CII Permit

In this episode, Wayne Rosenbaum from the Environmental Law Group in San Diego discusses the upcoming CII Permit impacting commercial properties in two key watersheds in the LA Area, including the Port of Los Angeles and the Port of Long Beach. The Los Angeles Regional Water Board and the US Environmental Protection Agency (EPA) are advancing a new regulatory framework for stormwater runoff from commercial, industrial, and institutional (CII) facilities. This framework covers the Dominguez Channel/Greater Los Angeles and Long Beach Harbor Watershed and the Los Cerritos Channel/Alamitos Bay Watershed. The draft National Pollutant Discharge Elimination System (NPDES) permit aims to regulate stormwater discharges from privately-owned CII sites such as big box stores, malls, office buildings, and parking lots. Once adopted, the permit will require commercial properties to develop and implement a Stormwater Pollution Prevention Plan (SWPPP), stormwater best management practices (BMPs), and collect stormwater samples. BV's expertise in designing large-scale stormwater treatment facilities nationwide will be highlighted. Public comments were due by October 24, 2022, and the board is currently addressing these comments. Compliance options will also be discussed. 

Trasncript:

welcome to the flowing through SoCal Video podcast. This is a video version of a podcast where we discuss water topics in Southern California with a heavy lean on stormwater. Today we have Wayne Rosenbaum with the Environmental Law Group to talk through a couple of the aspects and details of the new CII permit, which is the commercial, industrial and institutional in PDS permit that is in draft form now. There's a lot to this, so I wanna just jump right in. But first, Wayne, how about just a quick introduction? Again, thank you for joining me today, but just a quick introduction about what you do and what some of the projects that you work on are.

My pleasure, Sean. The Environmental Law Group is is a small boutique firm and my specific practice primarily deals with water quality and water rights and in that area we spend an awful lot of time looking at storm water and milk and multiple ways in terms of new permits as they come along. This year in California, we got a new construction general permit. We're gonna talk today about CII permit, but helping people one make comments on these new permits as they're being promulgated to helping people understand these new permits and some of the old permits so that they can understand their compliance options. And three, then, defending our clients with from claims either by the regulatory agencies or more frequently by third parties under the Clean Water Act citizen suit provisions. So that's kind of what we do.

So under these permits, these NPDES permits you talk about the construction and the industrial permit, those permits have with them requirements that you implement or identify mutants. And then identify the BMP's to reduce or eliminate those pollutants. And of course, collect samples to make sure that you are or are not reducing or eliminating those pollutants. And then reporting. So there's a whole process so, so. So how did we get to this point? With the CII permit, where now we're looking at in this type of NPDES permit for individual discharges in the commercial space, how do we get here?

Well, the history is somewhat convoluted, but RDC and a few other NGO's petitioned E USEPA to say that they should use what's called the residual designation authority to regulate stormwater from new categories of dischargers. And there argument EPA was look, if you look at an industrial parking lot and you look at a parking lot at at at a commercial say at CVS or a Ohio Walmart, the activities that go on in those parking lots are the same. The pollutants that are being discharged are the same, and therefore EPA you should use your authority to regulate those commercial or institutional activities in the same way that you currently regulate at require the state to regulate industrial activities. EPA looked at that and initially and denied the petition that the Nile of the petition.

To the federal court, there was this a series of litigation. And consentually, what the court told EPA was that there did not the basis for their denial was inadequate, and they either had to regulate these facilities or go back and do another determination as to why these facilities shouldn't be regulated EPA in, in my view, took the easy way out and they said OK, we'll just enter into a settlement with the plaintiffs, which they did. And that settlement then required first EPA for the for two limited watersheds to designate a whole new group of folks as being permittees. not just just the Walmarts or or big box stores? Think hospitals think churches think private schools. All of these folks, we're gonna designate them the same way we would heavy industry and then have the Regional Water Quality Control Board for those two region for those two watersheds, create a new permit that would implement the requirements on all of those new permittees, and that was how we got to where we started and then what September of last year as you'll recall, EPA put out their residual designation authority memorandum, the regional Board put out their draft permit and then in October of last year, we all submitted comments and here we are about a year later and those comments are still being reviewed. So that kind of brings us up to date, I think.

