MEMORANDUM
Eastern
Research
Group,
Inc.
110
Hartwell
Avenue
Lexington,
MA
02421
Date:
August
4,
2003
To:
James
Covington,
EPA
From:
Cal
Franz,
ERG
Re:
Distribution
of
Costs
and
Loads
under
Various
Production
Thresholds
The
attached
tables
compares
costs
and
loads
incurred
by
meat
and
poultry
product
facilities
in
subcategory
A
through
D
and
subcategory
K
under
three
different
production
thresholds.
The
first
comparison
presents
data
for
facilities
that
produce
more
than
and
less
than
10
million
pounds
of
red
meat
and/
or
poultry
products
annually,
the
second
comparison
sets
this
threshold
at
50
million
pounds
of
production
per
year,
and
the
third
specifies
a
100
million
pound
production
threshold.
This
analysis
includes
all
facilities
in
these
two
subcategories,
both
small
processors
(
those
with
annual
production
below
50
million
pounds
in
Subcategory
A
through
D,
and
those
with
annual
production
below
10
million
pounds
in
Subcategory
K)
and
large
processors
(
all
facilities
that
exceed
those
production
thresholds).

In
addition
to
pretax
annualized
compliance
costs,
annual
production,
and
annualized
compliance
costs
per
pound
of
production,
the
tables
present
annual
pounds
of
pollutant
loads
and
removals.
Both
loads
and
removals
are
calculated
as
the
sum
of:
5­
day
biochemical
oxygen
demand,
total
suspended
solids,
chemical
oxygen
demand,
carbonaceous
oxygen
demand,
ammonia
as
nitrogen,
total
nitrogen,
total
phosphorus,
nitrate
+
nitrite,
total
Kjeldahl
nitrogen,
and
oil
and
grease
(
measured
as
HEM).
Table
A
presents
totals
for
each
subcategory,
while
Table
B
provides
percentages.

For
each
option,
Table
B
also
presents
the
compliance
costs
per
pound
of
production
for
facilities
above
and
below
the
threshold
relative
to
the
overall
average
compliance
costs
per
pound
of
production
for
all
facilities
in
that
subcategory.
Thus,
in
Table
2A,
9
poultry
processors
produce
less
than
10
million
pounds
of
meat
products
per
year,
while
118
facilities
exceed
that
threshold.
Those
facilities
below
the
threshold
account
for
7.2
percent
of
facilities,
and
8.2
percent
of
Option
2
compliance
costs,
but
only
0.2
percent
of
total
annual
production
(
Table
2B).
Thus,
while
facilities
that
produce
more
than
10
million
pounds
of
poultry
products
per
year
incur
compliance
costs
of
$
0.0003
per
pound
per
year,
those
facilities
that
lie
below
that
threshold
incur
costs
of
$
0.0125
per
pound
(
Table
2A).
Compliance
costs
per
pound
for
the
9
facilities
below
the
threshold
exceed
the
overall
subcategory
average
cost
per
pound
by
a
factor
of
44.5
(
Table
2B).
In
addition,
while
those
9
facilities
account
for
0.2
percent
of
subcategory
production,
they
only
contribute
0.1
percent
of
subcategory
costs
and
loads.

1
Table
1A
Subcategory
A
­
D:
Facilities,
Production,
Removals
and
Loads
by
Production
Class
Pretax
Annualized
Annual
Costs
Production
Costs/
Pound
Removals
Loads
Annual
Production
Class
Option
Facilities
(
x
$
1,000)
(
x
1,000
lbs.)
Production
(
lbs/
year)
(
lbs/
year)

