A Message from the Director...
Fiscal year 2002 was a year of challenge and achievement for the Arizona Department
of Environmental Quality. Like elsewhere in state government, ADEQ felt the effects
of the nation’s economic downturn, absorbing a 7.75 percent across-the-board cut in
our General Fund operating budget, which amounted to $1,036,400 for the fiscal year.
ADEQ reduced expenditures by holding 20 percent of the department’s General Fund
positions vacant and focusing on our core functions in carrying out our public health
and environmental protection mission. In short, we set priorities and fulfilled
responsibilities in the areas that had the greatest impact on people’s lives and the
quality of Arizona’s environment.
As the fiscal year drew to a close in June 2002, ADEQ’s senior management began
finalizing its report to the legislature that the agency had met or exceeded all 13 of the
program performance objectives set forth in its 2000 sunset legislation. ADEQ entered
discussions with EPA and others to advance the department-wide effort to improve
factors affecting environmental health conditions in South Phoenix. As the massive
Rodeo-Chediski wildfire devastated the Mogollon Rim, we were hard at work on
restoration activities, ensuring clean and safe drinking water, monitoring affected
streams and preparing grant assistance for revegetation efforts on private lands.
As June gave way to fiscal year 2003, the Air Quality Division, in conjunction with its
contractor, Gordon-Darby, opened the Valley’s 13th vehicle emissions inspection
station to further improve customer convenience and service. The Waste Programs
Division rapidly advanced projects from investigation to clean-up, restoring
groundwater for beneficial use and making contaminated urban properties safe for
public contact. The Water Quality Division continued its march toward completing
permit actions for all existing non-mining facilities in the state by calendar year’s end.
And the Administrative Services Division culminated planning and preparation to
lead the agency’s relocation to the Capitol Mall.
Fiscal year 2002 was, indeed, a productive year for ADEQ despite the challenges
posed by the state’s budget crisis. The faltering economy resulted in no less work for
our dedicated staff who continued to meet deadlines, prioritize assignments and adjust
to resource shortages. As you read through our accomplishments, you can see how our
employees proved once again that they are capable stewards of Arizona’s natural
legacy and worthy of the responsibility entrusted to them. I am very proud to be
associated with men and women so dedicated to public service and professionalism.
This year’s annual report is structured around our core functions to help you better
understand the nature of our work. More detailed information about many of our
programs may be found in the appendices to this report and by reviewing our Web site

ADEQ's FY 2002 Annual Report, Page 1

at www.adeq.state.az.us. By reading through our accomplishments, you will see that
Team ADEQ does its job well, providing value to Arizona’s citizens.
Richard W. Tobin II
Acting Director

ADEQ's FY 2002 Annual Report, Page 2

ADEQ at a Glance...
The Arizona Legislature
established ADEQ as the state’s
environmental regulatory agency
under the Environmental Quality
Act of 1986. Our mission is to
protect public health by
administering our state’s
environmental quality laws and
delegated federal programs to
prevent, control and abate
pollution of our air, water and land
resources in a manner that
promotes productivity, quality,
service and advocacy for Arizona.
During FY 2002, ADEQ had an
average of 760 employees working
in our Phoenix headquarters and
our Flagstaff and Tucson regional
offices.
The department’s organizational
structure is composed of three
programmatic divisions that fulfill
our environmental protection
mission in the areas of air quality,
water quality and waste programs
and which are supported by the
director’s office and an
administrative services division.

Productivity
ADEQ enhances productivity and provides value for
Arizona citizens by reducing the cost of compliance
with environmental regulations. By making our
processes more efficient, we are able to respond
quickly to the needs of the regulated community
while reducing costs and without compromising
public health or environmental protection efforts.
ADEQ’s efforts help balance an expanding state
economy with a clean environment and a healthy
citizenry.
Quality
ADEQ achieves quality by reducing the public’s
exposure to pollutants through clean, safe water and
air, and regulation, management and minimization of
Arizona’s wastes. By measuring how clean the
environment is, ADEQ is able to take steps to reduce
pollution and oversee cleanup of contaminated sites.
Service
ADEQ understands that public service is a
cornerstone of its mission as a state agency. Thus,
ADEQ strives to meet and exceed our customers’
expectations in all that we do. As we serve our
customers, we reduce pollution and contaminants
through preventative measures and remediation
activities. Meeting customer needs also includes
educating the public about the environment and
involving stakeholders, who provide input on our
programs, rules and processes.
Advocacy
ADEQ is a leading advocate for Arizona’s
environmental interests. With the authority to
administer federal programs and through high-level
involvement in state and regional programs, we
ensure that the regulations and modes of enforcement
of these programs are applicable to the special needs
of Arizona’s environment. By making known our
positions on national environmental issues, we help
shape national policy to ensure that it reflects the
unique needs of Arizona.

Our agency’s core functions are
vital to public health and safety,
and by carrying them out, ADEQ
employees ensure that Arizona’s
environmental quality is protected
and that citizens enjoy an excellent
quality of life. The core functions
align with the agency mission,
strategic plan and performance
objectives, and fall under the following broad responsibilities:
ADEQ's FY 2002 Annual Report, Page 3

Pollution Control
Permitting – ADEQ issues permits, approvals and certifications to ensure that
facilities are constructed and operated in accordance with the law and that any
discharges to the air, water and soil are within healthful standards established by
law.
Planning – ADEQ’s planning specialists develop management practices and
increasingly stringent control strategies in areas where ambient standards are
threatened or violated. Arizona’s current air quality management areas and
watershed planning efforts are examples of this activity.
Pollution Prevention – As an alternative to regulatory enforcement, ADEQ offers
guidance, assistance and incentives to encourage the public to reduce and
eliminate waste and resulting pollution.
Environmental Clean Up
Remediation – ADEQ investigates and oversees the removal and cleanup of
contaminated soil and water to protect public health and the environment.
Emergency Response – ADEQ’s scientists, engineers and technicians assist local
responders and emergency coordinators by responding to hazardous chemical
releases that threaten public health and the environment as a result of
transportation accidents, fires or malfunctions at industrial sites.
Compliance Management
Inspections – ADEQ inspects facilities on a regular basis and in response to
citizen complaints to ensure compliance with environmental laws.
Enforcement – ADEQ ensures compliance with environmental laws by pursuing
formal enforcement actions, often in conjunction with the Arizona Attorney
General’s Office.
Monitoring and Assessment
Monitoring – ADEQ’s monitoring personnel collect air, water and soil samples
for laboratory analyses to determine the presence or absence of contaminants.
Assessment – ADEQ’s assessment staff interpret the data that result from field
research to draw conclusions about environmental indicators and trends and
form the basis for future planning and policy decisions.
Public Outreach
Education and Outreach – ADEQ offers a variety of seminars, workshops,
presentations and publishes information via newsletter and the Internet to inform
the public about department programs and activities. ADEQ staff also support
ADEQ's FY 2002 Annual Report, Page 4

