA

1993). OMB circular A-4 notes that the rationale for regulation is to
correct market failure or other social purposes: “The major types of
market failure include: externality, market power, and inadequate or
asymmetric information. Correcting market failures is a reason for
regulation, but it is not the only reason. Other possible justifications
include improving the functioning of government, removing distributional
unfairness, or promoting privacy and personal freedom.”

		Several of the rule changes correct inadequate or asymmetric
information. For example, regulatory change III.E requires that tap
monitoring results be provided to consumers, correcting asymmetric
information. Regulatory change III.D changes the timing of information
provision to States, again correcting asymmetric information. Additional
information is gathered under regulatory changes III.D and III.G,
correcting inadequate information. Regulatory change III.F provides for
the development of better information and the more effective
distribution of information, thereby also correcting a situation of
inadequate information.

		The other regulatory changes clarify the intent of the LCR, leading to
more effective implementation of the rule thereby improving the
functioning of government.

3	Regulatory Changes and Alternatives Considered

3.1 	Regulatory change III.A - Minimum number of samples required

		Description of Regulatory Change

		EPA is clarifying the minimum sampling requirement for small water
systems that have fewer than five taps by making revisions to § 141.86
(c).   These revisions include a clarification that the term “taps”
means “taps that can be used for human consumption”, as opposed to
taps not used for human consumption such as hose bibs or at utility
sinks.  In addition, the revisions clarify what a system must do to meet
the minimum number of samples requirement (five), when there are fewer
than five taps available for sampling.  In this situation, those water
systems must sample all taps at least once and take repeat samples on
different days until five samples are obtained.

		EPA  is adding a provision to § 141.86 (c) that gives States the
discretion to allow  public water systems with fewer than five taps to
collect one sample per tap that can be used for human  consumption.  The
requirement is not mandatory and NTNCWSs and CWSs that qualify must make
a request to the State in writing and must be approved by the State in
writing or by onsite verification.  Under this alternate sampling
schedule, the sample with the highest test result will be compared to
the Action Level to determine compliance.  If any sample result is above
the Action Level, it will serve as the system’s 90th percentile value.
 EPA is adding regulatory text to §141.80 to describe this new
compliance determination.  The new sampling schedule is also applicable
for NTNCWSs and CWSs that are on reduced monitoring and EPA is adding a
provision to §141.86 (d)(4)(i) for those systems.  The provision allows
the water system to reduce sampling frequency to once per year, but in
no case can the number of samples required be reduced below the minimum
of one sample per tap that can be used for human consumption.

		Rationale for Regulatory Change

		In the original Lead and Copper Rule of 1991, the term “site” is
used to refer to the number of samples collected, and there has been
confusion as to whether “site” refers to taps or physical locations.
 EPA is clarifying that sampling “sites” refer to “taps that can
be used for human consumption”. The phrase “that can be used for
human consumption” is being added to the regulations to ensure that
samples are taken from taps which would pose the highest risk for
exposure to lead, rather than from taps that are not frequently used for
human consumption.

		EPA is making clarifications for NTNCWSs and CWSs with fewer than five
taps that can be used for human consumption.  In the proposal for this
rule, EPA maintained that systems must take a minimum of five samples in
order to adequately capture the variability of lead levels and that it
was more cost effective for small systems to take more samples than
install corrosion control or source treatment based on a small pool of
samples taken.  EPA is maintaining that systems must take a minimum of
five samples as part of today’s rule, however, EPA is also giving
States the discretion to offer the alternative sampling requirement of
sampling 100 percent of taps that can be used for human consumption to
water systems with fewer than five taps.  This alternative sampling
schedule alleviates any cost burden for systems  associated with taking
repeat samples and is also health protective because it does not allow
water systems to ignore a potential problem by taking repeat samples at
taps that have low lead results when they get  a high sample result
Under the alternative sampling provision, systems would compare the
sample with the highest result to the Action Level to determine if
compliance actions, such as public education, corrosion control
treatment installation, and/or lead service line replacement, are
required.

		Alternatives Considered

Several alternative approaches were discussed by the Short-term
Regulatory Revisions and Clarifications to The Lead & Copper Rule
Workgroup (LCRSTR Workgroup). These approaches included retaining the 5
sample minimum requirement for systems, but allowing States the option
to reduce the number of samples to one per tap if the history of data
collected at the system demonstrates that levels have always been below
the Action Level with little to no variability.

3.2 	Regulatory change III.B - Definitions for compliance and
monitoring periods

		Description of Regulatory Change

	EPA is proposing to clarify the terms “compliance period” and
“monitoring period” for purposes of the LCR. The term “compliance
period” shall be as defined in Section 141.2 as a three-year calendar
year period within a nine-year compliance cycle. The term “monitoring
period” will refer to the specific period within the compliance period
in which a water system must perform the requirement (e.g.,
June-September).

		Rationale for Regulatory Change

	This change is intended to clarify when systems are required to conduct
routine monitoring under reduced schedules and when they must begin
actions (i.e., corrosion control, public education, lead service line
replacement) to remedy a lead Action Level exceedance.

	For systems on reduced monitoring, they must monitor either once during
each calendar year or once during each three-year compliance period. The
monitoring period is from June to September or some other four-month
period during normal operation where the highest lead levels are most
likely to occur. This change would clarify that a system that exceeds
the Action Level would be determined to be doing so as of the date on
which the monitoring period ended (e.g., on September 30).

	This change would also require, for systems on triennial monitoring,
samples be taken during four consecutive months within the compliance
period, not over multiple years. These systems must also conduct their
monitoring every three years.

		Alternatives Considered

		The Short-term Regulatory Revisions and Clarifications to The Lead &
Copper Rule Workgroup considered alternatives for defining the term
compliance period.

3.3 	Regulatory change III.C - Reduced monitoring criteria

		Description of Regulatory Change

	Under the current rule language, systems are eligible for reduced
monitoring based on certain criteria. For small systems, these criteria
include having lead and copper levels below both Action Levels for two
consecutive monitoring periods. For all systems, the criteria include
meeting the State-designated water quality parameters with State
approval, but without meeting either the lead or copper Action Level.
The rule change specifies that if a system on reduced monitoring exceeds
the lead Action Level, the system must revert to the regular monitoring
schedule for lead tap sampling.

		Rationale for Regulatory Change

		Monitoring lead levels at the tap is particularly critical for systems
that are exceeding the Action Level. These systems need frequent data on
the levels of lead corrosion so that they can evaluate the effectiveness
of any modifications to corrosion control treatment they may be
attempting, and to better inform their consumers of the effectiveness of
the system(s efforts to reduce lead levels.

		Alternatives Considered

		The LCRSTR Workgroup and EPA considered including meeting the copper
Action Level for reduced monitoring under all circumstances (i.e.,
systems meeting water quality parameter requirements) as part of this
rule change. However, since the current rule does not contain additional
requirements if a copper Action Level is exceeded (such as public
education), EPA determined that copper issues will be considered as part
of longer term revisions to the rule.

3.4 	Regulatory change III.D - Advanced notification and approval
requirement

		Description of Regulatory Change

		Under the current rule, Section 141.90(a) (3) requires that systems
deemed to have optimized corrosion control under §141.81(b) (3),
systems subject to reduced monitoring pursuant to §141.86(d) (4), or
systems subject to a monitoring waiver pursuant to §141.86(g) must
notify States no later than 60 days after of a treatment change or the
addition of a new source. The rule modification requires that these
systems notify States of any long-term change to be made in water
treatment process or additions of new sources in advance and the States
determine when and if these changes may be made through a formal review
and approval process. This gives systems the opportunity to consult with
their States as much as they want and to take other measures necessary
to avoid problems with corrosion. It also allows States to design
monitoring programs upfront or require additional actions for the
systems under those situations when it is necessary to ensure that
corrosion control is being maintained adequately after the change has
been made.

