EPA Delays Rules for Stormwater Runoff from Already Developed Properties

As advocated by AGC, the U.S. Environmental Protection Agency (EPA) has reportedly delayed its release of controversial new rules to restrict stormwater that washes off land development sites after construction work is completed.  We can now expect to see a “post-construction” stormwater proposal in December 2011.  This extra time hopefully will allow the agency to resolve many of the legal, authority and process issues that AGC has repeatedly expressed to both EPA and Congressional staff with regard to first-time national post-construction rules. Originally, EPA was to propose the post-construction stormwater rules by Sept. 30, under a litigation settlement agreement with the Chesapeake Bay Foundation. [1] As EPA fell behind schedule in drafting the new rules, its attorneys recently negotiated with the foundation to push the deadline for the proposal back to Dec. 2, 2011. The two-month extension, which will soon be finalized in court, does not apply to the final deadline by which the new regulations must be enacted: Nov. 19, 2012. AGC has told Congress that EPA’s plan to expand the stormwater program amounts to regulatory overreach that will drive up costs and slow economic recovery.  See AGC’s letter to Congress – click here. Accordingly, ranking members of the U.S. Senate Environment and Public Works (EPW) Committee recently wrote to EPA Administrator Lisa Jackson to say that the agency would be overstepping its legal authority to propose such rules. The letter focuses on the same legal, authority and process issues that AGC has repeatedly raised. Senate EPW leaders also called on committee Chairwoman Barbara Boxer (D-Calif.) to conduct an oversight hearing on EPA’s stormwater program. In addition, the U.S. Department of Interior-EPA appropriations legislation (HR 2584, Section 439) contains positive language that would delay EPA’s issuance of new post-construction stormwater regulations for 90 days – until after it issues a required report to Congress.  Reps. Norm Dicks (D-WA) and Jim Moran (D-VA) filed an amendment to strike that language.  AGC is part of a coalition of real estate and development groups that wrote letters in opposition to removing the provision – click here. Study and Report to Congress; Timing of Regulations AGC met with EPA last month to express concern that it appears to be moving hastily to expand its stormwater regulatory program, effectively circumventing the “study and report” mandate in the Clean Water Act.  As AGC pointed out, the CWA sets forth a clear process that EPA must follow before it increases its regulatory scope in the stormwater arena. (See CWA sections 402(p)(5) and (6); 42 U.S.C. § 1342(p)(5)-(6).)  The agency must first conduct a study on the need for new permit regulations, report to Congress and then Congress must have a fair and adequate opportunity to consider EPA’s recommendation before new regulations are proposed. As this story is being written, EPA has not delivered a study to Congress. And, no congressional committee with substantive oversight of EPA’s water agenda has had a chance to consider what the agency intends to propose.  Hopefully, this extra time will give some meaning to the 402(p)(5) congressional “report and study” process before the proposal is released. In addition, EPA has yet to release an analysis of the impacts its rules would have on small businesses, despite the fact that such a report was due months ago after the agency convened an impact review panel last year as required by the Small Business Regulatory Enforcement and Fairness Act (SBREFA). Key Provisions of the New Stormwater Rule According to recent updates from EPA, the post-construction stormwater program is expected to include the following key provisions—

• It would quantify performance standards for new development and redeveloped sites, based on a specific storm (the 95th percentile storm, for example). EPA is considering a requirement that new development could bear the hydrologic characteristics of a “forest, prairie, or meadow.”  Recognizing that there may be site constraints on redevelopment site, and also that redevelopment has environmental benefits compared to developing greenfield sites, the rule would hold redevelopment sites to a lesser standard (a lower percentile storm). Credits may be available for incorporating smart growth principles.
• It would require MS4s to develop plans to address discharge from existing sites—in other words, retrofits.
• It would extend the protection of the MS4 program, possibly to include areas not now included such as arterial roads connecting urbanized areas.

AGC is primarily concerned about how such new federal requirements will increase the cost of construction and present liability issues concerning the contractor's legal/contractual obligations to the site and the owner after the contractor leaves the site. AGC is also concerned that EPA may attempt to enact regulations that are not based on actual pollutant discharges, but on “surrogates” for potential discharges– like the amount of stormwater flows, or the extent of paved and impervious surfaces in a parking lot.  Court decisions make clear that EPA only has the authority to regulate the “actual” discharges of pollutants from point sources, and not “potential” discharges. Background EPA current stormwater regulations only apply to active constructions sites.  That is, while soils are being moved and disturbed to develop and build on land, EPA requires all construction site “operators” to secure coverage under a stormwater discharge permit.  EPA is looking to enact regulations that will vastly expand this authority.  EPA plans to propose regulations to control stormwater from “already developed properties.”  In other words, it is considering a new program that does not stop at discharges from active construction sites, but also to regulate discharges after construction activity stops. EPA plans to propose its post-construction regulations this December with final regulations expected in November 2012.  AGC will continue to stress that EPA needs authorization from Congress, to develop new regulations to control stormwater runoff after the construction process ends. See EPA’s website and a recent EPA PowerPoint on what it has planned in terms of post-construction rules.  For more information, contact Leah Pilconis at pilconisl@agc.org. [1] EPA originally committed to the following list in a settlement with Chesapeake Bay Foundation: By September 30, 2011, EPA will propose a regulation under section 402(p) of the Clean Water Act to expand the universe of regulated stormwater discharges and to control, at a minimum, stormwater discharges from newly developed and redeveloped sites. As part of that rulemaking, EPA will also propose revisions to its stormwater regulations under the Clean Water Act to more effectively achieve the objectives of the Chesapeake Bay TMDL. In developing the proposed rule, EPA will consider the following elements related to stormwater discharges both nationally and in the Bay watershed: (1) additional requirements to address stormwater from newly developed and redeveloped sites; (2) requiring development and implementation of retrofit plans by MS4s to reduce loads from existing stormwater discharges; and (3) expanding the definition of regulated MS4s.  EPA will take final action on the regulation by November 19, 2012.