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Affordability of arsenic, other water regs starts debate

by Scott Hoober, Ellen Miller Group

The ongoing flap over proposals to tighten the standards for arsenic in drinking water is a classic example of the intersection of science, regulation and politics.

When the Clinton administration enacted the new regulation in the waning days of its term in office, the drop from 50 to 10 ppb was seen as a desperate act by a liberal lame duck — despite the fact that the scientific studies behind the decision went back several years.

Then, when the Bush administration decided to the rescind the move, it hoped to be seen as a hero to those who oppose new, expensive regulatory schemes. Instead, President Bush and his people came across as insensitive to the health needs of ordinary Americans.

Yet back of all the rhetoric is a serious question: Is it OK to look at the costs and benefits of a particular regulation? And perhaps to delay or compromise on implementation if the cost of increased safety is too high?

Too late?

This question may come too late for the arsenic rule. In all likelihood, Congress will tell the Environmental Protection Administration to go ahead with the new 10 ppb MCL (maximum contaminant level), though EPA is still officially considering its options. But the issue of cost-benefit ratios and regulations is here to stay. And perhaps the arsenic issue will influence the way EPA — and ultimately other federal and state agencies as well — will look at proposals that would help consumers a little bit but cost a whole lot to implement.

Dennis Schwartz hopes so. General manager of Shawnee RWD No. 8 outside Topeka and president of the National Rural Water Association (NRWA), Schwartz is a member of the National Drinking Water Advisory Council, and he served on NDWAC's Arsenic Cost Review Work Group. (One recommendation from the arsenic group was to establish another body to look at affordability issues. If that happens, Schwartz stands a good chance of being named to that work group as well.) In a way, Schwartz said, the affordability argument isn't a new one. After all, the Safe Drinking Water Act has provisions dictating that affordability be addressed.

"It comes down to weighing risk against benefit," he says. "Probably that is a subjective thing, but that is a case that we argued on the Arsenic Work Group — successfully, I might add."

Yet Schwartz has serious objections to how EPA proposes to measure the cost-benefit ratio. "When we get to affordability, there are a lot of different ways that different people have tried to assess what an appropriate allocation of municipal funds is," he said. "It's highly possible that the benefit [of arsenic removal] could have been exaggerated," he adds. "It assumes that if you set a more stringent standard today, immediately mortality rates are going to decline, which is certainly not the case. There have been some challenges in the way the value of a typical life was determined, and different values have been established by different federal agencies — the Department of Transportation and OSHA and some of the other agencies that deal with making cost-benefit determinations — and there are three- and fourfold differences" in VSL — the value of a statistical life.

NRWA has compiled its own white paper on the topic "Balancing Benefits and Costs." The paper, conducted by Dr. Robert S. Raucher of Stratus Consulting Inc., Boulder, Colo., notes that nowadays, "MCLs reduce low level risks across a large population, and the VSL estimates also reflect how people value small changes in low level risks that are spread across a large population."

In addition, there are questions about how long it takes for benefits to show up, and if the onset of disease is decades after exposure, how much "statistical life" is actually saved.

"We believe that water quality and water standards should be protective of public health," Schwartz said of the NRWA white paper, "but also need to be reasonable in their ability to be efficiently implemented, and affordable by the systems, as entities, as well as the users of those systems."

Whining?

Yet some of arguments against tighter arsenic regs sound a little desperate. For instance, where EPA says that a particular regulation is affordable if it costs 2.5% of mean household income, he argues that it could be unaffordable to half the population — which is what "mean household income" means: half above that level, half below it.
It is also arguable that instead of spending local dollars to clean up arsenic, we should divert resources to other activities, such as reducing drunken driving or increasing seatbelt use. As if a portion of municipal water revenues would ever be used to attack those issues.

Even more troubling is who the anti-regulation folks have chosen as one of their more visible spokesmen. George E. Parris, director of environmental and regulatory affairs of the American Wood Preservers Institute, is an articulate man, but his trade association representing business that puts some 90% of the industrial arsenic in the U.S. into the environment, generally via the treated wood used to make fences and play equipment.
By putting Parris and his association out front, those who argue for holding back on regulating arsenic seem to be pleading for special treatment — not arguing for reasonable standards that benefit Americans without causing undue harm to water systems.