numerous advisory and stakeholder groups and conduct public hearings and
meetings in support of our regulatory and public policy functions.
Financial Assistance – ADEQ offers financial assistance for leaking underground
storage tank cleanup costs and provides grants to local governments for air
quality and water quality programs. Other ADEQ programs also make funding
available to eligible applicants for recycling and pollution prevention projects and
activities.
Public Policy
Policy Development – ADEQ works with state and national organizations and
stakeholders to shape and influence sound environmental policy at the state and
federal levels. Policies are developed to explain how we interpret statutes and
rules to ensure consistent, equitable decisions and to inform the public about how
we do business.
Rule Development – ADEQ writes rules, based on science and public policy, to
implement the broad statutory language contained in legislation.
In addition to these programmatic responsibilities, ADEQ has an administrative
services division that provides centralized support for many of the agency’s business
activities including accounting, budgeting and strategic planning, managing contracts
and procurement, maintaining our information technology systems, human resources,
and general and laboratory services.

Fiscal Highlights
Information on our FY 2002 expenditures, revenues and full-time employees is shown
on four charts. Total revenue from general fund appropriations, federal funds, interest,
fines, penalties and fees was $106,946,441 in FY 2002. Chart 1 shows the sources of
revenue and the percent contribution from each source. We expended $113,808,319
in FY 2002. (Note: Expenditures may exceed revenues because funding has carried
forward from previous fiscal years.) Chart 2 displays the expenditures broken down by
the state’s accounting classifications, while Chart 3 shows the expenditures by the
four major funding sources. Information on funding sources for authorized staff is
provided in Chart 4.

Legislative Highlights
In FY 2002, ADEQ sought changes to authorize more efficient and effective operation
of the department. The legislature clarified ADEQ’s enforcement capabilities,
enabling the department to move forward with its application for primacy for the
ADEQ's FY 2002 Annual Report, Page 5

National Pollutant Discharge Elimination System Program. The legislature also
changed administrative procedures to allow more efficient public review of draft
estimates and allocations for total maximum daily loads. The legislature continued the
waste tire fee, fund and program, and the Water Quality Appeals Board for five and
10 years, respectively. Amendments during the 2002 session required ADEQ to
administer the Clean Air Fund and continued the vehicle emissions inspection in-lieu
fee. The voluntary vehicle repair and retrofit program was also changed, setting a
$10,000 limit on the amount of money that can be used to repair and retrofit a fleet of
diesel vehicles. In addition, the legislature required ADEQ to submit a request for an
emissions testing exemption for motorcycles and collectible vehicles and SIP revisions
addressing regional haze to EPA. Finally, the legislature clarified the requirements for
meeting ADEQ’s sunset performance measures in regards to Title V air quality
permits.

Employee Highlights
Enhanced productivity, quality, service and advocacy result from a workforce that
possesses the technology, resources and commitment to get the job done. ADEQ
values its employees for their professionalism and commitment to public service.
Retaining quality employees has been a concern in state government for several years.
Just two years ago, ADEQ had a staff turnover rate of 20.8 percent. This figure
dropped to 11.7 percent in FY 2002.
Economic uncertainty no doubt influenced the decision of some employees who might
have gone elsewhere to remain with the department last year. Nevertheless, we
believe ADEQ’s commitment to improve the professionalism of our staff is resulting in
higher morale and reduced turnover. This commitment is evident through enhanced
accountability for work performed, better training, improved internal communication
and innovative approaches to rewarding employees for commitment to the agency
mission and goals. These efforts have resulted in:
•

Continuing employee job satisfaction
Employee surveys show ADEQ’s continued improvement for overall job
satisfaction, from 51 percent in FY 2000, to 56 percent in FY 2001, to 58
percent in FY 2002. This improvement is statistically significant because it is
difficult to sustain increases three years in a row.

•

Meeting customer expectations
ADEQ received an overall 90 percent approval rating from customers during
FY 2002, well above the governor’s 80 percent target. This compares
favorably to the overall 80 percent approval rating received from customers
in FY 2001.

ADEQ's FY 2002 Annual Report, Page 6

ADEQ Relocates to the Capitol Mall
In the final weeks of June,
ADEQ culminated more than
a year and a half of planning
and preparation and began its
move from our Central
Avenue headquarters to our
new address, 1110 W.
Washington St., in the
Capitol Mall complex. Our
relocation to the Capitol Mall
presented ADEQ a
tremendous opportunity to enhance our effectiveness by consolidating into one
building that was designed to meet our needs and more efficiently serve the public.
The building's large floor plates allow us to group each of our air, water and waste
divisions on a single floor, thus providing better coordination and assistance. In
addition, its energy-saving design and construction minimized the building’s effects on
the environment and may qualify it for national green building certification.