		Rationale for Regulatory Change

		EPA proposed that systems be required to provide advanced notification
of any change in treatment or addition of a new source and receive
approval from the State prior to making the change instead of the
existing requirement that the system had to notify the State within 60
days of making a change.  The final rule requires systems to provide
advanced notification of any change in treatment that has long term
impacts or addition of a new source and receive approval from the State
before implementing the change.  When water systems make changes to
their treatment process with long term impacts or add a new source of
water, there can be unintentional effects on the system’s optimal
corrosion control.  EPA believes that State review and approval of
changes in long-term treatment or addition of a new source will provide
an opportunity to minimize any potential impacts on optimal corrosion
control.  EPA has narrowed the scope of this provision in the final rule
to only long-term changes in treatment.  Long-term treatment changes
include the addition of a new treatment process or modification of an
existing treatment process.  Modifications include switching secondary
disinfectants, switching coagulants (e.g., alum to ferric chloride), and
switching corrosion inhibitor products (e.g., orthophosphate to blended
phosphate).  Long-term changes can include dose changes to existing
chemicals if the system is planning long-term changes to its finished
water pH or residual inhibitor concentration.  Long-term treatment
changes would not include chemical dose fluctuations associated with
daily raw water quality changes.

		Alternatives Considered

		The LCRSTR Workgroup considered various lengths for the time period
before a change that notification had to take place, such as at least 60
days. However, limiting notification to 60 days prior to a treatment
change could be too short for some major changes. Leaving the States
flexibility to decide on a timeframe through a review and approval
process would alleviate such potentially unnecessary burdens.

		In addition, some Workgroup members believe that source changes should
be considered in addition to new sources for review and approval. This
may cause additional burden if some States and systems do not consider
source adjustments as new sources.

3.5 	Regulatory change III.E - Requirement to provide sampling results
to consumers

		Description of Regulatory Change

		Systems take tap samples to test for lead for several purposes, most
notably to calculate compliance with the Action Level. The purpose of
this change in rule language is to add the requirement systems provide
consumers (owners and occupants) with the tap monitoring results for
samples taken for routine lead monitoring. The change modifies Sections
141.80(g) and 141.85, and adds a new Section 41.85(e) on the
notification of results. This new section specifies the timing (within
30 days of learning of the results), the content of the notification,
and the method of delivery for the notification.  EPA is also adding a
reporting requirement to §141.90(f) for systems to certify they have
completed this new consumer notification requirement.

		Rationale for Regulatory Change

	Community water systems must collect samples from between 5 and 100
households to calculate the 90th percentile for comparison to the LCR
Action Levels. Non community water systems (including some schools that
operate their own water system) must also collect samples. Currently,
systems are not required to notify the occupants of the lead levels
measured in samples taken from their specific taps. This rule change
would require systems to provide written notification to occupants of
the households within a specified period and to post or otherwise notify
occupants of non- residential buildings of the results of the lead
testing. This would include staff and parents of students for schools
that are tested as non-transient non-community water systems.   SEQ
CHAPTER \h \r 1   SEQ CHAPTER \h \r 1 While these tap samples are
primarily collected to evaluate the effectiveness of corrosion control
or to evaluate the corrosivity of the systems water, the results of the
lead monitoring can provide useful information to the occupants of the
location from which the samples were taken. In addition to the sample
results, the notifications will include an explanation of potential
health risks associated with lead in drinking water, methods for
reducing risks, contact information for the utility, and the 90th
percentile lead level for the most recently completed compliance
monitoring period reported to the State. Occupants may use this
information to inform any decisions they might make regarding taking
actions to reduce their lead exposure.

		Alternatives Considered

		The Workgroup considered alternative time frames and including the
results of any testing the utility performs in homes and buildings other
than routine monitoring requirements.

3.6 	Regulatory change III.F – Public education requirements

		Description of Regulatory Change

	The purpose of this regulatory change is to modify the public education
requirements of the Lead and Copper Rule (LCR) in the Code of Federal
Regulations §141.85. Water systems would still be required to deliver
public education materials after a lead Action Level exceedance.
However, the content of the message to be provided to consumers, how the
materials are delivered, and the timeframe for delivery will be
modified. The changes to the delivery requirements include additional
organizations that systems must partner with to disseminate the message
to at-risk populations as well as changes to the media used to
disseminate information to ensure water systems reach consumers when
there is an Action Level exceedance. EPA has also added a requirement
for systems to prepare and submit to States and letter certifying that
the public education activities after an Action Level exceedance have
taken place.  Specific changes include the following.

Changes to the mandatory text to written materials

The regulatory change requires systems that have a lead Action Level
exceedance to continue to deliver written materials to all customers as
well as a number of key organizations. However, the content of the
required written materials is modified to be much shorter and easier to
understand. The mandatory language addresses essential topics such as
the opening statement and health effects language. Community Water
Systems and Non- Transient Non-Community Water Systems are still
required to provide information on other topics, but the system may
either use EPA’s suggested language or their own words to explain
these topics.

Changes to better reach at-risk populations

This regulatory change adds organizations to the list of recipients of
the public education materials in order to increase the likelihood that
the most vulnerable populations or their caregivers will receive the
information they need to reduce their exposure to lead in drinking
water. This includes requiring the system to send information to
licensed childcare centers, preschools and Obstetricians-Gynecologists
and Midwives. In addition, systems are required to include an
informational notice with the printed materials that they send to these
organizations to explain the importance of sharing this information with
their customers/patients. Also, systems are required to directly contact
(e.g., phone, in person, etc.) the local health agency rather than
simply delivering brochures to this organization. By directly contacting
the local health agency, utilities can request the health agency’s
support in disseminating information on lead in drinking water and the
steps that vulnerable populations can take to reduce their exposure.

Systems are also required to complete additional activities from a list
of options. The list of additional activities that systems can choose
from includes the following.

Public Service Announcements

Paid advertisements such as newspaper or transit ads

Information displays in public areas such as grocery stores

Using the internet or email to disseminate information

Public meetings

Delivery to every household (not just bill paying customers)

Individual contact with customers such as door hangers

Provide materials directly to multi-family homes and institutions

Other methods approved by the primacy agency

Systems serving more than 3,300 people must implement three additional
public education activities from the list and systems serving 3,300 or
fewer individuals must implement one additional activity. The system
must work in consultation with the State to ensure that the content of
each of these additional activities is appropriate. A system can choose
three items from one, two, or three of these general categories. For
instance, a system can do a series of paid advertisements if that is the
most effective way to reach the target populations in their community.

Changes to help systems maintain communication with consumers throughout
the exceedance

Under this change, systems include information in or on the water bill
no less than quarterly as long as there is an exceedance of the lead
Action Level, with a provision to allow systems to work with their
primacy agency to deliver this information in a different way if
necessary. In addition, systems with a population greater than 100,000
are required to put the public education information on their Web site
until the system tests below the lead Action Level.

Currently, systems that exceed the lead Action Level must issue a press
release. The regulatory change requires that systems distribute two
press releases per year in order to ensure systems are maintaining
communication with their customers. The systems must send the press
releases to the major newspapers and TV and radio stations which cover
the population served by the water system. States can waive the press
release requirement if there are no media outlets that cover the
population served by the system. In addition, the requirement for medium
and large systems to provide two Public Service Announcements (PSAs) per
year is removed.

Changes to the required timing of completion of public education
requirements

While the revision requires systems to complete public education
activities within 60 days of the end of the monitoring period in which
the exceedance occurred, there is flexibility for the State to allow
longer for completion of these activities.  However, systems must
request and gain State approval on a case-by-case basis for extending
this deadline within the 60-day window. This ensures that the system and
the State begin public education actions to reduce exposure as soon as
possible, but allows these actions to continue past the 60-day timeframe
as needed for effective implementation.

Changes to Consumer Confidence Reports

		The regulatory change will require all community water systems include
information about the risks of lead in drinking water in their Consumer
Confidence Reports on a regular basis.

		Rationale for Regulatory Change

The intention of changing the public education requirements of the LCR
is to improve compliance and ensure that consumers receive the
information they need to limit their exposure to lead in drinking water.
Because the sources of lead are frequently within the home and reduction
of lead in drinking water is the responsibility of both the public water
systems and the consumer, EPA wants to ensure that information is
delivered and that it is meaningful and useful to the consumer.

As part of the review of LCR compliance issues, it was determined that
many water utilities did not conduct the required public education,
therefore the at-risk population did not get information they needed to
reduce their exposure from lead in drinking water. EPA believes these
changes better ensure at-risk populations receive information quickly
and are able to act to reduce their exposure. EPA also believes water
systems will be better able to comply with today’s requirements.

