OREGON DEPARTMENT OF ENVIRONMENTAL QUALITY WATER POLLUTION CONTROL FACILITY PERMIT EVALUATION. July 12,2012

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1 OREGON DEPARTMENT OF ENVIRONMENTAL QUALITY WATER POLLUTION CONTROL FACILITY PERMIT EVALUATION July 12,2012 Department of Environmental Quality Eastern Region - Bend Office 475 NE Bellevue Dr. Suite 110, Bend, OR Telephone: (541) Permit Applicant: Agri-Cycle, Inc Walker Road, Bend, OR FileNumber: Existing Permit No.: Expiration Date: August 31, 2020 Source Contact: Source Location: County: Permit Writer: Proposed Action: Source Category Matthew Borlen, President Telephone Number: (541) Septage alkaline stabilization treatment location: City of Bend Wastewater Treatment Plant Septage Receiving Station at McGrath Road, Bend, OR; Land application of Class B biosolids upon DEQ authorized sites in Deschutes and Crook Counties, Oregon. Deschutes Paul DeVito, ph New Permit Application Number: Bend DEQ Office Minor - Domestic Septage Alkaline Stabilization Date Received: 08/18/2010 BACKGROUND Introduction Agri-Cycle, Inc. (Agri-Cycle) is a sub-contractor for the City of Bend and operates and maintains the City's septage receiving and treatment facility immediately adjacent to the City's wastewater treatment plant located at McGrath Road in Deschutes County northeast of Bend. Agri-Cycle receives, treats, and beneficially land applies treated septage consisting of a blend of wastes from septic tanks, vault toilets, type III marine sanitation devices, chemical toilets, holding tanks, waste activated sludge, and grease from restaurant grease traps and interceptors. The receiving station/treatment facility property site and some of the original equipment is owned by the City of Bend. However, Agri-Cycle also owns some of the equipment and repairs and maintains most of it. Since July 1, 1993, the company has operated its business under a Water Pollution Control Facility (WPCF) permit issued by DEQ to the City of Bend. DEQ is now requiring that Agri-Cycle obtain its own WPCF permit and Agri-Cycle has submitted a permit application (#968905). Since Agri-Cycle treats domestic wastes, a WPCF permit is required under Oregon Revised Statues (ORS) 468B.050. The management of septage is also regulated under the Code of Federal Regulations (40 CRF Part 503) and the Oregon Administrative Rules (OAR ). The waste activated sludge is received from Cline Butte Utilities' membrane bioreactor wastewater treatment plant serving Eagle Crest Resort. Small volumes of low strength ph-balanced equalization tank water from Deschutes Brewery are also received at the septage facility.

2 Page 2 Treatment Facility The septage facility consists of the following primary components: Pumper truck scale Pumper truck unloading ramp Bar screens (2) Rotary screen 54,000 gallon screened concrete septage holding tank (cistern) Multiple pumps Lime silo and mixing valves/piping Lime mixing and recycle tanks (1 each) Aeration/batching tanks (7 total ranging in size from 6,000 to 12,000 gallons) Treated septage holding tanks (4 tanks totaling 40,600 gallons) The septage facility has the capacity to receive, treat and hold 164,000 gallons of septage at a given time. Current processing is just over 2 million gallons per year (2,051,500 gallons in 2010 and 2,143,453 gallons in 2011). As much as 2.9 million gallons in a single year has been processed by Agri-Cycle historically. Alkaline Stabilization Treatment Process DEQ certified septage haulers weigh their pumper trucks on a scale prior to unloading at the septage receiving facility and weigh out when the leave. The drivers are required by Agri-Cycle to check the ph of their wastes and record their information on Septage Survey Forms. The wastes are unloaded through a bar screen, with septic tank pumpings and waste activated sludge unloaded into the 54,000 gallon cistern. Occasionally, relatively minor volumes of low strength ph-balanced equalization tank water from Deschutes Brewery are delivered and discharged to this cistern tank and used to break-up and dilute solids that have accumulated in the bottom of the cistern. The brewery water is only received at the septage facility when the brewery is bumping up against a City of Bend permit limitation for quantity of wastewater being discharged to the City's wastewater collection system. When haulers are unloading higher strength wastes at the septage receiving facility, they are passed through a bar screen and routed to a 9,000 gallon steel tank. Allowable higher strength wastes include the wastes from portable toilets, vault toilets, type DI marine sanitation devices, holding tank septage, and grease collected from restaurant grease traps and interceptors. The low strength and higher strength wastes of the cistern and steel tank, respectively, are then pumped up through a second bar screen, followed by a rotary screen, and then into an underground mixing tank. When the higher strength wastes are processed through the treatment facility, they are required to be blended into the mixing tank at a ratio of no less than 3 gallons lower strength wastes to every one gallon of higher strength wastes to form a "septage blend." The septage blend is then pumped up to aeration tanks. En route to the aeration tanks, hydrated lime is injected into the piping to raise the ph of the septage blend. The septage blend is aerated and mixed via compressed air for a minimum of two hours, after which the septage is tested and must have at least a ph of 12 without further addition of alkaline agent. The septage blend is then aerated for an additional 22 hours, after which the ph must test at least 11.5 without further addition of alkaline agent. The treated septage blend is referred to as treated septage or biosolids. The alkaline stabilization treatment process is designed to insure that both pathogens and volatile solids present in the wastes are reduced to very low and acceptable levels. High levels of pathogens may pose a risk to human health and livestock and high levels of volatile solids may result in significant odors that may attract flies and other disease vectors. The treatment processes used by Agri-Cycle are prescribed methods that have been researched and approved by U.S. Environmental Protection Agency (EPA) for both pathogen and volatile solids reductions, and comply with 40 CRF Part 503 standards for biosolids. The processes ensure that the biosolids will be safe for land application at DEQ-authorized land sites following site restrictions required by DEQ.

