06-4079. Implementation of the Great Lakes Legacy Act of 2002

AGENCY:

Environmental Protection Agency (EPA).

ACTION:

Final Rule; Notice of Implementation Policy.

SUMMARY:

This action is intended to outline EPA's process for identification, evaluation, selection, and implementation of projects for funding under the Great Lakes Legacy Act of 2002 (also referred as GLLA or the Legacy Act). The Legacy Act authorizes the appropriation of $50 million annually for fiscal years 2004-2008 for contaminated sediment remediation projects and provides EPA with a unique approach for addressing contaminated sediment problems in Great Lakes Areas of Concern. The Act also authorizes smaller amounts of funding for other activities; this action pertains only to sediment remediation project selection and implementation. This action provides information to those interested in submitting cost-share, sediment remediation projects to EPA for funding under the Legacy Act.

DATES:

Effective on May 1, 2006.

FOR FURTHER INFORMATION CONTACT:

Scott Ireland, Technical Assistance and Analysis Branch, Environmental Protection Agency, Great Lakes National Program Office 77 West Jackson Blvd. G-17J, Chicago, IL 60604-3590, telephone number [phone]; fax number [phone], http://www.epa.gov/​greatlakes.

SUPPLEMENTARY INFORMATION:

I. General Information

Affected Entities: Federal agencies and public and private non-Federal sponsors eligible to have cost-shared projects approved under the Great Lakes Legacy Act of 2002.

II. Background

Contaminated sediments have been a problem in the Great Lakes for several decades. It has been reported that polluted sediment is the largest major source of contaminants entering the food chain from Great Lakes Rivers and harbors. This includes most of the current 41 Areas of Concern (AOCs) designated by the United States and Canada, the Parties to the Great Lakes Water Quality Agreement. Over the past several years, Great Lakes stakeholders have moved forward in the pursuit of sediment remediation through a variety of mechanisms (enforcement, voluntary partnerships, etc.). From 1997-2004, approximately 3.7 million cubic yards of contaminated sediment were remediated from the U.S. Great Lakes Basin. Roughly 76 million cubic yards of contaminated sediment remain.

Congress passed the Great Lakes Legacy Act of 2002 on November 12, 2002 and President George W. Bush signed the Legacy Act into law on November 27, 2002 (Pub. L. 107-303). The Legacy Act authorizes the appropriation of $50 million annually for fiscal years 2004-2008 for contaminated sediment remediation projects and provides EPA with a unique approach for addressing contaminated sediment problems in Great Lakes AOCs. The Act also authorizes smaller amounts of funding for other activities; this action pertains only to sediment remediation project selection and implementation.

In order to be an eligible project under the Legacy Act, a project must be carried out in an AOC located wholly or partially in the United States and the project must:

1. Monitor or evaluate contaminated sediment;

2. Implement a plan to remediate contaminated sediment; or

3. Prevent further or renewed contamination of sediment.

The Legacy Act program is implemented through Project Agreements, which are binding cost-sharing agreements between the Great Lakes National Program Office (GLNPO) and a cooperating agency or entity. Project selection decisions will be made in consultation with the USEPA Office of Water.

Legacy Act authorizing language places only limited restrictions on the types of entities (non-Federal sponsors) that may potentially enter into a Project Agreement with GLNPO. This provides the potential for entering into agreements with public and private entities, including not-for-profit organizations. It is the ultimate goal of GLNPO to work cooperatively with all qualifying potential non-Federal sponsors that have submitted project proposals under the Legacy Act in order to develop projects that are technically sound, beneficial to the environment, supported by the local community, and able to be completed in an expeditious manner. It is important to maintain the necessary flexibility in evaluating project proposals to achieve this goal.

In situations where other sources of funding are available (e.g., Water Resources Development Act—WRDA) or other mechanisms to complete the project are available (e.g., Superfund or other enforcement or regulatory programs), GLNPO will work with these existing programs, where appropriate, to add value in a way that maximizes the overall benefit to the environment.