There's even a vocal group that argues that arsenic isn't really all that harmful. That would be a terrible blow to fans of Agatha Christie and other mystery writers.
(It might also be news to the Leawood family that was the victim of a recent murder-suicide plot involving food laced with arsenic-laden pesticides. But maybe not, since both the alleged murderer and his wife survived.)

It would be too bad if the discussion of cost-benefit in water regulation were to turn into a cat fight between those who want zero deaths from water-borne pollutants and those who don't want any regulation at all. After all, large water systems generally have an easier time complying with new, more stringent regulations. They have technical expertise in-house, they have large customer bases over whom to spread costs, and they generally have ready access to capital markets.

That's why new regs often apply first to large systems and only later to smaller ones: It's small systems that have the hardest time keeping up. And Kansas is home to a great many small systems — including 23 that have one or more sources with arsenic readings of above 10 ppb.

Karl Mueldener, director of the Bureau of Water Protection at the Kansas Department of Health and Environment (KDHE), says that something like 93% of the state's water systems have fewer than 1,000 connections. Fully 53% have under 100.

Since the five largest systems in the state serve some 1.4 million consumers, you can imagine how small the others are. And remember, that statistic comes after decades of effort by KDHE to encourage consolidation of small systems and to encourage small noncummunity systems to hook up to the nearest public water supply.

Acute vs. chronic

But talking about how tough it is for small systems is really just another form of special pleading. Isn't there a way to discuss affordability, cost-benefit ratios and all the rest without asking for a favor from the public at large?

As a matter of fact, there is.

Water people have done such a good job of eliminating acute water-borne disease that most Americans no longer even consider whether they'll get typhus or some other dread disease from their drinking water. Instead, they worry about long-term health effects — the kinds of things that residents of third-world countries would gladly put up with in exchange for water without bacteria in it.

"We've gone beyond the basic bacteriological sanitation," said KDHE's Mueldener, "from the acute to the chronic."

Just as workers compensation has moved over the past century from worrying about being crushed to death on the job to helping those with carpal tunnel syndrome, water users have gone from worrying about getting sick today to possibly coming down with something years from now.

Not that we shouldn't be concerned about carcinogens or other nasties coming out of the tap. It's just that if our goal is to reduce exposure to noxious chemicals to zero, hold onto your wallets. This is not a quest that will end with arsenic — nor, in all likelihood, one that will ever end at all.

Once upon a time, a one-in-a-million chance meant something that couldn't possibly happen. Well, if a disease has a one in a million chance of hitting you or me, then on average, two or three Kansans will one day come down with that ailment. Just how many one-in-a-million possibilities water systems should have to spend money to guard against is a legitimate question.

If we want zero consequences, we may need zero MCLs. And infinite costs. For if arsenic causes disease at 50 ppb, there's little reason to believe it will do anything but cause less disease at 10.

Take the town of Atwood, county seat of Rawlins County, in the northwestern corner of Kansas, not far from the Nebraska border. The arsenic levels in the water supply for its 1,300 or so residents range from 12 to 18 ppb — way below the old limit of 50, but not far above the proposed MCL of 10 ppb.

Not far away is the city of Oberlin, where arsenic levels are just 10-12 ppb. If 50 ppb is too high and 10 ppb is just right, it would certainly seem that the water that comes out of the tap in Atwood or Oberlin today poses no discernible health risk.

Arsenic vs. nitrates

But lost in the political rhetoric surrounding arsenic is any possibility of compromise. That's too bad, because an MCL of 20 ppb wouldn't just help Atwood and Oberlin, but many other towns as well. It's been estimated that some 3,000 municipalities or RWDs — 1 in 20 nationwide — would need to take action to reach 10 ppb, but only 1,200 would need to take action to reach 20 ppb. And a 20 ppb MCL would do all that while continuing to protect consumers just about as well as 10 ppb would.

In general, that's the way EPA-mandated MCLs work. Below the limit you're fine, above the limit, comply or else. With one exception. In the case of nitrates — a major pollutant in a predominantly agricultural state such as ours — Kansas has carved out an alternative way of enforcing the limits. Although the MCL is 10 ppm, KDHE gives systems some slack as long as they're trying to comply and they're keeping it under 20.
"If you're over 20, we get after you, you'd have to do something, I think we'd probably even issue an order," Mueldener said. "But if they're in the lower end of that — 10, 15 — we try to get them to solve the problem without putting in hardware. Of course we don't make these decisions blindly. We look at the data, and sometimes a system will be in compliance one month, out another month."