FY 2002 Accomplishments...
Pollution Control – Permitting
ADEQ Completes 21 Title V Air Quality Permits
ADEQ’s Air Quality Division committed to taking final action on Title V air quality
permits for existing electric utilities, mines, smelters, lime plants, cement plants and
ammonium nitrate plants by June 30, 2002. The division took final action on 21 of
the 22 permits by the prescribed deadline. (One applicant had waived issuance of a
permit by the deadline, which ADEQ acknowledged in accordance with Senate Bill
1339 of the 2002 Regular Session.)
By taking final action on these Title V permits, ADEQ is ensuring that major sources
of air pollution in Arizona receive the proper, federally-approved permits under Title
V of the Clean Air Act. In addition, since January 2002, the Air Quality Division has
issued significant revisions for projects at cement, coal and natural gas-fired power
plants, natural gas transmission facilities and a steel mini-mill.
ADEQ Issues Air Quality General Permits for 10 Industry Sectors
General permits are designed to ensure that businesses that will be emitting small
amounts of pollution do so safely and within healthful levels established by law.
Because the permits are general to the industry sector, ADEQ is able to issue them
ADEQ's FY 2002 Annual Report, Page 7

more quickly and at less cost while ensuring that similar facilities receive consistent
treatment. This is valuable assistance to businesses seeking to begin or expand
operations in Arizona and support the state’s economy.
The legislature had required ADEQ to complete the issuance of new general air
quality permits for soil vapor extraction facilities, gas stations and asphalt batch
plants, and to renew air quality permits for crushing and screening facilities and dry
cleaners by June 30, 2002. ADEQ’s Air Quality Division met its objective, successfully
issuing or renewing general permits for all 10 of the required sector permit types. In
addition, the division issued four general permits for concrete batch plants,
commercial and industrial boilers, crematories, and generators.
ADEQ Reduces Backlog of Aquifer Protection Permits
In November 1999, the Water Quality Division had an inventory of 416 aquifer
protection permits, which included permits in process as well as the list of existing
facilities operating under legacy permits but required to obtain APPs. This “snapshot”
of work became the basis for a performance measure to reduce the inventory by 50
percent by June 30, 2002. ADEQ was given 30 months to complete 208 aquifer
protection permit actions, as well as process new permit applications submitted within
the time frame and subject to licensing time frames.
The Water Quality Division completed 222 permit actions by June 30, 2001,
accomplishing more than the target 50 percent reduction within 18 months and a full
year ahead of schedule. In FY 2002, the division continued to issue permit actions at a
record pace, completing 159 – more than in any other single year.
ADEQ Increases General Permits Under the APP Program
This measure encouraged the Water Quality Division to identify opportunities within
the Aquifer Protection Permit Program where a general permit could be used in place
of requiring an individual permit, to craft the general permits and to formalize in rule.
This action would significantly streamline the regulatory process while still protecting
groundwater. In addition, the significant increase in the number and types of general
permits would allow the Water Quality Division staff to focus its efforts on those
facilities in need of individual permits, where the risk to groundwater was higher and
protection was more critical.
The Water Quality Division completed regulatory changes under the umbrella of its
unified water quality permit initiative in December 2000. These changes significantly
streamlined and clarified APP and reclaimed water permitting, and strengthened
protection by requiring more stringent technology controls for new wastewater
discharges. Thirty-five new types of performance-based general permits were included
within the unified permitting approach. These general permits took effect Jan. 1,
2001, fulfilling the performance measure to broaden the Water Quality Division’s
APP general permitting program. In FY 2002, the division began seeing the beneficial
ADEQ's FY 2002 Annual Report, Page 8

impact of the new general permits available to discharging facilities, issuing 45 general
permit authorizations to discharge in lieu of individual permits.
ADEQ Moves Closer to Managing Federal NPDES Program
The National Pollutant Discharge Elimination System (NPDES) Program has
achieved significant reductions in pollutant discharges since it was established by the
federal Water Pollution Control Act Amendments of 1972. The development of this
permitting program, in turn, has resulted in tremendous improvement to the quality of
our nation’s water resources. A NPDES permit is required for any discharge to a water
of the United States. In FY 2002, Arizona remained one of only six states that has not
assumed authority to implement this permitting program. Because of identified
benefits of a state-operated program, ADEQ built on earlier progress with
stakeholders to secure the necessary legislative and regulatory authorities to enable
Arizona to manage the NPDES permitting, pretreatment and stormwater programs.
EPA declared the state’s application complete in July 2002, and the program is
pending final authorization.
Accelerated Permits Enhance ADEQ’s Productivity and Service
ADEQ manages an accelerated permit processing program to enable facilities to
expedite air quality and aquifer protection permits applications through use of
experienced, state-approved contractors to write the permit. Permit applicants bear
the additional costs associated with the program.
ADEQ processed an unprecedented eight air quality permit applications through the
accelerated program in FY 2002. Five additional applicants were interested in
acquiring their permits on an accelerated schedule, but were processed internally as
demand exceeded the program’s available budget. Tucson Electric Power, North Star
Steel and two cabinet manufacturers in Kingman, Ariz., were among the companies to
receive air quality permits via the accelerated route this year.
Meanwhile, ADEQ increased the number of contractors available to mining facilities
to prepare aquifer protection permits by determining that contractors on the stateapproved contract list for remediation activities were eligible for such work.

Pollution Control – Planning
ADEQ Submits Seven Air Quality Plans by Deadline
As part of its 2000 sunset review, ADEQ committed to submitting seven air quality
plans to EPA by June 30, 2002. Submission of these plans is the first step toward
redesignation of the areas to attainment status for ozone and sulfur dioxide.
Redesignation to attainment status has several advantages, including potential
economic benefits for businesses and industries. Moreover, potential employees may
find it more desirable to locate in an area that has been designated as meeting healthADEQ's FY 2002 Annual Report, Page 9

