The U.S. Environmental Protection Agency (EPA) recently re-negotiated its previously revised settlement agreement with environmental groups setting a new deadline for proposing a national rule that would limit stormwater discharges from developed and redeveloped properties. Latest reports are that EPA will propose the “post-construction” rule by June 10, 2013, and complete a final action by Dec. 10, 2014. AGC continues to track EPA’s progress in satisfying the many legal, authority and process issues that go along with promulgating first-time national post-construction rules.
Apparently the cost-benefit analysis of the impending stormwater rule has caused the repeated delay. EPA officials have publicly shared that the complex process of quantifying costs and benefits associated with stormwater management across the country – which must account for varying climates, soils and land development patterns – “is much more of a challenge than we originally imagined.” EPA estimates that every year approximately 700,000 acres are developed (that number may go as high as 1.2 million acres).
Cost Is the Big Issue
Leading experts predict that EPA’s post-construction rule will be one of the most costly regulations ever promulgated. Critics refer to it as an “unfunded mandate” that will cost state and local governments billions of dollars.
EPA’s post-construction rule is expected to set a stormwater runoff performance standard and provide regulated entities with compliance options including green infrastructure measures intended to limit runoff (e.g., standards for how much rainwater a new house, parking lot or building must retain and absorb though retention ponds, permeable pavement, green rooftops). By way of comparison, EPA just approved a new “green infrastructure” plan for Philadelphia with an expected price tag of $2.4 billion. See related story in the Observer on new EPA Green Infrastructure Fact Sheets.
In related news, E&E News recently reported that the U.S. Conference of Mayors has requested a “moratorium” on Clean Water Act enforcement of stormwater limitations on municipalities. The report makes clear that the Mayors avoided an attack on either the CWA or the current EPA administration. They acknowledged that there is still “much to be done to protect our water resources” but they are asking for a moratorium because they are broke.
Imposing a first-ever performance standard for stormwater discharges from already developed properties will certainly add compliance costs and burdens on U.S. commercial real estate and general contracting firms, many of which continue struggling to recover from property devaluation, credit constraints, weak job growth and lack of demand.
EPA’s Legal Obligations
As required by the Regulatory Flexibility Act, EPA initiated an abbreviated Small Business Regulatory Enforcement Fairness Act (SBREFA) review panel in late 2010 to provide small business input with regard to EPA’s anticipated scope and approach to the national stormwater rulemaking. AGC participated and submitted comments throughout EPA’s preliminary rulemaking efforts working through its coalition partner the Federal StormWater Association. Several of the parties involved in the original SBREFA process have asked EPA to consider re-engaging the SBREFA process because the first process was not based on any specific regulatory proposals and, supposedly, EPA has made significant progress on developing regulatory options. Based on the new proposal and final action dates, a renewed SBREFA process would make sense.
As explained in prior AGC updates, EPA also must issue a report to Congress prior to proposing any new regulation that would expand the scope of the current stormwater permitting program. EPA continues to claim that it has drafted a “Report to Congress” – a requirement for any proposal to expand the existing stormwater program – but the Agency will not commit to when it might release a copy of the report to the public or submit it to Congress in advance of the June 10, 2013, proposal date.
Opposition
There is significant Congressional opposition to this rule. Ranking members of the U.S. Senate Committee on Environment and Public Works sent a letter to EPA last fall demanding the Agency explain its legal rationale for the proposal.
AGC has met with EPA several times during the course of the rule’s development (pre-proposal) and repeatedly raised numerous legal, authority and process issues with both Agency staff and Congressional staff. AGC plans to comment on the proposal when it comes out and is coordinating efforts with a coalition of real estate and development groups.
Background
EPA agreed to propose the post-construction stormwater rule in a 2010 settlement with the Chesapeake Bay Foundation, although Agency attorneys have repeatedly sought and received time extensions. On December 28, 2009, EPA formally announced its intent to issue new stormwater regulations in final form by November 2012, which would regulate post-construction stormwater discharges from newly developed and redeveloped properties, as well as mandate retrofits of municipal separate storm sewer systems (MS4s). EPA is considering a retention standard; however, some stakeholders oppose this option in favor of a more flexible framework.
In early 2011, EPA indicated that it had identified significant economic concerns associated with the rulemaking, but has not made any formal announcements since then, despite a settlement with various environmental groups that set a new date for a proposed rulemaking. (The deadline for EPA to propose a rule has changed at least five times: from September 30, 2011, to December 2, 2011, to March 16, 2012, to April 27, 2012, to June 10, 2013.)
To find out more, contact Leah Pilconis at pilconisl@agc.org.