Right. And so in the industrial space, industrial NPDES permitting space, the size of the property doesn't really drive anything other than you know, the how big your map is in your storm water pollution prevention plan. So for these commercial facilities, is there a size that triggers?

Yes. And in the proposed permit, the the facility would have to be a minimum of five acres. Now there's lots of questions in the draft permit as to how you measure those five acres, how you measure it for an industrial facility versus again a a commercial facility and a lot of that turns on some of the things that we don't know. If the the permit isn't clear as to who is the permit type, is it the landowner or is it the operator of that commercial activity? Is it the owner of the the shopping center? Or is it hallmark cards? Who happens to have 10,000 square feet of of store in that that facility? Who's gonna be the permittee? And that's important because that's going to tell us how you define five acres if it's the entire facility then and if it's the owner, then it's the entire facility, then it it is what it is. If it's, you know if it's the operator, then the question becomes OK Hallmark says wait a minute. I only have a 10,000 square foot store. I'm 1/4 of an acre. I'm not subject to this permit, but then whose subject to how do you deal with the 15 acres of parking lots that that are in the common use areas? So those we're, we're still working through those questions and I think this is part of why we haven't gotten response to comments yet as to who's gonna be the the, the legally responsible party, which is what we call it in the other permits for you know compliance.

Right. And that that individual or that entity would be responsible. I have the financial means or at least responsibility to implement whatever treatment systems are are required. So Speaking of of treatment systems, so again, under typically NPDES permit, you're collecting samples and then you're comparing those sample results to some kind of benchmark. In this case, these two watersheds are under TMDL's, so this permit is proposing to collect samples and compare those to numeric effluent limits. Limits. Is that right?

Well, yes, in if I have the date right 2031 right now those TMDL, have not yet come into effect, but if it has, if they do and when they do and and I think it's 2031 or 32 then yes you would have numeric effluent limits that you would have to achieve depending. And here's another part of this permit that she that's sort of unique on which compliance option the PERMITTEE chooses and and we haven't and I'll try and keep it simple. But we have basically 3 compliance options. The first compliance option, the one that appears to be favored by at least the regional board, is that PERMITTEES would participate in Regional Water quality projects. That is and and I'll use the Long Beach as an example. Long Beach has has built a system called Long Beach must, which is a major treatment. Major capture and treatment facility, which will capture nuisance flows first flush storm water, treat that storm water. Ultimately to a Title 22 standards and then reuse that water. You know it. It becomes a water resource and so under option one. Hypothetically, a Walmart could come along and say, well, I need X number of units I need to. I need so many gallons or so many, so much capacity to meet my obligations. I'll go to the city of Long Beach and I'll buy into that project under that scenario where yes, they would still have some on site obligations, they would not be obligated to meet the numeric effluent limits. That's one of the big advantages to to option one, option two and we might as well go through all three option option two, says that I am going to capture on my site, give an amount of water defined by what's called the 85th percentile storm event and I'm going to use it on site.

This charge it to the sanitary sewer or otherwise kind of make it a infiltrate, make it go away without discharging it to the storm water system. Option two may make sense, particularly for some heavy industry that has high water demands. You know, this capture the rainwater and they'll bleed it into their system and use it. Some businesses may choose to take their storm water and enter into an agreement with the sanitary district and meter it into the sanitary district, although the more we look at that option, I don't I suspect for many businesses that one will become cost prohibitive or, you know, maybe they can infiltrate. Maybe they can find some other use for it. Maybe they can have ring. I don't know, but if you can capture and retain that 85th percentile storm event you have met your requirements. And again, while you may have to sample anything, that discharge is beyond the 85th. Under the current version of the permit, you don't again don't have to meet the numeric effluent limits. The third option, which is sort of the poison pill, is I'm going to design, install capture and treatment systems on my at my facility capable of capturing the storm water. And now we're not talking about the 85th percentile anymore. We're talking about all the storm water and treat it to a standard that would comply with the numeric effluent limits and the water and the California water quality objectives. The this is kind of like saying I'm going to capture my storm water and I'm going to likely have to purify it to a level that exceeds drinking water standards. Now, I'm not saying that the engineers can't design that system for you. I just don't think anybody's going to want the price tag that goes along with it. So if you look at the three options for some people, option two may work. I I suspect the vast majority of permittee potential permittees we'll be looking to option one, which will allow the communities in these watersheds to build a large regional capture treatment systems, which can then capture that storm water and either infiltrate it or pass it on for use as potable water augmentation. There are lots of good things that could come out of that, but I suspect that's the option that will ultimately be favored by most most folks.

