As part of a proposed $42 million study to assess the occurrence of 28 contaminants in drinking water, the U.S. Environmental Protection Agency will try to determine the extent of damage done to drinking water supplies by perchlorate, a component of rocket fuel - another step toward possible federal regulation of the chemical, according to the Water Quality Association. Perchlorate, which can inhibit thyroid function and hormone production, is found in water supplies in 26 states.