Often the solution involves managing nitrate releases. "Maybe the co-op's sprung a leak and we just need to get that cleanup going," said Mueldener. "Maybe they're washing out tanks nearby, maybe the system could pump their wells differently, maybe they could blend."

What's next?

Now, there's a solution that the Atwoods and Oberlins of the world could live with. But don't hold your breath. "We pulled that off for the nitrates, but we don't have a similar package for other pollutants," Mueldener said. In fact, it may not hold up for long even with nitrates. "We think EPA's trying to undo it," Mueldener said. "They really don't like it."

In the absence of some kind of common sense way of reducing arsenic in tap water, something like the Kansas plan for nitrates, the immediate future looks bleak.

"The concern is not simply the cost of the arsenic reg," points out NRWA's Schwartz. "The concern is that there's a series of additional regs that are coming down the pike that are going to by and large be affecting the same systems that are currently potentially affected by the arsenic reg," beginning with the groundwater rule and the radon rule.

"There's concern about the affordability of the arsenic reg," he added, "but also concern over the compounding effect." Betty Mickey, mayor of Atwood, has noticed that compounding effect herself. "We know we're facing the arsenic issue, but we're also probably facing a lot of other issues down the road," she said.

KDHE's Mueldener agrees: "We're trying to hit a moving target: OK, we're going to meet arsenic today, but what's coming tomorrow? You know that over the next six years they're going to come out with arsenic and then other organics, and you're sitting there thinking, Well, I don't want to invest a million bucks now and find out four years from now I need to rip it out and put in another gadget."

New approaches

Perhaps, says Mueldener, we should move from a parameter-specific approach to a technique approach, where regulators look at management practices instead of specific MCLs.

That's done today with cryptosporidium, which is difficult and expensive to test for. Instead, systems are required to take the kind of steps that have proven effective in removing crypto and preventing harm to consumers.

Other solutions might include different ways of allocating grant and loan dollars. Or simply making more tax dollars available, whether at the state or federal level. After all, if there's a widespread public benefit in cranking risk down toward zero, then the public should be willing to help foot the bill. In an era of $2.50 cookies and $45,000 SUVs, you'd think Americans would be willing to pay a few extra bucks each month to ensure they keep getting pure water when they turn on the tap.

In the arid West, some people are willing to spend just about anything just to get an assured supply. Californians are unhappy with the Canadians who don't want them to build a 30-foot pipe to divert 1.3 trillion gallons of water from Hudson Bay, even though the water would cost $1,630-2,445 per acre-foot — a cost that makes sense only if you compare it to desalination.

If both long-distance pipelines and new taxes sound unappealing, how about the free-market solution? That's where those systems that can meet the new regs do so. And the ones that can't, well, either they prices themselves out of sight or they go the way of Harris, Kan., a little County town that recently unincorporated itself rather than be forced to install a new wastewater system.

When the choices become as stark as that, and the rhetoric as harsh and unyielding as it's become on both sides of the arsenic debate, all you can hope for is a spirit of compromise.

There's no telling what new MCL is coming down the road. But wouldn't it be nice if EPA and Congress could compromise at a limit of 20 ppb this time around?

Atwood copes with change

Even if the rules never changed, places like Atwood would have a problem keeping up with the their citizens' need for a reliable source of clean water.
The city, in the northwestern corner of the state, north of Colby, has just voted to spend $3 million to upgrade its water system. And that's on top of a recent upgrade of its wastewater facilities.

"We have a failing system," says Atwood's mayor, Betty Mickey. "I mean, everything about our water system, everything's 65, 75 years old, and nobody had done anything, so we had to do everything. We've had main breaks, and we're down to one functioning water well, and our storage facility — we could not keep it full.  If we had a downtown fire, I'm not sure we could fight that fire," Mickey said.

Who pays for all of the needed upgrades? If the city had to rely on its water and sewer patrons, it would be in a bad way, for Atwood serves no suburban or rural customers. The burden would fall on the 1,300 citizens of Atwood. Even with a grant from Rural Development and a loan from the State Clean Water Revolving Loan Fund, that's quite a burden. And then, in the middle of the planning process came word that EPA might tighten the arsenic rule.

