California's new stormwater Permit – what's the fuss about?

Any project or common plan of development at which one acre of land will be graded or disturbed requires a stormwater discharge permit, if runoff from the site discharges heads towards “waters of the United States,” which is nearly any storm drain or surface water. On September 2, 2009, the State Water Resources Control Board (Water Board) adopted a controversial, updated General Permit for discharges of stormwater from these construction sites (Order No. 99-08-DWQ).

The new permit increases the costs of compliance, and its detailed mandates and more extensive reporting requirements increase exposure to enforcement. Because the permit is issued under the federal Clean Water Act, it can be enforced by citizen suit (penalties up to $37,500 per violation per day plus attorneys' fees), as well as by the Water Boards or Regional Water Resource Control Boards (discretionary penalties of $10,000 or more per day plus per gallon charges, and mandatory minimum penalties of $3,000 per violation for certain types of violations). The new standards will indirectly affect analysis of projects under the California Environmental Quality Act. Violations of the permit can be considered in LEED certification, and cited in Unfair Business Practices Act lawsuits.

The Water Board decided to delay the effective date of the new permit until July 1, 2010. Until then, projects need permit coverage under the existing general permits, under which new applications will be accepted through June 30, 2010. An appeal has been filed in Superior Court by the California Building Industry Association, California Business Properties Association, and Building Industry Legal Defense Foundation. However, permittees cannot afford to wait for a court decision, because compliance will require substantial advance planning. Developers, contractors and affected landowners should closely review their project designs to look for opportunities to minimize compliance costs, and ensure they have appropriate staff and consultants capable of handling the new responsibilities.

The permit requirements will differ for projects depending on which of three "risk levels" apply to the project. The permit adds substantial monitoring requirements, and requires prompt electronic reporting. Some projects will be subject to specific enforceable limits for turbidity and pH, and most will have to draft and file action plans if turbidity or pH are measured above “action levels.” Best management practices will be required during the dry season as well as the rainy season, even on active areas of the site.

A particularly controversial requirement affects final site designs. The permit contains a “post construction” requirement to reduce (or avoid increasing) the volume of runoff leaving the site, as compared to runoff from the location before the project. This requirement will kick in on September 2, 2012, and applies on the date of termination of permit coverage for a project, unless a project obtains a special extension of this “grandfathering” period. The requirement does not apply to sites lying within areas covered by similar post-construction requirements in Phase I or Phase II municipal permits.

Grandfathering provisions automatically assign the lowest of three risk levels (Level 1) to projects covered by one of the existing general permits. This is a substantial benefit, so project planners should consider obtaining an existing permit by June 30, 2010. Most sites, including almost all multi-year projects, will otherwise have to comply with the requirements of the higher risk categories (Levels 2 or 3).

Perhaps the most controversial requirements were new, enforceable numeric effluent limits for Risk Level 3 sites, of 500 NTU turbidity and 6.0 to 8.5 pH. Discharges exceeding these limits will violate the permit and expose the site to mandatory minimum penalties and other potential enforcement. There are concerns that “run on” may carry sediment or alkalinity, which could make compliance difficult when water leaves a site, even if the site does not add much sediment or alter the pH in runoff.

Risk Level 2 or 3 sites also have to respond to turbidity and pH “numeric action levels” of 250 NTU and 6.5 to 8.5 pH, though exceeding these levels will not be a permit violation. Advance treatment systems are subject to major restrictions including much lower turbidity limits, and monitoring for flocculent additives, and, sometimes, toxicity testing.

There are substantial new sampling requirements. For sites falling in Risk Levels 2 and 3, a minimum of three runoff samples must be taken each day of significant rain. Risk Level 3 sites and sites with advanced treatment systems must sample receiving waters (e.g. streams or storm ditches leading to streams). Risk Level 3 sites disturbing over 30 acres must do instream biological assessments before and after the construction project, at a time of year specified for each region. Multiple reports must be submitted on short timelines.

A shortage of qualified professionals is likely to result from the new permit, especially as the construction industry revives from the downturn. Staffing of stormwater compliance functions requires specified certifications and training for pollution prevention plan developers and for compliance managers.

High ranking representatives of property owners (or linear project easement holders) will have to personally sign applications and many reports. Although military and university protests were accommodated with some special language at the hearing, other municipal entities and federal agency landowners will have to have high ranking officials sign documents.

Sites between one and five acres may be exempted from the permit if the owner certifies in writing that construction activity will occur only when there is low potential for erosion, according to specific calculations. Final stabilization must be achieved by a specified date that ensures completion before erosion risks increase (e.g. before the rainy season).

Currently there is a separate general permit for linear activities (e.g. utility projects along narrow corridors); however, they will be covered under the new general permit along with non-linear projects. Caltrans projects will remain under the existing Caltrans general permit, at least until that permit is renewed next year. Then this major construction sector may well join the rest of the State's projects in the new, more costly and demanding regulatory scheme.

Katharine Wagner is a partner in Downey Brand's Environmental Law Practice Group, focusing on water quality and hazardous materials permitting, compliance and enforcement defense, and advising clients on transactional environmental issues.

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