oversight

Livestock Agriculture: Increased EPA Oversight Will Improve Environmental Program for Concentrated Animal Feeding Operations

Published by the Government Accountability Office on 2003-01-16.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

               United States General Accounting Office

GAO            Report to the Ranking Member,
               Committee on Agriculture, Nutrition
               and Forestry, U.S. Senate


January 2003
               LIVESTOCK
               AGRICULTURE

               Increased
               EPA Oversight
               Will Improve
               Environmental
               Program for
               Concentrated Animal
               Feeding Operations




GAO-03-285
                                               January 2003


                                               LIVESTOCK AGRICULTURE

                                               Increased EPA Oversight Will Improve
Highlights of GAO-03-285, a report to          Environmental Program for Concentrated
the Ranking Member, Committee on
Agriculture, Nutrition and Forestry,           Animal Feeding Operations
U.S. Senate




Congress is concerned that waste               Until the mid-1990s, EPA placed little emphasis on and had directed
from animal feeding operations                 few resources to its animal feeding operations permit program because
continues to threaten water quality.           it gave higher priority to other sources of water pollution. In addition,
In light of this concern, GAO was              regulatory exemptions have allowed many large operations to avoid
asked to review the Environmental              regulation. As a result of these problems, many operations that EPA
Protection Agency’s (EPA)
administration of its regulatory
                                               believes are polluting the nation’s waters remain unregulated.
program for animal feeding
operations and to determine the                Implementation of revised regulations raise management and resource
potential challenges states and EPA            challenges for the states and the agency. For example, because the
may face when they begin to                    number of animal feeding operations subject to the regulations will
implement the revisions to this                increase dramatically, states will need to increase their efforts to identify,
program. GAO surveyed all EPA                  permit, and inspect facilities and take appropriate enforcement actions
regional offices and four states               against those in noncompliance. For its part, EPA will need to increase its
with large numbers of animal                   oversight of state programs to ensure that the new requirements are
feeding operations that may be                 adopted and implemented. Neither the states nor EPA have determined
subject to EPA regulations.                    how they will meet these challenges.


GAO recommends that EPA
•  develop and implement a
   comprehensive tactical plan                 Concentrated Animal Feeding Operation
   that identifies resource
   requirements and how the
   agency will carry out its
   increased oversight
   responsibilities under the
   revised program; and
•  work with authorized states
   to develop and implement
   their own plans that will
   identify resource needs and
   how they intend to carry out
   their increased permitting,
   inspection, and enforcement
   responsibilities within
   specified time frames.




www.gao.gov/cgi-bin/getrpt?GAO-03-285.
                                               A concentrated animal feeding operation is a facility that discharges animal wastes to surface
To view the full report, including the scope   waters under certain conditions and is, therefore, subject to regulation.
and methodology, click on the link above.
For more information, contact Larry Dyckman
at (202) 512-3841 or dyckmanl@gao.gov.
Contents


Letter                                                                                    1
               Results in Brief                                                           3
               Background                                                                 5
               Shortcomings in Regulatory Approach and Oversight Problems
                 Have Limited Effectiveness of the CAFO Program                           6
               EPA’s Revised Regulations Offer Potential to Improve the
                 CAFO Program, but States and EPA Will Face Implementation
                 Challenges                                                             11
               USDA’s Role in Developing Revised Regulations Increased
                 Over Time                                                              13
               Conclusions                                                              14
               Recommendations for Executive Action                                     15
               Agency Comments                                                          15

Appendix I     Scope and Methodology                                                    17



Appendix II    Comments from the Environmental Protection
               Agency                                                                   19



Appendix III   GAO Contact and Staff Acknowledgments                                    21



Figures
               Figure 1: Uncovered Operation                                              8
               Figure 2: Covered Operation                                                9
               Figure 3: EPA Full-Time Equivalent Positions Assigned to Its
                        NPDES Permit Program in Four EPA Regions, 1997-2001             10




               Abbreviations

               CAFO         concentrated animal feeding operation
               EPA          Environmental Protection Agency
               NPDES        National Pollutant Discharge Elimination System
               USDA         U.S. Department of Agriculture



               Page i                     GAO-03-285 Concentrated Animal Feeding Operations
United States General Accounting Office
Washington, DC 20548




                                   January 16, 2003

                                   The Honorable Tom Harkin
                                   Ranking Member
                                   Committee on Agriculture, Nutrition
                                    and Forestry
                                   United States Senate

                                   Dear Senator Harkin:

                                   Livestock production generated $106 billion in farm revenue, or more than
                                   one-half of all farm revenue in 2001. Intensive livestock production—in
                                   which large numbers of poultry, swine, and dairy and beef cattle are held
                                   in confinement facilities—accounted for about $80 billion of this revenue.
                                   These confinement facilities raise concerns about water quality because
                                   the animals produce large quantities of waste—many times more waste
                                   than humans annually—and these wastes contribute to impairment of the
                                   nation’s waterways. To minimize environmental problems, animal feeding
                                   operations contain these wastes in storage facilities and periodically
                                   dispose of them, usually by spreading them on the land as fertilizer.
                                   Despite these efforts, animal feeding operations are significant
                                   contributors to impaired water quality in the nation’s rivers and lakes,
                                   according to the Environmental Protection Agency (EPA).

