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 AND THE TEXTILE RENTAL SERVICES ASSOCIATION David F. Hobson President and CEO, UTSA John C. Contney Executive Director, TRSA Of Counsel: John L. Wittenborn Jeffrey S. Longsworth Joseph J. Green Collier, Shannon, Rill & Scott, PLLC 3050 K Street, N.W. Washington, DC 20007 (202) 342-8400 EXECUTIVE SUMMARY The U.S. Environmental Protection Agency ("EPA" or "the Agency") has proposed pretreatment standards for industrial laundries ("ILs") that are neither legally nor technically supportable. Although developed on the basis of limits deemed achievable by chemical precipitation ("CP"), or, alternatively, dissolved air flotation ("DAF"), systems, the limits, in fact, are not achievable. Nor are the limits necessary. The Agency proposes to regulate the entire IL industry through the promulgation of categorical standards despite the fact that ILs already are regulated effectively through local implementation of the National Pretreatment Program. All IL facilities are indirect dischargers, the vast majority of which discharge into sewer systems that have numerical discharge limits and are required to meet discharge limits established by the local publicly-owned treatment works ("POTW"). EPA seeks to justify the proposal on the mistaken assumption that 87 percent of the industry discharges without treatment. The facts demonstrate, however, that approximately 90 percent of ILs have already implemented some form of wastewater treatment. EPA's Pass Through Analysis is Flawed EPA's technical justifications for the proposed rule—that it will eliminate pass through, interference, and other forms of inhibition caused by pollutants discharged by ILs to POTWs—are erroneous and not supported by proper analysis. The Agency has distorted its traditional methodology for assessing pass through (the percent removal comparison approach) in such a manner as to make the analysis illogical and irrelevant to Congress' goal of protecting the waters of the United States. EPA's pass through analysis is inaccurate for several reasons. The Agency improperly assumed pass through based on the hypothetical volatilization rates for certain volatile organic compounds ("VOCs") that, in fact, do not volatilize to any great extent and are treated effectively by POTWs. The volatility of these compounds is suppressed by the presence of detergents and organic material in laundry wastewater. EPA's assumptions conflict with its own data and models regarding volatilization of organic pollutants in sewer systems. For all of these reasons, EPA's application of the volatile override test is inappropriate. Moreover, these VOCs are effectively treated at POTWs and do not pass through on the basis of the percent removal comparison test. EPA's own data contradicts its pass through determination regarding most of the other pollutants addressed by the proposed rule. With the exception of manganese and total petroleum hydrocarbons ("TPH"), examination of EPA's data regarding raw wastewater loadings and the predicted reductions in loadings as a result of the proposed rule shows that POTWs remove pollutants in IL wastewater more effectively than CP or DAF systems. And EPA data and analysis with respect to TPH are wrong. The Agency erroneously concludes that TPH passes through and interferes with treatment works. EPA's calculation of POTW removal efficiency for TPH is based on three surrogate compounds (n-alkane compounds) that understate the ability of POTWs to treat TPH. In fact, POTW removal of TPH is essentially equivalent to CP or DAF removal rates. Therefore, there is no pass through. In addition, EPA mistakenly contends that the proposed rule would eliminate the inhibition of biological processes allegedly caused by TPH at POTWs, when there is no actual inhibition at all. POTWs simply do not experience inhibition or sludge management problems resulting from IL wastewater discharges that contain TPH or any other pollutant identified in this proposed regulation. The Proposed CP- and DAF-Based Limits Are Not Achievable The CP- and DAF-based technology limits proposed by the Agency are not technically supportable. EPA simply failed to demonstrate that CP and DAF technology can achieve the proposed limits. In particular, the Agency misrepresented the performance of CP systems by developing limits that, in fact, reflect the treatment performance of CP plus steam tumbling and the use of a chemical emulsion breaking ("CEB") unit. Furthermore, EPA has failed to establish that the wastewater at the facilities from which the Agency collected data to develop the proposed rule is representative of industry wastewater, and, accordingly, that the proposed limits are achievable across the industry. EPA's methodology for calculating the proposed limit is flawed and underestimates the effluent limit at which a consistent (99th percentile) rate of compliance is achieved. EPA Failed To Perform a Proper Subcategorization Analysis of the Industry The proposed rule is fundamentally flawed for at least one other significant reason: EPA failed to conduct a proper subcategorization analysis of the IL industry, despite an abundance of data evidencing the diversity in the industry. Dramatic differences are evident in raw wastewater characteristics among the diverse facilities covered by the proposal. There also is extraordinary variability in the cost of compliance and cost-effectiveness across the industry. These differences demonstrate the need for a sophisticated subcategorization analysis. EPA's failure to conduct this analysis was inappropriate. As a result, the proposed limits are not achievable by all facilities covered by the regulation—including some of the sample facilities whose data were used by EPA to develop the proposed limits—and the costs of compliance with the proposed rule vary dramatically across the industry. Hence, the proposed rule is inequitable and not appropriate. EPA Has Exaggerated the Cost-Effectiveness of the Proposed Rule EPA acknowledges that the proposed rule is not cost-effective. And even this analysis is replete with faulty assumptions and other methodological errors that result in a substantial overstatement of its predicted benefits and cost-effectiveness. Significantly, EPA relies on an inflated toxic weighting factor ("TWF") for TPH that is significantly higher than the toxicity associated with the individual petroleum hydrocarbons in laundry wastewater. Application of a more realistic TWF reduces the benefits associated with predicted TPH removals by as much as 90 percent. Because TPH removals account for 93 percent of the cost benefit, the true cost-effectiveness of the proposed rule is dramatically decreased. EPA further skews the cost-effectiveness analysis in a number of other ways. EPA includes the benefit of removing TPH from laundry wastewater, but also takes credit for removing many of the constituent hydrocarbons of TPH, thereby double-counting the benefits resulting from these removals. The Agency also assumes inaccurately that many of the compounds present in laundry wastewater have a POTW removal efficiency of zero, thus overstating the pretreatment pollutant removal benefits of the proposed rule. Finally, the incremental cost-effectiveness of the proposed rule is flawed and not within the range of previous ELGs. The Agency Understates the Economic Impacts of the Proposed Rule EPA sharply underestimates both the compliance costs and the magnitude of the adverse economic impacts of the proposed rule for the IL industry. Actual compliance costs likely are at least twice as high as EPA estimates. The Agency misconstrues the nature of competition in the industry—both internal and external from substitutes such as on-premise and home laundries, disposables, and customers' option of not using IL services at all. EPA, therefore, mistakenly assumes that cost pass through to customers is possible without experiencing a significant loss of market share. Similarly, EPA fails to recognize the potential market shifts to substitutes as a result of any cost pass through to customers. The Agency's economic assessment also seriously underestimates the number of IL facilities that will be forced to close or declare bankruptcy due to attempted compliance with the proposed rule. EPA Should Pursue the No Regulation Option In sum, EPA has proposed pretreatment standards for the IL industry that are neither economically achievable nor legally and technically supportable. Rather than moving forward with the most cost-ineffective proposed pretreatment standard ever—a regulation that would impose extraordinary and inequitable economic burdens on the industry—EPA should choose its "no regulation" option. Given the lack of pass through and low pollutant loadings for the industry, there is no need for additional EPA regulation of the IL industry which already is effectively regulated under the National Pretreatment Program. 
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