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NCLM News & Political Report

Since the last publication of EcoLINC, the lengthy 2014 short session of the General Assembly finally came to an end on August 20, and every group involved in state-level advocacy has spent the time since wrapping up loose ends. To give cities and towns a full picture of what transpired this session, the League published its comprehensive End of Session Bulletin September 4. This publication contains a status report on the most important bills to cities and towns of this session. It also shows a largely successful session for the League membership, a result directly attributable to the extensive involvement of elected and appointed League members in making personal contacts with their legislators.

Before fully closing the door on the 2014 session, we still await the Governor's signature on some notable bills, including SB 734 Regulatory Reform Act of 2014. That bill contains a laundry list of environment-related provisions, many of which affect municipal interests. In addition, the Governor has indicated that he will let SB 729 Coal Ash Management Act of 2014 become law without his signature.

Meanwhile, the League's regulatory advocacy program continued its involvement with state regulators. The League looks forward to working with three individuals in new posts, all of whom have extensive experience with environmental issues. First, Charles "Boots" Elam took his first votes as an N.C. Environmental Management Commission member last week, filling the Commission slot vacated by Wayne County Commissioner Steve Keen earlier this year. Commissioner Elam formerly served on the N.C. Coastal Resources Commission. Also, John Evans accepted the position of General Counsel at the N.C. Department of Environment and Natural Resources. Evans, an engineer, previously worked for two decades in both engineering and legal capacities at DENR as well as the N.C. Department of Justice. Finally, Craig Bromby also joined DENR's legal team after retiring from a career in private environmental law practice with Hunton & Williams.

The League also spoke out on regulatory issues in several sets of written comments this past month. First, the League filed comments in August regarding the state's proposed amendments to water quality standards -- otherwise known as the Triennial Review. The comments stressed the League's support of the proposal, which would achieve one of the top regulatory goals prioritized by cities. In upcoming issues of EcoLINC, we will report on other written comments we plan to file this fall for regulatory actions such as the state's 303(d) listing methodology and the new rules governing oil and gas extraction activities.

In addition, the League made comments that include suggestions for improvements to the original draft of the N.C. Division of Water Resources' (DWR) "Approval Framework For Alternative Nutrient Load-Reducing Measures." This document, a copy of which the League will likely review before it is released by the end of this month, details a process for DWR to follow in approving additional nutrient control measures that are needed for cities to enhance stormwater treatment. Also related to the issue of nutrient runoff, the League expects a release of the draft charter for the Scientific Advisory Committee (SAC) required by North Carolina’s Nutrient Criteria Development Plan (NCDP) soon, whereupon the League plans to make recommendations for SAC members.

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EMC Halts Ecological Flow Determination, Allows Model Use with Limitations

Acknowledging flaws in both the legislation that directed development of water system models and a report made by an advisory board examining the controversial ecological flow component of those models, members of the the N.C. Environmental Management Commission (EMC) halted the use of ecological flow data in these models last week. At the same time, the EMC specifically voted to allow state water supply experts to continue using those models for non-regulatory decisions.

Discussion of the topic spanned both of the Commission's meeting days last week. First, the Water Allocation Committee recommended Wednesday that the EMC continue to delay its approval of the Roanoke River, Tar-Pamlico River, and Cape-Fear-Neuse River Basins' hydrological models. This recommendation followed a staff presentation of information and a legal examination of the statute that was the basis of authority for the EMC to approve hydrological models for multiple river basins.

Then on Thursday, the full Commission considered the committee's recommendation and voted on a multi-part motion that will prevent the use of generally applicable ecological flow determinations in hydrologic models. While allowing the models to continue to be used in planning and other decisions, at the same time, the EMC did not take action to approve any specific hydrologic model, including the three models discussed the previous day.

