The New Federalism in Environmental Law: Taking Stock: Panel Discussion

The New Federalism in Environmental Law: Taking Stock

Panel Discussion

FREDERICK ANDERSON: Addressing my remarks to those who advocate a significant shift of power towards the states, are you not offering to return authority to institutions that we long ago rejected as a place in which to lodge major environmental protection authority?

My recollection of the history of the Clean Water and Air Acts is that over a long and fairly painful period the statutes were revised and tightened up, based on a record supported indirectly by the state people themselves that the states just could not handle the authority.

What we have today is not a state/federal program at all, but a purely through-and-through federal program. We deputized the states to do unpleasant or routine work for our federal government. What the Administration is really talking about is not so much the creative return of power to the states, but an attempt to shrink the size of the entire budget and to dismantle the environmental effort.

Does anyone care to comment?

WILLIAM EICHBAUM: When we look back at the 1960s we have to realize that at that time not only were the states not doing their jobs, but neither was the federal government. Both levels of government were failing in terms of protecting the environment and the public health as that idea has evolved during the 1970s. The major changes, however, in terms of statutory changes and enforcement activity began to occur first in the states, not at the federal level. For a variety of circumstances, largely political, the interests in protecting the environment became focused in Washington, and overwhelmed what was a burgeoning state effort. That has really masked what might have taken place in the state capitals.

I do not think that the past is necessarily indicative of what is inevitably going to happen. Even if the worst view is that it is a deregulatory game evidencing a lack of federal commitment to social programs, that does not necessarily mean that all is doomed at the state level.

GEORGE FREEMAN, JR.: I agree with you that the real impetus for speeding up the federal involvement in the late 1960s and early 1970s was political. But even in the early 1970s there was a great deal of rhetoric in the Water Act and the Air Act about the partnership role between the federal and state efforts. Some of the emphasis on 'new federalism' in this area is an attempt to turn that earlier rhetoric back into reality and to have a more viable partnership relationship.

I have had considerable experience at the state level and at the federal EPA over the years, and I think that both groups are dedicated public servants. I do not perceive any marked superiority in terms of intellect, moral courage, or dedication in one group over the other. Greater flexibility and the partial return of power to the states will probably be beneficial, particularly in the gray areas of environmental regulation where we do not know if we have the ultimate answer.

PARTICIPANT: It seems to me that the states have reflected a mixture of legal and technical abilities over the decade of the 1970s. In Pennsylvania in 1905, there was a commitment to clean up the water that proceeded the federal statutes. There was a long bipartisan conservation movement that led to technology-based standards in the early 1970s. But states and regions differ as to how closely they comply with the statutes, and that level can change from election to election if there is not a strong federal presence or commitment. There is an enormous pressure on the states to backslide. Although there is also a lot of competence at the state level, after virtually a decade of environmental activism we still do not have common commitment in some areas.

GUS SPETH: The path that John Daniel outlined for the EPA program may be very sincerely aimed at new responsibilities on the part of the states, but the program's effect leads to the deregulation that we have been alluding to throughout the conference.

Without the funding and the strong federal commitment backing it up, this effort to force increased responsibilities on the states leads to a relaxation in environmental cleanup.

We all agree on the general outlines of a stronger role for the states, but there is a very sharp disagreement here on how to strengthen those roles.

It is useful to look beyond some of the laws that we have discussed and ask whether we are actually willing to give the states increased responsibility and to abide by their independent decisions. For example, are we willing to have a larger state role under the Coastal Zone Management Act and other acts to allow the states to have a greater role in determining which tracts will be leased? Or are we going to cut the states out? I gather there has been some discussion of eliminating a state's ability to go beyond the federal requirements under the pesticide law. Indeed, that has been a recurrent theme in the preemption area. Are we willing to allow Minnesota, California, and other states that want to, to set tighter radiation protection standards than the ones that are provided and enforced by the Nuclear Regulatory Commission?

We really have to ask ourselves if there is in fact a federal commitment to allow the states to exercise increased responsibility.

