us department of justice official release - 01888-06 enrd 383

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FOR IMMEDIATE RELEASE

THURSDAY, JUNE 22, 2006WWW.USDOJ.GOV

ENRD

(202) 514-2007TDD (202) 514-1888

Fact Sheet: Indictment of and

Landmark Settlement with Puerto Rico

Aqueduct and Sewer Authority

In landmark enforcement actions, the Puerto Rico Aqueduct and Sewer Authority(PRASA) has agreed to pay $10 million in criminal and civil fines and committedto perform more than $1.7 billion in injunctive relief to resolve repeatedenvironmental violations at wastewater treatment plants and drinking watertreatment plants throughout the Commonwealth. Todays actions are the result ofthe utilitys agreement to plead guilty to 15 felony violations of the Clean WaterAct (CWA) affecting the islands nine largest wastewater and five of its drinkingwater treatment facilities, and enter into a civil agreement requiring the company toimplement significant remedial measures at all of its 61 wastewater treatment plantsand related collection systems over the next 15 years.

The Criminal Plea Agreement

PRASA has agreed to plead guilty to a 15-count indictment relating to its role, asowner and operator, and its conduct in the operation and management of thewastewater and drinking water treatment systems in Puerto Rico. Specifically,PRASA admits to violating the CWA through the illegal discharge of pollutants inviolation of its permits.

The indictment alleges that PRASA illegally discharged pollutants at its wastewaterfacilities in Bayamn, Caguas, Camuy-Hatillo, Carolina, Dorado, Isabela, PuertoNuevo, Santa Isabel and Vega Baja and drinking water facilities in El Yunque,Enrique Ortega,Guaynabo, Canvanas and Sergio Cuevas. The indictment alsocharges PRASA with a direct discharge of a pollutant from a point source into theMartin PeZa Channel, a water of the United States, without a permit.

Under the terms of the criminal plea agreement, PRASA will:

-Pay a $9 million fine; -Construct and complete capital improvements to replace,repair and upgrade the collection and wastewater treatment system in the Ponce deLeon Avenue area of San Juan for a cost of not less than $10 million to remedy and

prevent direct discharges to the Martin PeZa Channel;
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-Complete other capital improvements and upgrades at the nine waste watertreatment plants identified in the indictment for a cost of not less than $109 million;

-Fund a study of the operations at the five drinking water facilities to determine theappropriate remedial actions; and

-Serve a five-year-term of probation.

As a condition of PRASAs probation, the utility will be required to fully complywith the requirements of the civil consent decree. The civil consent decree lays out acomprehensive plan for PRASAs future compliance with the CWA at its 61wastewater treatment plants and requires PRASA to spend in excess of $1.7 billionover the course of the next 15 years on capital improvement projects and otherremedial measures.

The Civil Settlement

To comply with the settlement, PRASA will complete a total of 145 capitalimprovement projects (CIPs), including 32 short-term projects to be completedwithin the first six months of the settlement and 50 mid-term remedial projects to becompleted within 12-24 months of entry of the settlement. These projects areestimated to cost a combined total of $11.8 million over two years. Both waves ofproposed projects include the following types of remedial measures:

-Installing dechlorination equipment;

-Installing flow proportional chlorination equipment;

-Repairing and replacing equipment; and

-Implementing a chemical treatment program for phosphorous removal.

The remaining CIPS are long-term projects, implementation of which is divided intothree terms.

-During the first term, PRASA will complete 20 CIPs, all of which will becompleted by June 1, 2011, at an approximate cost of $316.3 million.

-The second term of 24 projects will be completed by June 1, 2016, at an estimatedcost of $275.6 million.

-During the final term, PRASA will complete 19 CIPs within by June 1, 2021, at anestimated cost of $323.3 million.

-The projects will include, but are not limited to: retrofitting existing facilities toachieve phosphorus removal and increasing treatment capacity; constructing sewer


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lines to divert flow to another waste water treatment plants to eliminate currentfacility; and installing flow proportional chlorination equipment.

-All of the remedial measures to be conducted over the next 15 years are estimated

to cost over $927 million.

To ensure proper maintenance and operation in the future of its wastewatertreatment plants, the settlement also requires PRASA to submit to the EPA anIntegrated Preventative Maintenance Program (IPMP). Once approved, the IPMPwill be implemented and will include the following key components: recordkeeping; maintenance planning and scheduling; purchasing procedures and aninventory system; and maintenance personnel training and organization.

PRASA must also submit a Spill Response and Cleanup Plan for EPA approval,

specifying response actions in the case of sanitary sewer overflows at all ofPRASAs 61 facilities. PRASA must additionally develop and implement a SanitarySewer Evaluation Plan and Rehabilitation Plan for seven collection systems, anddevelop a Preliminary Sewer System Evaluation Plan for all the remainingcollection systems on the island.

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us department of justice official release - 01888-06 enrd 383

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