10
million
pounds
or
less
Option
2
0
CBI
CBI
NA
CBI
CBI
greater
than
10
million
pounds
53
CBI
CBI
$
0.0002
CBI
CBI
Option
2+
P
0
CBI
CBI
NA
CBI
CBI
53
CBI
CBI
$
0.001
CBI
CBI
Option
2.5
0
CBI
CBI
NA
CBI
CBI
53
CBI
CBI
$
0.0004
CBI
CBI
Option
2.5+
P
0
CBI
CBI
NA
CBI
CBI
53
CBI
CBI
$
0.001
CBI
CBI
Option
4
0
CBI
CBI
NA
CBI
CBI
53
CBI
CBI
$
0.002
CBI
CBI
50
million
pounds
or
less
Option
2
14
CBI
CBI
$
0.0013
CBI
CBI
greater
than
50
million
pounds
39
CBI
CBI
$
0.0001
CBI
CBI
Option
2+
P
14
CBI
CBI
$
0.0037
CBI
CBI
39
CBI
CBI
$
0.0011
CBI
CBI
Option
2.5
14
CBI
CBI
$
0.0023
CBI
CBI
39
CBI
CBI
$
0.0004
CBI
CBI
Option
2.5+
P
14
CBI
CBI
$
0.0047
CBI
CBI
39
CBI
CBI
$
0.0013
CBI
CBI
Option
4
14
CBI
CBI
$
0.0057
CBI
CBI
39
CBI
CBI
$
0.0014
CBI
CBI
100
million
pounds
or
less
Option
2
14
CBI
CBI
$
0.0013
CBI
CBI
greater
than
100
million
pounds
39
CBI
CBI
$
0.0001
CBI
CBI
Option
2+
P
14
CBI
CBI
$
0.0037
CBI
CBI
39
CBI
CBI
$
0.0011
CBI
CBI
Option
2.5
14
CBI
CBI
$
0.0023
CBI
CBI
39
CBI
CBI
$
0.0004
CBI
CBI
Option
2.5+
P
14
CBI
CBI
$
0.0047
CBI
CBI
39
CBI
CBI
$
0.0013
CBI
CBI
Option
4
14
CBI
CBI
$
0.0057
CBI
CBI
39
CBI
CBI
$
0.0014
CBI
CBI
Subcategory
Totals
Option
2
53
CBI
CBI
$
0.0002
CBI
CBI
Option
2+
P
53
CBI
CBI
$
0.0011
CBI
CBI
Option
2.5
53
CBI
CBI
$
0.0004
CBI
CBI
Option
2.5+
P
53
CBI
CBI
$
0.0013
CBI
CBI
Option
4
53
CBI
CBI
$
0.0015
CBI
CBI
Removals
and
loads
are
calculated
as
the
sum
of:
5­
Day
Biochemical
Oxygen
Demand,
Total
Suspended
Solids,
Chemical
Oxygen
Demand,

Carbonaceous
Biochemical
Oxygen
Demand,
Ammonia
as
Nitrogen,
Total
Nitrogen,
Total
Phosphorus,
Nitrate/
Nitrite,

Total
Kjeldahl
Nitrogen,
and
Oil
&
Grease
(
HEM).
Table
1B
Subcategory
A
­
D:
Facilities,
Production,
Removals
and
Loads
by
Production
Class
As
Percent
of
Subcategory
Total
Pretax
Ratio
of
Annualized
Annual
Prodn.
Class
Costs
Production
Cost/
Pound
Removals
Loads
Annual
Production
Class
Option
Facilities
(
x
$
1,000)
(
x
1,000
lbs.)
to
Total
(
lbs/
year)
(
lbs/
year)