Atwood's one remaining well takes water from the alluvial aquifer — which contains far less arsenic than the current regs allow but more than will be permitted if, as expected, the more stringent MCL goes into effect. So instead of upgrading its wells and building a plant, Atwood is now looking at moving its source a few miles out of town, drawing water out of the Ogallala aquifer and piping it 6-7 miles back to town.

"First of all," said Mickey, "we'll have to identify wells, we'll have to purchase — maybe the wells, maybe the land, maybe the water rights — who knows what. That's not a predictable dollar amount," she said, "so you negotiate, plus it costs money just to negotiate, plus then we would be doing the piping. So I think we're looking at another million for all that."

So far, despite the high costs, Mickey feels Atwood's citizens feel they're getting their money's worth. "I don't mind, and I don't think people mind, if you spend tax dollars and actually get something," she said.

With arsenic, though, it's hard to know whether you're making a real difference. Mickey remembers a doctor, noticing a spate of cancers, joking that there must be something in the water. But in reality, no one knows for sure what the direct health effects of arsenic exposure are — especially at the levels in Atwood's water — and that can be frustrating.

"We're in line. We know we've got a problem. I may not be mayor again, " she said with a laugh, " but at least they'll remember me — I was the one who was the spendthrift."

NRWA's white paper
The National Rural Water Association commissioned Dr. Robert S. Raucher of Stratus Consulting Inc., Boulder, Colo. to take a look at the issues involved in deciding whether a particular MCL is cost-effective. Below is a brief summary of his white paper, "Balancing Benefits And Costs."
"This white paper describes key principles for how benefit-cost analysis (BCA) should be performed and interpreted for setting maximum contaminant levels (MCLs). The Safe Drinking Water Act (SDWA) as amended in 1996 requires that EPA conduct a benefit-cost analysis (known as Health Risk Reduction and Cost Analysis, or HRRCA) that contains both quantitative and nonquantitative information, compares incremental benefits to incremental costs, and indicates the presence and impacts of uncertainties. Based on the HRRCA, the EPA Administrator is required to issue a formal “determination” that the benefits of each standard “justify” the costs. Further, the Administrator is authorized to set MCLs at levels other than what is technologically feasible if the benefits are found not to “justify” the costs...
"The objective is to identify the MCL at which the benefits exceed the costs by the widest margin — the point where the “net benefits” are the greatest. The MCL that yields the greatest net benefit is... where incremental benefits become outweighed by incremental costs. This is why the SDWA specifies that the HRRCA reveal the incremental costs and incremental benefits of each MCL option — it is the comparison of these incremental benefits and costs that enables one to maximize social welfare.
"Drinking water regulations generate benefits in the form of reduced risks that people will suffer adverse health impacts. The benefits are often thought of as a reduced number of illnesses (morbidity) or deaths (mortality). However, there is no identifiable individual whose life is saved or illness avoided. Instead, the benefits reflect “statistical lives” because regulations reduce a low-level risk borne across a large population. Second, because every person is mortal, no regulatory action truly “saves lives.” ...
"To assign a monetary value to risk reductions, analysts rely on estimates developed of the “value of a statistical life” (VSL) by looking how people state or reveal their “willingness to pay” (WTP) for lower (or elevated) risks. These estimates represent monetary measures of the value individuals place on the change in quality of life achieved as a result of a risk reduction. The WTP-based measures are the conceptually appropriate approach, in accordance with well-established and broadly accepted principles of welfare economics...
"There are numerous challenges in developing and interpreting BCAs, such as accounting for uncertainty and variability, distinguishing the use of the precautionary principle in risk assessment when trying to estimate realistic benefits, and accounting for an important benefit or cost that cannot be readily quantified or expressed in monetary terms. In addition, benefits and costs need to evaluated by system size category. MCLs tend to impose much higher costs per unit of risk reduction benefit received by households served in small systems relative to the costs per risk reduction borne in larger communities. This raises a fundamental issue of fairness or “environmental equity” — should families served by small systems be forced through regulations to pay much higher costs for their risk reduction benefits than do households in larger, more urban settings?
"In conclusion, there are important uncertainties and challenges associated with applying BCA to the drinking water context... Accordingly, BCAs generally should not be used as a strict decision rule... When conducted and interpreted in a sound and objective manner, BCAs will be very informative in guiding the nation’s drinking water investments so that they generate the greatest public health returns possible."

From November 2001 issue of The Kansas Lifeline © 2001 KRWA