During EPA’s national review of the LCR, many stakeholders stated that
the public education requirements needed improvement. In September 2004,
EPA held an expert workshop to discuss the public education requirements
of the rule. A number of concerns were raised at this workshop about the
effectiveness of the existing public education language and
requirements. Workshop participants stated that the mandatory language
in the rule is too long, cumbersome, and complex to convey to the
general public an understanding of the risk posed by lead in drinking
water and an appropriate course of action. Public education must put the
risk in context and convey to the public the appropriate sense of
urgency for consumers to act to reduce exposure. In addition, workshop
members called for public education messages to be tailored to those who
are at highest risk for lead exposure. Many participants stated that the
mandatory language and delivery requirements in the current rule were
ineffective in providing useful and timely information to the public.

In order to address these concerns, the National Drinking Water Advisory
Council (NDWAC), EPA’s advisory body on the Safe Drinking Water Act,
formed a working group to consider possible revisions to the public
education requirements. The NDWAC Working Group raised a number of
concerns with the public education requirements of the LCR that are
consistent with the concerns expressed at the 2004 workshop. The NDWAC
Working Group recommended that the rule be modified to better ensure
that information reaches the most vulnerable populations (e.g., pregnant
women, infants and young children) or their caregivers. They also
recommended changes to ensure that these consumers received information
in a more timely manner and continued to receive information throughout
any exceedance. They also recommended changes to ensure that the
information is easy to understand and effective in informing affected
consumers and encouraging parents or other caregivers to take actions to
reduce exposure of infants and children to lead. In addition, the NDWAC
Working Group recommended changes to make sure critical information
reaches not only bill paying customers, but those consumers who live in
apartments and other housing where residents do not receive bills.

Finally, the NDWAC Working group was also concerned about the amount of
time it may take to test water, get back the results, calculate the 90th
percentile, and finally send out public education materials. They were
concerned that an individual could be drinking water with high lead
levels for months before knowing of the problem. As a result, they
recommended changes to increase the timeliness of public education on
lead in drinking water.

		The NDWAC recommendations are, in part, modeled after the public
education information under two existing EPA rules, the CCR and the
Public Notification Rule (40 CFR 141, Subpart Q). The NDWAC
recommendations form the basis for the changes to § 141.85 in this
rulemaking.

		Alternatives Considered

	The NDWAC Working Group considered many alternatives during their
deliberations in the areas of mandatory language, delivery requirements
to make the public education program more effective, consultation
between systems and States, the timing of notification, and means for
targeting vulnerable populations.

3.7 	Regulatory change III.G - Reevaluation of Lead Service Lines
deemed replaced.

		Description of Regulatory Change

		Under the existing rule, systems that are replacing lead service lines
in response to an Action Level exceedance may sample lead levels from
lead lines. If the sampled lead levels from an individual service lines
is below the Action Level (15 ppb), that line would not have to be
physically replaced, but could be considered replaced towards meeting
the goal of 7 percent replacement. Since these “tested-out” lines
are considered replaced, they do not have to be re-evaluated if water
quality conditions or treatments change.

		The rule language requires that these “tested-out” lines be
re-evaluated if a system subsequently exceeds the Action Level and is
triggered back into further lead service line replacements. The
tested-out lines are put back into the inventory of lead service lines
and are then treated as any other line in the inventory, to be either
re-tested and “tested-out” or re-tested and replaced if the lead
levels for the line exceed the Action Level.

		Rationale for Regulatory Change

	This “test-out” provision was intended for service lines that are
not leaching high levels of lead. However, if a system has again
exceeded the Action Level, the previous service line sample may no
longer be representative of the lead concentrations being contributed by
the service line under the new conditions causing the Action Level
exceedance. For example, in the recent case of elevated lead levels in
the DC WASA system, the switch from chlorine to chloramines may have
changed the corrosiveness of the water in the distribution system,
potentially elevating lead levels, especially those from the service
lines. Service line samples collected under chlorination may not be
representative of service line samples under chloramination. Re-testing
is necessary to determine whether these lines are still contributing low
levels of lead under the new conditions. If not, then the line should be
considered for replacement along with the rest of the inventory of lead
service lines.

		Alternatives Considered

		The workgroup did not consider any alternatives to this rule change.

4	Costs of Regulatory Changes

		This chapter describes the estimates of costs for the regulatory
changes to systems and State Primacy Agencies (States), including costs
associated with administrative, monitoring, sampling, reporting, and
public notification activities. There are two types of costs that may
result from the regulatory changes – direct and indirect. Direct costs
are costs for activities that are specified by the regulatory change,
such as costs for additional monitoring or distribution of consumer
notices. Indirect costs may also result when systems and States use the
information generated by the directly–related rule activities to
modify or enhance practices to reduce lead levels. These indirect costs,
and related health risk reductions, are not quantified for the purposes
of this analysis, but are described qualitatively in greater detail in
Section 5 of this document. The remainder of Section 4 focuses solely on
the estimation of direct costs. Exhibit 4 summarizes the expected direct
and indirect cost impacts for the seven regulatory changes.

Exhibit 4: Summary of Direct and Indirect Implications of the LCR Short
Term Regulatory Changes

Rule Change #	Rule Change Description	Direct Cost Implications	Indirect
Cost and Health Risk Implications

III.A	Number of samples	Yes	Yes

III.B	Monitoring period	Unquantified	None

III.C	Reduced monitoring criteria	Yes	Yes

III.D	Advanced notification and approval 	Yes	Yes

III.E	Consumer notice of Lead results	Yes	Yes

III.F	Public Education	Yes	Yes

III.G	Reconsideration of lead service lines	Yes	Yes

		The costs associated with the Lead and Copper Rule have been estimated
previously in several documents. Direct costs due to the 1991 Lead and
Copper Rule are presented in the Final Regulatory Impact Analysis of
National Primary Drinking Water Regulations for Lead and Copper, April
1991. This RIA estimates costs for monitoring, coping with source water
contamination, coping with lead leached from solder, coping with lead
leached from lead service lines (including public education, corrosion
control, and lead service line replacement), and State implementation
costs.

		EPA proposed and adopted minor changes to the LCR. The direct costs
for these minor changes are described in Regulatory Impact Analysis
Addendum: Proposed Changes to National Primary Drinking Water
Regulations for Lead and Copper, January 1996. This addendum estimates
changes to costs with respect to the April 1991 RIA, under the same cost
categories. An Information Collection Request was also prepared for the
minor rule changes, Information Collection Request: National Primary
Drinking Water Regulations For Lead and Copper, June 1999.

		The most recent cost estimates can found in the 2004 Information
Collection Request for Disinfectants/Disinfection Byproducts, Chemical,
and Radionuclides Rules, OMB Control Number: 2040-0204, EPA Tracking
Number: 1896.05. The 2004 ICR estimates administrative burden and costs
associated with the LCR for systems and States. Direct system costs are
estimated for community water systems and non-transient non-community
water systems to perform the following activities:

Conduct monitoring for water quality parameters

Conduct tap sampling of lead levels for Action Level compliance

Review sample data, including the calculation of lead and copper 90th
percentile levels

Submit monitoring data and any other documents or reports to the State

Record and maintain information

The 2004 ICR also estimates burden and costs for systems that must
submit corrosion control studies, recommend and submit information
regarding the completion of corrosion control or source water treatment
installation, conduct public education, or conduct LSL monitoring,
notification, and replacement.

	In the 2004 ICR, for the LCR requirements to CWSs and NTNCWSs, the
average annual respondent burden is estimated at 1.72 million hours and
$57.9 million for reporting (including lead service line replacement
reporting), recordkeeping, and public education activities of the LCR.
For States, the annual burden incurred by primacy agencies for
activities associated with the lead and copper regulation is
approximately 0.21 million hours and $6.8 million. This estimate
includes costs for employing a corrosion control expert and costs to
review various letters and results submitted by water systems in
accordance with the LCR.

4.1		Overall Cost Methodologies and Assumptions

		As part of its comprehensive review of the Lead and Copper Rule, EPA
collected and analyzed new data on various aspects of LCR
implementation. When available, this new information is the first choice
source for use in estimating costs. Sources of the new information
include the following.

Medium and Large Public Water Systems Exceeding the Action Level Summary
from SDWIS/FED data as of January 27, 2005 provides up-to-date counts of
the number of medium and large systems that have exceeded the Action
Level since 2000 and 2003.