3 Page 3 Land Application After treatment necessary to comply with vector attraction and pathogen reduction requirements, the biosolids are beneficially land applied on sites that have been conditionally approved by DEQ and are located within Deschutes and Crook Counties. Any future land application sites must conform to the site selection criteria in Agri-Cycle's approved Septage Management Plan and any future DEQ Site Authorizations for the specific sites. Agri-Cycle's current Septage Management Plan was previously approved by DEQ when the company was operating under the City of Bend's WPCF permit, along with several approved addendums to the plan since Agri-Cycle began operation in DEQ has received an updated Septage Management Plan from Agri-Cycle, together with the company's application for a new WPCF permit. The new permit requires reporting of the methods used by Agri-Cycle to comply with the 503 regulation requirements for both vector attraction and pathogen reduction. An annual operations summary report is also required. The new permit requires that the lime (alkaline) stabilized wastes (biosolids) continue to be beneficially land applied at sites that have been reviewed and authorized in writing by DEQ. The application of biosolids to authorized sites agronomic rates is beneficial to soils and crops. The biosolids contain important plant nutrients, primarily nitrogen, and organic matter that improves plant growth and soil tilth. While the application of biosolids has multiple benefits, there are also public health and environmental concerns that must be considered and addressed via the permit and site authorization process. The permit requires that practices of site management, biosolids land application, farm cropping, and irrigation all conform to conditions contained in the site authorization letters. There are a total of 19 rural agricultural sites within east Deschutes and west Crook Counties that are currently authorized by DEQ to receive land applications of Agri-Cycle biosolids, with over 2,400 acres availability (see table below). The properties are privately owned and have perimeter fencing. Crops grown on these sites are alfalfa, cereal grains, and orchard grass that are used for hay or pastured, and are not for human consumption. When authorized irrigated land is not available, Agri-Cycle sometimes applies to authorized dry land sites growing crested wheat. Applications are made using a 4,000 gallon tanker truck equipped with a gravity discharge outlet and a spreader plate that produces a 10-foot wide application pattern. For additional odor and vector control, the crops are generally irrigated soon after application on established fields. On fields with new crop establishment, the biosolids are sometimes tilled, plowed or disked into the soil soon after application. The site-specific site authorizations typically include the following types of restrictions: Specific application setbacks or buffer strips from property lines, residences, streams and wells. Maximum allowable gallons for the site to ensure that the nitrogen products present are utilized by vegetation and to prevent groundwater contamination (applied at no greater than agronomic rates for the site crop). In addition, specific hydraulic loading rates may be required to ensure that runoff, ponding or over-saturation does not occur. Maximum site loadings to ensure that soils are not overloaded with other pollutants from normal household activities. Seasons of allowed application. Time-restricted entry upon the application site following the application by humans or livestock or both. Application equipment to be used. Other site restrictions as needed, for example no application allowed on steep slopes. Based on a review of the Septage Management Plan, DEQ has determined that the application rates and site management practices for the land application of alkaline stabilized domestic septage will ensure continued agricultural production and not reduce the productivity of land if materials are applied in strict compliance with the authorization letters and all applicable statutes, rules, permits, plans, and federal guidance.