TURNER SMITH: In asking ourselves about the practical effect of giving more authority to states, we ought to distinguish between those programs already in place and those programs not yet completely structured and operating.

As to programs in place, I am not sure it makes much difference who is running the NPDES permit program, or who is doing the enforcing. I am not even sure it makes much difference how much money they have. The permittee's legal obligations are the same, no matter who has the enforcement responsibility. As to programs not yet in place, giving the states added authority is more significant, since authority to formulate the program is at issue.

WILLIAM BUTLER: There is one major environmental statute which still has to be enacted, and that has to do with nuclear waste disposal. It currently is enacted in the Senate and is soon to be enacted in the House. The critical question there has always been, is the technology available to dispose of nuclear waste forever? The other major question has been, what is the appropriate role for the states in vetoing nuclear waste disposal sites in their state?

Assume for a moment that the technology to dispose of the waste properly does exist, what about the question of federalism in that statute?

ANDERSON: There is certainly one inference from [12 ELR 15102] looking at the Senate-passed version—the decision is going to be made federally. The statute does not even address the problems which would involve a major part of the states of the union—the highway or railway network required to transport the materials. There is a tremendous quantity of litigation inherent in that statute.

TURNER SMITH: The basic political question is whether you want nuclear power, and if there is sufficient federal interest in accomplishing that objective to override parochial vetoes? If you allow states to veto nuclear programs, it is simply a decision that you are willing to run a great risk that there will be no nuclear power because of a local veto.

Something that I found striking in John Daniel's list of rationales for federalism is that two are missing. One is the need to avoid burdens on commerce, a rationale EPA is implementing in developing a universal manifest system under RCRA. The second is this problem of overriding parochial vetoes where necessary to vindicate certain national interests. After all, that ability is the ultimate benefit of the federal system.

JOHN DANIEL: I think we have to separate what we are doing at EPA from the national debate that concerns, in particular, the eventual disposal of nuclear waste. The nuclear waste disposal program has always been a federally dominated program in which there has been a fairly broad preemption of state and local controls. While those doors have been opened somewhat over the years, everyone continues to look to the Congress for the answers to questions of preemption. Even though we have responsibilities for writing standards for high level waste disposal, we are not in charge of these other questions that remain about where those sites might be located, what political jurisdictions they might be located in, or how wastes are transported there. Those questions are being debated and dealt with by other agencies of the government, and I am really not prepared to talk about them.

The EPA's view is that because of the states' closeness to environmental problems there ought to be great deference to the states in their decision to go to more stringent standards than what might be set by EPA. EPA ought to be faithful to its charter in trying to set the minimum federal standards at levels to protect public health, welfare, and environmental values as they are spelled out in the statute. To the extent that those statutes now allow more stringent state regulation, that ought to be an option open to the states.

There are situations in which states themselves have cried for uniformity, and I consider the present situation as one of those. EPA's decision to go to a uniform manifest system under RCRA was more a function of states' requests than demands from generators and transporters.

There are cries right now from a lot of people wanting some preemption in RCRA for existing and new sites. We are determined that options ought to remain available to state and local governments although there has been a request for a greater federal role. While it may burden commerce, in a lot of instances that is just going to have to be the result.

We are also required to enforce regulations that burden commerce that have little or no environmental context. One of them, brought up this morning, was derived from political, parochial, and economic bases. I do not think that is the way we ought to go in terms of setting a standard. We should have an environmental reason for setting it, set it as correctly as possible, and enforce it. But for whatever bases a state or local government chooses to impose more stringent regulations, it should be their option to do so.

PARTICIPANT: I would like to offer additional observations on the veto issue. First of all, in discussing the new federalism and the sharing of responsibilities between the federal government and the states, you have all been speaking in the context of responding to an essentially agreed-upon gla— clean air, clean water, etc. But the issue of whether California can lock out nuclear power or Mississippi or New Mexico can lock out nuclear waste is antithetical to the concept of sharing the responsibility for going forward toward a goal that we all generally agree upon. In the current discussion, you have said that Congress has adopted a national goal, but you want to permit one state or another to block reaching that goal. I don't see this as fitting within the general context of the preceding discussion.