In cases where enforcement or regulatory actions are pending, or underway, GLNPO will work and coordinate with the applicable enforcement or regulatory program on a case-by-case basis to determine the proper role, if any, for the Legacy Act to provide a value-added component to the project. In some cases, identifying a role for the Legacy Act may not be possible, if a proposed action is more appropriately accomplished by another program or agency.

III. Project Selection

The Legacy Act specifically directs the Administrator to give priority to projects that:

1. Constitute remedial action for contaminated sediment;

2. Have been identified in a Remedial Action Plan (RAP) and are ready to be implemented;

3. Use an innovative approach, technology, or technique that may provide greater environmental benefits, or equivalent environmental benefits at a reduced cost; or

4. Include remediation to be commenced not later than 1 year after the date of receipt of funds for the project.

EPA will use a scoring system to evaluate how well applications meet program priorities. In addition to the priorities listed above, the Agency will score applicants based on criteria that place greater weight on projects meeting Category 1 requirements (see Section V, Step 2: Project Evaluation Process) in order to allocate limited resources and facilitate coordination with requirements of other Agency programs. A Category 2 application would receive fewer points than a Category 1, and so on for Categories 3 and 4. The Agency will also award additional points to applications that exceed the minimum non-Federal cost-share requirements for their category (see Section IV below) and those that will result in the delisting of an AOC.

IV. Cost Share Requirement

The Legacy Act requires a minimum of a 35% non-Federal cost share for all projects carried out under the Legacy Act. The Legacy Act also requires a 100% non-Federal share for operation and maintenance of a project. The non-Federal cost share of a project may include the value of in-kind services. Additionally, the Legacy Act provides that the non-Federal cost share “may include monies paid pursuant to, or the value of any in-kind service performed under, an administrative order on consent or judicial consent decree.” The Legacy Act also states that the non-Federal cost share “may not include any funds paid pursuant to, or the value of any in-kind service performed under, a unilateral administrative order or court order.”

EPA believes project sponsors have substantial non-Federal cost-share responsibilities and has set the non-Federal cost-share rate minimums accordingly, by project category (see Section V, Step 2: Project Evaluation Process).

The underlying principle that guides our decision-making is that GLNPO will require at least a 35% non-Federal cost share in those cases where no responsible parties are clearly identified (the action could not be required of any responsible party). In other cases, where Agency regulatory and/or enforcement programs determine that the non-Federal sponsor may have some clear responsibility, GLNPO will require a substantially higher contribution (minimum of 40-50%). However, for all potential projects, GLNPO will coordinate and work with other applicable programs (Federal, State, tribal, and local), including regulatory programs, to ensure that the GLLA is not providing funding in a situation where other programs are more appropriate.

EPA's approach to non-Federal cost share with regard to the Legacy Act projects is as follows. The non-Federal cost share does not include costs incurred prior to initiation of a Legacy Act project. Costs incurred after project initiation but within the context of a consent decree in place at the time of project initiation can be included in the non-Federal cost share.

V. Project Identification, Evaluation and Selection

GLNPO has a three stage process in place for the identification, evaluation, and selection of projects for Great Lakes Legacy Act funding. This process aims to merge the statutory priorities identified in the Legacy Act along with considerations of fiscal responsibility and technical merit. The process includes:

• Step 1: Project Identification
• Step 2: Project Evaluation
• Step 3: Project Selection and Funding

Step 1: Project Identification:

Projects are identified through the release of a Request for Projects (RFP). The first RFP was released in January 2004 to solicit projects to be considered for funding under the Legacy Act. This RFP closed on March 31, 2004 (http://www.epa.gov/​glla/​rule/​rfp.html). GLNPO will issue a new RFP incorporating this action within 90 days following publication of this action in the Federal Register (this new RFP will then replace the initial RFP at the web address above). However, GLNPO remains open to the receipt of additional proposals at any time.

The potential non-Federal project sponsors are responsible for submitting a project proposal using the guidelines provided in the RFP.