                                   Because wastes from animal feeding operations may degrade water
                                   quality, the Clean Water Act requires EPA and authorized states to regulate
                                   these operations similar to the way they regulate municipal and industrial
                                   waste treatment facilities. Specifically, EPA developed effluent guidelines
                                   for establishing limits on the discharge of pollutants from these operations
                                   into surface waters. As stipulated in the act, the agency and authorized
                                   states enforce these limits through permits issued under the National
                                   Pollutant Discharge Elimination System (NPDES) permit program.

                                   Animal feeding operations that discharge wastes to surface waters
                                   under certain conditions are called concentrated animal feeding
                                   operations (CAFO) and are required to obtain discharge permits.
                                   CAFOs are generally defined as animal feeding operations that have more
                                   than 1,000 animal units1 but also include smaller operations that discharge


                                   1
                                    An animal unit is a representation of size among animal types EPA uses for permitting
                                   purposes. For example, one animal unit is equivalent to one beef cattle or 2.5 adult swine.



                                   Page 1                              GAO-03-285 Concentrated Animal Feeding Operations
directly into surface waters. EPA has authorized 44 states and the
U.S. Virgin Islands to administer the discharge permit program for CAFOs
since passage of the act in 1972.2 To become an authorized state, the state
must have discharge permit requirements that are at least as stringent as
the requirements imposed under the federal program and must contain
several key provisions such as public participation in issuing permits. The
act provides for EPA’s withdrawal of a state’s authorization if the state has
not adequately administered its program. EPA’s 10 regional offices oversee
the 44 authorized states and the U.S. Virgin Islands and administer the
program directly in the remaining states.3 EPA also provides grants to
authorized states to help them implement the permit program. In fiscal
year 2002, $145 million were appropriated for these grants.

Although it has regulated waste discharges since the mid-1970s, EPA
continues to report serious impairment to the nation’s waters from these
discharges. On October 30, 1989, the Natural Resources Defense Council
and Public Citizen sued EPA,4 alleging that the agency had failed to comply
with the Clean Water Act.5 In the ensuing settlement, EPA agreed to,
among other things, revise its effluent limitation guidelines and permitting
regulations for CAFOs.6 As agreed, EPA published proposed revisions to
the regulations for public comment in January 2001 and issued its final
regulations on December 15, 2002.

You asked us to (1) identify the key shortcomings of the of CAFO program,
(2) assess the potential challenges the states and EPA may face when
implementing revisions to the CAFO regulations, and (3) determine the
extent of U.S. Department of Agriculture’s (USDA) involvement in
developing the proposed revisions to EPA’s regulations. To address the
first and second objectives, we, among other things, surveyed all 10 EPA


2
 Although Oklahoma is authorized to implement other aspects of the permit program, it is
not authorized to administer the CAFO program.
3
 Alaska, Idaho, Massachusetts, New Hampshire, New Mexico, and Oklahoma are not
currently authorized.
4
 Natural Resources Defense Council and Public Citizen are nonprofit organizations that
advocate for environmental and consumer protection, among other issues.
5
 Natural Resources Defense Council, Inc. v. Reilly, Civ. No. 89-2980 (RCL) (D.D.C.),
October 30, 1989.
6
 Plaintiffs and EPA agreed to an initial settlement on January 31, 1992, which has been
modified several times, to establish a schedule for EPA to propose and take final action on
18 point source categories, including CAFOs.




Page 2                              GAO-03-285 Concentrated Animal Feeding Operations
                   regional offices and interviewed EPA officials in four of the regions. These
                   four regions oversee the 23 states that have an estimated 70 percent of
                   large animal feeding operations that could be defined as CAFOs under the
                   revised regulations. We also interviewed state officials in four states—
                   Iowa, North Carolina, Pennsylvania, and Wisconsin—that have large
                   numbers of confined poultry, swine, dairy, and beef cattle operations. To
                   address the third objective, we interviewed agency officials, reviewed
                   relevant documents, and observed meetings between the agencies.
                   Appendix I contains further details of our scope and methodology.