Summary, Lead Action Level exceedances for public water systems subject
to the Lead and Copper Rule (For data through September 13, 2004)
provides up-to-date counts of the number of small systems that have
exceeded the Action Level since 2000 and 2003.

State responses to EPA’s “ Survey of States Questions on State
Implementation of the Lead and Copper Rule” (July 2004) provides
information on the number of systems that are conducting lead service
line replacement under the LCR, the fraction of systems on reduced LCR
monitoring, and system practices with regard to notification of
customers of sampling results.

		If new information was not available about a cost item or assumption,
previous analyses of LCR requirements were reviewed to determine if a
suitable estimate was available. The 1991 RIA, the 1996 RIA Addendum,
and the various Information Collection Requests were all used as sources
of information and assumptions.

		In a limited number of instances, appropriate estimates were not
available either from new analyses or existing documents. For those cost
items, the best professional judgment used to derive estimates.

		For the regulatory changes that clarify rule language (III.B), the
costs associated with those activities may have already been included in
the original LCR cost estimates as presented in the 1991 RIA. In these
cases, costs for performing these activities are not included in this
analysis.

		Inventory of Systems

		The primary inventory of systems that will be impacted by the direct
costs of the regulatory changes was derived from a pull of data from the
SDWIS/FED system in the 4th quarter of 2004, available at   HYPERLINK
"http://www.epa.gov/safewater/data/pivottables.html"
http://www.epa.gov/safewater/data/pivottables.html  and summarized in
FACTOIDS: Drinking Water and Ground Water Statistics for 2004.  The
number of systems covered by the LCR that result from the SDWIS/FED pull
for 2004 are summarized in Exhibit 5.

Exhibit 5: Number of Systems by Size Category and Type Subject to the
LCR

SDWIS/FED 2004 Data

 	CWS	NTNCWS	TOTAL LCR

<=100	13,766	9,548	23,314

101-500	16,240	6,997	23,237

501-1,000	5,914	1,925	7,839

1,001-3,300	8,298	795	9,093

3,301-10,000	4,707	96	4,803

10,001-25,000	2,107	7	2,114

25,001-50,000	950	6	956

50,001-75,000	343	1	344

75,001-100,000	141	0	141

100,001-500,000	322	0	322

500,001-1,000,000	32	0	32

>1,000,000	18	0	18

Grand Total	52,838	19,375	72,213

		Wage Rates

		Wage rates for systems were taken from the report Labor Costs for
National Drinking Water Rules prepared by Science Applications
International Corporation (SAIC) in October 2003 for EPA’s Office of
Ground Water and Drinking Water. Exhibits 20 and 21 of that report
summarize recommended average technical and managerial wage rates by
system size for EPA to use in cost analyses. These rates are updated to
4th quarter 2006 levels using the Employment Cost Index.  To represent
the composition of staff at PWSs of smaller sizes (e.g., systems serving
fewer than3,300 people), EPA uses only the updated technical rate. For
systems serving 3,300 or more people, EPA uses a ratio of 80 percent
technical labor to 20 percent managerial labor to arrive at a weighted
labor rate.  Appendix B presents the wage rates for systems used in the
cost analyses.

		Wage rates for States are based on information provided by the
Association of State Drinking Water Administrators (ASDWA) as presented
in the Information Collection Request for Contaminant Occurrence Data in
Support of EPA's Second Six Year Review of National Primary Drinking
Water Regulations (August 2006). Please refer to Appendix A for further
detail.

		Incremental Direct Costs Quantified

		As discussed earlier, Regulatory Changes III.A, III.C, III.D, III.E,
III.F, and III.G are expected to result in direct costs to States and
systems. For these potential regulatory changes, direct costs could be
incurred in the areas of system reporting, tap water monitoring and
public education for systems, and review and consultation for
States/Primacy Agencies. Exhibit 6 summarizes the direct cost categories
to be estimated for each regulatory change. The following sections
present either the rationale for why direct costs are not incurred, or
estimate of direct costs for each rule provision.

Exhibit 6:  Direct Costs Associated with Regulatory Changes

Regulatory

Change	System Costs	State Costs

	System Reporting	Tap Water Monitoring	Customer Notification	Review and
Consultation

Regulatory Change III.A	X

	X

Regulatory Change III.B	None – Clarifications of definitions with no
direct cost impact

Regulatory Change III.C	X	X

X

Regulatory Change III.D	X

	X

Regulatory Change III.E	X

X	X

Regulatory Change III.F	X

X	X

Regulatory Change III.G

X

4.2 	Direct Costs Associated with Regulatory Change III.A

		Activities resulting from regulatory change

		Regulatory change III.A clarifies EPA’s intent that a minimum of 5
tap samples must be taken when conducting LCR compliance monitoring. If
a system has fewer than the minimum number of sites required for
sampling, then those systems will have to collect multiple samples on
different days from the same site so that the total number of samples
per monitoring period is 5. However, III.A gives States the discretion
to allow certain systems with fewer than 5 taps on a case by case basis
to take 1 sample per tap.  Under this alternate sampling schedule, the
sample with the highest test result will be compared to the action level
to determine compliance.

		Public water systems with fewer than 5 taps that are in States that
allow 1 sample per tap will undertake a one time activity to document
the number of appropriate taps and communicate this information with the
State.  States that will allow 1 sample per tap will engage in a one
time effort to review, track, and respond to submittals from the systems
with fewer than 5 taps on the number of appropriate taps for future
sampling.

	Costs to systems

	The systems that will incur costs under this regulatory change are
NTNCWSs and CWSs with fewer than 5 taps in States that allow 1 sample
per tap. The following data are used to estimate the number of systems
impacted by the regulatory change and related direct costs.

The number of NTNCWSs in States that will allow 1 sample per tap:  This
analysis assumes that the 11 States that commented favorably on the
option of allowing 1 sample per tap for NTNCWSs with fewer than 5 taps
will exercise their discretion under III.A and permit 1 sample per tap.
Note that two States commented unfavorably on the option and it is
assumed States that did not comment at all would not allow the
alternative since the default requirement maintains a minimum of five
samples.  Exhibit 7 contains estimates of the number of NTNCWSs in these
11 States.

The number of CWSs with fewer than five taps in States that will allow 1
sample per tap:  This analysis assumes that the 11 States that commented
favorably on the option of NTNCWSs will also allow permit 1 sample per
tap for applicable CWSs.  In addition, the analysis assumes that Alaska
will exercise its discretion to allow 1 sample per tap for small CWSs
due to the presence of washeterias in the State.  This analysis assumes
that all CWSs with fewer than five taps are a portion of those that
serve 100 or fewer people since EPA believes that CWSs with fewer than 5
taps, even in the smallest system size category, are relatively unique
situations and do not occur frequently. Exhibit 7 contains estimates of
the number of CWSs serving 100 or fewer people in the 11 States plus
Alaska.

Exhibit 7:  Number of NTNCWSs and CWSs in 11 States that Favored 1
Sample Per Tap in Comments on Proposed Rule plus Alaska

11 States that Favored 1 Sample Per Tap In Comments to Proposed Rule, &
Alaska	Number of NTNCWSs By State 	Number of CWSs serving <101 by State

AK	N/A	341

IN	686	317

MI	1631	744

WI	907	592

IL	405	670

TX	785	2105

VT	234	319

UT	63	241

WA	315	1748

MD	573	327

MN	563	484

TN	46	151

Total	6208	8039

Source: SDWIS/FED data pull from the 4th quarter of 2004.

The fraction of NTNCWSs that have fewer than 5 taps:  No nationally
available data source provides information on the fraction of NTNCWSs
with fewer than 5 taps.  However, in their comments submitted on the
Draft LCRSTR, MI provided information that 53% of the NTNCWSs in MI had
fewer than 5 taps.  In the absence of other data, this analysis assumes
that 53% of the NTNCWSs in the 11 States have fewer than 5 taps.
Exhibit 8 displays the calculation of the number of NTNCWSs with fewer
than 5 taps in the 11 States.

The fraction of CWSs serving <101 people that have fewer than 5 taps: As
stated above, EPA believes that CWSs with fewer than 5 taps, even in the
smallest system size category, are relatively unique situations and do
not occur frequently.  In the absence of any other data source, this
analysis assumes that 5% of CWSs serving <101 have fewer than 5 taps, as
displayed in Exhibit 8.