Hydrologic models simulate the flow of all waters in a river basin, taking into account surface and ground waters, transfers into and out of the basin, other withdrawals, and other data on the flow of water. These calculations can predict which surface water systems will experience future shortages, both during droughts and normal flow times. Ecological flow is a percentage of a river's flow set aside to maintain aquatic life. In previous presentations by the N.C Division of Water Resources (DWR) to the EMC, agency staff stated that the ecological flow component of the models was based on a report by N.C. Ecological Flows Science Advisory Board (EFSAB), which studied the topic for over two years. While agency staff have long-maintained that this data would only be used for planning purposes and not for regulation, commenters including municipal interests stated recently that the way DWR had chosen to implement the EFSAB's recommendations amounted to regulation and raised concerns about the validity of a proposed set-aside percentage.

Controversial Ecological Flow Component Delayed

In its decision Thursday, the EMC directed the N.C. Department of Environment and Natural Resources (DENR) to work with the Legislature to clarify "inconsistent and incompatible" uses of the term "ecological flows" in the hydrologic models statute. As written, the statute listed "ecological flow" as both an input into the hydrologic model and an output of the model -- the model was supposed to be able to predict the places, times, frequencies, and intervals at which ecological flow may be adversely affected. Confused as to how the ecological flows component could be both an input and output, the EMC requested DENR leadership to seek legislative clarification.

In addition, the EMC stated that if DENR wished to establish generally applicable standards or values for determining "all needs," "all essential water uses," or "ecological flow" for purposes of making predictions required by the hydrologic models statute, it would be required to do so through an official rulemaking process. That conclusion was congruent with the N.C. Administrative Procedures Act (APA) provision stating that a "rule" is any agency regulation, standard, or statement of general applicability that implements or interprets an enactment of the General Assembly or Congress or a regulation adopted by a federal agency or that describes the procedure or practice requirements of an agency.

Future Use of Hydrologic Models

Also in its decision Thursday, the EMC chose to wait on approving the hydrologic models presented that day for consideration until the ecological flows issue was clarified. However, it allowed DENR to continue to use the models in planning decisions, as needed to comply with statutes and rules, and in permit or water allocation decisions. In making those decisions, the EMC allowed DWR to use information regarding ecological flows, as long as it was based on site-specific data and not based on any generally applicable standard or value for ecological flow. As a practical result, those decisions will not be based upon the recommendations from the EFSAB report. 

This allowance of the use of models was important to League members because it ensured that planned interbasin transfers and other water allocation decisions could move forward without delay. Read previous coverage of this issue in the July 2014 and May 2012 editions of EcoLINC.

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Commissioners Question Implementation of Mercury Minimization Plan Requirements

Commissioners on the Water Quality Committee of the N.C. Environmental Management Commission (EMC) questioned N.C. Department of Environment and Natural Resources (DENR) staff Wednesday regarding an increase in the number of wastewater dischargers required to have mercury minimization plans (MMPs), as compared to predictions when the EMC originally approved those regulatory requirements. The EMC gave DENR the green light to incorporate MMPs into wastewater permits when it approved a statewide mercury TMDL and permitting strategy September 2012. 

After a presentation updating the EMC on the status of the almost-two-year-old TMDL and permitting strategy Wednesday, EMC Chair Benne Hutson expressed concern that two-thirds of the state's wastewater dischargers were required to have MMPs as a result of the statewide mercury TMDL. He asked at what point (or percentage of facilities required) would the requirement of MMPs go beyond a "best practice" and be considered a program of "general applicability," requiring rulemaking under the N.C. Administrative Procedures Act. Commissioner Steve Tedder followed up in a similar vein, "Will we soon see the entire 136 dischargers required to have MMPs? Is this really case-by-case or is it a rule?"

Mercury Permitting Strategy

The water body clean-up plan -- generally called a Total Maximum Daily Load (TMDL), its name in the federal Clean Water Act (CWA) -- was developed in response to measured accumulations of mercury in large-mouth bass in N.C. waters. As with other TMDLs, DENR proposed requiring reductions from municipal wastewater treatment systems through limits in their federal discharge permits. Wastewater dischargers -- both municipal and industrial -- were the only two classes of permit-holders targeted by a wastewater permitting strategy. In this TMDL, DENR estimated that wastewater dischargers contributed two percent of the mercury load to the state's waters, while airborne mercury that reached the ground via rainfall contributed the remaining 98 percent. All the same, permitted sources of mercury air emissions were not affected under these plans, unlike wastewater dischargers. 

