Department of Environmental Conservation

Financial Statements for the Title V Operating Permit Program for the Two Years Ended March 31, 2007

In the Title V Operating Permit Program, the Department of Environmental Conservation regulates the amount of pollutants emitted by large businesses. The Program is financed by an annual fee assessed on the regulated businesses and, to the extent that Program costs are not covered by fee revenue, by State appropriations. As of March 31, 2007, the Programís fund balance totaled $803,088. We audited the consolidated statements of revenues, expenditures and changes in fund balances pertaining to the Program for the two years ended March 31, 2007. We concluded that the financial statements were presented fairly in all material respects.

According to the Federal Clean Air Act, the fees assessed on the regulated businesses must be sufficient to cover all the costs of administering the Title V Operating Permit Program. However, these fees have not been sufficient, and as a result, the Programís fiscal viability is in jeopardy. The Department has periodically requested that the State Legislature increase the fees, but the Legislature has not done so. We recommend the Department comply with the requirement that the Program be financially self-sufficient.

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