IDEM UpdateIndiana Industrial Operators

AssociationApril 18, 2007

Thomas W. Easterly, P.E., DEE, QEP Commissioner

IN Department of Environmental Management

New State Laws impacting IDEM from the 2006 Legislative Session

HB1110—Removal of Mercury Convenience Switches from End of Life Motor Vehicles.SB 234—Improving the rulemaking process for wet weather discharges and authorizing the Environmental Stewardship Program.HB1117—Simplifying the solid waste statutes and eliminating the groundwater task force.SB 146—Removing the Property Transfer Disclosure Form from Statute.

IDEM’s Environmental Goal

Increase the personal income of all Hoosiers from the current $0.88/$1.00 of the national average to at least $1.00/$1.00 of the national average while maintaining and improving Indiana’s Environmental Quality.

Pilot 2006 Environmental Performance Index

Yale Center for Environmental Law & PolicyYale University

Center for International Earth Science Information Network (CIESIN)Columbia University

http://www.yale.edu/epi/

How Will IDEM Help Increase Personal Income?

Clear, consistent and speedy decisionsClear regulationsAssistance first, enforcement secondTimely resolution of enforcement actionsEvery regulated entity will have current valid

permits without unnecessary requirementsWritten Standard Operating Procedures Improved staff training and development

Performance MetricsQuality of Hoosiers' Environment Result Target Comments

% of Hoosiers that live in counties that meet air quality standards 85% 100% 80% 2 counties @ 964,725 of

6,271,973 failed

% of CSO Communities with approved programs to prevent the release of untreated sewage

48% 100% 20% 75% by 2007 is goal

Permitting Efficiency Total calendar days accumulated in issuing environmental permits, as determined by state statute

Land 81,726 66,565 86,864 208 permits

699 permits

82 permits

Air 321,262 207,000 385,000

Water 85,443 48,000 200,000

* Places emphasis on back logged permits

Compliance Total percentage of compliance observations from regulated customers within acceptable compliance standards

Inspections 96.84% 97% 75%

Self reporting 94.99% 99% 95%

Continuous monitoring (COM) 99.61% 99.90% 98.95%* Tracks observations and not just inspections

Organizational Transformation Budgetary agency dollars spent on key outside contracts for core agency functions.

Dollars spent on outside services per year $3,100,00 $0 $3,447,017Will require increase in head count to accomplish

Counties above AQ StandardsJanuary 10, 2005 Allen--Ozone Boone--Ozone Clark—PM & Ozone Dubois--PM Elkhart--Ozone Hamilton--Ozone Hancock--Ozone Madison--Ozone Marion—PM & Ozone Shelby--Ozone St. Joseph--Ozone

January 1, 2007 Clark--PM Marion--PM

Communities with Approved CSO Long Term Control Plans

Akron

Albion

Angola

Aurora

Avilla

Berne

Bluffton

Boonville

Brazil

Bremen

Brownsburg

Butler

Centerville

Chesterfield

Columbia City

Columbus

Communities with Approved CSO Long Term Control Plans

Crawfordsville

Crown Point

Decatur

Frankfort

Goshen

Greenfield

Indianapolis

Kendallville

Knox

LaGrange

LaPorte

Lowell

Madison

Markle

Michigan City

Milford

Communities with Approved CSO Long Term Control Plans

New HavenNorth VernonOssianPlainfieldPlymouthRockportRemingtonSeymourSouth Whitley

SullivanValparaisoVeedersburgWakarusaWarrenWarsawWaterlooWinamac

Permitting

IDEM is still meeting the statutory deadlines for permit issuance, as reported in past years

IDEM now tracks the total calendar days a permit is in house and is applying a deadline to permits that traditionally do not have a statutory deadline; as a new interpretation to the intent of statutes

Total Permit Calendar Days

0

1 0 0 0 0 0

2 0 0 0 0 0

3 0 0 0 0 0

4 0 0 0 0 0

5 0 0 0 0 0

6 0 0 0 0 0

A i r

W a t e r

L a n d

Percent of Activities Meeting Regulations

8 8 . 0 0 %

9 0 . 0 0 %

9 2 . 0 0 %

9 4 . 0 0 %

9 6 . 0 0 %

9 8 . 0 0 %

1 0 0 . 0 0 %

I n s p e c t i o n sS e lf R e p o r t i n gE m i s s i o n M o n i t o r i n g

Office of Enforcement2002-2007

2002 2003 2004 2005 2006 2007*

Referrals 887 607 467 547 591 134

Violation Letters 17 33 47 203 231 47

Notice of Violations

561 457 318 202 427 66

Agreed Orders 311 349 314 258 417 62

Commissioner's Orders

15 15 6 41 38 7

Dismissals 125 121 44 48 46 5

Major Regulatory InitiativesRegulations to facilitate the proper management of e-Scrap

Rulemaking to require the removal of mercury convenience switches from automobiles prior to crushing or shredding

