Environmental Quality Restricted Environmental Quality Restricted Account (EQRA)Account (EQRA)BackgroundBackground

Bill SinclairBill Sinclair

Acting Executive DirectorActing Executive Director

Utah Department of Environmental QualityUtah Department of Environmental Quality

May 28, 2009May 28, 2009

EQRA - BackgroundEQRA - Background

• Disposal fees originally established in 1985 to fund the Hazardous Waste program

• First fee was on hazardous waste at $6/ton • EQRA codified in UCA 19-1-108 in 1996• EQRA provides revenue for regulation of solid,

hazardous, and radioactive waste– Funded through disposal fees paid by operators of

commercial solid, hazardous, radioactive waste facilities and municipal solid waste landfills

– Amount of waste varies month to month, year to year, waste by waste, making revenues vary

Principles of EQRAPrinciples of EQRACurrent StateCurrent State

• Until recently, has provided a sufficient source of funding to account for fluctuations in waste volumes

• Covers entire waste management program• Fees are not dedicated to a specific

function or site • Scope of waste facility operations and

oversight does not decrease with reduced volumes coming into facilities

Environmental Quality Restricted Account

Incoming Funds- Statutory

Year fee was last raised

Incoming Funds - Fee Schedule

Year fee was last raised

Solid Waste Construction

and Demolition Waste Facility

Fee

$2.50/ton

2006

Radioactive Waste Fees

$0.15/cubic feet and $1/curie for LLW or $28/ton Mixed

2001

Generator Site Access Permit Annual Fees

$2,500 per generator $7,500 for brokers

2009

Uranium Mill Monthly Fees

$5,833 (standby) $8,333 (operating)

2009

Hazardous Waste Fees

$28/ton 1993 unless treated which is $14/ton 1997

Commercial Solid Waste Facility Fees

$2.50/ton

2006

Municipal Solid Waste Facility Annual

Fee

Average: $0.13/ton

2003

PCB Fees (applies to both radioactive and

hazardous waste facilities

$4.75/ton

1993

Interest Income

Revenues

Environmental Quality Restricted Account

Dept of Public Safety

OPTIONAL$200,000/year

Division of Solid and Hazardous Waste Program

Budget

Host county receives 10% of hazardous

waste fees

Division of Radiation Control Program

Budget

Hazardous Substances

Mitigation Fund OPTIONAL

Goal: $400,000/year

General Fund Revenue

$400,000/year

DEQ Executive Director’s Office

Budget

Funds have been used for DWQ, DAQ,

HLNW, and GF 1 or more times

Disbursements

Why are we in this situation?Why are we in this situation?

Prior Estimate

Current Estimate

Beginning Balance FY 2009 $2.9 M $2.9 M

Projected Revenues (lowest of past 6 years) $5.6 M $4.5 M

Estimated Funds Available $8.5 M $7.4 M

Disbursements $(7.3) M $(7.3) M

Estimated Ending Balance FY2009 $1.2 M $0.1 M

EQRA Status without further EQRA Status without further ActionAction

Beginning Balance FY2010 $ 0.1 M

Projected Revenues (Same level as FY2009) $ 4.5 M

Infusion of New Revenues (Approved in 2009 General Session)

Generator Site Access Fees $245,000 and Uranium Mill Fees $ 60,000 $ 0.3 M

Total Available Funds $ 4.9 M

Disbursements $ (7.1)M

Estimated Ending Balance FY2010 $ (2.2)M

EQRA 10 Year Average Revenues EQRA 10 Year Average Revenues Contribution %Contribution %

EQRA 10 Year Average EQRA 10 Year Average Disbursements %Disbursements %

EQRA Immediate Need for FY10 (July 1, 2009 - June 30, 2010)

• Will need to address the shortfall projected to occur

• DEQ will be submitting a General Fund supplemental appropriation request as part of the budgeting process

• Will need support of the Governor, Legislature, and Stakeholders

Options for stabilizing EQRA into the future (FY11 and

beyond)

Option 1 - Maintain Current Fee Structure + Option 1 - Maintain Current Fee Structure + Annual General Fund Supplemental Annual General Fund Supplemental

AppropriationAppropriationAdvantages:• Industry continues to pay based on rate-based

fees (fee/ton or fee/cubic foot)Disadvantages:• Requires a General Fund appropriation which is

contrary to the user fee concept of paying for services

• DEQ revenue varies based on volume disposed• Competing for General Fund monies is a difficult

process

Option 2 - Increase Current Fee Structure Option 2 - Increase Current Fee Structure RatesRates

Advantages• Raises required revenue• No need for General Fund supplemental

appropriation• Maintains user fee concept of paying for

servicesDisadvantages• Industry pays more• May impact volume or tonnage disposed• DEQ revenue varies based on volume disposed

Option 3 - Develop A Flat Fee StructureOption 3 - Develop A Flat Fee Structure

Advantages:• Industry is certain of fees owed to DEQ• DEQ has guaranteed revenue stream without

fluctuations due to changes in volumes disposed• No General Fund appropriations needed• Maintains user fee concept of paying for services• During high volume years, industry may pay less

than Option 2

Option 3 continued - Develop A Flat Fee Option 3 continued - Develop A Flat Fee StructureStructure

Disadvantages:• Industry may pay more• May impact volume or tonnage disposed

Consequences of inactionConsequences of inaction

Reduction in Force within DEQ (DSHW, EDO and DRC)•Jeopardizes authorization, federal grants•Less timely issuance of permits, modifications, technical assistance, plan reviews•Less oversight, including independent sampling

Reduction or elimination of important programs•Recycling•E-waste•Staff Training•Small business compliance assistance•Corrective action, clean ups•Redevelopment

Inability to fund Superfund match

Where do we go from here?Where do we go from here?

• Stakeholders assistance needed to evaluate these options.

• Are there other options we need to consider?• Timeframe for deliberations:

– June 2009 - next Stakeholder meeting to discuss the options

– July 2009 - Stakeholder meeting to develop consensus on path forward

– August/September 2009 - Develop strategy for path forward (including potential legislation)