Law and the Environment : Environmental Lawyer & Attorney : Foley Hoag Law Firm : Boston, Washington D.C.

Earlier this week, EPA announced release of a draft North Coastal Small Municipal Separate Storm Sewer System General Permit. Once finalized, the General Permit will affect 84 communities in eastern Massachusetts. EPA has noted that similar MS4 General Permits will also be rolled out for the rest of the Commonwealth.

The draft General Permit is only the latest salvo in an ongoing debate among EPA, MassDEP, municipalities and the regulated community regarding how to control stormwater discharges. The background to all of this is the increasing attention being given to the TMDL process and NGO efforts, including litigation, to ensure that EPA and the state actually make the TMDL process work.

As followers of this blog know, in November 2008, MassDEP released an extremely ambitious set of draft stormwater regulations. I think it is fair – and apt – to say that MassDEP was deluged with comments. While MassDEP may not accept this characterization, the length of time which has passed without issuance of final MassDEP regulations suggests that MassDEP may in fact have, as requested by the regulated community, gone back to the drawing board.

One of the issues raised by the regulated community in commenting on the MassDEP proposal was precisely that, because EPA regulates MS4s, it would make sense for the federal MS4 program, rather than a new state program, to be the bedrock for stormwater regulation. One big question left hanging with today’s announcement by EPA will be the extent, if any, to which MassDEP now builds on the MS4 permit, rather than creating its own program from scratch.

Since the regulated community to some extent asked for this permit, I can’t complain about the concept, but make no mistake, the MS4 General Permit will impose significant changes on municipalities and those changes will absolutely trickle down to the regulated entities.

The draft permit is 57 pages, not including appendices, so it is far too long to summarize here, but I will note some highlights:

Municipalities within the Charles River Watershed subject to approved TMDLs will have to develop specific Phosphorus Control Plans to demonstrate how they will attain the phosphorus reductions required.

New and increased stormwater discharges will face stringent requirements. In some cases, such discharges will not be eligible for coverage under the General Permit, but will instead require individual permits.

Municipalities will have to reduce discharges to the Maximum Extent Practicable, or MEP, through the use of Best Management Practices. 

Municipalities will be required to enhance programs to identify and eliminate illicit discharges.

Notwithstanding the existing General permit for construction sites, permittees will have to continue to develop their own construction site stormwater program.

Permittees will have to establish a program to minimize post-construction run-off by tracking the extent of impervious surfaces and imposing new requirements on new development and redevelopment.

Municipalities have already cried foul based on concerns about the cost of implementing the General Permit. Unfortunately, unless Congress amends the Clean Water Act to eliminate the TMDL program, it is difficult to see how a general permit in some form can be avoided. Indeed, as already noted, the MS4 level is probably the right place to focus stormwater reduction efforts. The question will be how efficiently the program can be implemented and whether EPA and MassDEP can harmonize their respective programs in a way that allows progress towards attaining compliance with the TMDL program in a cost-effective way.

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Yesterday, EPA released its effluent guidelines for construction sites. The guidelines establish the first national standard containing numeric limitations on stormwater discharges. The final standard imposed is 280 nephelometric turbidity units. It will apply to all construction sites greater than 20 acres in size as of 18 months following the effective date of the regulations (which will be 60 days after Federal Register promulgation) and sites larger than 10 acres 4 years after the effective date.

As expected, EPA did not take NRDC and Waterkeeper Alliance up on their suggestion that EPA impose post-construction controls. However, since EPA has already signaled that its long-term plan is to impose stormwater controls beyond the current universe of industry and construction sites, it seems at this point that broader stormwater regulation by EPA is more a question of when than whether.

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On Tuesday, EPA announced its intention to issue new effluent guidelines for the Steam Electric Power Generating industry by sometime in 2012. The announcement follows an EPA study in 2008 which indicated that toxic metals, particularly those collected as part of flue gas desulfurization processes, can pose a problem in facility effluent. EPA’s announcement is not particularly surprising, given the ongoing study and given that EPA has not revised the guidelines since 1982. Indeed, notwithstanding EPA’s announcement, Environmental Integrity Project, Defenders of Wildlife and Sierra Club announced that they would still sue EPA over its failure to timely update the guidelines.