Rulemaking to allow Performance Track (Indiana Environmental Stewardship Program)—Charter Members Announced in February 2007

Major Regulatory InitiativesOutdoor Wood Fueled Boilers—EQSC Report recommended waiting to proceed until EPA issues its model rule in January 2007

Utility NOx, SO2 and Mercury emission rules:CAIR, which regulates NOx and SO2, was adopted

by the Air Pollution Control Board in November.CAMR, regulating mercury, was due to EPA on

November 17, but Indiana does not have a Final Rule because there has been no resolution of issues between Utilities which favor the federal program and the Hoosier Environmental Council which favors a 90% reduction—APCB May 2, 2007

Major Regulatory InitiativesRulemaking to establish presumptive 8-1-6 VOC BACT controls to streamline permitting: Acid Scrubbers for foundry core making amines—

Withdrawn at Request of INCMA Compliance with certain NESHAPs--Continuing Ethanol Plant BACT—Final Adoption 12/6/2006

Possible statewide regulations on the formulation of consumer products (i.e. air fresheners, deodorants, etc.) and paint products to ensure continued compliance with the Ozone standard and reduce our impact on neighboring States—First Notice Soon

Adjustments to the Title V fees to fully fund the program—Air Board Adoption 12/6/2006

IDEM Fees & Fund Balances Title V Example

Significant Communication Challenge:Auditor reports the “check book balance” for each

fund on June 30 IDEM collects almost all of its Title V fees in the

2nd Quarter of each year. IDEM’s June 30 fee balance is similar to a

person’s check book balance right after depositing their paycheck

IDEM must pay all of its bills until the next pay day (next June 30) without overdrawing

IDEM Fees & Fund Balances Title V Example

For the last five years (FY 02-FY 06), Title V fund expenditures have exceed revenues by $5,771,277, yet the June 30, 2006 check book balance was $10,039,779 which many people believe is a healthy fund balance.

This fund balance is insufficient to cover the estimated $10,587,184 in expenditures up to the date of receipt of new funds in the 2nd Quarter of 2007.

IDEM Fees & Fund Balances Title V Example

The “payday checkbook balance” minus the expenditures before the next pay day gives the “minimum cash in the check book” which is projected to be negative by $547,405 during FY 06.

The actuarial fund balance (assets less contracted liabilities) is much worse because the fund has $6,131,187 in contractual obligations and its projected lowest net worth is actually a debt of $6,678,592.

05-06 Available Cash by MonthFY 2006 7-31-2005 8-31-2005 9-30-2005 10-31-2005 11-30-2005 12-31-2005 1-31-2006 2-28-2006 3-31-2006 4-30-2006 5-31-2006 6-30-2006

Available Cash Balance 5,160,120 5,106,237 2,670,495 391,762 (1,197,329) (1,170,121) (2,876,751) 889,278 5,464,556 4,763,721 4,182,213 3,767,774

$391,762

($2,876,751)

$3,767,774$4,182,213

$4,763,721

$5,464,556

$889,278

($1,170,121)

$5,106,237

$5,160,120

$2,670,495

($1,197,329)

(4,000,000)

(3,000,000)

(2,000,000)

(1,000,000)

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

Available Cash Balance

2007 Legislative IssuesBudget—SB432Federal Funds continuing to decreaseState General Funds fluctuateDedicated Funds: Except for Title V, fees

collected for do not relate to program costs—some programs like Methamphetamine Clean-up and Mercury Switch Management completely unfunded (Recently adjusted Title V fees)

Consider Prohibiting the Commissioner from renewing a permit for a facility that was not constructed or has not operated for the past 5 years—SB205

IDEM Budget Comparisons (w/o ELTF)

2005-2007 $240,798,257

2007-2009 $206,249,350

Federal: $57,530,097(27.9%) Red

General: $61,750,166

(29.9%) Lt. Aqua

Dedicated: $86,969,087

(42.2%) Green

Dedicated: $91,318,803

(37.9%) Green

Federal: $84,618,622

(35.1%) Red

General: $64,860,832

(29.9%) Lt. Aqua

IDEM Fees (Thousands)FY 07-09 Air Water Land Total

Income $19,815 $22,100 $27,500 $69,415

Expense $25,008 $27,296 $37,571 $89,875

Spend Down

-$5,193 -$5,196 -$10,071 -$20,460

Annual -$2,596 -$2,598 -$5,036 -$10,230

Proposed Increase

$2,500 $2,461 $4,094 $9,056

Efficiency $96 $137 $942 $1,174

Fee Proposals

CAFO/CFO – 25 staff (17 FTEs)

Fee Revenue: $42,000

Expenses: $1.2M

Proposed Fee Revenue: $2.8

Annual Number of permits issued: 121

Annual Number of Permit renewals: 435

Number of Compliance Inspections: 1100 (Proposed)