                   The CAFO program has had two major shortcomings. First, exemptions
Results in Brief   in EPA’s regulations allowed an estimated 60 percent of animal feeding
                   operations with more than 1,000 animal units to avoid regulation.
                   Specifically, animal feeding operations that discharged waste into
                   waterways only during a 25-year, 24-hour storm event—the amount
                   of rainfall during a 24-hour period that occurs on average once every
                   25 years—or greater were not explicitly defined as CAFOs and did not
                   require permits. Additionally, chicken operations with dry manure-
                   handling systems were not generally required to obtain permits. Finally,
                   animal wastes applied to crop and pastureland were generally not
                   regulated under the CAFO program.

                   Second, EPA’s limited oversight of the states has contributed to
                   inadequate implementation by some authorized states. For example,
                   our surveys show that 11 authorized states with over 1,000 large animal
                   feeding operations do not issue discharge permits that contain all required
                   elements. Three of these states have not issued any discharge permits
                   to their operations, thereby leaving these facilities and their wastes
                   essentially unregulated by the CAFO program. EPA officials acknowledge
                   that they have historically paid little attention to the state CAFO programs
                   because they gave higher priority to other sources of pollution, such as
                   industrial and municipal waste treatment facilities, considered the major
                   sources of water impairment. In addition, EPA officials stated that the
                   agency’s only leverage to compel states to implement the program with all
                   federal requirements is to either withhold the grant funding to states for
                   program operations or retract the state’s authority to run the entire
                   NPDES permit program—including the components that regulate
                   industrial and municipal waste treatment facilities. EPA is reluctant to use
                   these tools because it maintains that withholding grant funding would
                   further hamper the states’ ability to effectively implement their programs,
                   and EPA does not have the resources to directly implement the entire
                   permit program in additional states. However, EPA has recently devoted


                   Page 3                        GAO-03-285 Concentrated Animal Feeding Operations
more attention and resources to the CAFO program and, as a result, has
had some limited success in persuading authorized states to improve their
programs without resorting to these tools. For example, in 2002, EPA
persuaded several states to begin to issue discharge permits that meet all
EPA requirements.

EPA recently issued revisions to its regulations that would (1) eliminate
the 25-year, 24-hour storm discharge exemption, (2) require chicken
operations that use dry manure-handling systems to obtain permits, and
(3) subject wastes applied to crop and pastureland under the control of
the CAFO operator to permit requirements. Although the revised
regulations address some of the key shortcomings of the program, they
raise even greater management challenges for the states and EPA. By
extending coverage to previously exempt animal feeding operations, we
estimate that the revised regulations could increase the number of
operations required to obtain permits by an estimated 7,000—from the
about 4,500 permits currently issued to about 11,500. These changes, along
with extending permit coverage to the application of animal waste to crop
and pastureland controlled by the CAFO operator, will create a resource
and administrative challenge for the states. Specifically, states will need to
increase their efforts to identify, permit, and inspect CAFOs and take
appropriate enforcement actions against those in noncompliance. For its
part, EPA will need to increase its oversight of state programs to ensure
that the new requirements are adopted and implemented. This oversight
effort will be significant in light of the large number of animal feeding
operations that will need permits under the revised regulations. However,
neither EPA nor the states we reviewed have developed plans—including
the identification of resource requirements—for carrying out their
increased responsibilities. We are making recommendations to
EPA designed to increase the probability that the new program will
be effective.

EPA did not formally consult with USDA when developing the proposed
CAFO regulations, but USDA was increasingly involved in developing
the revised regulations. EPA published the proposed regulations in
January 2001 without allowing sufficient time for USDA to fully assess the
proposed revisions. In June 2001, to help address USDA’s concerns, EPA
and USDA established a collaborative interagency working group. USDA’s
role in the working group was to provide technical information that
identified how the regulations might adversely affect the livestock industry
and to suggest alternative approaches that would mitigate these effects,
such as allowing states greater flexibility in regulating smaller animal



Page 4                         GAO-03-285 Concentrated Animal Feeding Operations
                 feeding operations. EPA and USDA officials said this arrangement has
                 worked well.

                 To help ensure that the potential benefits of the CAFO program are
                 realized, we are recommending that EPA develop and implement a
                 comprehensive tactical plan that identifies how the agency will carry out
                 its increased oversight responsibilities under the revised program. In
                 addition, we are recommending that EPA work with authorized states to
                 develop and implement their own plans that identify how they intend to
                 carry out their increased permitting, inspection, and enforcement
                 responsibilities within specified time frames.

                 We provided EPA and USDA with a draft of this report for review and
                 comment. Both EPA and USDA provided technical comments that we
                 incorporated into the report as appropriate. EPA and USDA agreed with
                 our findings and recommendations. EPA provided written comments that
                 are presented in appendix II; USDA provided oral comments.