based standards. ADEQ submitted all seven plans by June 27, 2002. The plans are the
Maricopa County serious area ozone attainment demonstration plan and the
attainment demonstration and maintenance plans for the six sulfur dioxide nonattainment areas in Arizona: San Manuel, Miami, Hayden, Ajo, Morenci and
Douglas.
Two of Arizona’s Moderate PM10 Nonattainment Areas Achieve Redesignation
Following Congressional approval of the 1990 amendments to the federal Clean Air
Act, EPA designated several areas in Arizona as being out of compliance with the
federal health standard for particulate pollution, known as the national ambient air
quality standards for PM10 (particulate matter 10 microns and smaller in size). In
1995, ADEQ submitted to EPA air pollution control plans for these areas that
included a number of particulate reducing strategies to be implemented by local
facilities and governmental entities to bring the areas into compliance with the federal
health standards. In addition, the Clean Air Act requires states to develop
maintenance plans that demonstrate how these areas will continue to achieve
healthful air for at least 10 years.
In FY 2002, EPA published official determinations that the Bullhead City and Payson
areas had come into compliance with the standards, and on July 26, 2002, EPA
approved the air quality plans and officially redesignated the Bullhead City and
Payson areas as being in attainment with the federal health standards for PM10,
effective Aug. 26, 2002. As part of the maintenance plan requirements, the strategies
will continue to be implemented and ADEQ will continue to operate air quality
monitors in both areas to ensure the strategies are adequately protective.
ADEQ Develops Arsenic Master Plan to Assist Arizona’s Public Water Systems
In FY 2002, EPA revised the federal maximum contaminant level allowed for arsenic
in drinking water from 50 to 10 parts per billion, effective January 2006. High levels of
arsenic occur naturally in Arizona, and more than 350 of Arizona’s approximately
1,800 public water systems won’t be able to meet the new standard. Capital costs of
complying with this new standard are estimated to approach $1 billion statewide, with
annual operating costs falling between $75 million and $120 million.
In FY 2002, ADEQ developed the Arsenic Master Plan to help Arizona water systems
come into compliance with this new standard by presenting them cost estimates and
options for treatment approaches based on their particular needs and situation.

Pollution Control – Pollution Prevention
Car Care Program Emphasizes Service and Preventive Maintenance
The Vehicle Emissions Inspection Program adopted the new name “Car Care” to
better reflect the relationship between the motorist, the inspection process and the
ADEQ's FY 2002 Annual Report, Page 10

repair industry. The Car Care name and logo reflect
ADEQ’s pledge to customer service and education as
well as high quality, technically advanced inspection
services. The Car Care theme, “Because Every Car
Counts,” speaks to ADEQ’s commitment to help
motorists take the best possible care of one of their
most valuable assets.
In January 2002, Car Care implemented state-of-the-art on board diagnostics (OBD)
testing for 1996 and newer light duty vehicles. The OBD equipment downloads and
reports emissions-related operational data directly from the vehicle’s computer system.
This technology is improving the identification of vehicles needing emissions-related
repair while significantly reducing test time. Implementation has been successful and
without serious transition difficulties.
A major improvement in customer service is the increased inspection capacity in
Phoenix and Tucson. The vehicle emissions inspection contract signed in FY 2001
provided increased capacity with three new inspection facilities in Phoenix and added
lanes in Tucson. New stations have been located in Surprise (Grand Avenue and Bell
Road), South Phoenix (16th Street and University) and Chandler (Chandler Air
Park), increasing capacity to 59 lanes. ADEQ opened additional lanes at the two Car
Care facilities in Tucson, bringing the total there to 13 lanes.
Wait time monitoring allows ADEQ to monitor contractor and network performance,
through continuous accurate assessment of each customer’s wait for inspection
services. Using an entry gate and ticket system, similar to a parking facility, the
contractor is able to monitor and report the time each customer must wait in line for
inspection services. The system provides for improved customer service and
accountability. Customers can access wait time information by calling a hotline
number or online through their personal computers.
Pollution Prevention Reaches Across the U.S.-Mexico Border
ADEQ’s binational pollution prevention program, AMIGO, continues to strengthen
the collaboration with its counterpart agencies in Mexico. AMIGO, which stands for
Arizona-Mexico International Green Organization, provides recognition to industries
that have implemented exemplary pollution prevention in the border region. During
this year, the governors of Arizona and Sonora jointly presented ADEQ’s AMIGO
awards to two Mexican industrial facilities in Nogales, Sonora, for undertaking process
improvements and pollution prevention outreach with their community.

ADEQ's FY 2002 Annual Report, Page 11

Environmental Cleanup – Remediation
ADEQ Touts Underground Storage Tank Program Efficiencies
ADEQ’s Underground Storage Tank Program steadily streamlined its closure request
process so that, by the end of June 2002, ADEQ was responding to closure requests
within 60 days more than 90 percent of the time. Expedited closures of leaking UST
sites facilitate property transactions and spur redevelopment. They also eliminate
additional oversight and remediation expenditures that are incurred because of longer
review times.
In addition, ADEQ has addressed more than 52 percent of the 644 sites that have
been identified as requiring corrective action plans. The higher percentage indicates
that the UST Program has progressed from investigation to cleanup at a significant
number of groundwater contamination sites.
By streamlining processes and realigning resources, ADEQ also had reduced by May
2002 the UST Program’s administrative costs to approximately 20 percent of the
monies in the State Assurance Fund. As a result, a greater percentage of funding is
available to reimburse owners and operators for the costs of corrective actions.
At the end of FY 2002, the Governor’s Regulatory Review Council was considering
final action on a risk-based corrective action rule that ADEQ had submitted following
extensive stakeholder input and approval from the UST Policy Commission.
Implementation of a risk-based corrective action program will result in cost effective
cleanups by allowing selection of site specific, risk-based cleanup levels that are
protective of public health as well as current and future property use.
State’s Water Quality Assurance Revolving Fund Program Sees Results
ADEQ uses the Arizona Water Quality Assurance Revolving Fund, created under the
Environmental Quality Act of 1986, to support hazardous substance cleanup efforts in
the state. The fund is dependent upon legislative appropriations, cost recovery from
responsible parties, corporate income tax and special fees. The program identifies sites
that are most in need of cleanup and adds them to the WQARF Registry. Under the
WQARF Program, liability for remedial costs is proportionate to a responsible party’s
contribution to the problem, with the “orphan” share paid by the fund.
The state’s budget shortfall threatened WQARF funding and the continued cleanup
of the state’s 33 WQARF Registry sites. The $18 million fund transfer from the
Corporate Income Tax was reduced by $10 million in FY 2002, with an additional $5
million cut scheduled in FY 2003. Despite these challenges, ADEQ continued to
make progress in eliminating significant threats to public health and the environment.
During FY 2002, ADEQ spent approximately $7 million in WQARF funds on early
response action work, completing five early response actions and several early