10
million
pounds
or
less
Option
2
0.0%
0.0%
0.0%
NA
0.0%
0.0%

greater
than
10
million
pounds
100.0%
100.0%
100.0%
1.00
100.0%
100.0%

Option
2+
P
0.0%
0.0%
0.0%
NA
0.0%
0.0%

100.0%
100.0%
100.0%
1.00
100.0%
100.0%

Option
2.5
0.0%
0.0%
0.0%
NA
0.0%
0.0%

100.0%
100.0%
100.0%
1.00
100.0%
100.0%

Option
2.5+
P
0.0%
0.0%
0.0%
NA
0.0%
0.0%

100.0%
100.0%
100.0%
1.00
100.0%
100.0%

Option
4
0.0%
0.0%
0.0%
NA
0.0%
0.0%

100.0%
100.0%
100.0%
1.00
100.0%
100.0%

50
million
pounds
or
less
Option
2
27.1%
12.2%
1.6%
7.82
0.2%
0.2%

greater
than
50
million
pounds
72.9%
87.8%
98.4%
0.89
99.8%
99.8%

Option
2+
P
27.1%
5.2%
1.6%
3.31
0.1%
0.2%

72.9%
94.8%
98.4%
0.96
99.9%
99.8%

Option
2.5
27.1%
9.0%
1.6%
5.77
0.2%
0.2%

72.9%
91.0%
98.4%
0.92
99.8%
99.8%

Option
2.5+
P
27.1%
5.6%
1.6%
3.57
0.2%
0.2%

72.9%
94.4%
98.4%
0.96
99.8%
99.8%

Option
4
27.1%
5.9%
1.6%
3.77
0.2%
0.2%

72.9%
94.1%
98.4%
0.96
99.8%
99.8%

100
million
pounds
or
less
Option
2
27.1%
12.2%
1.6%
7.82
0.2%
0.2%

greater
than
100
million
pounds
72.9%
87.8%
98.4%
0.89
99.8%
99.8%

Option
2+
P
27.1%
5.2%
1.6%
3.31
0.1%
0.2%

72.9%
94.8%
98.4%
0.96
99.9%
99.8%

Option
2.5
27.1%
9.0%
1.6%
5.77
0.2%
0.2%

72.9%
91.0%
98.4%
0.92
99.8%
99.8%

Option
2.5+
P
27.1%
5.6%
1.6%
3.57
0.2%
0.2%

72.9%
94.4%
98.4%
0.96
99.8%
99.8%

Option
4
27.1%
5.9%
1.6%
3.77
0.2%
0.2%

72.9%
94.1%
98.4%
0.96
99.8%
99.8%
Table
2A
Subcategory
K:
Facilities,
Production,
Removals
and
Loads
by
Production
Class
Pretax
Annualized
Annual
Costs
Production
Costs/
Pound
Removals
Loads
Annual
Production
Class
Option
Facilities
(
x
$
1,000)
(
x
1,000
lbs.)
Production
(
lbs/
year)
(
lbs/
year)

10
million
pounds
or
less
Option
2
9
CBI
CBI
$
0.0125
CBI
CBI
greater
than
10
million
pounds
118
CBI
CBI
$
0.0003
CBI
CBI
Option
2+
P
9
CBI
CBI
$
0.0255
CBI
CBI
118
CBI
CBI
$
0.0012
CBI
CBI
Option
2.5
9
CBI
CBI
$
0.0129
CBI
CBI
118
CBI
CBI
$
0.0005
CBI
CBI
Option
2.5+
P
9
CBI
CBI
$
0.0259
CBI
CBI
118
CBI
CBI
$
0.0014
CBI
CBI
Option
4
9
CBI
CBI
$
0.0338
CBI
CBI
118
CBI
CBI
$
0.0026
CBI
CBI
50
million
pounds
or
less
Option
2
28
CBI
CBI
$
0.0079
CBI
CBI
greater
than
50
million
pounds
99
CBI
CBI
$
0.0002
CBI
CBI
Option
2+
P
28
CBI
CBI
$
0.0168
CBI
CBI
99
CBI
CBI
$
0.0011
CBI
CBI
Option
2.5
28
CBI
CBI
$
0.0106
CBI
CBI
99
CBI
CBI
$
0.0004
CBI
CBI
Option
2.5+
P
28
CBI
CBI
$
0.0195
CBI
CBI
99
CBI
CBI
$
0.0013
CBI
CBI
Option
4
28
CBI
CBI
$
0.0290
CBI
CBI
99
CBI
CBI
$
0.0024
CBI
CBI
100
million
pounds
or
less
Option
2
28
CBI
CBI
$
0.0079
CBI
CBI
greater
than
100
million
pounds
99
CBI
CBI
$
0.0002
CBI
CBI
Option
2+
P
28
CBI
CBI
$
0.0168
CBI
CBI
99
CBI
CBI
$
0.0011
CBI
CBI
Option
2.5
28
CBI
CBI
$
0.0106
CBI
CBI
99
CBI
CBI
$
0.0004
CBI
CBI
Option
2.5+
P
28
CBI
CBI
$
0.0195
CBI
CBI
99
CBI
CBI
$
0.0013
CBI
CBI
Option
4
28
CBI
CBI
$
0.0290
CBI
CBI
99
CBI
CBI
$
0.0024
CBI
CBI
Subcategory
Totals
Option
2
127
CBI
CBI
$
0.0003
CBI
CBI
Option
2+
P
127
CBI
CBI
$
0.0013
CBI
CBI
Option
2.5
127
CBI
CBI
$
0.0005
CBI
CBI
Option
2.5+
P
127
CBI
CBI
$
0.0015
CBI
CBI
Option
4
127
CBI
CBI
$
0.0027
CBI
CBI
Removals
and
loads
are
calculated
as
the
sum
of:
5­
Day
Biochemical
Oxygen
Demand,
Total
Suspended
Solids,
Chemical
Oxygen
Demand,