                 Discharge permits establish limits on the amounts and types of pollutants
Background       that can be released into waterways. Under the Clean Water Act,
                 concentrated animal feeding operations that discharge pollutants to
                 surface waters must obtain permits from EPA or authorized states.
                 However, unlike municipal and most industrial facilities that are allowed
                 to discharge some waste, concentrated animal feeding operations are
                 required to construct and operate facilities that do not release any waste
                 to surface waters, except in extraordinary circumstances.

                 Under EPA’s prior regulations, animal feeding operations could be defined
                 as CAFOs and require discharge permits if they, among other things

             •   had more than 1,000 animal units,
             •   had more than 300 animal units and either discharged through a man-made
                 device into navigable waters or directly into waters of the United States
                 that originate outside the facility, or
             •   were of any size but had been determined by EPA or the state permitting
                 authority to contribute significantly to water pollution.

                 Under these regulations, a large animal feeding operation did not need a
                 permit if it only discharged during a 25-year, 24-hour storm event—the
                 amount of rainfall during a 24-hour period that occurs on average once
                 every 25 years or more. In addition, the regulations did not generally
                 require permits for chicken operations that use dry manure-handling


                 Page 5                       GAO-03-285 Concentrated Animal Feeding Operations
                        systems—that is, systems that do not use water to handle their waste.
                        Further, animal wastes that were applied to crop and pastureland were
                        generally not regulated.

                        EPA has authorized 44 states and the U.S. Virgin Islands to administer
                        the discharge permit program for CAFOs. To become an authorized state,
                        the state must have discharge permit requirements that are at least as
                        stringent as the requirements imposed under the federal program and must
                        contain several key provisions. These provisions include allowing for
                        public participation in issuing permits; issuing permits that must be
                        renewed every 5 years; including authority for EPA and authorized states
                        to take enforcement action against those who violate permit conditions;
                        and providing for public participation in the state enforcement process by
                        either allowing the public to participate in any civil or administrative
                        action or by providing assurance that the state will investigate citizen
                        complaints. According to EPA, public participation in the permitting and
                        enforcement process is critical because it allows the public to express its
                        views on the proposed operations and to assist EPA and state authorities
                        in ensuring that permitted operations remain in compliance.


                        The CAFO program has had two major shortcomings that have led to
Shortcomings in         inconsistent and inadequate implementation by the authorized states.
Regulatory Approach     These shortcomings include (1) exemptions in EPA’s regulations that have
                        allowed as many as 60 percent of the largest animal feeding operations to
and Oversight           avoid obtaining permits and (2) minimal oversight of state CAFO programs
Problems Have           by EPA. Although EPA maintains that it has limited tools to compel states
                        to properly implement the CAFO program, it recently has had limited
Limited Effectiveness   success in persuading some authorized states to begin issuing discharge
of the CAFO Program     permits that include all program requirements.


Exemptions in EPA’s     Two exemptions in CAFO regulations have allowed large numbers of
Rules Allowed Most      animal feeding operations to avoid obtaining discharge permits. However,
Animal Feeding          EPA believes that many of these operations may degrade water quality.
                        The first exemption allowed operations to avoid obtaining discharge
Operations to Avoid     permits if they discharge waste only during 25-year, 24-hour rainstorm
Regulation              events. However, based on its compliance and enforcement experience,
                        EPA believes that many of the operations using this exemption should, in
                        fact, have a discharge permit because they are likely discharging more
                        frequently. For example, when EPA proposed changes to the CAFO
                        regulations, it stated that operations using this exemption were not taking
                        into consideration discharges that may occur as a result of overfilling the


                        Page 6                        GAO-03-285 Concentrated Animal Feeding Operations
                             waste storage facility, accidental spills, or improper land application of
                             manure and wastewater. The second exemption allowed about 3,000
                             confined chicken operations that use dry manure-handling systems to
                             avoid obtaining permits. EPA believes that chicken operations using dry
                             manure-handling systems should obtain permits because EPA and state
                             water quality assessments found that nutrients from confined chicken
                             operations, similar to other large livestock operations, contaminate waters
                             through improper storage, accidental spills, and land application.

                             As a result of these exemptions, we estimate that only about 40 percent
                             (4,500 of 11,500) of confined animal feeding operations currently have
                             discharge permits.7 In addition, EPA believes about 4,000 smaller animal
                             feeding operations may threaten water quality and may also need to be
                             permitted. According to EPA and state officials, these smaller operations
                             are generally not permitted because federal and state programs have
                             historically focused their limited resources dedicated to CAFOs on
                             regulating only the largest operations.


