APPENDIX R

** FACT SHEET 1**
Economic Benefit Potential From Implementation of a
Wellhead Protection Program in Wyoming

Wellhead Protection Programs are implemented by states to assist and guide communities in the development of local Wellhead Protection Plans. These plans are designed to protect Public [drinking] Water System (PWS) wells from potential contamination resulting from past, present and future practices.

Wellhead Protection Plans may provide economic benefits to a community in three ways: 1) using core elements (i.e., Wellhead Delineation, Contaminant Source Inventories, Source Management Approaches, Contingency Plans) of Wellhead Protection Plans as a basis for obtaining susceptibility [vulnerability] monitoring waivers, potentially allowing PWSs to avoid portions of the costly monitoring currently required by EPA under the Safe Drinking Water Act (SDWA); 2) avoiding the need to install a costly system to treat contaminated drinking water, and; 3) avoiding the cost of having to replace a well due to contamination.

Use of Wellhead Protection Plans to Obtain Monitoring Waivers:

Table 1 presents estimated annual costs for Synthetic Organic Compound (SOC) and Volatile Organic Compound (VOC) monitoring tests that PWSs presently must perform to meet SDWA requirements. In the event that a community's local Wellhead Protection Plan were utilized in obtaining monitoring waivers, these costs, or a portion of them, may be eliminated (and realized as a savings).

Costs at the state level are assumed to be approximately $150,000 per bi-ennium ($75,000/yr) or $300,000 over a four year period for one Full Time Equivalent (FTE) position (plus related expenses) to administer the program. Savings illustrated would accrue as a result of using Wellhead Protection Plans to aid in obtaining monitoring waivers for either or both tests.

Based upon Utah's experience where 1,000 PWSs saved approximately $3.8 million per year in monitoring costs, the 600 Wyoming PWSs could reasonably experience a proportional savings of roughly $2.28 million per year or $9.12 million over a four year period and the benefit/cost ratio would be 30:1, meaning that for each dollar spent by the state to administer the program, $30 in savings would be realized by communities. As illustrated in Table 3, assuming that 44% (265) of the Wyoming PWSs should qualify for monitoring waivers based upon vulnerability to contamination, as has been found in Texas where wellhead protection is likewise a voluntary program, savings would be roughly $1 million per year or $4 million over a four year period and the benefit/cost ratio would be 13:1.

Use of Wellhead Protection Plans to Potentially Save on Treatment Costs:

Implementation of Wellhead Protection Plans at the local level may benefit both the Farm Loan Program and the Wyoming Water Development Commission from the reduced need for emergency funding to replace contaminated wells or provide for water treatment facilities.

As an example, in 1995 the Rock Springs-Green River Joint Powers Board approached the legislature seeking state funding for a drinking water treatment plant due to site contamination. The expected cost of the proposed system is roughly $30 million. Since most communities do not have the financial means to fund an emergency water system improvement, it is reasonable to expect that resources will continue to be requested from state funding mechanisms if/when similar situations arise in the future.

Use of Wellhead Protection Plans to Potentially Save on Replacement Costs:

Table 2 contains a summary of potential costs associated with replacement of a contaminated drinking water supply well. When a well becomes contaminated, there are usually two options available to deal with the problem: 1) the well can be replaced, or: 2) the contaminants can be removed through treatment.

In locations where another drinking water source (aquifer) is non-existent, or prohibitively deep, treatment may be the only viable option.

An example well of 300 feet in depth ($110 per foot) drilled 2.5 miles ($247,000 per mile) from the system intake would result in a development cost of approximately $650,500.

Summary of Potential Savings:

Table 3 illustrates the potential savings which could potentially accrue to Wyoming communities through successful use of Wellhead Protection Plans. As illustrated in Table 3, in the event that replacement of one similar well could be avoided through the implementation of a Wellhead Protection Plan, savings to the state would amount to roughly $2 for every $1 spent by the state to administer the program over a period of four years. As illustrated in Table 3, in the event that implementation of a Wellhead Protection Plan prevented the need for just one similar drinking water treatment plant, the savings to the state would amount to $100 for every $1 spent by the state to administer the program over a period of four years.

** FACT SHEET 2 **
Potential Economic Benefits and Cost-Avoidance to Wyoming Communities (or Public
Water Systems) When Wellhead Protection Plans are Implemented

This fact sheet presents the potential economic benefits and cost savings that can be achieved when a community or its Public [drinking] Water Systems (PWSs) develop and implement local Wellhead Protection (WHP) Plans. The cost-benefit ratio is obtained by comparing the average cost of developing wellhead protection plans to EPA monitoring costs, and to the avoided costs of either providing a new drinking water supply or a water treatment system in the event that a PWS well becomes unuseable due to contamination. Implementation of Wellhead Protection Plans at the local level may benefit both the Farm Loan Program and the Wyoming Water Development Commission from the reduced need for emergency funding to replace contaminated wells or provide for water treatment facilities.

