October 10, 2005
Author: Lawerence Liebesman, Bonni Kaufman, & Rafe Peterson
Organization: Holland & Knight
In May 2004, the United States Environmental Protection Agency (EPA) announced a major new enforcement initiative related to compliance with its regulatory regime for stormwater management at construction sites. Since then, EPA has initiated numerous enforcement actions seeking millions of dollars in penalties from developers and builders for failure to obtain and comply with permits for stormwater discharge. Given this regulatory climate, it is important to ensure compliance with the requirements of the stormwater permit regime, including maintenance of sediment controls such as silt fences, inlet protection and site stabilization. However, the question of what constitutes failure to comply with permit requirements can be a matter of interpretation – coming down to questions such as whether the stormwater measures in place were the best “practicable.” Consequently, it is important to utilize experienced design professionals to ensure that the management design meets all federal and local requirements and to be zealous in inspecting and maintaining sediment control measures once implemented.
The Clean Water Act Regulatory Regime for Stormwater Management
The federal Clean Water Act (CWA), enacted in 1972, is the primary federal surface water quality protection statute in the United States. The CWA authorizes a variety of regulatory and nonregulatory tools to reduce direct pollutant discharges into “navigable waters,” to finance municipal wastewater treatment facilities and to manage polluted runoff. Section 301(a) of the CWA states that except in compliance with the statutory permit requirements, it is Polluted stormwater runoff is one of the main causes of pollution in bodies of water that do not meet water quality standards. If left unchecked, this pollution can result in the destruction of fish, wildlife and aquatic life habitats, and pose a threat to public health. Yet, regulation of stormwater has proved difficult.
Pursuant to Sections 301 and 402(p) of the federal Clean Water Act, EPA has jurisdiction over stormwater discharges from industrial facilities. EPA’s National Pollutant Discharge Elimination System (NPDES) is the permit mechanism which allows such discharges. The CWA allows EPA to delegate its NPDES permitting authority to the states that meet minimum requirements for administering the approved program. See 40 C.F.R. Part 122. EPA has delegated permit authority to the most states. See EPA’s Web site cited at: . Consequently, as a practical matter, the states are delegated stormwater permitting authority from the EPA and the prospective permittee only has to seek one permit (i.e., one permit issued by the state covers both state and federal requirements). Yet, it is important to understand that EPA does not completely delegate enforcement authority. Hence, parties that violate their stormwater permits could face two potential enforcement regimes (in addition to local erosion control authorities, who also may assert authority over grading and sediment control).
Construction activities involving five acres or more are regulated under Phase I of the NPDES stormwater program. 40 C.F.R. §122.26(b)(14)(x) On March 10, 2003, new regulations came into effect (Phase II) that extended coverage to construction sites that disturb one to five acres in size, including smaller sites that are part of a larger common plan of development or sale. 40 C.F.R. § 122.26(b)(15). Thus, putting in a restaurant on a threequarters of an acre pad that is part of a 20-acre retail center would require permit coverage.
Practical Considerations of Stormwater Management
The operator is the party who must apply for the permit. “Operator” is defined as the person who has operational control over construction plans and specifications, and/or the person who has day-to-day supervision and control of activities occurring at a construction site. 57 Fed. Reg. 41190. Several states require a single entity to be the permittee. Other states and EPA require all relevant entities to obtain permit coverage, as co-permittees, for a given construction project. (For example, if several builders are constructing within a large-scale home development they operate under one permit).
Most stormwater permits are “general” NPDES permits issued by the states, unless the discharge is likely to impair water quality. In that case, an “individual permit” may be required. Where EPA is the permitting authority (i.e., the permit authority has not been delegated to the state), EPA’s Construction General Permit (CGP) controls. Rather than “apply” for general permit coverage, parties send “notices of intent to discharge” providing details concerning the project and proposed management measures. Notices of intent must be submitted to the permitting authority before starting construction. All permits provide an issuance and expiration date and permit terms may not exceed five years. Stormwater permits do not require zero discharge, rather, they seek to limit the amount of sediment that will be discharged over the course of a certain time period, primarily through implementation of best management practices (BMPs). The heart of the permit is the Stormwater Pollution Prevention Plan (SWPPP), which contains the BMPs. Determining what constitutes compliance with the SWPPP and the BMPs can be difficult.