I also received the impression from this morning's discussion that there are some highly technical decisions in the environmental area that everybody agrees ought to be made at the national level. Whether or not a cask that is designed and licensed for the transportation of spent nuclear fuel is safe is the same kind of highly technical judgment that should be made once at the federal level, and thereafter states and localities should not be permitted to make second guesses. They have a forum to come to Washington and argue that the cask should be redesigned, but once that decision has been made, I do not really agree that there is a federalism issue involved.

ANDERSON: How about the speed, timing and route taken for passage of this cask through a community?

PARTICIPANT: First of all, speed regulations and other local traffic regulations have never been preempted, and I do not think anyone seriously argues that they ought to be. Routing is another question because in routing you have a clear conflict between the interest of a larger public and the interest of people who live in a specific area. Congress ruled in the Hazardous Materials Transportation Act in favor of federal preemption, which I think was a wise decision.

The only way that you can reach the highest general level of safety is by having some objective national standard for routing.

FREEMAN: If we are going to talk about federalism, at some point we ought to discuss the Constitution. If we look at the Constitution and follow it from what the founding fathers thought through the Marshall Court and the Civil War aftermath and on to the present, there is still a central theme regarding the need for the balancing of power in our system. Balancing is the key to federalism—not centralization. The whole theme of our federal system is that, as Lord Action once said, "power corrupts, and absolute power corrupts absolutely."

We are presently dealing with the fundamental conflict that the states were intended to have the basic police power, and this was expressly denied to the federal government. The police power is not only the power to send us to jail or to execute us because we violate certain norms of conduct; it is also the power over land-use and the use of economic resources.

A conflict immediately arises under the Constitution with that residual power and the power granted the federal government in the Constitution through its express clauses. Most of the areas we have been discussing have been areas where Congress has been exercising the commerce power; [12 ELR 15103] but there are also other powers. I think that one of the concerns that makes the nuclear waste issue so difficult is that you have the federal commerce power and the war power to weigh against the police power of the state over its land use.

We cannot let the states of our union thwart our whole military program by prohibiting transport of nuclear materials. But I think it is quite another thing to ask whether the states should be permitted to prohibit construction of a nuclear power plant within their borders under their zoning laws. I would say that absent overriding national defense considerations federalism says the states ought to be able to prohibit that—although personally I would not think it a wise policy.

In short, in these areas it is important for us to return to the Constitution to focus on the particular federal power that is being exercised, the way it is being exercised and the way in which it is coming into conflict with state police powers.

In each of these situations we have to come back to what is practical, but we also have to go back to the Constitution, and the effect of balancing one way or the other on the long-term survival of the system of checks and balances.

NORTON TENNILLE, JR.: Our discussion today has really focused on only two-thirds of the country. We have not had any discussion at all of what the new federalism means in terms of the federal lands which are one-third of the surface area of the continental United States.

The reason that the new federalism model breaks down is that the federal government really does control what goes on on the federal lands. If the federal government is not managing those lands or is deregulating environmental regulations on those lands, there is nobody who can pick up the slack. It is unrealistic to think that the states and the local governments are going to be given any meaningful authority to regulate the federal lands.

My question is, what does the new federalism mean in the context of the eleven western states where most of the land is owned and managed by the federal government? Is there any meaningful role that the states and the local entities play in determining what goes on on those lands?

DANIEL: There are many regulations that play a definite role in terms of the federal lands. The Clean Air Act and Clean Water Act were amended in 1977 to provide for specific authority for the states to regulate these certain federal activities. Moreover, the authority that can be exercised by western Indian tribes can have a marked effect not only on federal lands but on other western private lands.