Costs of Developing and Implementing Wellhead Protection Plans:

As illustrated in Table 1, the majority of groundwater-supplied PWSs in Wyoming serve fewer than 500 people, and all but 8 serve fewer than 3300 people.

Table 1: Wyoming (Groundwater) Public Water Systems (PWSs) by Class and Size

Source: Data collected from the EPA Safe Drinking Water Program Database; (1/23/96).

Actual and projected costs for development of Wellhead Protection Plans are provided for two small towns (Elk Mountain, WY and Gilbert, LA) and for three small (Utah) public water systems of differing sizes in Table 2:

Table 2: Cost to Develop Wellhead Protection Plans

Fact: 92% of all Wyoming Public Water Systems serve fewer than 3300 people.
Fact: All but 18 of Wyoming's communities have populations less than 3300 people.

Since most Public Water Systems in Wyoming serve communities similar in size to those illustrated in Table 2 (i.e. <2500), the cost to the majority of Wyoming communities (or PWSs) to develop a Wellhead Protection Plan should approximate the costs depicted in Table 2, or roughly:

• $500 for the 366 PWSs serving <100 people
• $2000 for PWSs serving between 100 and 175 people
• $5000 for PWSs serving between 175 and 2500 people

As mentioned earlier, 92% of all Wyoming Public Water Systems serve fewer than 3300 people and all but 22 of Wyoming's communities have populations of less than 2500 people. The cost estimates above would therefore reasonably apply to the majority of communities (and PWSs) within the state.

Potential Economic Benefits and Cost-Avoidance to Wyoming Communities When Wellhead Protection Plans are Implemented:

Wellhead Protection Plans may provide economic benefits to a community in three ways: 1) using core elements (i.e., Wellhead Delineation, Contaminant Source Inventories, Source Management Approaches, Contingency Plans) of Wellhead Protection Plans as a basis for obtaining susceptibility [vulnerability] monitoring waivers, potentially allowing PWSs to avoid portions of the costly water quality sampling currently required by EPA under the Safe Drinking Water Act (SDWA); 2) avoiding the need to install a costly system to treat contaminated drinking water, and; 3) avoiding the cost of having to replace a well due to contamination.

The economic benefit (avoided cost) and (avoided) cost-benefit ratio of each of the above factors' is presented in Table 3:

Table 3: Potential Avoided Costs and Cost/Benefit Ratios

Based upon Utah's experience where 1,000 PWSs saved approximately $3.8 million per year in monitoring costs, the 600 Wyoming PWSs could reasonably experience a proportional savings of roughly $2.28 million per year. Assuming that 44% (265) of the Wyoming PWSs should qualify for monitoring waivers based upon vulnerability to contamination (as has been found in Texas, where wellhead protection is likewise a voluntary program) savings would be roughly $1 million per year or $3,775 per system, per year.

Avoidance of Cost to Replace Drinking Water Supply:

An example well of 300 feet in depth ($110 per foot) drilled 2.5 miles ($247,000 per mile) from the system intake would result in a development cost of approximately $650,500. These costs do not include the remediation costs required to remove the source of contamination and restore the groundwater as a viable drinking water source. In many cases, since the source will continue to threaten new PWS wells or existing private drinking water wells, active remediation of the groundwater is necessary. As documented in many case studies of existing PWSs across the country, the cost of remediation significantly increases the total costs of replacing a water supply. Most small PWSs need outside sources of funding to pay for drilling new wells, remediation costs, and treatment systems.

Avoidance of Cost to Treat Contaminated Drinking Water:

Estimated costs to install a relatively simple reverse osmosis treatment system at the wellhead range from as little as $23,000 to more than $500,000, depending upon the volume of water required to treat. Capital costs and the 5-year operation and maintenance costs are included in these estimates. Depending on the location of the water well(s), additional water transmission lines may be needed, thereby increasing the capital costs even higher.

Summary:

The cost/benefit ratios illustrated in Table 3 demonstrate that from $7 to $1300 might be saved (or avoided) for every $1 spent by a community (or PWS) to develop a Wellhead Protection Plan. As illustrated in Table 3, in most cases it is the smaller communities that stand to gain the most by developing Wellhead Protection Plans. Very small PWSs (< 100 people served) could possibly save (or avoid) as much as $1300 for every $1 spent if development and implementation of a Wellhead Protection plan prevented the contamination of one drinking water supply well. For all sizes of PWSs (or communities) illustrated in Table 3, the cost savings that might be achieved by obtaining monitoring waivers alone can justify the cost involved in developing the Wellhead Protection Plan.

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Wellhead Protection Program Guidance Document Contents
Wyoming Department of Environmental Quality