Exhibit 8:  Number of Public Water Systems with Fewer Than 5 Taps in 11
States

11 States that Favored 1 Sample Per Tap In Comments to Proposed Rule
Number of NTNCWSs By State 	Fraction of NTNCWSs with <5 Taps	Number of
NTNCWSs with <5 Taps	CWSs Serving <100 By State [1]	Percent of CWSs <100
With <5 taps [6]	Number of CWSs <100 With <5 taps

AK	N/A	N/A	N/A	341	5%	17

IN	686	53%	364	317	5%	16

MI	1631	53%	864	744	5%	37

WI	907	53%	481	592	5%	30

IL	405	53%	215	670	5%	34

TX	785	53%	416	2105	5%	105

VT	234	53%	124	319	5%	16

UT	63	53%	33	241	5%	12

WA	315	53%	167	1748	5%	87

MD	573	53%	304	327	5%	16

MN	563	53%	298	484	5%	24

TN	46	53%	24	151	5%	8

Total	6208	 	3290	8039	 	402

The labor and cost estimates per applicable system with <5 Taps: Based
on similar activities, it is estimated that systems will take 1 hour to
prepare a letter to States verifying the number of applicable taps for
lead and copper sampling, with a materials cost of $0.43 for postage and
supplies.  This analysis assumes that all systems that are eligible for
taking 1 sample per tap will request this option from States.

The one-time direct costs to systems, summarized in Exhibit 9, are
estimated to be $104,000 including $102,500 in labor costs and $1,600 in
materials costs. Detailed estimates are provided in Appendix J.

		Costs to States

Regulatory Change III.A will require State/Primacy agencies that
exercise their discretion and allow 1 sample per tap for applicable
systems with fewer than 5 taps to verify the appropriate number of taps
per system by reviewing the letters submitted by systems and responding
to systems.

Estimates of state review burden are based on similar activities (such
as reviewing a letter reviewing tap monitoring events).  States are
estimated to take 1 hour to review and respond to the letter from
systems verifying the applicable number of taps for sampling.

The one-time direct costs to State/Primacy agencies is estimated to be
$162,000 ($160,700 in labor costs and $1,600 costs for postage and
supplies to mail the response letter to systems), as summarized in
Exhibit 9. Detailed estimates are included in Appendix J.

Exhibit 9: Summary of Estimated Direct Costs to Systems and
State/Primacy Agencies Associated with Regulatory Change III.A

(4th Qtr 2006$)

One-Time Labor	One-Time Materials	Total One-Time Costs

Costs to Systems

Reporting	$102,500	$1,600	$104,000

Total System Costs	$102,500	$1,600	$104,000

Costs to State/Primacy Agencies

	Review Costs	$160,700	$1,600	$162,000

Total State Costs	$160,700	$1,600	$162,000

Note:  Totals may not add due to rounding.

4.3 Direct Costs Associated with Regulatory Change III.B

	Regulatory Change III.B clarifies the terms “monitoring period” and
“compliance period.” Based on the regulatory change, if a system
exceeds the lead or copper Action Level during a monitoring period, the
compliance calendar for required actions starts at the end of the
monitoring period, which for most systems would occur on September 30.
Under the previous regulatory language, systems were confused as to
whether compliance actions began at the end of that calendar year
(December 31) rather than the monitoring period (September 30).

	As a result of the regulatory change, activities triggered by a lead or
copper Action Level exceedance could begin three months earlier (i.e.,
at the end of September instead of the end of December), but it is not
clear if activities would last any longer. The net result is a change in
the timing of activities, with a difference of three months having an
unclear impact on costs, although there may be health risk implications.

4.4 	Direct Costs Associated with Regulatory Change III.C

		Activities resulting from regulatory change

As a result of Regulatory Change III.C, utilities that are conducting
LCR compliance monitoring on a reduced monitoring schedule and that have
90th percentile LCR monitoring samples that exceed the lead Action Level
will be required to resume standard monitoring schedules for monitoring
lead at taps. In addition to monitoring activities, utilities will have
to meet reporting requirements to the State/Primacy agency.
State/Primacy agencies will be involved in review of utility monitoring
reports. Supporting calculations and information are included in
Appendix C.

		Costs to systems

	The systems that will incur direct costs under this regulatory change
are those systems that exceed the lead Action Level and that had been on
a reduced monitoring schedule. The following data are used to estimate
the number of systems impacted by the regulatory change and related
direct costs.

Number of systems exceeding the lead Action Level:  This analysis uses
the number of systems that have exceeded the lead Action Level since
2003 as an estimate of the number of systems that will exceed the lead
Action Level each year in the near future. Exhibit 10 contains estimates
of the number of systems exceeding the lead Action Level annually by
size category.

Exhibit 10: Number of Systems Exceeding Annually

System Size Category	# Systems that Exceed Lead AL Since 20031,2

<3.3K	884

3.3K-10K	55

10K-50K	41

50K-100K	7

>100K	7

Total	994

1. Data source: USEPA Survey of States - Questions on State
Implementation of Lead and Copper Rule. July 2004.

2. Data Source: www.epa.gov/safewater/lcrmr/lead-data.html, 8/30/05.

Percent of systems on reduced monitoring:  In their responses to the EPA
survey on LCR implementation, States provided estimates of the percent
of systems on reduced LCR monitoring (summarized in Appendix C-1). Based
on this data, 91 percent of systems are on a reduced schedule for LCR
lead and copper monitoring. In the absence of additional data, this
analysis assumes that systems that will exceed the lead Action Level are
on a reduced monitoring schedule at the same rate as all systems.
Therefore, we assume that 91 percent of the systems that exceed the lead
Action Level were on reduced monitoring and will therefore incur direct
costs due to regulatory change III.C. This assumption may be
conservative, because systems that are likely to have exceedances are
less likely to be on reduced monitoring.

Additional monitoring events: The frequency for monitoring on a standard
schedule under the LCR is once every 6 months. Reduced monitoring could
refer to either monitoring once every year or once every three years.
From the state responses to the survey, it is impossible to distinguish
the number of systems on a reduced monitoring schedule of once every
year from those monitoring once every three years. This analysis assumes
that all systems on reduced monitoring are on the triennial schedule, a
conservative assumption that might slightly over-estimate costs. Thus, a
system that was on reduced monitoring but is placed on a standard
monitoring schedule after a lead Action Level exceedance under
regulatory change III.C will incur an additional 5 monitoring events
over a 3 year period (6 monitoring events in three years under standard
monitoring instead of 1 monitoring event in three years under reduced
monitoring).

Tap samples per monitoring event: The number of samples collected in
each monitoring period will also change when the utility switches from
reduced monitoring to standard monitoring. The required number of
samples varies by system size, with the smallest systems (serving less
than or equal to 100 people) required to take 5 samples per monitoring
event under both standard and reduced monitoring, and the largest
systems (serving > 100,000 people) required to take 100 samples per
monitoring event under standard monitoring, and 50 samples per
monitoring event under reduced monitoring.

Labor and cost estimates per sample: Based on previous EPA documents,
the labor required to collect each lead and copper compliance tap sample
is estimated at 2.5 hours. The labor to analyze the sample for lead and
copper is estimated at 1 hour, with a material cost of $8.16 per sample
(also referred to as the materials cost). In addition, systems must
calculate their 90th percentile value to assess compliance and report
the monitoring and compliance results to the State. These activities are
estimated to require 1.5 to 2 hours per system, varying by system size,
with a materials cost of $0.39 for postage and $0.04 in materials. The
derivation of the labor and cost estimates relating to compliance
monitoring is detailed in Appendix C-2.

The direct Costs to systems, summarized in Exhibit 11, are estimated to
be $2,696,000 annually including $2,502,000 in labor costs and $194,000
in materials costs. Detailed estimates are provided in Appendices C-4
and C-5.

		Costs to States

Regulatory Change III.C will require State/Primacy agencies to review
utility monitoring reports as a result of resuming standard monitoring
schedules.

