Environmental FeesEnvironmental FeesMarch 2007March 2007

Thomas W. Easterly, P.E., DEE, QEP Thomas W. Easterly, P.E., DEE, QEP

IDEM CommissionerIDEM Commissioner

IDEM’s Business is Protecting Human Health and the

Environment Protecting human health and the Protecting human health and the

environment costs money—IDEM spends environment costs money—IDEM spends money to:money to:– Issue PermitsIssue Permits– Review and approve Long Term Control Review and approve Long Term Control

Plans to address Combined Sewer OverflowsPlans to address Combined Sewer Overflows– Develop regulations to protect the Develop regulations to protect the

environmentenvironment– Petition EPA to recognize that our air quality Petition EPA to recognize that our air quality

meets all health based standardsmeets all health based standards– Inspect facilities for complianceInspect facilities for compliance

Environmental Fees

Funding for environmental regulation Funding for environmental regulation comes from three sources:comes from three sources:

Federal Funds– currently 35%Federal Funds– currently 35% State General Funds– currently 27%State General Funds– currently 27% Dedicated Funds from Users of the Environment– 38%Dedicated Funds from Users of the Environment– 38%

Note: IDEM’s total budget also includes funding for the Note: IDEM’s total budget also includes funding for the Excess Liability Trust Fund (ELTF) which reimburses Excess Liability Trust Fund (ELTF) which reimburses companies for cleaning up leaks of petroleum companies for cleaning up leaks of petroleum productsproducts

IDEM’s proposed budget includes no increased fees

The proposed budget is balanced and will The proposed budget is balanced and will allow us to continue to provide current allow us to continue to provide current levels of service through the biennium. levels of service through the biennium.

The public is asking for improvements in The public is asking for improvements in a number of IDEM programs including:a number of IDEM programs including:– CFO/CAFO (livestock agriculture) inspectionsCFO/CAFO (livestock agriculture) inspections– Storm water pollution and erosion control Storm water pollution and erosion control

programsprograms– Expedited permitsExpedited permits– Water quality improvement projectsWater quality improvement projects– Better operation of Wastewater treatment Better operation of Wastewater treatment

plantsplants

Programs funded by users

I believe the most responsible funding for environmental programs is user-based fees.

I propose increasing fees or establishing new fees to fully support and improve Indiana’s environmental programs.

The Indiana Department of The Indiana Department of Environmental Management (IDEM) will Environmental Management (IDEM) will be working with legislators during the be working with legislators during the 2007 session to bring our environmental 2007 session to bring our environmental fees to levels that will adequately fund fees to levels that will adequately fund the programs.the programs.

Programs funded by users

Incremental move towards fee Incremental move towards fee supported programssupported programs

Faster permits, trained staff, Faster permits, trained staff, quality assessments require fully quality assessments require fully funded programsfunded programs

Improved technologies to make Improved technologies to make doing business with IDEM easierdoing business with IDEM easier

Last major IDEM fee increase was in 1994

Recent Fee increases adequately fund a Recent Fee increases adequately fund a few programs:few programs:

2003 the Indiana General Assembly 2003 the Indiana General Assembly passed a fee for drinking water passed a fee for drinking water systems. systems.

2005 the Excess Liability Trust Fund 2005 the Excess Liability Trust Fund received an additional $0.002 per received an additional $0.002 per gallon and a full $0.01 on special gallon and a full $0.01 on special fuels, formerly exempt.fuels, formerly exempt.

2006 the Air Pollution Control Board 2006 the Air Pollution Control Board increased Title V air permits by 25%increased Title V air permits by 25%

Recent IDEM Accomplishments

Reduced permit backlogs in all Reduced permit backlogs in all programs by 50%, plan to be current programs by 50%, plan to be current by the end of 2007 by the end of 2007

Petitioned EPA to redesignate all Petitioned EPA to redesignate all communities to attainment for Ozonecommunities to attainment for Ozone

Reduced use of outside contracts for Reduced use of outside contracts for core regulatory functions (air permits, core regulatory functions (air permits, ELTF)ELTF)

Reduced administrative duplication by Reduced administrative duplication by combining support functions with other combining support functions with other state agencies (e.g. IOT, SPD, OLC) state agencies (e.g. IOT, SPD, OLC)

IDEM Goals

IDEM’s overall goal is to “Increase the IDEM’s overall goal is to “Increase the personal income of all Hoosiers from the personal income of all Hoosiers from the current $0.88/$1.00 of the national average current $0.88/$1.00 of the national average to at least $1.00/$1.00 of the national to at least $1.00/$1.00 of the national average while maintaining and improving average while maintaining and improving Indiana’s Environmental Quality.” Indiana’s Environmental Quality.”

In order to achieve that goal, IDEM will In order to achieve that goal, IDEM will continue to strive to be clear, consistent continue to strive to be clear, consistent and speedy.and speedy.

In order to meet even higher standards of In order to meet even higher standards of responsiveness some IDEM programs need responsiveness some IDEM programs need more stable funding.more stable funding.