Step 2: Project Evaluation Process:

Upon receipt of a project proposal, the proposal undergoes a two-stage evaluation process consisting of a Stage 1: “Minimum Requirements Check” (Stage 1 Minimum Requirements Check http://www.epa.gov/​glla/​rule/​min_​req.html) and a Stage 2: “Strength of Proposal” (Stage 2 Strength of Proposal http://www.epa.gov/​glla/​rule/​str_​pro.html).

In Stage 1, projects are evaluated against several minimum requirements that reflect statutory requirements of the GLLA, including:

1. Project scope as identified under the Legacy Act (e.g., monitors or evaluates contaminated sediments, remediates contaminated sediments, or prevents further contamination of contaminated sediments),

2. Location of the project within a U.S. AOC,

3. Identification of a cumulative 35% minimum cost share from (a) non-Federal project sponsor(s), and

4. Completion or commencement of a site assessment and an evaluation of remedial alternatives (applies only to remediation projects).

All projects that successfully meet the statutory requirements of the Legacy Act pass the Stage 1 review and are then subject to a more complete Stage 2 evaluation process. The Stage 2 review process is a thorough technical evaluation process that includes representatives from U.S. EPA enforcement and regulatory programs, the U.S. Army Corps of Engineers, the National Oceanic and Atmospheric Administration, and the U.S. Fish and Wildlife Service. These representatives form the Technical Review Committee (TRC) for each project. This multi-disciplinary, multi-agency review team provides for broad technical and enforcement/regulatory input into the review process.

The TRC evaluates each project for:

1. “Strength of Proposal” (see http://www.epa.gov/​glla/​rule/​str_​pro.html), and

2. Overlap with on-going enforcement or regulatory actions or other Federal activities (Water Resources Development Act (WRDA), Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), etc.), and State, local or tribal efforts.

All sediment remediation proposals are first subjected to a comprehensive written review by the TRC. GLNPO consolidates comments from the TRC and provides them to the applicant. The applicants are then required to provide a formal, oral presentation and a revised written proposal that addresses each of the TRC's comments.

The major functions of the TRC are first, to identify any technical deficiencies in the proposed project, and then to highlight any potential issues regarding ongoing or planned enforcement or regulatory activities at the site. The technical deficiencies identified by the TRC can range from relatively minor comments regarding the need for small modifications to the project design or changes to the long-term sampling plan, to more major issues regarding the need for additional sediment characterization at the site or the viability of the proposed remedial strategy, that could potentially require re-design of the remediation. Non-Federal sponsors for the projects are given an opportunity to respond to any deficiencies noted by the TRC during the Stage 2 review process. Based on the extent of the deficiencies identified and the speed of the applicant in addressing the deficiencies, the Stage 2 process could last from several weeks to several years.

To aid in the Stage 2 evaluation process, projects are assigned to one or up to four categories, with input from applicable regulatory and enforcement programs, including coordination with the Office of Enforcement and Compliance Assurance (OECA) staff to determine if enforcement or regulatory actions are pending or underway at each proposed project site. In those cases where a project includes more than one category, GLNPO will determine the appropriate category and the applicable cost share for each component of the project, and pro-rate the overall cost share requirement proportional to the project costs from each category. For all project categories, GLNPO will seek to evaluate the extent to which proposed projects address the restoration of beneficial uses, per the Great Lakes Water Quality Agreement.

Category 1: Formal enforcement/regulatory evaluation completed, no action is anticipated by any governmental body against any entity. No restrictions on GLLA implementation. GLNPO will require a non-Federal cost share minimum of 35 percent.

Category 2: No enforcement, regulatory or CERCLA response actions are pending. GLNPO will coordinate with enforcement/regulatory programs to verify that no actions are pending or planned for the site. In cases where the non-Federal sponsor is a nonliable public entity, the non-Federal cost would typically be 35%. Additionally, it is possible that through consultation with Superfund, projects may be identified that although Superfund has the potential to conduct the project, it is more appropriate to use the Legacy Act. For projects in this situation, GLNPO will require a non-Federal cost share of greater than 35%.