EPA’s Limited Oversight of   EPA’s limited oversight of the states has contributed to inconsistent and
States’ CAFO Programs        inadequate implementation by the authorized states.8 In particular, our
Has Contributed to           surveys show that 11 authorized states—with a total of more than
                             1,000 large animal feeding operations–do not properly issue discharge
Inconsistent and             permits. Although eight of these states issue some type of permit to
Inadequate                   CAFOs, the permits do not meet all EPA requirements, such as including
Implementation               provisions for public participation in issuing permits. The remaining three
                             states do not issue any type of permit to CAFOs, thereby leaving facilities
                             and their wastes essentially unregulated. EPA officials believe that most
                             large operations either discharge or have a potential to discharge animal
                             waste to surface waters and should have discharge permits.




                             7
                               Since EPA and most states do not know precisely how many animal feeding operations
                             should have discharge permits, USDA estimated the number of potential CAFOs based on
                             livestock type and the number of animals on the farm from the 1997 Census of Agriculture.
                             See USDA, Profile of Farms with Livestock in the United States: A Statistical Summary
                             (Washington, D.C.: February 2002).
                             8
                               We did not evaluate how EPA administered the program in the states not authorized to
                             implement the CAFO program because these states contained fewer than 5 percent of
                             large CAFOs.




                             Page 7                             GAO-03-285 Concentrated Animal Feeding Operations
The two states that lead the nation in swine production illustrate how
programs can meet some EPA permit requirements but not others. For
example, while Iowa’s permits for uncovered operations (see fig. 1) meet
all program requirements, its permits for covered operations (see fig. 2) do
not. Contrary to EPA requirements that permits are renewed every 5 years,
Iowa issues these permits for indefinite periods of time. While North
Carolina issues permits to both covered and uncovered animal feeding
operations, these permits do not include all EPA requirements, such as
provisions for public participation or allowing for EPA enforcement of the
state permit.

Figure 1: Uncovered Operation




Page 8                          GAO-03-285 Concentrated Animal Feeding Operations
Figure 2: Covered Operation




Michigan and Wisconsin also illustrate how two authorized states
with a similar number of animal feeding operations differ in program
implementation. According to USDA estimates, both states have over
100 operations with more than 1,000 animal units that could be defined
as CAFOs. While Wisconsin had issued 110 permits to these operations,
Michigan had not issued any, according to our survey.9 As a result, waste
discharges from facilities in Michigan remained unregulated under the
CAFO program.

EPA officials acknowledged that until the mid-1990s the agency had
placed little emphasis on and directed few resources to the CAFO program
and that this inattention has contributed to inconsistent and inadequate
implementation by authorized states. Instead, the agency gave higher
priority and devoted greater resources to its permit program for the more
traditional point sources of pollution—industrial and municipal waste


9
 On December 13, 2002, Michigan established procedures for issuing CAFO
discharge permits.




Page 9                            GAO-03-285 Concentrated Animal Feeding Operations
treatment facilities. However, as EPA’s and the states’ efforts have
reduced pollution from these sources, concerns grew in the 1990s that the
increasing number of large concentrated animal feeding operations could
potentially threaten surface water quality. In response, EPA began placing
more emphasis and directing more resources to the CAFO program. As a
result, some states that had not previously issued discharge permits began
to do so.

As shown in figure 3, EPA has historically assigned significantly more
personnel resources to the industrial and municipal portions of the
NPDES permit program. In the four regions we reviewed, the number of
full-time equivalent positions dedicated to the CAFO program has
increased since 1997—from 1 to 6 percent—but this increase has, for the
most part, been at the expense of the industrial and municipal portions of
the permit program. EPA officials told us that due to budget constraints,
any increase in resources in one program area requires the reduction of
resources in others.

Figure 3: EPA Full-Time Equivalent Positions Assigned to Its NPDES Permit
Program in Four EPA Regions, 1997-2001




Page 10                         GAO-03-285 Concentrated Animal Feeding Operations
                      In addition to resource constraints, EPA officials say that the agency has
                      little leverage to compel states to issue permits with all required elements
                      because the agency’s primary recourses in such situations are to either
                      (1) withhold grant funding it provides to states for program operations
                      or (2) withdraw the states’ authority to run the entire NPDES permit
                      program, including the regulation of industrial and municipal waste
                      treatment facilities. EPA has been reluctant to use these tools because it
                      maintains that withholding grant funding would further weaken the states’
                      ability to properly implement the program and EPA does not have the
                      resources to directly implement the permit program in additional states.
                      To date, EPA has never withheld grants or withdrawn a state’s authority.