Estimates of state review burden are based on the 2004 ICR page H-12,
which estimates that a State takes 1 hour to review the letter
describing a tap monitoring event for each system. Additionally, States
will spend an additional 10 minutes to 1 hour checking the compliance
(90th percentile) calculations for each monitoring event. The materials
cost is limited to postage for letters sent to utilities regarding
review findings.

The direct costs to State/Primacy agencies is estimated to be $82,000
annually including $81,000 in labor costs and $1,000 in materials costs,
as summarized in Exhibit 11. Detailed estimates are included in Appendix
C-7.

Exhibit 11: Summary of Estimated Direct Costs to Systems and
State/Primacy Agencies Associated with Regulatory Change III.C

(4th Qtr 2006$)

Annual Labor	Annual Materials	Total Annual

Costs to Systems

Reporting	$60,000	$1,000	$61,000

	Tap Monitoring	$2,442,000	$193,000	$2,635,000

Total System Costs	$2,502,000	$194,000	$2,696,000

Costs to State/Primacy Agencies

	Review Costs	$81,000	$1,000	$82,000

Total State Costs	$81,000	$1,000	$82,000

4.5 	Direct Costs Associated with Regulatory Change III.D

		Activities resulting from regulatory change

	Regulatory Change III.D revises the current 60-day notification
requirement, under which systems notify States about long-term changes
in treatment or additions of new sources that could cause problems with
optimal corrosion control. Rather than requiring systems to notify
States up to 60 days after treatment changes or source additions have
been made, systems now must notify the states in advance and the changes
must undergo a formal review and approval process by the State prior to
implementation. All States currently review treatment or source changes
within 60 days after the change.  However, some States are already
reviewing and issuing approval before such changes are made. The
activities associated with the formal review and approval process are a
new requirement for those States that do not currently have such a
review and approval process. System activities will include preparation
of a submittal to the State and coordination with the State/Primacy
agency during the review. State/Primacy agency activities will include
review of system data/reports and coordination with systems.

		Costs to systems

	In order to estimate the cost of this provision to utilities,
information is needed on the number of systems that will change a
treatment or add a source annually, as well as the number of systems
that are located in States that already have a review and approval
requirement. Systems located in these States will not incur additional
costs under this provision.

States with review and approval process:  Many States already have a
review and approval process for treatment or source changes. As part of
the survey on LCR implementation, EPA asked States to respond to the
following question:  “How do systems notify the State of treatment
changes?  Does the State require that systems provide information about
potential effects of treatment changes on corrosion control?”  A
summary of State responses is provided in Appendix D-1. Based on the
State responses, 14 States explicitly replied that they currently have a
review and approval process for treatment changes. It should be noted
that another nine States mention a process that requires a permit for
treatment changes and eight States refer to submittal and review of
engineering plans for a change. Although not a review and approval
process focused specifically on the impact of a change on corrosion
control, the permitting and plan review processes may be comprehensive
enough that they consider corrosion issues. For the purposes of this
analysis, however, we base our estimates by excluding only the 14 States
that specifically consider corrosion issues, recognizing that other
States may also include corrosion issues in their review processes.

Number of systems in States without an existing review and approval
process:  Based on the characterization of the process for each State
and the number of systems in each State, the number of systems that are
not covered by an existing process and may therefore incur costs under
this regulatory change is estimated in Appendix D-1. Under the
alternative in which only the 14 States with explicit review and
approval are excluded from the count, 53,372 systems (of 72,213 CWSs and
NTNCWSs) may incur costs for the regulatory change.

Fraction of systems that change treatment or add a source each year:
Treatment changes over the next several years are likely, as systems
will be faced with new regulatory requirements, including changes to
comply with the already promulgated Arsenic Rule and the upcoming Long
Term 2 Surface Water Treatment Rule and Stage 2
Disinfectants/Disinfection Byproducts Rule. Together, these regulatory
requirements are estimated to cause 9,243 systems to institute a
treatment change, although not all of these treatment changes will
affect corrosion control. Also the compliance periods for these
regulations varies. To account for these expected treatment changes, and
to account for treatment changes and source additions unrelated to the
Arsenic, LT2, and Stage 2 rules, EPA assumed (based on the projected
rule-related treatment changes and expert judgment) that approximately
20% of the systems affected by the LCR will institute a treatment change
in the next ten years. It is assumed that these changes occur uniformly
over that 10-year period, so that approximately one-tenth of these
systems (or 2 percent of the total) institute a treatment change or
source addition each year. Appendix D-2 provides additional detail.

Based on the 2 percent assumption, the analysis estimates that 1,067
(53,372 X .02) systems each year would report a treatment change or
source addition and incur costs in States currently not covered by an
explicit review and approval program.

System burden and activities: EPA anticipates that systems will incur
additional costs under this rule change as systems and States more
carefully review and consider possible corrosion impacts of treatment
changes or source additions. The activities and burden associated with
the review and approval process are expected to vary based on the size
and complexity of a system, and the nature of the change or source
addition. In the absence of information on the current prevalence of
these activities, EPA has used the best professional judgment to
estimate the range of potential activities and associated costs
resulting from the review and approval process. All systems, regardless
of size or complexity, are assumed to undertake additional activities
related to data collection and evaluation, preparation of a submittal to
the State, and coordination with the State. For small systems or systems
making relatively simple changes, considering the corrosion impacts of
the change may be a rather basic process of reviewing water quality data
and previous lead monitoring results. For these systems, additional
effort will be incurred by system staff in coordination with State
personnel to assemble water quality parameter and lead data and evaluate
the potential impacts.  EPA estimates the burden for this additional
effort at 7.5 hours per system, at an average cost of $231 per system.
For larger or more complex systems making major treatment changes,
activities would be more extensive, including conducting engineering
studies to evaluate impacts on corrosion control. To some extent,
systems may already be conducting these studies, resulting in no net
cost due to the regulatory change.

The current LCR regulatory requirements on notification of treatment
changes cause a system burden of 0.5 hours per treatment change.
Therefore, the new system burden is expected to be 8 minus 0.5 hours or
7.5 hours per treatment change.

Additional burden for engineering studies:  Based on best professional
judgment, EPA estimates that between 10 percent and 20 percent of medium
and large systems may incur the additional cost of $20,000 to conduct an
engineering study on corrosion impacts. The $20,000 estimate is based on
recent similar studies for medium-sized systems.

The direct costs to systems are estimated to range from $506,000 to
$765,000 annually. These direct costs are strictly labor costs; material
costs are expected to be negligible. Detailed estimates are provided in
Appendix D-3.

		Costs to States

Those States that do not already have a review and approval process will
also incur additional costs due to regulatory change III.D.

Activities that States will undertake include review of system data,
preparation of conclusions and letter to systems, and coordination with
utilities. The level of effort associated with these activities is
expected to vary based on the complexity of the change and the type of
submittal (amount and type of information). Based on best professional
judgment, State review could range from 4 hours to 8 hours.

The current LCR regulatory requirements on State review of treatment
changes entail a burden of 0.5 hours per review. Therefore, the new
State burden is expected to range from 3.5 to 7.5 hours per treatment
change.

Based on the State responses on existing review and approval processes,
the analysis assumes that 14 States have existing processes (explicit
review and approval). The remaining States will incur costs under this
regulatory change.

The direct costs to State/Primacy agencies are estimated to range from
$163,000 to $348,000 annually. These direct costs are strictly labor
costs; material costs are expected to be negligible. Estimates are
summarized in Exhibit 9 and detailed in Appendix D-4.

Exhibit 12: Estimated Direct Costs to Systems and State/Primacy Agencies
Associated with Regulatory Change III.D

(4th Qtr 2006$)

Annual Costs

 Low End of Range (1)	Annual Costs– High End of Range (2)

Costs to Systems

	Reporting	$506,000	$765,000

Total System Costs	$506,000	$765,000

	Costs to State/Primacy Agencies

Review Costs	$163,000	$348,000

Total State Costs	$163,000	$348,000

(1) 10 percent medium and large systems conduct engineering study and 4
hours for State review

(2) 20 percent medium and large systems conduct engineering study and 8
hours for State review

 4.6 	Direct Costs Associated with Regulatory Change III.E

		Activities resulting from regulatory change

		Regulatory Change III.E will require systems to provide written
notification to each owner/occupant of the lead level found in the tap
sample collected for LCR compliance monitoring. Both CWSs and NTNCWSs
are required to provide notification on tap sampling results, but the
activities are expected to differ between the two types of systems. In
addition, systems are required to certify to States in a letter that the
notification activity has taken place.  Supporting calculations and
information regarding Costs to systems associated with this regulatory
change are included in Appendix E.