ADEQ's FY 2002 Annual Report, Page 12

response action evaluations, which will result in additional clean up actions at
WQARF sites in FY 2003.
ADEQ successfully installed a soil vapor extraction system at F&B in the West
Central Phoenix WQARF site; completed the removal of more than 3,400 tons of
hazardous substances from the E.C. Winter property in the El Camino del Cerro
WQARF site; completed the removal of a sump, septic tanks and more than 1,700
tons of hazardous substances at the 20th Street and Factor Avenue WQARF site; and
abandoned a well at the Miracle Mile WQARF site.
ADEQ also worked on the design and construction of several other early response
actions, including groundwater pump and treat systems at the Broadway-Pantano and
the Central and Camelback WQARF sites. ADEQ continued operations and
maintenance work at previously completed early response actions, such as the pump
and treat, air sparging and soil vapor extraction at the ALSCo facility in the West
Van Buren WQARF site and pump and treat at the Payson PCE WQARF site. Early
response action evaluations were completed at the 16th Street and Camelback, East
Central Phoenix/40th Street and Indian School, Tyson Wash, and Park Euclid
WQARF sites.
By June 30, 2002, ADEQ had initiated potentially responsible party searches to
recover remedial action costs from the parties who are potentially responsible for the
contamination at all sites on the WQARF Registry. In addition, ADEQ completed a
search for potentially responsible parties associated with the Estes Landfill WQARF
site and initiated the multiparty allocation by sending a notice of liability and
proposed remedial action plan to all responsible parties on June 28, 2002. Through
the allocation process, ADEQ will recover some remedial action costs from
responsible parties.
ADEQ Program Encourages Voluntary Cleanups
Through its Voluntary Remediation Program, ADEQ encourages property owners,
prospective purchasers and other interested parties to investigate and clean up
contaminated sites in cooperation with the agency. Benefits of the program include
reducing exposures to contaminants and ensuring that cleanups meet applicable
requirements. In exchange for their initiative and cooperation, program participants
benefit from ADEQ’s expedited review of the voluntary action and upon successful
completion, a closure document that is accepted by all relevant ADEQ programs.
Ultimately, a once idle and contaminated property is returned to marketability and
productive use.
At the beginning of FY 2002, 57 sites were actively working through the Voluntary
Remediation Program. By the end of the year, ADEQ had facilitated closure of 10
sites, which resulted in remediation of approximately 54,000 tons of contaminated

ADEQ's FY 2002 Annual Report, Page 13

soil. In addition, program staff conducted 15 educational outreach activities to explain
benefits of the program and how to get involved.

Environmental Cleanup – Emergency Response
ADEQ Part of State’s Effort Battling Rodeo-Chediski Wildfire
The worst wild fire in Arizona history began in mid-June in the Apache-Sitgreaves
National Forest located along the Mogollon Rim in east-central Arizona. By the time
fire crews had it contained a month later, the $43 million fire had burned some
470,000 acres, destroyed more than 460 homes and caused the evacuation of 30,000
people. ADEQ was one of 20 state agencies to contribute resources and personnel to
the massive fire-fighting, relief and recovery effort.
Our Emergency Response Unit staff served as the state’s on-scene coordinator for
environmental and hazardous materials issues and participated in a multi-agency
hazardous materials team that inspected several hundred homes destroyed in the fire.
Our Hazardous Air Response Team assisted the on-scene commanders by collecting
air quality data in the areas affected by the fire’s mammoth plume. Air Quality
Assessment Unit staff continued to collect data with the assistance of ADEQ’s
Northern Regional Office in Flagstaff and posted information on the department’s
Web site until the fire was fully contained.
ADEQ’s Recycling Program provided Navajo County more than $50,000 to purchase
two wood chippers to help with the removal of burned and damaged wood. The
chipped wood could be applied to the soil, thereby reducing erosion and the amount
of waste to be hauled to landfills.
Staff from our Water Quality Division, with considerable support and assistance from
the Northern Regional Office, inspected all drinking water and wastewater systems
affected by the fire, identifying the number of systems that required “boil water”
advisories. They provided technical support and assistance to municipalities and
wastewater treatment system managers in areas receiving large numbers of evacuees,
and through their diligence in evaluating water systems affected by the fire, they
helped speed the process of returning residents to their homes.
Binational Emergency Response Efforts
Recognizing the need for binational emergency preparedness on the border, ADEQ
assisted with the development of the Sister City Emergency Response and
Preparedness Plan that was signed by the mayors of Douglas, Ariz. and Agua Prieta,
Sonora in November 2001. ADEQ also successfully coordinated the first binational
emergency response on the Arizona-Sonora border in December 2001 when the
municipal dump in Naco, Sonora, caught fire and led Cochise County to declare a
state of emergency in that area. This noteworthy response led to the current pursuit of
ADEQ's FY 2002 Annual Report, Page 14

a binational Sister Community Emergency Response and Preparedness Plan by the
county of Cochise and the Mexican municipality of Naco, Sonora.

Compliance Management – Inspections and Enforcement
Increased Compliance Rates Result in Fewer Leaking Underground Storage
Tanks
Compliance with regulatory requirements for leak prevention is resulting in fewer
releases or leaks from Arizona’s operating underground storage tanks. Only 101 new
releases were reported to ADEQ in FY 2002, as compared to the high of 978 leaking
USTs that were reported in FY 1996.
Many of Arizona’s UST facilities either installed new tanks or upgraded existing tanks
to comply with federal requirements for corrosion protection and overfill and spill
prevention that took effect in late December 1998. Since then, ADEQ’s UST
Program has inspected almost 90 percent of the approximately 3,000 UST facilities
with regulated tanks in Arizona for compliance with these federal and other
regulatory requirements for leak prevention. By the end of FY 2002, more than 97
percent of Arizona’s UST owners were in compliance with the upgraded leak
prevention requirements, as compared to the national average compliance rate of 90
percent.
USTs typically contain various regulated substances, some of which have
cancer-causing constituents. The federal UST upgrade requirements and other
operational standards were developed to prevent releases of these regulated
substances. Continued compliance with UST leak prevention requirements should
ultimately result in even fewer tanks leaking in the future and better protection of
public health and the environment.
Notable Enforcement Cases Recognized
ADEQ employs a spectrum of tools and resources to protect Arizona’s public health
and environmental quality. At the far end of this spectrum lie its enforcement
authorities. ADEQ has shown leadership in taking enforcement actions against
businesses that violate laws or otherwise act to endanger public health or the
environment.
With the assistance of the Attorney General’s Office, ADEQ announced in late June
2001 that North Star Steel, of Kingman, Ariz., paid $7.75 million in the largest
enforcement action in the history of the state’s air quality program. The settlement
was the most collected by any state against a single facility acting without the U.S.
Department of Justice and resulted in increased monitoring and public apologies to
the people and elected officials of Kingman and Mohave County.