                      However, EPA has had limited success in persuading some authorized
                      states to begin issuing discharge permits with all EPA requirements. For
                      example, Michigan has been an authorized state since 1973, but only
                      agreed in 2002 to begin issuing discharge permits. This agreement
                      followed an EPA investigation that revealed several unpermitted CAFOs.
                      Similarly, EPA recently persuaded Iowa to increase the issuance of
                      discharge permits to uncovered feedlots. However, to date the agency
                      has not been able to convince the state to issue permits to its covered
                      operations, even though EPA believes these types of operations should
                      also have permits. In 2002, EPA was also successful in persuading three
                      other authorized states—Florida, North Carolina, and South Carolina—to
                      begin issuing discharge permits that meet all program requirements.


                      According to our surveys of the regions and states, EPA’s revised
EPA’s Revised         regulations—eliminating the 25-year, 24-hour storm exemption; explicitly
Regulations           including dry-manure chicken operations; and extending permit coverage
                      to include the land application areas under the control of CAFO—address
Offer Potential to    some key problems of the CAFO program. However, they will also
Improve the           increase EPA’s oversight responsibility and require authorized states to
                      increase their permitting, inspection, and enforcement activities.
CAFO Program, but     Furthermore, neither EPA nor the states have planned how they will face
States and EPA Will   these challenges or implement the revised program.
Face Implementation
Challenges




                      Page 11                       GAO-03-285 Concentrated Animal Feeding Operations
Revisions Will Help        EPA’s decision to eliminate regulatory exemptions should strengthen the
Address Regulatory         permit program because the revised regulations will extend coverage to
Problems by Requiring      more animal feeding operations that have the potential to contaminate
                           waterways. As previously mentioned, the 25-year, 24-hour storm
Potential Dischargers to   exemption has proven particularly problematic for EPA and the states
Obtain Permits             because it allowed CAFO operators to bypass permitting altogether. By
                           eliminating this exemption, we estimate that an additional 4,000 large
                           animal feeding operations will require permits. According to our survey
                           results, the elimination of this exemption could significantly improve the
                           program. In addition, EPA’s decision to also explicitly require permits for
                           large dry-manure chicken operations will increase the number of
                           permitted facilities by another 3,000. Lastly, CAFO operators are, for the
                           first time, required to either (1) apply for a permit or (2) provide evidence
                           to demonstrate that they have no potential to discharge to surface waters.

                           In addition to eliminating regulatory exemptions, EPA also extended
                           permit coverage to include the application of animal waste to crop and
                           pastureland controlled by the CAFO. Specifically, CAFO operators who
                           apply manure to their land will be required to develop and implement
                           nutrient management plans that, among other things, specify how much
                           manure can be applied to crop and pastureland to minimize potential
                           adverse effects on the environment. CAFO operators will need to maintain
                           the plan on site and, upon request, make it available to the state permit
                           authority for review.


Authorized States          Although EPA believes that the revised regulations will improve the
Will Face Challenges       CAFO program, the changes will create resource and administrative
Implementing the           challenges for the authorized states. We estimate that the revised
                           regulations could increase the number of operations required to obtain
Revised Regulations        permits by an estimated 7,000—from about 4,500 permits currently issued,
                           to about 11,500. States will therefore need to increase their efforts to
                           identify, permit, and inspect animal feeding operations and, most likely,
                           will have to increase their enforcement actions. However, many states
                           have not yet identified and permitted CAFOs that EPA believes should
                           already have been covered by the CAFO program. Therefore, increased
                           permitting requirements could prove to be a daunting task. For example,
                           Iowa has only permitted 32 operations out of more than 1,000 of its animal
                           feeding operations that have more than 1,000 animal units. Furthermore,
                           states may need to identify and permit an estimated 4,000 operations with
                           fewer than 1,000 animal units that EPA believes may be discharging.
                           Finally, when states inspect CAFOs, they will need to determine if the
                           operation’s nutrient management plan is being properly implemented.


                           Page 12                        GAO-03-285 Concentrated Animal Feeding Operations
                            According to state officials, meeting these demands will require additional
                            personnel. However, most of the states we visited cannot hire additional
                            staff and would have to redeploy personnel from other programs. For
                            example, Iowa and North Carolina, two states with a large number of
                            potential CAFOs, each have less than one full-time employee working in
                            the CAFO program.


EPA’s Oversight of States   While the burden of implementing the revised regulations will fall
Will Need to Increase       primarily on the states, EPA will need to increase its oversight of state
                            programs to ensure that the states properly adopt and implement the new
                            requirements. This oversight effort will be especially important in light of
                            the large number of animal feeding operations that will need permits
                            under the revised regulations. Although most of the regions have not
                            determined precisely what additional resources they will need to
                            adequately carry out their increased responsibilities, EPA officials told
                            us that, like the states, they will have to redeploy resources from
                            other programs.


