165 



With regard to structuring the charge it is also necessary to determine how flexi- 

 ble the amount to be collected from an individual dumper should be. While one of 

 the primary virtues of the charge approach is its flexibility, frequent adjustments in 

 the charge may be counter-productive. Most waste treatment technologies and proc- 

 ess charges require large capital expenditures and long-term planning. A climate of 

 economic uncertainty created by frequently fluctuating dumping charges would, 

 therefore, create a disincentive for dumpers to invest in alternative waste disposal 

 measures. Thus a balance must be struck between an unpredictable, frequently 

 changing charge system and one that is unable to adjust to significant environmen- 

 tal, technological or economic changes. 



Fourth, what should the revenue be used for? A number of possibilities exist: the 

 money could be merged with general federal revenue, be turned over to the EPA 

 and the Corps or earmarked for certain activities. The concept of a user fee suggests 

 the revenue be turned over to the federal agencies which provide special services to 

 the dumpers; EPA and the Corps of Engineers would get money for administering 

 the dumping program and NOAA would receive money for monitoring and research. 

 Part of the revenue could be used productively, as previously discussed, for research 

 and development of alternative waste disposal methods. Such a distribution scheme 

 is analogous to a number of state hazardous waste programs which use part of the 

 revenue generated by a fee on hazardous waste site operators to fund waste recy- 

 cling and research on disposal alternatives. Another possible use of the revenue is 

 redistribution. Redistribution is used in a number of European countries to reduce 

 the net cost of pollution control by giving part of the charge income to polluters 

 with low treatment costs. This technique has been found to be more acceptable to 

 dischargers and hence enhances the political acceptability of the charge system gen- 

 erally. 



COMMENTS ON THE STAFF DRAFT FEE PROPOSAL 



The fee proposal contained in the May 16, 1983 Subcommittee Staff Draft is com- 

 mendable in terms of how the revenue vnll be distributed but is deficient with re- 

 spect to creating incentives for sound waste disposal practices. 



Earmarking a large percentage of the revenue generated from the 12-mile site 

 dumping fee to state and local governments for the development of long-term dispos- 

 al options is sensible. Such a decentralized distribution scheme should spawn a 

 wider variety and diversity of approaches to waste dispoal. As the experience of 

 many municipalities, including Philadelphia, attest there is rarely one single solu- 

 tion to municipal waste disposal. Instead the solution often involves a combination 

 of different methods and approaches, some large-scale some small. 



The 12-mile site revenue distribution provision, however, may favor state and 

 local activities too much. As mentioned earlier, there have been a number of signifi- 

 cant advances in alternative waste processing due, in part, to the input of federal 

 research monies. These research projects, such as the development of Ecorock, have 

 been capital intensive and arguably beyond the financial reach of most local or even 

 state governments. It may be wise, therefore, to increase the federal percentage, es- 

 pecially in light of the large number of purposes to which the federal government's 

 25 percent share is to be put such as monitoring and effects research. 



Funding a comprehensive multi-media assessment of disposal options for munici- 

 palities in the New York and New Jersey region with dumping fee revenues is also 

 a sound idea. Multi-media assessment is now useful for defining the general con- 

 cerns associated with each waste disposal option. But before it can become useful as 

 a decision-making tool many questions associated with its use need to be answered. 

 A federally funded multi-media management study could significantly improve the 

 utility of this approach. 



The staffs fee proposal could incorporate many potentially beneficial regulatory 

 uses of pricing mechanisms which it does not now include. There are no provisions 

 for var3dng the fee level to create incentives for sound waste disposal practices. The 

 staff proposal, for instance, could vary the fee level according to the types and con- 

 centrations of contaminants in the waste. Different wastes effect the marine envi- 

 ronment in different ways. Adjusting the fee level to these differences would inter- 

 nalize the social cost of ocean dumping and would create and incentive for reducing 

 the loading of contgmiinants of concern. The present staff draft relies instead on 

 quality standards. The past experience with numerical standards suggests that we 

 should seriously consider an alternative approach — such as a variable fee system 

 based on the contaminant levels in the waste. 



By confining the special dumping fee to the 12-mile site the staff proposal implies 

 that dumping at other sites poses no environmental problems. This inference is un- 