The SWPPP focuses on two primary requirements: (1) providing a site description that identifies sources of pollution in stormwater discharges; and (2) identifying and implementing appropriate measures to reduce potential discharges. The actual details of the BMPs that meet these goals vary widely, depending on local standards and site conditions (BMPs often also fulfill local erosion control requirements as well). Basically, BMPs are a combination of structural and non-structural measures. Structural measures involve the installation of devices to divert, store or limit runoff, such as sediment traps, inlet protection, or silt fences. Non-structural measures minimize disturbance by specifying good housekeeping practices, such as garbage removal and street sweeping, etc. Stabilization of disturbed soil by covering or maintaining an existing cover is also a standard requirement. This includes seeding, mulch, straw and other materials to prevent soil erosion.
A key aspect of the general permits is the requirement for routine inspections (at least every seven days and after major storm events) and maintenance of the controls. Once an inspection has been performed, an inspection report must be retained for up to three years after the permit expires or is terminated. The report must identify any incidents of noncompliance with permit conditions or, if none were found, a certification that the site is in compliance with the SWPPP. This requirement is very important as the general permits also require that the SWPPP be amended if inspections or investigations by state or federal officials determine that the SWPPP is ineffective in eliminating or significantly minimizing pollutants in stormwater discharges from the construction site. Hence, not only must the existing BMPs be maintained, but their effectiveness must be continually evaluated and changed if they are no longer effective.
At the conclusion of construction, all disturbed areas must be finally stabilized by either vegetative or non-vegetative cover. At this point, a Notice of Termination may be submitted and NPDES obligations are terminated.
Enforcement Has Become a Priority for EPA
Stormwater permit enforcement is a national priority for EPA. In addition to other enforcement remedies, EPA may seek civil penalties for noncompliance of up to $27,500 per day for each day of violation. To date, EPA’s focus has been on “big box” builders and on large, national home builders. This does not mean, however, that EPA will be content to stop at the larger companies. Indeed, a majority of construction activities nationwide are undertaken by smaller entities. In numerous states, EPA is undertaking its own investigations as well as encouraging states to target compliance assessment and enforcement efforts in watersheds with water bodies of special concern. The penalties sought by EPA and, more importantly, the penalties obtained in settlement, have ranged up into the millions of dollars.
While no one denies the need for compliance with the stormwater permitting requirements, EPA’s tactics are not without controversy. Many of the claims are brought against companies that have failed to obtain permits. The liability there is pretty straightforward, although some would argue that EPA has not been effective in communicating the need for stormwater permits to smaller builders. In instances when companies did obtain permits, it is also difficult to determine whether or not a BMP is being complied with. BMPs are governed by good engineering practices designed to retain sediment on site to the maximum extent “practicable,” rather than on specific effluent limitations. In many cases it is difficult to discern what practices are sufficient. For example, a silt fence that sags for several days in-between inspections may be considered by EPA to be a violation for each day that it is not fixed, despite the fact that under the SWPPP the fence is not required to be inspected during that several day period. Labeling such an event a permit violation (subject to up to $27,500 of fines per day) would appear inconsistent with the notion that inspections, followed by maintenance and repair of problems identified in the inspection are fundamental to BMPs.
The magnitude of this interpretation of a permit violation is seen when one considers that a large site may have hundreds of different BMPs in place. It is well understood by people in the construction industry that in a dynamic environment, such as a construction site, silt fences and other structural elements are going to experience natural wear and tear. The liability exposure is considerable. Thus the general perspective of the regulated community is that, while the failure to install a sediment and erosion control measure or to properly maintain it (i.e., to repair on a timely basis what is discov- ered to be failing) may, under certain circumstances, be considered a permit violation, it is questionable whether a sagging fence that is not discovered until the authorized inspection takes place is a permit violation. This issue is presently the subject of much controversy nationwide and how EPA (and more importantly the courts) interpret the tension between routine maintenance and the EPA’s desire to enforce will have significant ramifications for the construction industry.
Compliance with the NPDES stormwater permit requirements is essential. At a minimum, seeking coverage under the applicable stormwater permit and developing and implementing a SWPPP is necessary to reduce the possibility of enforcement. To further lessen the chances of problems arising, the BMPs should be designed by parties familiar with effective design strategies and local conditions. In addition, routine inspection and maintenance must be followed to the letter. The risks of federal or state enforcement for relatively minor BMP maintenance issues has become a reality. In the worst case scenario of an enforcement action, the best defense will be that the BMPs were designed, implemented and maintained according to an approved SWPPP and that BMPs such as silt fences are permitted normal wear and tear.