WILLIAM PEDERSEN, JR.: There is a perception that the federal government has a responsibility to preserve things for future generations. There certainly has been much debate about national parks and wilderness areas, all of which seems to accept that this is something in which the federal government has a particular stake.

FREEMAN: That is claiming the parens patriae power for the federal government, and, clearly, the Constitution did not intend that.

PEDERSEN: Then why do we have national parks?

FREEMAN: We have national parks because the federal government owns a lot of land, and wanted to do something with it. The federal government does not own a single acre in the state of Virginia which it acquired as the successor to the King of England because the state of Virginia was here before the federal government.

I am a fundamentalist on the Constitution. I believe that the source of governmental power, as well as the practical problems that come with its exercise, are very important. We need to balance the powers of a strong federal government and preserve something of power in order to fight this centralizing tendency. This is critical through the whole array of governmental powers. It affects civil rights, free speech, environmental law, and all other issues.

PARTICIPANT: I agree with a great deal of what you are saying, but I am not quite sure what the consequences are for environmental control.

FREEMAN: First let us take the interstate pollution problem. It is quite clear to me that the concept of needing some overriding control to keep one state from polluting another state was pretty well settled when we adopted the Constitution. The federal solution is the only solution for those kinds of conflicts. If, however, we were to say that to do that the federal government can directly take over the zoning of all land use in the United States, I do not think there is a person in this room who would support it.

Particularly under the Clean Air Act, we are into the gray area of land-use planning. The whole Class I, Class II program is really inverse land control through zoning. It presents a substantial problem because there are factors other than health and commerce to consider. In those areas, I think the federal government has gone too far.

SPETH: Mr. Freeman's views do not have much support on the current Supreme Court. His perspective was decisively rejected in the recent strip mining litigation, where the claim was that land use regulation should be confined to state and local government as a police function prerogative, and the court had no trouble in upholding an assertion of federal power over that. In the footnote, in fact, the Court generally, endorsed federal environmental laws under the commerce clause.

One of the fundamental constitutional principles is that the court will routinely strike down state environmental legislation if it believes that it unduly burdens interstate commerce under the dormant commerce clause. There have certainly been state environmental laws upheld under the dormant commerce clause, but today the principle limits states much more readily than it does the federal government.

I do not know whether it is always helpful to go back and argue these principles of constitutional law, but it is equally valuable to point out that the Constitution itself cuts both ways on this subject.

BUTLER: I would like to review the constitutional law points. As I understand the new federalism (when it was called the Sagebrush Rebellion prior to the 1980 election), the Westerners wanted the federal government to give them the federal lands within their states' jurisdiction. Now the pressure is running in the opposite direction from the people who used to be "sagebrush rebels". They are saying that the land should not be given back to the states or, then, to private owners. They want merely to exploit it at a time when they do not have to take responsibilities of ownership.

What new federalism means has undergone an almost 180-degree evolution in the course of the last three years. Basically, what it means to me now in practical terms is a greater sympathy to those whose views favor increased private exploitation of the resources on federal lands. It does not mean anything more or less than that.

PARTICIPANT: Everyone has his own definition of "new [12 ELR 15104] federalism", but it seems to me that it means an attempt to achieve the results of health in the environment that everybody agrees are of somewhat less use to centralized authority. This question of whether or not we are going to try to achieve social objectives by decentralized market power has got to be a part of the new federalism. It is not really very important whether we delegate fully to the states or not. We should be relying on market forces.

PEDERSEN: I do not see that there is any necessary link between a federalism and a free market approach. One meaning of greater respect for states is they will be free to choose whether to adopt a free market approach. Marketbased regulatory approaches have a lot to commend them, but I think that if you are taking federalism, you should be selling the state governments on the merits so that they can make their own choice.

ROGER SCHWENKE: I am troubled by the concept of the federal arm deciding what is right or wrong for the states to do. The EPA's decision to cut back on grants to the states so that they will assume long-range independence from the federal government seems to go to the opposite extreme of a paternalistic approach.