EPA and States Have Not     Despite the challenges that EPA and the states will face in implementing
Prepared for Additional     the revised CAFO program, they have not yet prepared for their additional
Responsibilities            responsibilities. According to our survey of 10 EPA regions, the regions
                            and states have not estimated the resources they will need to implement
                            the revised CAFO program. EPA, for its part, has not developed a plan
                            for how it intends to carry out its increased oversight responsibilities
                            under the revised regulations, such as ensuring that authorized states
                            properly permit and inspect CAFOs and take appropriate enforcement
                            action. EPA and state officials told us they intend to wait until the revised
                            regulations are issued before they begin planning for their implementation.


                            EPA did not formally consult with USDA when it was developing the
USDA’s Role in              proposed CAFO regulations published in January 2001, but the department
Developing Revised          has played a greater role in providing input for the revised regulations.
                            EPA and USDA developed a joint animal feeding operation strategy in 1998
Regulations Increased       to address the adverse environmental and public health effects of animal
Over Time                   feeding operations. However, USDA’s involvement in developing the
                            proposed CAFO regulations was generally limited to responding to EPA
                            requests for data. USDA officials told us that they were asked to provide
                            substantive comments only after the Office of Management and Budget
                            suggested that EPA solicit USDA’s views. However, USDA officials
                            maintained that they did not have sufficient time to fully assess the


                            Page 13                       GAO-03-285 Concentrated Animal Feeding Operations
              proposed regulations and discuss its concerns with EPA before the
              proposed regulations were published in January 2001.

              In June 2001, to address USDA concerns, EPA and USDA established
              an interagency workgroup on the proposed revisions to the CAFO
              regulations. Under this arrangement, USDA provided technical
              information that identified how the proposed regulations could adversely
              affect the livestock industry and suggested alternative approaches that
              would mitigate these effects. For example, through this interagency
              workgroup, USDA suggested that EPA consider allowing states greater
              flexibility in regulating smaller operations. USDA also raised concerns that
              EPA’s proposed nutrient management plan was not entirely consistent
              with USDA’s existing comprehensive nutrient management plan and
              would be confusing to operators. EPA agreed to take these concerns into
              consideration when it prepared the final revisions to the regulations.

              In July 2001, to further strengthen the cooperative process, EPA and USDA
              developed Principles of Collaboration to ensure that the perspectives of
              both organizations are realized. In essence, the principles recognize that
              USDA and EPA have clear and distinct missions, authorities, and
              expertise, yet can work in partnership on issues on mutual concern.
              To ensure that both EPA and USDA work together constructively, the
              principles call for EPA and USDA to establish mutually agreeable time
              frames for joint efforts and provide adequate opportunities to review and
              comment on materials developed in collaboration prior to public release.
              According to USDA and EPA officials, this new arrangement has improved
              the agencies’ working relationship.


              Although EPA has historically given the CAFO program relatively low
Conclusions   priority, it has recently placed greater attention on it as a result of the
              1989 lawsuit and the growing recognition of animal feeding operations’
              contributions to water quality impairment. The implementation of the
              CAFO program has been uneven because of regulatory exemptions and
              the lower priority EPA and the states have assigned to it. Although
              EPA has had some recent success in persuading states to begin issuing
              discharge permits that include all program requirements, agency officials
              say that their ability to compel states to do so is limited. While the revised
              regulations will help address the regulatory problems, they will also
              increase states’ burdens for permitting, inspecting, and taking enforcement
              actions. Because several states have yet to fully implement the previous,
              more limited, program, EPA will need to increase its oversight of state
              programs in order to ensure that the new requirements are properly


              Page 14                       GAO-03-285 Concentrated Animal Feeding Operations
                      adopted and carried out by the states. EPA and the states have not
                      identified what they will need to do—or the required resources—to carry
                      out these increased responsibilities. For example, they have not
                      determined how they intend to accomplish their expanded roles and
                      responsibilities within current staff levels.


                      To help ensure that the potential benefits of the revised CAFO program are
Recommendations for   realized, we recommend that the Administrator, EPA,
Executive Action
                  •   develop and implement a comprehensive tactical plan that identifies how
                      the agency will carry out its increased oversight responsibilities under the
                      revised program. Specifically, this plan should address what steps the
                      agency will take to ensure that authorized states are properly permitting
                      and inspecting CAFOs and taking appropriate enforcement actions against
                      those in noncompliance. In addition, the plan should identify what, if any,
                      additional resources will be needed to carry out the plan and how these
                      resources will be obtained; and
                  •   work with authorized states to develop and implement their own plans
                      that identify how they intend to carry out their increased permitting,
                      inspection, and enforcement responsibilities within specified time frames.
                      These plans should also address what, if any, additional resources will be
                      needed to properly implement the program and how these resources will
                      be obtained.

