Court Invalidates Construction Storm Water Numeric Effluent Limits

After three years of regulatory wrangling with the State Water Resources Control Board (State Water Board) and after two years of litigation, Judge Lloyd Connelley has handed down a victory for the building industry–tossing out the inappropriate numeric effluent limits that the State Water Board had sought to impose through the statewide Construction Storm Water Permit (Permit).  This victory is substantial in that it emphasizes the need for practical, scientifically-founded regulation of water quality.

From 2007 through 2009, I worked with the California Building Industry Association (CBIA) and others in the regulated community as we sought to affect change of the drafts of the Permit being circulated by the State Water Board.  There were many objections to the Permit raised by the building industry, but the preeminent complaint was that the Permit improperly established statewide, not-to-exceed, end-of-pipe numeric effluent limits (NELs) for turbidity and pH that defied science and were not established pursuant to federal or state law.  (The NELs included in the permit were 500 NTU for turbidity and 6-9 pH for all construction sites considered Risk 3 or high water quality risk sites.)

A lawsuit brought by CBIA and others challenged these NELs and the Court agreed with the building industry that the NELs had not been properly included in the Permit.  Specifically, the Court found that the State Water Board had not supported the NELs through sufficient scientific evidence, namely the data that the State Water Board used was faulty as it: did not address construction storm water, did not identify the best management practices used on the construction sites, was not indicative of California locations, or did not prove that best management practices in place at various sites caused any high levels of pollutants in storm water runoff.

Furthermore, the Court found that because of a lack of supporting data, the State Water Board had not complied with federal law in establishing the NELs.  The Board must identify available technologies, through the gathering of performance data under various site conditions, in order to derive an NEL.  “The Board cannot properly base . . . [an] NEL on theory and inferences drawn from limited or inconclusive studies….”  (Slip Opinion at 16)  And until the performance data is properly assessed, the State Water Board cannot examine the other technical aspects and cost-benefits of the proposed NELs as required by the federal Clean Water Act.  Thus, the Court found both the turbidity and the pH NELs to be invalid and unenforceable.

So What Now…

The Court’s decision prevents the State Water Board from enforcing any alleged violations of the NELs and the Board must revise the permit to remove the NELs.  The State Water Board is free to propose NELs in the future, however, it must do so in accordance with federal and state law.  Only if properly established, would California construction sites be subject to NELs on their storm water runoff.

Numeric action levels (NALs) are included in the Permit and are not-enforceable numbers but require sampling and serve as guideposts to permittees to adjust practices on their sites.  The NALs remain in place after the Court’s ruling and Risk 2 and 3 sites that are subject to NALs must continue to implement their monitoring and reporting programs related to the NALs.  All other aspects of the Construction Storm Water Permit not related to the NELs remain in tact and continue to be required of permittees.

Relationship to EPA’s Withdrawal of Turbidity Number

An interesting parallel between the Court’s decision and recent U.S. EPA action cannot be overlooked.  As was pointed out to the Court in the California construction permit litigation, the U.S. EPA has been struggling to establish national Effluent Limitation Guidelines (ELGs) for construction storm water.  EPA established a numeric ELG on turbidity (of 280 NTU) from construction sites, but had that rule challenged by the building industry and small business trade groups.  In 2010, while the challenge was ongoing, EPA stated it would revise the proposed number.  However, in August of this year, EPA withdrew its numeric ELG altogether declaring that it needed to collect additional data on treatment performance from construction sites.

The Court deciding the fate of the NELs in the Permit recognized and was likely influenced by EPA’s decision to seek additional data before attempting to set a numeric limit for construction storm water.  (See Slip Opinion at 4.)

Influence on Other California Permits

The State Water Board is in the midst of issuing a new general storm water permit for numerous industrial sites statewide.  The State Water Board had previously proposed to include NELs in the permit based upon benchmark (non-enforceable numbers) established by EPA.  However, the State Water Board is in the process of revising the draft industrial permit, and has indicated in testimony before the California State Legislature that it will not be including any new NELs in the permit (aside from those already established by federal law) due to a lack of sufficient data to justify the proposed NELs.

After this loss on the construction storm water permit NELs, it is likely that neither the State Water Board or any of the Regional Water Quality Control Boards will seek to establish any NELs in storm water permits unless they can properly justify them in terms of having sufficient scientific data and through strict adherence to the requirements of federal and state laws governing the establishment of NELs.