IDEM Budget ComparisonsIDEM Budget Comparisons (w/o ELTF) (w/o ELTF)

2005-2007 2005-2007 $240,798,257$240,798,257

2007-2009 2007-2009 $206,249,350$206,249,350

Federal: $57,530,097

(27.9%) Red

General: $61,750,166

(29.9%) Lt. Aqua

Dedicated: $86,969,087(42.2%) Blue

Dedicated: $91,318,803(37.9%) Blue

Federal: $84,618,622

(35.1%) Red

General: $64,860,832

(29.9%) Lt. Aqua

Fund Name

Title V Air Permit Fees

NPDES Permits

Drinking Water

Solid Waste Management

Hazardous Waste Management

Hazardous Substance Response

Special Fund CAFOs Totals

08-09 Income $19,815,000 $13,604,652 $8,495,690 $10,649,922 $12,849,736 $4,000,000 $4,907,118 $74,322,118

08-09 Expenses $25,008,250 $18,034,159 $9,261,776 $12,384,535 $16,243,331 $8,942,783 $5,835,811 $95,710,645

Income less Expenses ($5,193,250) ($4,429,507) ($766,086) ($1,734,613) ($3,393,595) ($4,942,783) ($928,693) ($21,388,527)

Annual Spend down ($2,596,625) ($2,214,754) ($383,043) ($867,307) ($1,696,798) ($2,471,392) ($464,347) ($10,694,264)

Proposed Increases $2,500,000 $2,840,000 $0 $2,800,000 $1,294,300 $9,434,300

Fee ProposalsFee Proposals

NPDES – 79 staffNPDES – 79 staff Fee Revenue: $3.8M Fee Revenue: $3.8M Expenses: $6.2MExpenses: $6.2M Proposed Fee Revenue: $4.75MProposed Fee Revenue: $4.75M Annual Number of permits issued: Annual Number of permits issued:

340340 Proposed increase is 25%Proposed increase is 25%

Fee ProposalsFee Proposals

Drinking Water/Wastewater Drinking Water/Wastewater Operator Certification – 6 current Operator Certification – 6 current staff staff

Fee Revenue: $146,000 Fee Revenue: $146,000 Current Expenses: $471,000 Current Expenses: $471,000 Proposed Fee Revenue: $526,000 Proposed Fee Revenue: $526,000

(would add 3 staff)(would add 3 staff) Annual Number Certifications/tests Annual Number Certifications/tests

issued: 4469issued: 4469

Wastewater Operator Biennial Renewal Fees

Classification Current New IncreaseAnnual

Increase

Class I-SP $30 $60 $30 $15

Class I $30 $60 $30 $15

Class A-SO $30 $60 $30 $15

Class A $30 $60 $30 $15

Class II $30 $80 $50 $25

Class B $30 $80 $50 $25

Class III $30 $100 $70 $35

Class C $30 $100 $70 $35

Class IV $30 $120 $90 $45

Class D $30 $120 $90 $45

Water System Operator Triennial Renewal FeesAll $30 $150 $120 $40

Fee ProposalsFee Proposals

Wetland/Water Quality Certification – Wetland/Water Quality Certification – 7 staff7 staff

Fee Revenue: $0 (60% federal Fee Revenue: $0 (60% federal funds/40% state funds) funds/40% state funds)

Expenses: $538,000 Expenses: $538,000 Proposed Fee Revenue: $96,900Proposed Fee Revenue: $96,900

– Proposed General Permit Fee $100Proposed General Permit Fee $100– Proposed Individual Permit Fee $200Proposed Individual Permit Fee $200

Annual Number of permits issued: 760Annual Number of permits issued: 760

Fee ProposalsFee Proposals

Storm-water Fees – 8 current StaffStorm-water Fees – 8 current Staff Fee Revenue: $365,000Fee Revenue: $365,000 Expenses: $698,000Expenses: $698,000 Proposed Fee Revenue: $1.4M (add Proposed Fee Revenue: $1.4M (add

field staff for inspections)field staff for inspections) Annual Number of permits issued: Annual Number of permits issued:

4,0504,050 Rules 5, 6 and 13 have been funded Rules 5, 6 and 13 have been funded

through fees and enforcement finesthrough fees and enforcement fines

Current Proposed Increase

Rule 5 $100 $400 $300 per NOI

Rule 6 $100 $150 $50 Annually

MS 4 by Population

1-999 $0 $250 $250 per NOI

1,000-2,999 $0 $500 $500 per NOI

3,000-4,999 $0 $750 $750 per NOI

5,000-6,999 $0 $1,000 $1,000 per NOI

7,000-9,999 $0 $1,500 $1,500 per NOI

10,000 and up $0 $2,000 $2,000 per NOI

MS 4 by Type

Non-municipal $0 $500 per NOI

County System $0 $2,000 per NOI

Note: 25% reduction if MS4 is co-permitted

Fee ProposalsFee Proposals

Hazardous Waste – 96 staffHazardous Waste – 96 staff Fee Revenue: $1.3MFee Revenue: $1.3M Expenses: $8MExpenses: $8M Proposed Fee Revenue: $4.1MProposed Fee Revenue: $4.1M Permit Review, renewal, modifications Permit Review, renewal, modifications

and Corrective action plan reviews: 375and Corrective action plan reviews: 375 Federal funding (currently) 33%Federal funding (currently) 33% State funding (currently) 31%State funding (currently) 31% Fee funding (currently) 36% Fee funding (currently) 36%

QuestionsQuestions

Please contact either of these staff Please contact either of these staff members with questions or for members with questions or for assistance:assistance:

Sandra Flum, 232-9479 or Sandra Flum, 232-9479 or sflum@idem.in.govsflum@idem.in.gov

Bowden Quinn, 233-3835 or Bowden Quinn, 233-3835 or bquinn@idem.in.govbquinn@idem.in.gov