		Costs to systems

		In order to estimate the additional direct costs associated with
regulatory change III.E, information is needed on the number of systems
that already notify customers of tap monitoring results and the burden
associated with notification activities.

Number of systems that already notify customers:  Based on feedback from
participants in workshops and interactions with States, some systems
already notify customers of monitoring results for their particular
establishments. These systems would not incur costs under the regulatory
change. This analysis uses information from the State survey to develop
an estimate of the number of systems that currently notify customers of
tap sampling results, as detailed in Appendix E-1. Of 72,213 CWS and
NTNCWSs (per 2004 SDWIS/Fed data) subject to the LCR, approximately 11
percent of these systems are estimated to already notify owner/occupants
as derived from USEPA’s Survey of States (July 2004). Therefore, this
regulatory change will apply to the remaining 89 percent of systems or
64,273 systems.

Activities associated with notification: CWSs will prepare a customer
notification letter and mail letters to all owner/occupants for
residences where tap samples were collected. For NTNCWSs, the
notification burden will be different, and may consist of posting a
notice on community bulletin boards or web sites.

Activities associated with reporting to States:  CWSs and NTNCWSs will
prepare a letter to the State certifying that they have completed the
required notification activities.

Burden and costs for CWSs: Labor costs are based on the labor required
to prepare a sample customer notification letter and mail letters to
customers. The system burden is estimated to be 1 hour per monitoring
event for systems serving <3,300 people and 1 hour per 20 sample letters
for systems serving more than 3,300 people. For example, systems serving
less than 3,300 people will prepare either 5 or 10 customer letters for
each monitoring event at an estimated time burden of 1 hour. Material
costs include paper, envelopes and postage, estimated at $0.43 per
customer letter.

Burden and costs for NTNCWSs:  Costs for NTNCWSs include the labor
required to prepare a consumer notice and post the notice. It is
estimated that all systems will spend 1 hour per monitoring event. It is
assumed that material costs are negligible for NTNCWSs.

Burden and costs for reporting:  Both CWSs and NTNCWSs will incur labor
to prepare a self-certification letter and submit the letter to the
State.  Based on a similar activity under the CCR, the labor to prepare
the self-certification letter is estimated at .12 hours per system (PWSS
ICR, 2040-0090, page B-5), with materials cost of $0.43 for postage and
supplies.

Frequency of monitoring and number of samples: Of the 64,273 systems
affected by this Regulatory Change, it is assumed that 91 percent of
systems are currently on a reduced monitoring schedule, and 9 percent
follow a standard monitoring schedule as documented in USEPA’s Survey
of States (July 2004). Although reduced monitoring can imply a 1 year, 3
year or 9 year monitoring frequency, a 3 year frequency is assumed for
all systems for use in this economic analysis. The number of samples
collected by each system is estimated based on sampling schedules
established in 40 CFR 141.86c for standard and reduced monitoring
according to population served. In addition, the number of increased
monitoring events that would result from Regulatory Change #III.C (1,692
additional monitoring events per year) are added to the total.

		The direct costs to systems for compliance with Regulatory Change
#III.E are summarized in Exhibit 13 and estimated to be $1,248,000
annually including $1,098,000 in labor costs and $150,000 in material
costs. Detailed estimates are provided in Appendix E.

		Costs to States

		States will incur costs to review and track the self-certification
letters from systems.  Based on a similar activity for the CCR, this
analysis estimates that States will require 0.10 hours per system letter
(PWSS ICR, 2040-0090, page B-7).  The direct costs to States for review
under Regulatory Change #III.E are summarized in Exhibit 13 and
estimated to be $163,000 annually (all labor costs). Detailed estimates
are provided in Appendix E.

Exhibit 13: Summary of Direct Costs Associated with Regulatory Change
III.E

(4th Qtr 2006$)

Annual Labor	Annual Material	Total Annual

Costs to Systems

Customer Notice of Lead Results Costs	$979,000	$134,000	$1,112,000

	Self-certification Letter to States	$120,000	$16,000	$136,000

Total System Costs	$1,098,000	$150,000	$1,248,000

	Costs to States

Review Costs	$163,000	$0	$163,000

Total State Costs	$163,000	$0	$163,000

Totals may not add due to rounding.

4.7		Direct Costs Associated with Regulatory Change III.F

	 (a) Changes to the mandatory text of the written materials

	(a)(1) Customer Notification

		Activities resulting from regulatory change

	Regulatory change III.F(a)(1) substantially reduces the mandatory
language required for delivery to all bill paying customers after a lead
Action Level exceedance and gives systems more flexibility in developing
the notification. Systems are required to address several topics in the
notification, namely: “sources of lead”, “steps to reduce
exposure”, “what happened”, and “what is being done”. This
analysis assumed that template language will be provided for the sources
of lead and steps to reduce exposure sections. However, by their nature,
the “what happened” and “what is being done” sections will need
to be customized by each system to reflect their specific conditions.
Therefore, the additional activity under this change is the effort
required to develop the sections specific to the system.

Costs to systems

	In order to estimate the additional direct costs associated with
regulatory change III.F(a)(1), information is needed on the number of
community water systems that exceed the lead Action Level and the burden
associated with language development activities.

Number of systems exceeding the lead Action Level:  This analysis uses
the number of water systems that have exceeded the lead Action Level
since 2003 as an estimate of the number of systems that will exceed the
lead Action Level each year in the near future. Exhibit 14 contains
estimates of the number of community and non-community systems exceeding
the lead Action Level annually by size category.

Exhibit 14: Number of Systems Exceeding Annually

System Size Category	CWSs that Exceed Lead AL1,2	NTNCWSs that Exceed
Lead AL1,2	All Systems that Exceed Lead AL1,2

<3.3K	473	411	884

3.3K-10K	54	1	55

10K-50K	40	1	41

50K-100K	7	0	7

>100K	7	0	7

Total	581	413	994

1. Data source: USEPA Survey of States - Questions on State
Implementation of Lead and Copper Rule. July 2004.

2. Data Source: www.epa.gov/safewater/lcrmr/lead-data.html, 8/30/05.

Burden to prepare system specific notification language: Because the
current notification after an Action Level exceedance relies solely on
mandatory language, the 2004 ICR does not provide a burden effort for a
similar activity. However, the ICR for the Public Notification Rule
(PNR) includes a burden estimate associated with a Tier 2 notification
(notice as soon as possible of an exceedance that does not pose an
immediate health threat). The 3.5 hours of labor per system will be used
to estimate the additional burden associated with developing the new
language after an Action Level exceedance.

	The direct costs to systems for compliance with Regulatory Change
#III.F(a)(1) are summarized in Exhibit 15 and estimated to be $91,400
annually, all in labor costs. Detailed estimates are provided in
Appendix H-2.

Exhibit 15: Summary of Direct Costs Associated with Regulatory Change
III.F(a)(1)

(4th Qtr 2006$)

Annual Labor	Annual Material	Total Annual

Costs to Systems

Customer Notification Costs	$91,400	$0	$91,400

Total System Costs	$91,400	$0	$91,400

(b) Changes to better reach at-risk populations

 (b)(1) Delivery of brochures to organizations

		Activities resulting from regulatory change

Regulatory change III.F(b)(1) requires that CWSs exceeding the lead
Action Level distribute brochures to three additional types of
organizations – obstetric/gynecologist offices, licensed child care
facilities, and pre-schools. Also, an informational notice must now be
included with the brochures and the public health agency must be
directly contacted by phone, rather than through a mailed brochure.

Costs to systems

	In order to estimate the additional direct costs associated with
regulatory change III.F(b)(1), information is needed on the number of
community water systems that exceed the lead Action Level, the number of
additional organizations to be contacted, and the burden associated with
distributing brochures to the additional organizations, the development
of an informational notice, and the direct contact with the public
health agency.

Number of community systems exceeding the lead Action Level:  The number
of CWSs that exceed the lead Action Level can be found in Exhibit 11.