ADEQ's FY 2002 Annual Report, Page 15

In May 2002, EPA awarded a bronze medal, its highest award to citizens outside the
federal government, to several members of ADEQ who had participated in finalizing
the record settlement against air bag manufacturer TRW Vehicle Safety Systems Inc.
in January 2001. The $22 million in fines and penalties for repeated hazardous waste
violations at its Mesa facility was the largest settlement of its kind in U.S. history.
Bringing ADEQ’s Compliance Activities Together
To improve the consistency, fairness and timeliness of the department’s compliance
and enforcement program, ADEQ appointed a centralized coordinator for its
compliance and enforcement activities in FY 2002. As a result of this effort, ADEQ
authored a compliance and enforcement handbook to serve as a comprehensive guide
for staff on how to conduct compliance and enforcement activities and to promote
consistent and timely evaluations of these activities by the department. Upon
completion of the printed handbook, ADEQ made it available as an electronic
document, complete with convenient links to attachments and other online
documents, making it even more accessible and user-friendly. The handbook now
serves as a model for similar projects at ADEQ or other agencies.
Following this effort, ADEQ designed, developed and deployed an inspection,
compliance and enforcement database to enable convenient tracking of ADEQ’s
compliance and enforcement efforts and ensure that department policy is obeyed. The
agency’s past administrative decisions since 1996 are now available online in a
searchable database.
ADEQ Improves Hazardous Waste Complaint Process
In any given year, ADEQ’s Hazardous Waste Inspections and Compliance Unit
receives more than 200 citizen complaints alleging improper storage, treatment or
disposal of hazardous waste and other environmental issues. Historically, these
complaints did not receive timely attention, which resulted in dissatisfied customers
and a backlog of casework.
Recognizing the role and value of the complaint process in protecting human health
and the environment, unit management completed in FY 2002 a review of its
methods for responding to citizen complaints and determined to improve the
timeliness of its service. The unit set a goal of responding to complaints within five
working days of receipt, and established rotating teams of three individuals who were
to field complaints received each week. The unit also established procedures for
obtaining information, so that a quality referral could be made if the complaint was
outside the jurisdiction of the hazardous waste program.
Between Oct. 22, 2001, and March 5, 2002, the unit responded to a total of 75
complaints, of which 49 were new and 26 were backlogged complaints. The unit has
since eliminated the backlog of complaints and all new complaints are now responded
to within five working days.
ADEQ's FY 2002 Annual Report, Page 16

Monitoring and Assessment
ADEQ Uses Varied Approach to Improve South Phoenix Air Quality Monitoring
Acutely aware of concerns that South Phoenix residents have expressed about poor
air quality in their community, ADEQ in FY 2002 pursued several strategies to engage
the community to address these concerns.
Reducing Levels of Particulate Pollution
ADEQ’s particulate monitoring data collected near 22nd Avenue and Lower
Buckeye Road support residents’ concerns about the high levels of dust in South
Phoenix. In fact, the Salt monitor, as it is known, has recorded violations of the
annual health-based federal particulate standard every year of its operation, as
well as numerous violations of the 24-hour standard.
After discussions with ADEQ and Maricopa County regarding these continued
violations, on April 10, 2002, EPA issued a proposal in the Federal Register that
would require the development of a new set of enforceable programs by Dec. 31,
2003, to bring the air in South Phoenix back to healthful levels. In response,
ADEQ has worked with Maricopa County to install an additional particulate
sampler near 43rd Avenue and Broadway to better define the extent of the
particulate problem, and to replace the Salt monitor, which must be moved by
the end of 2002.
A thorough understanding of the sources contributing to the problem is needed
to reduce pollution levels. In May 2002, ADEQ and Maricopa County began to
analyze satellite images and conduct field studies to identify all of the
contributors. This information will indicate whether sources are complying with
existing control programs and if those control programs need to be strengthened
or new controls need to be implemented. ADEQ understands that community
support for the controls is necessary to resolve the air quality, and the department
continues to keep citizens informed and seek their input.
More Air Quality Monitoring on the Way
ADEQ needs to relocate some of the existing particulate samplers located at sites
around the Valley. This is good news for the South Phoenix community, which
has told ADEQ that more monitoring is needed in the area. As a result of these
concerns, ADEQ has examined potential monitoring sites in the community that
will meet the technical standards set by EPA for all air quality agencies to use to
ensure consistent monitoring is done across the country. At the end of FY 2002,
ADEQ was still looking for a suitable site.
Measuring the Community’s Exposure to Hazardous Air Pollutants
In FY 2002, ADEQ collaborated with EPA, Maricopa County and three Valley
Native American communities to address South Phoenix residents’ concerns
ADEQ's FY 2002 Annual Report, Page 17