4 Page 4 Currently Authorized Land Application Sites: Site Name (Owner) Borlen Ranch Singhose Ranch Wogman Date Authorized 11/09/93 11/09/93 11/09/93 Location Address Mountain Country Farms Zemlicka/Blake Titus Tye Gregory Burnside City of Bend Robinson Sale Rantz Overman Wolf/Frantz Crouch Tate 03/10/94 05/15/97 05/15/97 03/23/98 03/23/98 03/23/98 05/04/98 06/25/98 08/27/98 06/14/99 01/18/00 01/18/00 03/21/00 05/23/00 06/15/01 07/03/01 03/11/03 10/27/03 Deschutes and Sterns Rd, Crook County Johnson Ranch Rd, east of Bend in Walker Rd, east of Bend in Deschutes County Walker Rd, east of Bend in Byram Rd, east of Bend in Alfalfa Market Rd, east of Bend in Johnsons Ranch Rd, east of Bend in Johnsons Ranch Rd, east of Bend in Tax lot Johnsons Ranch Rd. east of Bend in Tax lot Alfalfa Market Rd, east of Bend in wastewater treatment plant fields, east of Bend in Dodds Rd, east of Bend in Johnsons Ranch Rd. east of Bend in Tax lot 500 & Johnsons Ranch Rd, east of Bend in Tax lots 800 & Alfalfa Market Rd, Powell Butte, Crook Co Johnson Ranch Rd, east of Bend in Dodds Rd, east of Bend in Dodds Rd, east of Bend in County Line Rd, east of Bend in Willard Rd, east of Bend in * Total acreage of the 4 site authorizations is acres Acres * 60 * * * Land Application of Brewery Wastes In addition to land application of biosolids, Agri-Cycle also land applies local brewery wastes upon farmland. Not to be confused with the Deschutes Brewery ph-balanced low strength equalization tank water received at the septage receiving and treatment facility, these brewery wastes consist primarily of spent grains, yeast, and filtrate. DEQ understands that at times these brewery wastes are used as fodder for livestock, and at other times the material is more

5 Page 5 liquid and land applied. Land application of brewery wastes requires either a WPCF permit from DEQ, or, alternatively, brewery wastes may be tested and certified by the Oregon Department of Agriculture (ODA) and allowed to be applied agriculturally as a beneficial soil amendment upon farm land without a DEQ permit. Agri- Cycle has obtained ODA certification for its brewery waste agricultural land applications. Occasionally, DEQ receives odor complaints from neighboring property owners where Agri-Cycle is applying certified brewery wastes. Since the land application of these sometimes odorous brewery wastes are neither regulated nor required to be regulated under this or another DEQ permit, and are instead applied as an ODA tested and certified agricultural amendment, DEQ has no jurisdiction or control over such applications or the odors, they may cause. Groundwater Based on the Department's current information, stabilized domestic septage operations have a low potential for adversely impacting groundwater quality. Therefore, Schedule D of the proposed permit states that no groundwater evaluations will be required during the permit cycle. The permit also includes a condition in Schedule A that prohibits any adverse impact on groundwater quality. Compliance History Since this is a new permit, a compliance history has not been developed. Septage Management Plan Approval In support of the permit application, Agri-Cycle submitted an updated Septage Management Plan. The plan was developed consistent with Department guidance and rules. The Department proposes to approve the updated plan with one exception. The plan, in addition to alkaline stabilization treatment of septage, also identified a secondary treatment method (in addition to alkaline stabilization) that involves long term drying of septage on the City of Bend's sludge drying beds. This alternative treatment, using EPA approved vector attraction and pathogen reduction standards, was approved by DEQ while operating under the City of Bend's WPCF permit. However, the availability of the City's drying beds for septage drying is extremely limited Since submittal of the updated septage management plan, Agri-Cycle has decided to not utilize drying treatment technology going forward given the limitation on drying bed use and the higher permit fees associated with a permit that would allow air drying treatment. As a result, the proposed permit only allows alkaline stabilization treatment of septage and does not allow air drying treatment. PERMIT DISCUSSION Face Page The permittee is authorized to construct, install, modify, or operate a wastewater collection, treatment, control and disposal system. The permit allows disposal of treated wastewater within limits set by Schedule A and the following schedules. All other discharges are prohibited. Schedule A - Waste Discharge Limitations Schedule A identifies requirements and limitations for septage treatment and land application. This permit requires treatment processes to significantly reduce pathogens and reduce vector attraction consistent with 40 CFR Part 503 and OAR Receipt and treatment of Primary Septage and specified Other Wastes is allowed. Primary Septage is identified in this permit as septage from septic tanks, waste activated sludge received from Cline Butte Utilities wastewater treatment facility, and minor amounts of Deschutes Brewery low strength phbalanced equalization tank water. Other Wastes are identified in this permit as domestic septage not from septic tanks (from holding tanks, chemical toilets, marine type III privies, and/or equivalent that take only human wastes) and grease collected from restaurant grease traps and grease interceptor tanks. Agri-Cycle uses alkaline stabilization to treat septage (Primary Septage and Other Wastes). A minimum 3-to-l blending ratio is required by