The permitting strategy called for certain point sources to develop and implement MMPs, a standard method to control mercury discharges in wastewater. For wastewater permit-holders, an MMP was required if the facility had (1) a permitted design capacity of more than two million gallons per day and (2) mercury at quantifiable levels in their effluent. When seeking EMC approval in 2012, DENR staff stated that approximately 59 out of the 156 major municipalities would receive an MMP requirement (39 percent). However, staff stated Wednesday that the implementation of the TMDL and permitting strategy resulted in two-thirds being required to have an MMP. When asked why there was a difference in the projection and who was actually affected, DENR staff stated that more recent data was used that was based on a newer sampling method, revealing more mercury discharges than originally estimated.

A Generally-Applicable Requirement?

Throughout the discussion, Commissioner Hutson reiterated that if rulemaking was required, it would give certainty to the regulated community of defined standards to follow. The N.C. Administrative Procedures Act (APA) characterizes a "rule" as any agency regulation, standard, or statement of general applicability that implements or interprets an enactment of the General Assembly or Congress or a regulation adopted by a federal agency or that describes the procedure or practice requirements of an agency. Therefore, if the MMP requirement was found to be generally applicable, rulemaking would be required to be in order to be compliant with the APA.

The League was very involved in the EMC's 2012 decision to implement the statewide mercury TMDL and permitting strategy, and reported on both in previous EcoLINC articles:

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Law Renders Gravel Rule Unnecessary

A legislative regulatory reform intended to address how the state regulates gravel-covered surfaces likely renders a related rulemaking currently underway unnecessary. Further, some state regulators said the law now put passage of the rule outside state regulators' authority. The gravel-related provision was in SB 734 Regulatory Reform Act of 2014, passed by the Legislature in August though not yet signed into law by the Governor. 

If it becomes law, among many other effects, the provision would remove the term "gravel" from the list of statutory exemptions to the calculation of "built-upon area," undoing a 2013 law and restoring municipal program implementation to how it was prior the passage of HB 74 Regulatory Reform Act of 2013. At the same time, though, legislators took a pass on providing a final resolution on the issue. In the final version of the provision, legislators declined to fund a study that would provide a scientific basis for determining the extent to which these surfaces allowed stormwater to soak into the ground, eliminating an N.C. State University study of the infiltration rates of non-paved/aggregate surfaces, which had been recommended by a legislative study commission earlier this year.

After the passage of HB 74 in 2013, the N.C. Environmental Management Commission (EMC) adopted a temporary rule to define "gravel." That effort arose because the 2013 law used the term but failed to include a definition. In the temporary rule, the EMC defined gravel as "a clean or washed, loose, uniformly-graded aggregate of stones from a lower limit of 0.08 inches up to 3.0 inches in size." With the temporary rule set to expire in January, the EMC voted in July to proceed with permanent rulemaking that would incorporate the definition of "gravel" into state rules, addressing concerns over excess stormwater runoff from non-paved surfaces.

Future of Rulemaking

The legislature's latest volley on the subject of gravel likely halted the EMC's permanent rulemaking effort for good. EMC Chair Benne Hutson noted Thursday that because SB 734 was not yet law, the EMC retained the authority to proceed with its permanent rulemaking last month, holding one public hearing and accepting written public comment through Sept. 30. However, he noted that because SB 734 would remove "gravel" from the exemptions to "built upon area" and would mandate that the EMC cannot define gravel, if this year's bill becomes law, the EMC's temporary rule would become ineffective and the EMC would instead have to remove the definition of gravel from its permanent rule. At the same time, he said, the EMC would need to update the definition of "built upon area" in the permanent rule to not include gravel.