There are two reasons why this announcement is significant beyond just its implications for effluent discharges from these facilities. First, it’s hard to see EPA’s announcement – and the threat of NGO litigation – as anything other than another bullet aimed squarely at the coal industry. From climate change, to attacks on mountaintop removal, to the reaction to the TVA spill, to this effort to make the effluent guidelines more stringent, there is no doubt that coal is in the cross-hairs at the moment. If there are any doubters concerning this point, Duke Energy CEO Jim Rogers isn’t among them. He was quoted in this morning’s Energy & Environment Daily as saying that it is at least possible to envision a world in 2050 “where coal is not in the equation.”

The other reason why this announcement is significant is that it raises fairly squarely the question regarding the very structure of our current regulatory system.  It’s not really any more than happenstance and political convenience that we regulate different environmental media differently. In this context, it is noteworthy that EPA’s Science Advisory Board just recommended that EPA consider setting multi-pollutant standards under the Clean Air Act, rather than regulating each pollutant separately. Theoretically, that’s good as far as it goes, but it doesn’t really solve the problem of the balkanization of EPA’s different regulatory programs.  In the long run, EPA’s regulatory efforts would be much more cost-effective – and would probably garner much more public support – if they were rationally based on an overall assessment of risk, across pollutants and across media.

I’m not holding my breath.

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As we have reported, EPA and MADEP have both been taking steps over the past year to broaden the scope of their stormwater programs beyond existing regulation under the rules concerning stormwater discharges associated with industrial or construction activity. EPA has proposed using residual designation authority in Maine and Massachusetts and the MADEP proposed sweeping rules governing existing private facilities.

In the regulated community, there has been substantial concern that these efforts have focused too narrowly on private properties, with the MADEP proposed rules, for example, potentially requiring costly retrofits on many properties without consideration of whether there might be more cost-effective ways to control stormwater pollution, such as through increased focus on MS4s.

Based on this week’s news, EPA may have heard these complaints.

On Wednesday, EPA Region I announced enforcement actions against municipalities for violations of MS4 requirements. EPA proposed to fine nine communities in Massachusetts and New Hampshire; EPA also issued orders requiring that the municipalities take certain actions to come into compliance with the MS4 requirements.  Given the current economic climate and the erosion in municipal budgets, the willingness to impose penalties demonstrates EPA’s seriousness in enforcing the MS4 requirements.

So why does the private sector need to remain worried? One word in the first sentence of EPA’s press release says it all: “integrated.”  Wednesday’s enforcement announcement was part of “a new integrated effort” to enforce stormwater requirements.  While this notice was focused on illegal connections to storm sewers, is there any doubt that this is also part of a broader “integrated” effort to attack stormwater pollution more generally?  Now, when EPA and MADEP come calling on the private sector, the agencies can respond to complaints about unequal focus by noting that they have already made municipalities take their medicine; now it’s time for the private sector to do so as well.

Spoonful of sugar, anyone?

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As many readers of this blog will have already learned, the Supreme Court issued its long-awaited decision in Entergy v. Riverkeeper yesterday. The Court reversed the Second Circuit Court of Appeals and held that EPA was within its authority to consider cost-benefit analysis in setting standards for cooling water intake structures under § 316(b) of the Clean Water Act.

I’m definitely getting on my soapbox here, but this should not be news and it should not be controversial – though I certainly realize that it is. If current conditions tell us anything, it is that resources are not infinite. The irony here is that it is environmentalists who tend to make this point most frequently. Unfortunately, they don’t like to acknowledge that, because resources are not infinite, cost-benefit decisions get made implicitly, even when EPA does not utilize cost-benefit analysis in its regulations.

