Protecting Drinking Water: The U.S. Safe Drinking Water Act Chapter 16 © 2004 Thomson Learning/South-Western

2 The Evolution of U.S. Safe Drinking Water Legislation Setting Standards to Protect Drinking Water  Public Health Services Act of 1912 – the first U.S. law to specifically call for drinking water health standards

3 The Evolution of U.S. Safe Drinking Water Legislation The Safe Drinking Water Act (SDWA) of 1974  Aimed at protecting drinking water from any contaminant that could threaten human health or welfare

4 The Evolution of U.S. Safe Drinking Water Legislation The Safe Drinking Water Act Amendments (SDWA) of 1986  Expanded federal controls on drinking water and corrected some failings of the original SDWA

5 The Evolution of U.S. Safe Drinking Water Legislation The Safe Drinking Water Act Amendments (SDWA) of 1996  Drinking Water State Revolving Fund (DWSRF) – authorizes $1 billion per year from 1994 to 2003 to finance infrastructure improvements

6 Directives of the Safe Drinking Water Act Soul-source aquifers – underground geological formations containing groundwater that are the only supply of drinking water for a given area

7 Directives of the Safe Drinking Water Act Relating the SDWA to Other Laws  Safe Drinking Water Act (SDWA) is more focused than the Clean Water Act

8 Directives of the Safe Drinking Water Act Pollutants Controlled Under the Safe Drinking Water Act  Priority contaminants – pollutants for which drinking water standards are to be established based on specific criteria

9 Setting Standards To Define Safe Drinking Water Establishing National Primary Drinking Water Regulations (NPDWRs)  National Primary Drinking Water Regulations (NPDWRs) – health standards for public drinking water supplies that are implemented uniformly  Setting the Goal: The MCLG The maximum contaminant level goal (MCLG) – a component of an NPDWR that defines the level of a pollutant at which no known or expected adverse health effects occur, allowing for a margin of safety

10 Setting Standards To Define Safe Drinking Water  Setting the Standard: The MCL The maximum contaminant level (MCL) – a component of an NPDWR that states the highest permissible level of a contaminant in water delivered to any user of a public system  Defining Treatment Technologies Best available technology (BAT) – a treatment technology that makes attainment of the MCL feasible, taking cost considerations into account

11 Setting Standards To Define Safe Drinking Water Current Status of the National Primary Drinking Water Regulations  As of 2002, NPDWRs have been announced for 69 organic and inorganic chemicals, 7 microorganisms, 7 disinfectants, and 4 radionuclides.

12 Setting Standards To Define Safe Drinking Water Establishing National Secondary Drinking Water Regulations (NSDWRs)  Secondary maximum contaminant levels (SMCLs) – national standards for drinking water that serve as guidelines to protect public welfare

13 Analysis of U.S. Safe Drinking Water Policy The Federal Role: Setting the Standards  Efficiency Implications Benefit based Economic Analysis (EA) – a requirement under Executive Order that calls for information on the benefits and costs of a “significant regulatory action.”  Cost Implications Regulatory Impact Analysis (RIA) – a requirement under Executive Order that calls for information about the potential benefits and costs of a major federal regulation

14 Analysis of U.S. Safe Drinking Water Policy Figure 16.2 Inefficiency of Benefit-Based Primary Drinking Water Standards

15 Analysis of U.S. Safe Drinking Water Policy Economic Analysis (EA) – for the New Arsenic Standard in Drinking Water  Incremental Benefits of the New Arsenic Standard  Incremental Costs of the New Arsenic Standard  Net Benefits of the New Arsenic Standard

16 Analysis of U.S. Safe Drinking Water Policy The State and Local Role: Compliance and Enforcement  Compliance Problems General Accounting Office (GAO) found that the extend of compliance by public water systems had been overstated by the EPA  Enforcement Failures Inadequate enforcement action taken by state authorities and the EPA  Analyzing the Issues

17 Economic Principles in Pricing Water Supplies An International Comparison  U.S. per capita consumption is higher than most nations around the world  Water prices vary considerably across countries

18 Economic Principles in Pricing Water Supplies Figure 16.3 International Water Prices in 1996 (U.S. dollars per cubic meter)

19 Economic Principles in Pricing Water Supplies Pricing Practices of U.S. Water Utilities  Flat fee pricing scheme – pricing water supplies such that the fee is independent of water use  Uniform rate (or flat rate) pricing structure – pricing water supplies to charge more for higher water usage at a constant rate  Declining Block Pricing Structure – a pricing structure in which the per unit price of different blocks or quantities of water declines as usage increases  Increasing Block Pricing Structure – a pricing structure in which the per unit price of different blocks of water increases as water use increases

20 Economic Principles in Pricing Water Supplies Figure 16.4 Alternative Pricing Structures of Water