Fee Proposals

NPDES – 79 staff

Fee Revenue: $3.8M

Expenses: $6.2M

Proposed Fee Revenue: $4.75M

Annual Number of permits issued: 340

Proposed increase is 25%

Fee Proposals

Drinking Water/Wastewater Operator Certification – 6 current staff

Fee Revenue: $146,000

Current Expenses: $471,000

Proposed Fee Revenue: $526,000 (would add 3 staff)

Annual Number Certifications/tests issued: 4469

Wastewater Operator Biennial Renewal Fees

Classification Current New IncreaseAnnual

Increase

Class I-SP $30 $60 $30 $15

Class I $30 $60 $30 $15

Class A-SO $30 $60 $30 $15

Class A $30 $60 $30 $15

Class II $30 $80 $50 $25

Class B $30 $80 $50 $25

Class III $30 $100 $70 $35

Class C $30 $100 $70 $35

Class IV $30 $120 $90 $45

Class D $30 $120 $90 $45

Water System Operator Triennial Renewal FeesAll $30 $150 $120 $40

Fee Proposals

Wetland/Water Quality Certification – 7 staff

Fee Revenue: $0 (60% federal funds/40% state funds)

Expenses: $538,000

Proposed Fee Revenue: $96,900Proposed General Permit Fee $100Proposed Individual Permit Fee $200

Annual Number of permits issued: 760

Fee Proposals

Storm-water Fees – 8 current Staff

Fee Revenue: $365,000

Expenses: $698,000

Proposed Fee Revenue: $1.4M (add field staff for inspections)

Annual Number of permits issued: 4,050

Rules 5, 6 and 13 have been funded through fees and enforcement fines

Current Proposed Increase

Rule 5 $100 $400 $300 per NOI

Rule 6 $100 $150 $50 Annually

MS 4 by Population

1-999 $0 $250 $250 per NOI

1,000-2,999 $0 $500 $500 per NOI

3,000-4,999 $0 $750 $750 per NOI

5,000-6,999 $0 $1,000 $1,000 per NOI

7,000-9,999 $0 $1,500 $1,500 per NOI

10,000 and up $0 $2,000 $2,000 per NOI

MS 4 by Type

Non-municipal $0 $500 per NOI

County System $0 $2,000 per NOI

Note: 25% reduction if MS4 is co-permitted

Fee ProposalsHazardous Waste – 96 staffFee Revenue: $1.3MExpenses: $8MProposed Fee Revenue: $4.1MPermit Review, renewal, modifications and Corrective action plan reviews: 375Federal funding (currently) 33%State funding (currently) 31%Fee funding (currently) 36%

Environmental Crimes Task Force

SB286

Environmental Crimes Task Force Created by SEA 195 (2005) has been meeting since October, 2005.

Chaired by Senator Kenley then Rep Walorski

Developing more specific environmental criminal statutes.

2007 Legislative IssuesStreamlined Rulemaking when adopting Federal Requirements (including deadlines) without change SB154

Ask the 2007 EQSC to study Environmental Rulemaking Process SB154

Current Roles of Environmental DistrictsRegional Water and Sewer DistrictsSolid Waste Management Districts (Recycling)

SB154

Questions Submitted in AdvanceQ. Where are we with the wastewater operator

rule?

A. Work group completed its work in August 2006, Second Notice scheduled for May, 2007. Fees in SB 432.

Q. What are we seeing in terms of alternative fuel in IN. Are we actually going to have convenient gas stations where you can buy bio fuel?

A. There are now 82 E-85 and 8 B-20 public pumps list is at: www.in.gov/isda/biofuels

Questions Submitted in Advance

Q. What is IDEM doing in terms of economic development to help attract or keep industry?

A. Clear, Consistent and Speedy decisions.

Q. Why are we getting Copper numbers on industrial permits that are lower than background?

A. Aquatic toxicity.

Questions Submitted in AdvanceQ. We have heard that several departments

have been downsized and wonder if that will impact our permit?

R. IDEM total staff is up 6 full time and 11 part time people since 12/31/2004. Permitting staffs have been increased and permit backlogs are going down. Still need staff in industrial pretreatment, operator certification, and storm water programs.

Questions Submitted in AdvanceQ. When will the continuing education

coordinator be replaced?

R. The current person is Tonja Fuller-White.

Q. Where are we on the CSO Issue?

R. Answered in presentation.

Questions Submitted in AdvanceQ. Where are we with the future of electronic

reporting?

A.1. Let $5.9 million contract with CGI for overall

system. Going program by program, three years to completion.

2. First State approved by EPA for CROMEER.

3. Digital Inspector

4. Virtual File Cabinet—some programs are on IDEM’s website now.

Questions?

Tom Easterly

100 N. Senate Ave. IGCN 1301

Indianapolis, IN 46204

(317) 232-8611

Fax (317) 233-6647

teasterly@idem.in.gov