Category 3: A decision document under Superfund, or a settlement agreement under another applicable state or Federal authority, has been signed. GLNPO will not provide any funding for implementation of the decision document or settlement agreement. Instead, GLNPO may use GLLA funding for the portions of these sites not addressed by the Superfund decision document or settlement agreement where enforcement or regulatory actions are not anticipated. GLLA may be used to provide betterments or enhancements to the required elements of the decision document to address the U.S. Government's commitment under the Great Lakes Water Quality Agreement. For Category 3 projects, the non-Federal sponsor at these sites will be required to contribute at least 40%.

Category 4: Enforcement, regulatory or CERCLA response actions pending but no settlement has been reached. If Legacy Act funds are used for a project where enforcement, regulatory or CERCLA response actions are pending but no settlement has been reached, GLNPO will work and coordinate with the applicable enforcement or regulatory program to determine the appropriate project delineation and cost distribution between the Legacy Act and the other program. The appropriate GLLA share for conducting a project that meets the combined objectives of the enforcement program and the Great Lakes Water Quality Agreement will be determined through discussions with the applicable enforcement authority. The non-Federal sponsor at these sites will be required to contribute at least 50%.

GLNPO utilizes TRC input to work with the applicant to modify proposed projects and ensure that the proposed project meets the technical requirements for implementation. Once this step is complete, GLNPO compiles information from the Stage 2 review for presentation to the Great Lakes National Program Manager in the project selection and funding process. As part of this compilation process, GLNPO completes a Great Lakes Legacy Act Scoring Sheet (Attachment A; http://www.epa.gov/​glla/​rule/​scor_​sheet.html) for each project. The scoring sheet represents a summary of:

1. “Strength of Proposal” (see http://www.epa.gov/​glla/​rule/​str_​pro.html);

2. Success in addressing statutory priorities of the Legacy Act (i.e., identified in a RAP and ready to be implemented, includes sediment remediation to be commenced within one year, and use of an innovative approach, technology, or technique);

3. Other relevant policy factors (e.g., including presence of Potentially Responsible Party (PRP), project category, eligibility for other cleanup programs, the ability to delist an AOC at the end of the project, and the non-Federal contribution).

The Step 2 evaluation process assigns a score based on relevant factors that allows the decision-maker to identify projects that are technically sound and represent the best use of program resources.

Step 3: Project Selection and Funding:

In Step 3, every six (6) months, or at other appropriate intervals, but never less frequently than once each year, GLNPO prepares a project ranking based on scores computed on a Great Lakes Legacy Act Scoring Sheet (Attachment A) for all pending projects. GLNPO then provides this ranking, along with a Proposal Scoring and Summary Information sheet (http://www.epa.gov/​glla/​rule/​scor_​summ_​sheet.html) and a “Minimum Requirements Check” (http://www.epa.gov/​glla/​rule/​min_​req.html), a “Strength of Proposal” (http://www.epa.gov/​glla/​rule/​str_​pro.html), and a Great Lakes Legacy Act Scoring Sheet to the Great Lakes National Program Manager who, in consultation with the USEPA Office of Water, and taking into account available GLLA funding, selects projects for which formal Project Agreement (PA) negotiations will be initiated.

Given the complications that can occur when planning and implementing a sediment remediation project, GLNPO continually evaluates each proposed project. A project's ranking may evolve or change through several ranking cycles as an applicant addresses EPA concerns with its application or other project circumstances change.

Once a project has been selected for potential funding, GLNPO and the Office of Regional Counsel (ORC) begin Project Agreement discussions with the non-Federal sponsor of the project. The PA is a legal agreement between GLNPO and the non-Federal sponsor that memorializes each entity's legal and financial responsibilities and requirements. GLNPO, ORC and Headquarters staff, as required, will coordinate closely during PA development to ensure that legal, financial, and technical requirements are clearly identified. If complications arise during the PA discussions that result in delays in signing the agreement, the project may be reevaluated to determine the potential impact of the delays on project schedule; and therefore, these complications may also impact project priority.