DANIEL: The point that I was attempting to make is that the states have been very dependent on EPA, not only for funds, but for all elements of their delegations and day-to-day responsibilities. The level of dependence varies from state to state, but it has been substantial nationwide.

States have the wherewithal, the will to operate programs, and they will achieve that sooner if they can feel that they operate independently. There still need to be minimum federal standards that would prescribe the level of health and welfare and environmental protection that ought to be achieved.

Right now, states are constrained not only by the statutes but also by EPA policies. That is one of the areas we can address in attempting to come up with some better solutions. In the end, what we need is a statement of the results we are trying to achieve. Then we need to allow the states the independence and flexibility to arrive at those results in the way that best fits the needs within their own borders.

If a state wants to have more stringent regulations in a certain manner or certain area of economic activity within its border, that is a choice that it should be able to make. It should not be constrained by federal preemption or EPA's regulations.

SPETH: How do you then deal with a state that does not want to implement those national standards?

DANIEL: It is incumbent upon EPA to implement national standards on the basis of the minimum federal standards that have been prescribed by the statute itself or by operation of EPA's regulatory activity.

SPETH: What about situations where the minimum general standard approach is not applicable but the federal government still wants to force state action through federal statutes (for example in coastal zone management or Section 208 planning)? The federal government, basically, obtains compliance and cooperation by the states through the funding mechanism. When we get beyond these traditional regulatory functions and funding shrinks, how do we motivate the states to implement these other national objectives unless we are encouraging their actions financially?

DANIEL: The federal scheme must spell out exactly what it is the states are to accomplish. In Section 208 planning, under the Clean Water Act, the federal scheme said, we want 208 plans. There are plans, and they were made at considerable expense to federal, state and local governments; but because the statute does not spell out implementation requirements the plans sit on shelves collecting dust.

EICHBAUM: I was asked earlier, why have the states not increased funding for these programs during the period of the 1970s? My answer is: first, because the federal money was available, they did not have to increase their funding; and, second, it is difficult to ask a legislature to pay for a program over which it has virtually no control.

There is some reason to believe that the flexibility and need may produce more money at the state level. As we see that we have been cleaning our environment but have far to go before it is clean, as a society we will commit the necessary funds to get to the stage we want. I do not know that whether there are federal planning dollars is going to be critical at all to whether we make that financial decision.

PHILLIP REED: Listening to this discussion, I had at first been very impressed and then gradually developed a sinking feeling as the day wore on. I knew there was something missing, something that did not quite add up. I was impressed with the general agreement on the principles of increasing state responsibilities and was interested in the philosophical debates, but looking at what is actually happening, we see cuts in state funding of somewhere between 10 and 33 percent, cuts in EPA funding of between 30 and 50 percent, cuts in federal guidance to the states, streamlining federal guidance to the states and streamlining state-EPA agreements. We also hear that the delegation of programs from EPA to the states is going to increase by 50 percent but EPA is prepared to step in and take over the job if the states cannot handle it. I just do not think all of that adds up. A much better staff at EPA in the past was unable or declined to step in or developed new legal wrinkles to avoid taking over from the states.

We are going to need some new mechanisms to ensure that states do carry out these responsibilities. It appears that the delegation is occurring through the budgetary developments, and we will see if we can find a workable mechanism for accomplishing the federal job after the states have been given the burdens.

Who is developing the mechanisms that are going to make this work? What priority is being given to this enterprise within EPA or state groups?

BUTLER: In other words, you are saying that the new federalism is de facto deregulation; is that right?

In practical terms, there is no other way of looking at it. In the short run we will have less environmental regulation of federal statutory authority. We are told that in the long term the way you develop responsibility is by giving responsibility. Responsibility's breeding responsibility certainly is not always true from the point of view of a parent. I do not mean to say that states can be equated to children, but some of the same principles apply. What we have now is not delegation, we have deregulation de facto. Whether it was the intent, the effect is going to be that.