When I was just a poor Superfund lawyer, I attended a public meeting in Somersworth, New Hampshire, as local residents tried in vain to persuade EPA that they could save more lives by installing traffic signals and hiring public safety personnel than by spending millions of dollars cleaning up an old landfill to the nth degree. The simple truth is that when we force regulated industries to incur costs without regard to the associated benefits, other spending gets displaced. It may be better to have power plant owners spend money on closed cycle cooling than on worker health benefits or, God forbid, payments to shareholders, but let’s make the decision honestly and not ignore the trade-offs.

I still don’t understand why the debate can’t be about how fairly to define costs and benefits. There are serious issues here, but there’s certainly no free lunch. I posted recently about my disappointment regarding early indications that the Obama administration will not be a friend to common sense regulatory reform. The same issues arise here. The Obama administration, because of its undoubted credibility, could advance the cause of cost-benefit analysis and cost-effectiveness analysis. I fear it is not going to happen.

For the same reason, it’s quite possible that the Riverkeeper decision may be much ado about nothing. Riverkeeper holds that EPA may consider costs and benefits, but does not require it. Environmentalists are already clamoring for EPA to rewrite the 316(b) rules and I wouldn’t be surprised if the agency does so.

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Demonstrating that the recent announcement of new stormwater controls for the Charles River in Massachusetts were not an aberration, EPA, joining with the Maine DEP, announced last Friday that it will be imposing new stormwater regulations for discharges into Long Creek, which ultimately flows into Casco Bay.

Responding to petitions from the Conservation Law Foundation, EPA has exercised its Residual Designation Authority under its NPDES permitting regulations.

The new designation can be found on EPA’s website. Notably, the new program will apply to impervious surfaces larger than one acre. This is a smaller area than is currently proposed for the Charles River. EPA estimates that regulating impervious surfaces one acre and up will place 90% of all impervious area in the Long Creek watershed under NPDES jurisdiction.

Owners of properties in other degraded watersheds, you may be next on the list.

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Although some of you may think that the regulatory agencies are now all climate change all the time, Massachusetts DEP has demonstrated that there is still life in some more traditional aspects of environmental regulation. MassDEP has just proposed sweeping new stormwater regulations that would go far beyond the traditional EPA model of regulating construction sites and stormwater discharges from industrial facilities.

DEP’s proposal is far too detailed for a blog post. For those interested in this issue, take a look at the client alert we issued, which hits the big issues. One big-picture item to note: There certainly seems to be something of a competition brewing between EPA and DEP regarding regulations of stormwater. 

Anyone who has at least 5 – and perhaps at least 2 – acres of impervious surface should certainly consider commenting on the regulations when they are formally issued for public comment.

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On September 22, EPA issued a new Stormwater Multi-Sector General Permit (MSGP) to cover 4,100 facilities with discharges associated with an industrial activity. The permit replaces the MSGP that was issued in 2000 and expired in October 2005. The expired permit continued to be valid for facilities that were covered by the permit at the time it expired.

The new permit applies to states not authorized to implement EPA’s NPDES program, including Massachusetts and New Hampshire. It will be effective as of September 29, 2008.

Although EPA claims of regulatory reform sometimes ring hollow, the new MSGP truly does seem to be an improvement over the prior MSGP for industrial facilities. One significant improvement is that permit now separates technical requirements for effluent limitations from the requirement to prepare and implement stormwater pollution prevention plans (SWPPP). Importantly, EPA has clarified that a SWPPP is not an effluent limitation. Therefore, industrial facilities may amend SWPPP without EPA approval. More important, because the SWPPP is not an effluent limitation, noncompliance with the SWPPP will not subject a permittee to claims that he/she has violated an effluent limitation (though noncompliance with a SWPPP may be a violation of a record-keeping requirement).

EPA has also significantly streamlined its filing and compliance systems. First, notice of intent to be covered by the MSGP may be made electronically, through a new “eNOI” system. Second, EPA has created a “Water Locator” tool, which will enable facilities to obtained certain relevant information, such as applicable total maximum daily loads, or TMDLs, on-line. Facilities will also be able to provide required monitoring data on-line.

In short, while the new permit may not eliminate any substantive complaints that industrial facilities may have with EPA’s stormwater program, it should reduce transaction costs associated with compliance.

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