The California State Water Resources Control Board (State Board) has finally released for review a draft general permit for surface water discharges from industrial sites.  The current permit governing these sites expired in 2002 and we have waited more than 8 years for the current draft.  Flows regulated by the permit will include storm water flows as well as any non-storm water discharges (e.g., dewatering, landscape irrigation runoff, and leaked materials).

After having gone through a protracted reissuance process for the construction site general permit, the new draft of the industrial permit incorporates several of the new requirements from that permit into the present draft—items that will significantly change the design and management of most industrial facilities in California, that will add significant compliance costs to these facilities, and that will potentially expose these facilities to significant risk of fines from either agency enforcement actions or citizen-initiated lawsuits.

The permit governs most industrial facilities throughout the state, including manufacturing facilities, oil and gas facilities, mines, recycling facilities, steam electric power generation facilities, transportation-related facilities (including vehicle maintenance shops), sewage treatment plants, confined animal feeding operations (e.g., dairies), and landfills.

Most significantly, the draft permit deemphasizes the current approach of protecting water quality through iterative implementation of structural and nonstructural Best Management Practices (BMPs). Instead, the draft permit introduces numeric standards for storm water runoff—something most California industrial facilities have never had to comply with before now.  The numeric effluent limits have been borrowed from U.S. EPA benchmark numbers that were not intended to be applied as not-to-exceed limitations, and many of the proposed limits represent “one-size-fits-all” standards that appear to lack robust scientific and economic justification and fail to consider natural background conditions throughout the state.

Key new requirements for industrial sites contained in the draft permit include:

• Numeric effluent and numeric action levels.  Taken from the U.S. EPA’s industrial storm water permit, the proposed numeric action levels include between 4 and 22 pollutants (or more depending upon the industry).  The action levels are benchmarks, exceedance of which will trigger increased monitoring and increased application of pollution controls.  After several exceedances of the action levels, the levels will morph into not-to-exceed effluent limits, any exceedance of which (by any amount) will subject the discharger to enforcement actions.  Mandatory minimum penalties can also apply for certain exceedances.

• Electronic Filing of Documents.  All permit-related documents will be required to be submitted electronically to the State Board, including applications for coverage, Storm Water Pollution Prevention Plans (SWPPPs), sampling data, exceedance notices for numeric limits, annual compliance reports, etc.  The State Board will make electronically submitted information available to the public on the Internet.  Applications for permit coverage will be subject to public comment and possible rescission by local water boards.

• Increased inspections and sampling.  Inspections under the draft permit will increase to more than 70 inspections per year (compared with 14 under the current permit).  Sampling requirements will increase from 2 sampling events per year under the current permit to at least 4 sampling events (or many more if numeric action levels are exceeded).  Options for cost-saving group monitoring are not available under the new draft permit.

• Minimum Best Management Practices. Unlike the prior permit that allowed dischargers to self-select appropriate pollution controls, the new permit establishes specific minimum BMPs.  Failure to implement consistently the minimum requirements will be considered permit violations.  Minimum requirements include emphases on cover and containment of materials, diversions of run-on from adjacent sites and non-industrial areas, daily inspection and cleaning of outdoor material or waste handling containers, erosion and sediment control, and spill prevention and clean up.

• Minimum training requirements. Certain documents under the new draft permit must be prepared by Qualified SWPPP Developers (having a specific registration such as registered civil engineers), and pollution controls must be implemented by a Qualified SWPPP Practitioner.  Both of these individuals must have completed State Board-approved training courses.

Once adopted, penalties for violations of the permit can be as high as $25,000 to $37,500 per day per violation in either state or federal court, with six- and seven-figure penalties not uncommon. Mandatory minimum penalties will apply for certain types of violations (e.g., exceeding numeric effluent limits and filing reports late).

State Board staff has indicated their intent to have the permit finalized within the next several months.  Industrial facility operators have a substantial stake in this permit, as its terms will affect not only management budgets, but also will dictate specific operational and facility design elements.

Additionally, the potential liability for administrative enforcement or citizen-initiated lawsuits is extremely high, with any violation of the permit subjecting site owners to possible fines and other penalties.

The State Board will be accepting public comment on the draft permit at a hearing on March 29^th and written comments are due no later than April 18^th.

Please contact Shanda Beltran if you have questions regarding the draft permit, would like assistance preparing comments on the permit, or would like help developing a compliance program for your company.