Number of additional organizations to be contacted: The number of
additional establishments to be contacted is estimated at 193 per
100,000 population served. This value includes 178 per 100,000 licensed
child day care facilities based on the number of licensed child day care
facilities (500,143) spread over the national population (281,422,000).
The total also includes 15 ob/gyns per 100,000 population (41,900
ob/gyns per 281,422,000).

Burden to contact additional organizations: Systems serving greater than
3,300 will incur an additional 1 hour in burden to generate and update
lists of additional facilities. These systems will also incur production
costs of 0.25 hours for every 100 additional brochures and applicable
mailing and materials costs.

Burden to develop informational notice:  Based on similar activities,
this analysis assumes that developing an informational notice for
distribution with the brochures will take a system 1 hour.

Burden to directly contact public health agency:  Based on similar
activities, this analysis assumes that directly contacting the public
health agency through a telephone call will require an additional 0.5
hours.

The direct costs to systems for compliance with Regulatory Change
#III.F(b)(1) are summarized in Exhibit 16 and estimated to be $43,300
annually, in labor costs and material costs. Detailed estimates are
provided in Appendices H-3 through H-5.

Exhibit 16: Summary of Direct Costs Associated with Regulatory Change
III.F(b)(1)

(4th Qtr 2006$)

Annual Labor	Annual Material	Total Annual

Costs to Systems

Contacting Additional Orgs	$21,900	$21,400	$43,300

Total System Costs	$21,900	$21,400	$43,300

(b)(2) Additional activities

		Activities resulting from regulatory change

	Regulatory change III.F(b)(2) requires systems to perform additional
public notification activities. Systems are given a choice of 8
activities. Systems serving fewer than 3,300 must implement 1 activity
from the list while other systems must implement 3 activities.

Costs to systems

	In order to estimate the direct costs for regulatory change
III.F(b)(2), the cost for each of the activities per system needs to
estimated. Exhibit 17 contains a summary of the assumptions used to
derive the cost per system for the eight activities. Detailed
calculations can be found in Appendices H-6 through H-20. Exhibit 18
summarizes the resulting costs per system.

Exhibit 17: Assumptions Used to Derive System Costs for III.F(b)(2)

III.F(b)(2)(i) Public Service Announcements

	Production of a radio PSA involves developing a script for the spot and
then producing an audio of the spot.

For small systems (serving fewer than 10,000) assume produce 1 radio PSA
using freelance voice talent and in-house staff to prepare the content
of the PSA. Assume $50 for the voice-over, based on internet quotes from
free-lance talent and 2 hours for the system to develop the contents.
Total cost per radio PSA: $95.

For systems serving greater than 10,000, assume produce 1 radio PSA and
1 TV PSA.

For a large system to produce a radio PSA, assume they use union talent
at a studio. Based on internet quotes, union talent is about $280 per
hour plus $80 per hour for studio time. Also assume that a large system
uses a freelance writer to develop the script at $200 for 2-3 hours of
effort. Total cost for radio PSA: $560.

For a large system to produce a TV PSA, assume on-camera talent at about
$560 per hour, plus studio time (based on internet quotes) and script
development. Total cost for TV PSA: $840.

III.F(b)(2)(ii) Paid Advertisements

	Assume 1 newspaper advertisement, 10 column inches (about 1/8 of a
page), rates derived from internet research.

Rate per 10 column inch advertisement for system >1,000,000: $5,000

Rate per 10 column inch advertisement for system 50k to 1 mil: $850

Rate per 10 column inch advertisement for system 3.3k to 50k: $180

Rate per 10 column inch advertisement for system <3.3k: $105

III.F(b)2(iii) Display Information in Public Areas

	Assumed to involve posting a notice at local grocery stores or other
locations. Posting would be free, but costs incurred to travel to
identify and travel to establishments, plus materials cost.

Assume 1 hour to do 5 postings.  Number of postings varies by system
size.

III.F(b)(2)(iv) Internet Notification

	Assumed to entail email contact with all customers.

Requires time to develop email and review contact list.  Time varies by
system size.

Assume small systems have an email list.  Large and medium systems must
purchase list.

III.F(b)(2)(v) Public Meetings

	For systems serving fewer than 3,300, assume that system reps would
bring up the issue for discussion at an existing town meeting. Assume 2
hours preparation and meeting time.

For systems serving over 3,300, assume conduct of separate public
meeting of 2.5 hours. Effort includes making logistical arrangements,
preparing 30 – 45 minute presentation, attending the meeting, and
follow-up activities.

III.F(b)(2)(vi) Delivery to Every Household

	Delivery to every postal address, either through mail or distribution
of flyers. Based on internet quotes for distribution of flyers: $.12 to
$.25 per piece, based on volume. Assume delivery of a flyer to all
households in a system: $.25 per household for systems serving fewer
than 10k, $.17 for systems serving 10-50k, $.12 for systems serving
>50k, $.04 for systems serving >100k (assumes insert into existing
mailing).

Reduce population by 23% to take out the population that lives in
multi-family housing, who may not be adequately reached by flyers). [64
million pop in multifamily/281 million total population = 23%]

III.F(b)(2)(vii) Targeted Contact

	Assume system purchases list of targeted populations, such as pregnant
women and children.

Based on Portland experience and internet quotes, assume $250 for
purchase of targeted list. Assume that list is purchased once. This
up-front cost is pro-rated over 3 activities and 3 years.

Assume 1 targeted communication for every 250 population served
(approximately 2000 homes for a population served of 482,500 for
Portland).

Assume $0.44 for materials and postage. Assume 15 minutes for 100 copies
production labor.

III.F(b)(2)(viii) Provide Materials Directly to Multi-family and
Institutions

	Assume an effort to identify multi-family homes and institutions.
Assume 165 multi-family units per 100,000 population (in buildings with
10 or more units) from Census.

Assume 5 minute per establishment to identify multi-family homes and
institutions. Assume that identification is done once. This up-front
cost is pro-rated over 3 activities and 3 years

Assume $0.44 for materials and postage. Assume 15 minutes for 100 copies
production labor.

Exhibit 18: Summary of Cost Per System for Activities
III.F(b)(2)(i)-(viii)

(4th Qtr 2006$)

System Size

Category	(i) Public Service Announcements	(ii) Paid Advertisements	(iii)
Display in Public Areas	(iv) Internet Notification	(v) Public Meetings
(vi) Delivery to Every Household	(vii) Targeted Contact	(viii) Materials
Directly

to Multi-Family & Institutions

25-100	$98	$105	$24 	$24 	$48 	$7 	$34	$12

101-500	$101	$105	$26 	$26 	$51 	$30 	$35	$15

501-3,300	$105	$180	$111 	$28 	$55 	$166 	$37	$27

3.3K-10K	$118	$180	$137 	$420 	$900 	$435 	$44	$81

10K-50K	$1,400	$850	$696 	$596 	$2,400 	$1,114 	$66	$303

50K-100K	$1,400	$5,000	$1,392 	$596 	$3,000 	$2,448 	$138	$945

>100K	$1,400	$5,000	$3,943 	$1,035 	$5,000 	$3,874 	$563	$5,035

	Determining which activity or combination of activities systems will
regularly choose is subject to considerable uncertainty. Systems will
consider many factors in choosing activities. Certainly cost will be an
important factor, but effectiveness and ability to reach a variety of
audiences may also be considered. In the absence of information on the
selection of activities, this analysis conservatively assumes that all
activities are equally likely to be chosen. The average cost per system
for each size category is calculated and assumed to represent the
typical cost for this regulatory change. Because of the uncertainty
entailed in this assumption, Appendix I contains results of sensitivity
analyses that calculate per system costs based on alternative scenarios
for choosing activities.

The direct costs to systems for compliance with Regulatory Change
#III.F(b)(2) are summarized in Exhibit 19 and estimated to be $292,700
annually, in labor costs. Detailed estimates are provided in Appendices
H-6 through H-20.

Exhibit 19: Summary of Direct Costs Associated with Regulatory Change
III.F(b)(2)

(4th Qtr 2006$)

Annual Labor	Annual Material	Total Annual

Costs to Systems

Additional Activities	$292,700	$0	$292,700

Total System Costs	$292,700	$0	$292,700

(c) Changes to help systems maintain communication with consumers
throughout the exceedance

(c)(1) Adding Note to Customer Bills for CWSs that Exceed the Lead
Action Level