about their exposure to hazardous air pollutants. ADEQ also discussed with EPA
about securing federal funding for additional monitoring in the area to
characterize exposure and to develop strategies for reducing exposure.
Potential Multi-Media Toxics Reduction Plan for South Phoenix
EPA and ADEQ also discussed possible funding for development of a Toxics
Reduction Plan for South Phoenix. This development occurred as a result of EPA
guidance to help communities address high levels of toxic exposure from a wide
variety of sources, including indoor and outdoor air, water and waste. The
guidance lays out a process by which a community develops and implements a
plan with the help of state, local and tribal governments, local industry and
others, including technical and other support from EPA. It is intended to
integrate economic development with a straightforward approach to achieve
short- and long-term toxic risk reduction.
Because the plan needs to be community based, it is necessary to have respected
community leaders convene and show leadership in gauging the community’s
interest in the process and, assuming a favorable response, in developing the plan.
This is particularly critical if a South Phoenix plan is to succeed. The only other
pilot project that EPA has funded targets a neighborhood in Cleveland. The
South Phoenix community is much larger in scale and diversity, and the
Cleveland pilot project is EPA-driven, whereas a community-based approach will
be used in South Phoenix.
Binational Air and Water Quality Monitoring
Binational air quality monitoring continued throughout FY 2002 for particulate
matter in the sister cities of Nogales, Ariz., and Nogales, Sonora (Ambos
Nogales). ADEQ also continued technical efforts for its comprehensive multiyear binational air quality study in Douglas, Ariz. and Agua Prieta, Sonora.
Intensive air quality monitoring for particulates and hazardous air pollutants was
completed and a binational emissions inventory was performed for both cities.
Subsequent phases of the Douglas-Agua Prieta study will include development of
a binational computer model and risk assessment.
Air quality monitoring in Nogales, Ariz., and Nogales, Sonora, displays elevated
levels of particulate matter contamination. ADEQ co-chaired a border liaison
mechanism subgroup under the auspices of the U.S. and Mexican consulates to
identify a set of binational actions that could be taken to improve local air
quality. This model process resulted in 12 recommended actions, which were
developed faster than in any other U.S.-Mexico border community. Together
with ADEQ’s extensive local outreach efforts, these actions will improve local air
quality and public health. As part of our outreach efforts with Mexico, ADEQ
also developed its second-annual children’s clean air calendar, which features
winning drawings from more than 8,000 entries. Notably, Mexico’s foremost
ADEQ's FY 2002 Annual Report, Page 18

Olympic track star, Ana Gabriela Guevara, of Nogales, Sonora, dedicated this
year’s calendar.
ADEQ also undertook water quality monitoring efforts in cooperation with the
Mexican government and the University of Sonora to examine the quality of
groundwater and surface water in rivers and aquifers along the Arizona-Sonora
border.

Public Outreach – Education and Outreach
Year of Clean Water
The year 2002 marked the 30th anniversary of the passage of the Clean Water Act,
and throughout the year, ADEQ sponsored a number of signature events to celebrate
the improvements to water quality in Arizona and to rededicate ourselves to the
continuing challenges. On June 7, Governor Jane Dee Hull addressed more than 100
citizens in Nutrioso, Ariz., who gathered to celebrate the water quality improvements
achieved at the EC Bar Ranch on Nutrioso Creek. Other events held during the year
included education activities with Arizona science teachers and training for volunteer
monitors of Arizona’s waters.
Lake Havasu City Sewer Bond Election
Lake Havasu City is generally considered to be the largest city in the United States
that treats and disposes of its wastewater through individual septic systems. City
engineers had developed a design for sewering the city and treating the wastewater for
reuse, thereby minimizing its impact on the environment and creating more water
resources for use in parks and golf courses. A bond election was scheduled for
November 2001. At the request of Lake Havasu City’s mayor, ADEQ worked with
city staff and a citizen-led committee to educate the public about the negative impact
of the many septic systems on the city’s groundwater and options for collecting and
treating the city's wastewater. As part of this effort, ADEQ’s community liaisons and
Water Quality Division deputy director participated in several informational
workshops. ADEQ Director Jacqueline Schafer also testified before the city council.
Voters responded positively to the information they received, and the bond election
passed by a 75- to 25-percent margin.
South Phoenix Environment Initiative
In June 2002, ADEQ representatives accepted EPA Region 9's award recognizing the
department’s South Phoenix Environment Initiative as one of the most ambitious
community-based environmental outreach efforts that ADEQ has ever undertaken.
What began in May 2001 as a project to keep area residents informed about the
department’s early response action to address an immediate public health threat has
developed into a long-term strategy to make a significant and lasting difference in the
ADEQ's FY 2002 Annual Report, Page 19

environmental quality of South Phoenix. The initiative grew in scope and impact
during FY 2002, and continues to provide the framework for forging a more
productive bond between ADEQ and the community.
Specific agency actions taken under the initiative include:
Increased Inspections – Over a one year period (November 2000 to November
2001), the South Phoenix initiative accounted for nearly 70 percent of all
inspections conducted by the agency’s hazardous waste inspections section, as
ADEQ and EPA conducted a targeted joint inspection sweep (51 sites from
March to July 2001) of all treatment, storage and disposal facilities and large
quantity generators in South Phoenix.
Expedited Clean Up – Remediation efforts of brownfields in South Phoenix
became a top priority for the agency as ADEQ eliminated an immediate public
health risk at the East Washington Fluff state superfund site by conducting an
early response action with $3 million from the state’s Water Quality Assurance
Revolving Fund.
Began Work on a Comprehensive Air Survey – Initiated work to identify funding
for a comprehensive ambient air monitoring survey in and around the South
Phoenix area. (See pages 16-18 of this report for details.)
Expanded Pollution Prevention Assistance – Ramped up the Small Business
Pollution Prevention Program, which provides business owners with information
on the reduction of waste generation and compliance with environmental
regulations.
Enhanced Public Education and Information – Partnered with neighborhood
groups and community leaders to improve services and participation in recycling
and hazardous waste collection.
Re-established a Vehicle Emissions Inspection Station – Opened a new vehicle
emissions inspection station at 1520 E. Riverview Drive to improve convenience
and service for South Phoenix motorists.
Organized a High-Profile Community Forum on Brownfields – Entitled “Tools
for Success,” ADEQ hosted a high-level, multi-agency community seminar on
programs to help urban communities address blighted properties and set the stage
for economic revitalization.
Initiated a Vigorous Grassroots Outreach Program – Established contact and
ongoing dialogue with myriad community leaders and neighborhood
organizations in an earnest effort to listen and act upon resident concerns.
ADEQ's FY 2002 Annual Report, Page 20

Making More Information Available on the Web
In FY 2002, ADEQ followed through on its commitment to improve communication
with customers by standardizing the agency’s major databases and making more
information available via the Internet. The result has been improved data quality,
more efficient development of applications and better customer service.
In addition, ADEQ’s Web site now contains 10 interactive databases and other
applications, as well as more than 600 pages of environmental information, and 3,000
forms, publications and technical assistance documents. When ADEQ committed to
this effort in March 2000, only one of 22 applications was available on the Internet.