FREEMAN: To return to an earlier theme: in certain environmental areas that we are concerned with there is a broad consensus in the country for the validity of the overriding federal standards that have been enacted. The key area we should be focusing on today is where an overriding federal imperative substantially conflicts with local interests.

[12 ELR 15105]

In those areas fundamental constitutional principles do guide us. One of the lessons we learn from them is that through our federalistic balance of power we have room for a pluralistic society to continue in this country.

In the environmental area, we cannot manage our system without conflict. If you look at Japanese, German, or English regulation of environmental matters, it is a matter for the local authorities to sit down with the industry, and, on a one-to-one basis, negotiate what will be the proper levels of control. There is a partnership in Japan between business and the government and virtually the same thing in Germany and in England. In our country, we do everything in terms of conflict. I am reluctantly for that because conflict is the price of freedom in a pluralistic society. To the extent that people are concerned with overriding federal imperatives and enforcing conformity, they are going against the grain of that whole system. That is why we have to have a balance in this area and that is why I would strike the balance differently than would Mr. Speth.

I would not mandate federal uniformity except where there was an overriding consensus. That would return us to the kind of government which the founding fathers wanted. As Thomas Jefferson once said, "that government governs best which governs least." If the broad consensus of society supports a law, it will be largely self-enforcing. The role of the federal government should be to enforce what there is already a consensus on.

EICHBAUM: I would like to comment on Phillip Reed's question. It is clear to me that there is going to be less funding and less will be accomplished. We also do not have any choice as to whether the states should be allowed to assume greater responsibility and authority as part of this new federalism.

As an example of that, let me discuss the construction grant program. The construction program has probably done more to clean up the environment in the last decade than any other single effort or class of activity. We have gone from no sewage treatment or only primary sewage treatment for most of the people in this country to having now or in the next few years a secondary or even advanced sewage treatment for most of the people in this country.

To serve its citizens in this manner, Maryland, over the last decade, has obtained about $60 million worth of federal funds each year. We now have a water quality-oriented future need of $600 million. Under the $2.4 billion formula, which is what Congress is now working with, we will get about $40-$50 million per year. That is a five-year program.

There is no way that that federal program is going to be extended over another decade to meet that $600 million water quality need. That does not even address the question of how we are going to accommodate new growth, maintenance and rehabilitation of the existing facilities over time.

There is a creative debate on how the states should accomplish their goals that is yet to be held, and this ought to be just the start of all that and not the conclusion.

PARTICIPANT: We have been talking as if the states are an entity, a unit, and all the same, but we all know that this is a country with a great variety of problems, issues, views, and interests. I have made trips abroad and studied some of these issues in the context of other countries and come back ready to apply their solutions over here and make it work. But our problems are much more complicated, and although it is useful and inspirational to get fresh ideas from wherever one goes, they do not translate into solutions for our complexities.

In the mid-1960s I did a Public Health Service study comparing state water pollution control programs. That study made me recognize some real differences in the state of progress and accomplishment of the programs as to goals and procedures. If it were so then—that there were different capacities and tendencies on the part of these states to work toward the goals that we all share—it is probably at least as true now.

North Carolina has a strong Coastal Area Management program, but one of the key reasons is that there was federal money available to help get the program started and to flow to the local government to get them involved in planning, management, and regulation. I do not believe this program will work without that funding because the local involvement has been encouraged and purchased with money.

We do not have mountain management at all because there has not been any money available for such a program.

Another environmental approach of some southeastern states is illustrated by North Carolina's Hardison Amendment which proscribes state enactment of laws, regulations or standards which are more stringent than the federal government's regulation. Concerning hazardous wastes, the regulations may not be more comprehensive than the federal programs either.

The idea of the Hardison Amendment was born at a time when there was a strong federal presence with a great deal of federal funding and energy. That idea takes on a very different meaning in the new context than it had then. We need the federal government's support in both finances and philosophy. Without that support, a state like North Carolina will retreat to its previous policy of using all the assimilative capacity of the water and air that we can. The rest of us must set future agendas that deal with the priorities. Some areas are more important than others and, with limited resources, we must begin with specific, critical situations.