6 Page 6 the permit for mixing Primary Septage with Other Wastes. Other Wastes tend to be more odorous than Primary Septage and required blending helps to reduce the overall odor of the treated product. Discharge of wastes to surface waters is prohibited. Land application of septage is only allowed after receiving required treatment and only allowed to be applied on sites that have been authorized in writing by DEQ. The treated septage must be applied in conformance with conditions in the site authorization letters including provisions for site management, application methods and setbacks, cropping practices, and irrigation. Application distribution and rates are limited to prevent nutrient and hydraulic overloading, ponding of septage upon the ground, creation of nuisance conditions (including odors), runoff, or groundwater contamination. Schedule B - Minimum Monitoring and Reporting Requirements Monitoring and reporting requirements under Schedule B of the permit ensure the minimum pennit limitations of the treatment process. Recordkeeping requirements under 40 CFR 503 and OAR include tracking all treated septage that is land applied on authorized sites. The recordkeeping includes collecting information on where the septage came from (which pumper and actual source of the septage), type of septage (types of Primary Septage or Other Wastes septage as allowed for and defined in Schedule A), treatment process used and measured values, and the operations and maintenance activities conducted. Land application records must be maintained identifying the date, time and amount of stabilized septage applied and the location of septage application. An annual report is due each February describing the methods uses to meet pathogen and vector attraction reduction standards and information demonstrating septage applications were not applied at rates greater than agronomic rates. A second annual report (or combined report) is also required each February that forecasts the locations and how much treated septage is planned for application on approved sites in the coming year. Schedule C - Compliance Conditions There are no compliance schedule conditions in this proposed permit and thus no Schedule C which is reserved for such conditions. ' Schedule D - Special Conditions Schedule D of the permit contains seven special conditions which are standard conditions for Water Pollution Control Facilities permits for septage alkaline stabilization systems. These conditions include the following requirements and permit re-opener clauses: 1) Submit plans and specifications prior to any treatment system modifications and/or expansions; 2) Manage septage in accordance with their approved septage management plan; 3) Have a contingency plan for the prevention and proper handling of a spill; 4) Control site access to grazing animals and the public; 5) Certify the quality/treatment of all loads of treated septage being delivered to and applied at land application sites; 6) A reopener clause identifying that hydrogeologic characterization or groundwater monitoring requirements could be added to the permit if septage operations are not managed consistent with the permit or the Department believes that the septage facility operations is causing adverse groundwater quality impacts; and 7) A reopener clause in the event that biosolids regulations change and an acknowledgement that the WPCF permit does not relieve the permittee of any responsibility under Federal regulations.

7 Page 7 Schedule E - Pretreatment Activities There are no pretreatment conditions in this proposed permit and thus no Schedule E which is reserved for such conditions. Schedule F - General Conditions These are conditions that are attached to all WPCF permits. It includes in one location the rules and requirements that most commonly apply to permittees. The General Conditions consist of a wide variety of standard conditions that are attached to all WPCF permits. Among these are conditions that relate to permit actions (modification, suspension, revocation, transfers, and payment of permit fees), proper operation and maintenance of wastewater facilities, monitoring, records, reporting, and permit definitions.