The gravel provision in SB 734 grew out of interim legislative activities. This spring, the Environmental Review Commission (ERC) conducted an exhaustive study of the topic. Through that study, the ERC recognized that aggregate materials colloquially called "gravel" functioned with varying degrees of perviousness that depended on the material's ability to infiltrate water. As a result of findings from that study, the bill proposed to reverse the 2013 law that declared all aggregate-covered surfaces were pervious, a conclusion not based in science.  

Read prior coverage and more detail about the this topic in previous EcoLINC articles:

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Regulatory Briefs

At the request of the EMC and DWR, EPA extended its comment deadline regarding its decision to add 52 waters back to NC's 303(d) impaired waters list to October 14; the EMC selected a subset of its members to work on additions to its draft comments with a focus on justifying its 90/10 methodology...DWR signed a memorandum of understanding with EPA committing to auditing each MS4 permittee once every five years...The EMC voted to submit its report regarding its classification of 375 of its rules (subchapters 2B, 2H, 2T, and 2U) as "necessary with substantial public interest" to the Rules Review Commission, initiating the next step in the periodic review of rules process mandated by HB 74...The EMC also announced a special meeting to be held on September 30 at 3:00 pm to take action on a temporary consolidated buffer ruleas required by SL 2014-95...In an attempt to help local governments comply with the Jordan and Falls nutrient management strategies, DWR told EMC commissioners that it would send seven nutrient-reduction practices out for public review this month...The N.C. Source Water Collaborative announced its inaugural Source Water Protection Awards program, and nominations are being sought for candidates that demonstrate innovative and collaborative solutions to protect NC's drinking water and watersheds...EPA published its final Sufficiently Sensitive Test Methods Rule for wastewater effluent testing procedures...NCSU's WRRI program, in partnership with the USGS, tested 75 wells in Lee County to create baseline data on groundwater quality before oil and gas exploration begins, and will release a report in January to document water quality parameters and list constituents that have been points of conflict in other states...EPA announced that its draft study on drinking water risks posed by hydraulic fracturing will focus on "best management practices" and non-regulatory suggestions on how states should manage the process...EPA asked to join as amicus a federal district court case challenging North Carolina's requirements for CWA permits for air emissions of feather and farm dust; however, environmental groups and the State urged the court to dismiss the suit on grounds that the case was already resolved in state court and there were no factors in dispute that allow the assertion of federal jurisdiction...In addition, environmentalists petitioned EPA to investigate whether the State violated the civil rights (under Title VI) of N.C. residents by allowing large farms to store and land-apply biosolids near vulnerable communities...EPA claimed that its proposed rule regarding the "Waters of the US" would eliminate existing legal gray areas regarding which waters were jurisdictional, which it said should limit potential citizen suits for CWA violations...In addition, EPA rejected claims that a group of maps it revised were created to determine jurisdiction under the CWA, stating instead that the maps merely showed locations of water bodies and were intended to serve as a tool...All the while, the U.S. House approved the Regulatory Overreach Protection Act of 2014 which, if it became law, would prevent EPA from implementing new rules expanding federal regulatory authority, targeting EPA's controversial "Waters of the US" rule and requiring EPA to consult with state and local regulators on a new proposal to define the law's reach...EPA said it was exploring ways resolve municipalities' concerns regarding participating in the Water Infrastructure Financing and Innovation Authority (WIFIA) program, such as a prohibition on a municipality's use of tax-exempt bonds to finance its share of any project cost or allowing participants to use SRF loans as a match...A federal court supported EPA's authority to reject state water quality criteria, giving deference to the agency's reasonable interpretation of its own rules and possibly making way for the topic of Auer deference to be addressed by the U.S. Supreme Court...The federal appeals court governing North Carolina issued a decision rejecting a mining company's CWA permit shield defense that its lack of knowledge of potential selenium discharges released it from liability, and held that the permittee had an affirmative obligation to assess whether such discharges were possible...A federal court held that the Army Corp of Engineers was not required to consider possible adverse health effects when issuing CWA dredge-and-fill permits, stating that the Corps' CWA 404 review and NEPA review were limited to effects arising from the discharge of dredge and fill material.

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NCLM and State Environmental Government Meetings & Events