                      We provided EPA and USDA with a draft of this report for review and
Agency Comments       comment. The Director of Animal Husbandry and Clean Water Programs,
                      along with other USDA officials, provided oral comments for USDA. EPA
                      provided written comments. Both agencies expressed agreement with the
                      findings and recommendations in the report. EPA and USDA also provided
                      technical comments that we incorporated into the report as appropriate.
                      EPA’s written comments are presented in appendix II.

                      We are sending copies of this report to the Administrator of the
                      Environmental Protection Agency, the Secretary of Agriculture,
                      appropriate congressional committees, and other interested parties.
                      We will also make copies available to others upon request. In addition,
                      the report will be available at no charge on the GAO Web site at
                      http://www.gao.gov.




                      Page 15                       GAO-03-285 Concentrated Animal Feeding Operations
If you or your staff have any questions about this report, please call me at
(202) 512-3841. Key contributors to this report are listed in appendix III.

Sincerely yours,




Lawrence J. Dyckman
Director, Natural Resources
 and Environment




Page 16                       GAO-03-285 Concentrated Animal Feeding Operations
                Appendix I: Scope and Methodology
Appendix I: Scope and Methodology


                To determine the problems EPA faced in administering the CAFO
                program and the potential challenges the states and EPA may face
                when implementing revisions to its CAFO regulations, we surveyed all
                10 EPA regional offices. Our survey asked regional officials to provide
                information on program management and oversight of authorized states’
                CAFO programs, resources dedicated to the program, problems EPA has
                faced administering the program, and the potential challenges the states
                and EPA might face in implementing revisions to the CAFO program.

                In addition, we interviewed EPA officials in 4 of the 10 regions. We
                judgmentally selected the 4 regions that represent 23 states with an
                estimated 70 percent of large animal feeding operations that could be
                designated as CAFOs under the revised regulations. Because EPA and
                most states do not know precisely how many animal feeding operations
                should have discharge permits, we used USDA’s estimate of the number of
                potential CAFOs based on livestock type and the number of animals on the
                farm from the 1997 Census of Agriculture. These regions and their
                represented states are

            •   Region 3–Philadelphia: Delaware, Maryland, Pennsylvania, Virginia, and
                West Virginia;
            •   Region 4–Atlanta: Alabama, Florida, Georgia, Kentucky, Mississippi, North
                Carolina, South Carolina, and Tennessee;
            •   Region 5–Chicago: Illinois, Indiana, Michigan, Minnesota, Ohio, and
                Wisconsin; and
            •   Region 7–Kansas City: Iowa, Kansas, Missouri, and Nebraska.

                To determine how the 44 authorized states and the U.S. Virgin Islands
                administer the program and to obtain their views on the challenges they
                might encounter in implementing the revised regulations, we interviewed
                program officials in four authorized states—Iowa, North Carolina,
                Pennsylvania, and Wisconsin. We judgmentally selected these states from
                among the four regions we visited because they have large numbers of
                confined poultry, swine, and dairy and beef cattle operations. We did not
                evaluate how EPA directly administers the program in the states and
                territories not authorized to implement the CAFO program because these
                states contained less than 5 percent of large CAFOs. EPA administers the
                program directly because these states have not asked for authority to
                administer the program.




                Page 17                             GAO-03-285 Concentrated Animal Feeding Operations
Appendix I: Scope and Methodology




To examine the extent of USDA’s involvement in developing the proposed
revisions to EPA’s CAFO regulations, we interviewed officials in USDA’s
Natural Resources Conservation Service and EPA. We also observed an
EPA and USDA Working Group Meeting on Concentrated Animal
Feeding Operations.

We conducted our review from January 2002 through October 2002 in
accordance with generally accepted government auditing standards.




Page 18                             GAO-03-285 Concentrated Animal Feeding Operations
             Appendix II: Comments from the Environmental Protection Agency
Appendix II: Comments from the
Environmental Protection Agency




             Page 19                           GAO-03-285 Concentrated Animal Feeding Operations
Appendix II: Comments from the Environmental Protection Agency




Page 20                           GAO-03-285 Concentrated Animal Feeding Operations
                  Appendix III: GAO Contact and Staff
Appendix III: GAO Contact and
                  Acknowledgments



Staff Acknowledgments

                  Greg Kosarin, (202) 512-6526
GAO Contact


                  In addition to the individual named above, Mary Denigan-Macauley,
Acknowledgments   Oliver Easterwood, Lynn Musser, Paul Pansini, and John C. Smith made
                  key contributions to this report.




                  Page 21                           GAO-03-285 Concentrated Animal Feeding Operations
(360166)
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