Carbonaceous
Biochemical
Oxygen
Demand,
Ammonia
as
Nitrogen,
Total
Nitrogen,
Total
Phosphorus,
Nitrate/
Nitrite,

Total
Kjeldahl
Nitrogen,
and
Oil
&
Grease
(
HEM).
Table
2B
Subcategory
K:
Facilities,
Production,
Removals
and
Loads
by
Production
Class
As
Percent
of
Subcategory
Total
Pretax
Ratio
of
Annualized
Annual
Prodn.
Class
Costs
Production
Cost/
Pound
Removals
Loads
Annual
Production
Class
Option
Facilities
(
x
$
1,000)
(
x
1,000
lbs.)
to
Total
(
lbs/
year)
(
lbs/
year)

10
million
pounds
or
less
Option
2
7.2%
8.2%
0.2%
44.50
0.1%
0.1%

greater
than
10
million
pounds
92.8%
91.8%
99.8%
0.92
99.9%
99.9%

Option
2+
P
7.2%
3.7%
0.2%
20.26
0.1%
0.1%

92.8%
96.3%
99.8%
0.96
99.9%
99.9%

Option
2.5
7.2%
4.5%
0.2%
24.30
0.1%
0.1%

92.8%
95.5%
99.8%
0.96
99.9%
99.9%

Option
2.5+
P
7.2%
3.3%
0.2%
17.71
0.1%
0.1%

92.8%
96.7%
99.8%
0.97
99.9%
99.9%

Option
4
7.2%
2.4%
0.2%
12.75
0.1%
0.1%

92.8%
97.6%
99.8%
0.98
99.9%
99.9%

50
million
pounds
or
less
Option
2
21.8%
22.9%
0.8%
28.04
1.4%
1.0%

greater
than
50
million
pounds
78.2%
77.1%
99.2%
0.78
98.6%
99.0%

Option
2+
P
21.8%
10.9%
0.8%
13.32
1.0%
1.0%

78.2%
89.1%
99.2%
0.90
99.0%
99.0%

Option
2.5
21.8%
16.3%
0.8%
20.02
1.2%
1.0%

78.2%
83.7%
99.2%
0.84
98.8%
99.0%

Option
2.5+
P
21.8%
10.9%
0.8%
13.35
1.0%
1.0%

78.2%
89.1%
99.2%
0.90
99.0%
99.0%

Option
4
21.8%
8.9%
0.8%
10.95
1.0%
1.0%

78.2%
91.1%
99.2%
0.92
99.0%
99.0%

100
million
pounds
or
less
Option
2
21.8%
22.9%
0.8%
28.04
1.4%
1.0%

greater
than
100
million
pounds
78.2%
77.1%
99.2%
0.78
98.6%
99.0%

Option
2+
P
21.8%
10.9%
0.8%
13.32
1.0%
1.0%

78.2%
89.1%
99.2%
0.90
99.0%
99.0%

Option
2.5
21.8%
16.3%
0.8%
20.02
1.2%
1.0%

78.2%
83.7%
99.2%
0.84
98.8%
99.0%

Option
2.5+
P
21.8%
10.9%
0.8%
13.35
1.0%
1.0%

78.2%
89.1%
99.2%
0.90
99.0%
99.0%

Option
4
21.8%
8.9%
0.8%
10.95
1.0%
1.0%

78.2%
91.1%
99.2%
0.92
99.0%
99.0%