Public Outreach – Financial Assistance
Recycling Funding Assistance Program
ADEQ’s Recycling Program administers a funding program that provides financial
assistance or start up money to private businesses, non-profit organizations and
government entities existing or servicing areas within Arizona. In FY 2002, the
Recycling Program awarded $721,884 to 10 Waste Reduction Assistance (WRA)
projects and $138,595 to seven Waste Reduction Initiative Through Education
(WRITE) projects.
WRA funding assists projects that divert significant amounts of material from the
solid waste stream, or that represent comprehensive programs designed to achieve
high solid waste diversion levels. All projects are related to one or more of the
following: recycling collection, household hazardous waste, electronics and/or material
recovery facilities.
WRITE projects assist the Recycling Program in its mandate to provide recycling
education to the public. This funding provides Arizona residents with the information
and education needed to increase their awareness of properly reducing and disposing
of solid waste and to encourage participation in source reduction, reuse and recycling
activities. Education projects may include, but are not limited to, school curricula,
workshops, seminars, publications, mail outs, flyers and mass media campaigns.
Water Quality Improvement Grant Program
ADEQ awarded $2.88 million in FY 2002 through the Water Quality Improvement
Grant Program to fund 28 projects statewide as part of our effort to improve water
quality and watershed conditions. The funds are provided annually by EPA under the
federal Clean Water Act to assist recipients with “on-the-ground” implementation
projects that protect or improve water quality by controlling nonpoint source
pollution – the nation’s largest source of water quality problems. This type of pollution
results when rainfall, melting snow or irrigation runoff picks up pollutants and deposits
them in rivers, lakes, coastal waters or ground water sources. Agriculture, forestry,
ADEQ's FY 2002 Annual Report, Page 21

grazing, septic systems, recreational boating, urban runoff and construction also
contribute to nonpoint source pollution.

Public Policy
Arizona Emissions Bank
The rule establishing the Arizona Emissions Bank became effective March 20, 2002.
Under the rule, sources that reduce carbon monoxide, oxides of nitrogen, sulfur
dioxide, volatile organic compounds or particulate matter may have those reductions
certified by the appropriate permitting authority and market the emission reduction
credits through the emissions bank. Likewise, the rule enables sources wanting to
locate or expand in an area to find available credits for offsetting any anticipated
emission increases.
ADEQ has participated in the development of other incentive-based emission
reduction credit programs, including the Western Regional Air Partnership’s Backstop
Market Trading Program for stationary sources emitting sulfur dioxide. ADEQ is also
involved in the development of a potential cap and trade program for sources found to
contribute to the metropolitan Phoenix haze problem, also known as “brown cloud.”
More information related to the Backstop Market Trading Program, Annex to the
Regional Haze Rule, and the Cap and Trade Committee’s work stemming from the
Governor’s Brown Cloud Summit can be found on ADEQ’s Web site.
ADEQ Sets New Fee Structure for Air Quality Permits
In March 2000, the Air Quality Division began a comprehensive stakeholder process
involving sources that ranged from large utilities to small gas stations and crematories
to determine a more adequate air quality permit fee structure. The process was based
on an in-depth analysis of the division’s current and projected workload. The
objective of the process was to provide sufficient revenue to cover state costs by
addressing inequities identified by stakeholders, and to set state fees, which function
as caps for county fees, to allow Maricopa, Pinal and Pima counties to collect
sufficient revenue to administer their programs.
Agreement was reached, the rule was proposed for public comment in May 2001 and
completed in time for the new fee structure to be in place by Jan. 1, 2002.
ADEQ Develops Remediated Water End Use Standards
The Water Quality Assurance Revolving Fund Program worked with stakeholders
and the Arizona Department of Health Services to develop an end use standards rule.
The purpose of the rule is to facilitate the cleanup of the state’s contaminated aquifers
and, in turn, to facilitate the use, transportation and distribution of the remediated
water.

ADEQ's FY 2002 Annual Report, Page 22

The rule would enable contaminated water to be cleaned up to a level protective of
public health based on its intended use. Potential end users and transporters would be
knowledgeable of appropriate standards contained in the rule and would thus be
encouraged to use and handle it.
ADEQ has developed and reached consensus among stakeholders on a draft end use
standards rule, and in FY 2003, ADEQ will open a docket and proceed with the
process to promulgate the rule.

Conclusion...
Fiscal year 2002 was a productive year for ADEQ despite the challenges we faced with
reduced funding, staff and resources. By concentrating on our core functions, we were
able to protect public health and the environment by ensuring compliance with laws
and regulations that prevent pollution of our air, water and land resources. Yet,
placing priority on permitting, inspections and enforcement meant a reduced
emphasis on other functions critical to our mission and which enable us to plan and
work proactively to further sound environmental protection policies in Arizona.
ADEQ faces several short- and long-term challenges entering fiscal year 2003. First
among these challenges is to meet programmatic goals and customer expectations
with reduced resources as the state’s budget crisis continues. Also on our planning
horizon:
• Addressing particulate air pollution and regional haze that threaten public
health and diminish visibility in our national parks and wilderness areas
• Developing an appropriate and timely recommendation to the governor for
defining the boundaries for areas that are not in compliance with the new
federal eight-hour ozone health standard
• Ensuring that contaminated soil and groundwater sites are cleaned up safely
and efficiently
• Improving the operational efficiency of the Underground Storage Tank
Program
• Assisting Arizona’s public water systems in complying with the new federal
arsenic standard
• Strengthening protection of our state’s aquifers from nitrate contamination
With the continued dedication of our employees, ADEQ will strive to meet the needs
of Arizona’s citizens, knowing that their judgment ultimately determines our success.
We will further endeavor to streamline our operations and provide value to Arizona in
fulfilling our public health and environmental protection mission.

ADEQ's FY 2002 Annual Report, Page 23