The signing of a PA represents an Agency decision to fund a Legacy Act project. It is important to note that no official funding decision is made prior to PA signing, and, therefore, Legacy Act funds remain available for all potential projects until a PA is signed. Projects will be periodically evaluated and compared until a PA is signed.

Once a PA is signed, the implementation phase of the project can begin, including, but not limited to, issuing a work order with an EPA contractor or entering into an Interagency Agreement with the Corps of Engineers. It is GLNPO's goal to work with the non-Federal sponsors, other Federal agencies, other EPA program offices, state and local governments, and the public to implement the Legacy Act in order to clean up contaminated sediment sites throughout the Great Lakes, and ultimately begin delisting AOCs, under provisions of the Great Lakes Water Quality Agreement. Project management and oversight will be performed by GLNPO, in consultation with the USEPA Office of Water. Each project will have a GLNPO project manager who will convene a project management team consisting of representatives from the non-Federal sponsor, the EPA contractor, and appropriate project personnel and other involved stakeholders. The project agreement will not relieve any third party from any liability that may arise under CERCLA, RCRA, TSCA, or other Federal environmental statutes.

VI. Statutory and Executive Order Reviews

Under Executive Order 12866 (58 FR 51735, October 4, 1993), this action is not a “significant regulatory action” and is therefore not subject to OMB review. Because this action is not subject to notice and comment requirements pursuant to 5 U.S.C. 553(a)(2) and 553(b)(A), it is not subject to the Regulatory Flexibility Act (5 U.S.C. section 601 et seq.) or sections 202 and 205 of the Unfunded Mandates Reform Act of 1999 (UMRA) (Pub. L. 104-4). In addition, this action does not significantly or uniquely affect small governments. This action does not have Tribal implications, as specified in Executive Order 13175 (63 FR 67249, November 9, 2000). This action will not have federalism implications, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999). This action is not subject to Executive Order 13211, “Actions Concerning Regulations that Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001), because it is not a significant regulatory action under Executive Order 12866. This action does not involve technical standards; thus, the requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. This action does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). The Congressional Review Act, 5 U.S.C. 801 et seq., generally provides that before certain actions may take affect, the agency promulgating the action must submit a report, which includes a copy of the action, to each House of the Congress and to the Comptroller General of the United States. Since this final action contains legally binding requirements, it is subject to the Congressional Review Act, and EPA will submit this action in its report to Congress under the Act.

Attachment A—Great Lakes Legacy Act Scoring Sheet

Project #:

Project Title:

Score the project for each evaluation criterion listed below, with higher scores representing a more favorable rating. Provide narrative rationale (4-5 sentences) for total score in the space provided.

1. Measurable environmental results/risk reduction is expected upon project completion, potential for delisting Areas of Concern, soundness of approach, reasonableness of costs, and probability of success. (0 = Low, 35 = High)Score ________

2. Project identified in Remedial Action Plan (RAP). (0 = Low, 5 = High)Score ________

3. Project will use an innovative approach, technology, or technique that may provide equivalent environmental benefits at a reduced cost or greater environmental benefit. (0 = Low, 5 = High)Score ________

4. Probability (based on best professional judgment) that remediation will occur not later than 1 year after the date of the receipt of funds for the project. (0 = Low, 5 = High)Score ________

5. The non-Federal sponsor will exceed the minimum non-Federal cost-share requirements for its respective project category (exceeds category target by 10% = 4 points, 20% = 8 points, 30% = 12 points, and greater than 40% = 15 points; EPA will interpolate between these values if percentages differ from the above numbers).Score ________

6. Project category (Category 1 = 35 points, Category 2 = 25 points, Category 3 = 15 points, and Category 4 = 5 points). Points will be apportioned for multiple-category projects.Score ________

TOTAL SCORE ________

Provide Narrative Discussion

Dated: April 25, 2006.

Stephen L. Johnson,

Administrator.