EICHBAUM: As constructive a light as we might try to put upon all of this, there is the fundamental contradiction of admittedly less money for the states and a strong desire to give them more programs. If we recognize they are not going to receive more funds, should EPA be rethinking the urgency of the delegation question?

DANIEL: The programs were designed by the Congress for delegation and the EPA is charged with assuring that delegation occurs within the statutory constraints. Even with the pressures on state budgets we should not slow down in our effort to delegate programs to states that are ready to undertake the responsibility. If we were to wait to make a policy decision about delegation until there was an enacted 1983 budget, we would probably be into the middle of 1983. It is not in our interest or in the states' interest to wait that long to make some fairly fundamental decisions about delegation of programs.

PARTICIPANT: Where the state is currently running a program but could not continue at the level federal required to avoid preemption without the federal funds, we are going to have delegation problems.

If the federal budget were cut in an area where there had been a longstanding state effort, we would be under some compulsion to continue. On the other hand, if we volunteer [12 ELR 15106] to run a program at 60 percent of effort, whether the federal government would preempt us is also a very interesting question.

One other observation is where politics some into play. Congress is not dealing with the Constitution as much as it is with votes. It has been relatively easy for the Congress to impose costs on industry. It is easy to put a steel company under a permit and put effluent limits on it, but the Congress has become touchy about a number of popular issues—transportation strategies, public sewage treatment, nuclear disposal, and acid rain.

The more global issues are not within the states' capabilities. That is why I am concerned about not undercutting some of the consensus we have, and building consensus around these issues. The Congress has the toughest issues left to deal with. Some of the most traditional, personal practices and activities—such as fluorocarbons—may have to be controlled in the decades ahead, and those are not going to be easy.

PARTICIPANT: Without unduly chastising everybody who has stepped into this particular trap, I have noticed the words "delegation of programs" being used rather than "approving a state program."

The variation in terminology does make some real legal difference. If the state acts pursuant to federal authority, state-issued permits may be major federal actions requiring EISs. It may also lead to differences as to where an action can be reviewed, in federal court or in state court.

The larger issue is, how efficient a system do we develop if we are going to pursue partial NPDES approvals? Will we then have a situation where a permittee will have to go both to the state and the federal government to get different parts of a single permit approved? Is the Administration's proposal to grant approval to partial state programs the correct way to pursue federalism?

DANIEL: Thirty-seven states have NPDES right now. There has been analysis of why the rest of the program has not been delegated. A substantial part of the problem is that there are states that want to take the programs, but they do not have the ability or legal authority to issue all the permits. We are not talking about an individual source needing several different kinds of NPDES permits, but, for some activities, sources might need a permit from a federal office that is then certified by the state.

That is what we mean by a partial delegation of NPDES, and, if we are able to have the Clean Water amendments encompass this, there are a number of states that are ready to pick up a substantial part of the program.

PARTICIPANT: Bill Butler has expressed concerns about effective deregulation with the cutting of aid to the states, and some question has come up about whether, in fact, states will accept authorization or delegation of programs.

The EPA budget for the coming year is premised on the assumption that a fair number of state programs will be authorized, or programs will be delegated. What happens if the states do not accept that responsibility? What are the consequences for the regulated community if the states do not take on certain permitting and other responsibilities and the regulated community is dependent on EPA with far less manpower than it presently has? Will not uncertainty be increased, predictability decreased, and administrative costs run up because the permit process is very slow at EPA with its diminished resources?

DANIEL: Our RCRA people are in touch with the states constantly, and there still seem to be a lot of states that want to pick up RCRA, a program where there is fertile ground for further delegation or authorization.

TURNER SMITH: Mr. Daniel, if the Congress gives EPA more money than it had asked for, do you have any sense at present of your priorities for spending that money? Would the states have high or low priority?

DANIEL: The budget is set up with a separate account for Abatement Compliance and Control. If Congress commanded that the money be placed in that account it would go to the states.