Right. So I I could envision where you have the real estate, for example Black and Veatch did Echo Lake Park some years ago. And I I suppose something like that could be used as a wet pond treatment system. Other projects we've done around the country as well that that sort of mimic that either lake restoration or large stormwater I'm you know stormwater treatment projects. So if I'm hearing this right, it sounds like the the the discharger when we when they define who that is could enter into an agreement to pay for at least in part for a project like that, that would treat the water from their facility and other facilities in in that watershed. And it's is this be some kind of ongoing like every year you have to pay X amount of dollars to remain in compliance?

Yeah. So think of it. Think of it in the same way you might think of if I were gonna do a development and I needed, I need potable water. I end up paying two fees. I I pay a connection fee, which is the essentially my share of the capital costs to provide the work. You know the build the infrastructure so that I have water for my project. OK. That's that's the connection fee, and that's a one time fee. And then I still pay for the water on an ongoing basis because there's, you know, the cost of the O&M costs of getting the water and tuning the water and sending the water to my place. This is just sort of kind of the reverse. I'm gonna pay a connection fee if you will. Or a fee to to build the capture facility. And then I'm going to pay an annual fee of some amount that represents my share of the operating and and maintenance costs to operate that facility into perpetuity.

So these facilities will probably most likely be designed and constructed by the municipalities. I I can't imagine a private entity building one of these large regional BMP, so city of Hawthorne or Torrance or one of or Long Beach, they'll have to so they'll have to procure the funding. So what I'm wondering now is measure W in Los Angeles that that pot of money from the parcel tax is designed to, you know, fund these type of large regional why is it possible that as part of this CII permit that the PERMITTEE could just pay into measure W and then then Hawthorne and Torrance would seek through the feasibility study process seek to to gain the money to build that project. And so, because I'm not, I'm just unclear as to how a Walmart or a Home Depot that has this five acre parcel. How are they gonna pay? Who are they gonna pay to build this? Ok, let's break it into two pieces sources and uses. That that's the confusion I think on my end.

In terms of how would they pay it is what the permit request requires? Is that Walmart would enter into a contractual agreement. You're right with some form of a public agency that says in the public, agency says we're going to and. And here's another place that is not clear. We're gonna build or we have built a vocal capture system capable of capturing 100 acre feet and you Walmart need two acre feet. And here's what we're gonna charge you for your share of the capital costs. And here's what we're gonna charge you annually for your own M course. That contract then has to be approved by the Regional Water Quality Control Board, but that's the structure, if you will. The other question you you've kind of asked is hey, is it fair to be have to be pay both a tax which is what measure W is and then on top of that a fee or an additional fee to participate in this program and the logic of that is and I'm not saying the fairness but the logic is the taxes, the taxes, the tax and everybody pays based on the rules that the tax the fee if you will is discretionary Walmart you don't have to pay into that system. You don't have to contract with the city of Yacht. You can do option two. Option three, you're not forced to do this now, will those funds ultimately comingle? Absolutely. I would suspect that what you're gonna kind of see is something like this city builds project using measure will be a funds. Along comes Walmart, and we shouldn't pick out just on Walmart. Along comes Lowes and and lows. Says I wanna buy capacity out of that project. Well, that money that lows then pays to buy capacity can be used by the city to build the next project. They can't just take the money and run, OK, the money has to be directly related to some sort of of stormwater capture and regional capture and treatment system. So I suspect the that, that procedurally, that's the way it may play out measure W money to as initial seed money and funding money then that that builds things that then gets sold off under the CII permit to generate more money to build more things in conjunction with Measure W the other thing that the CII permit does that is lot of sketchier under measure W is the CII option one secures O&M money into perpetuity. Measure W doesn't necessarily do that, so you may you may have the scenario where you get measure W money to build it and you get CII money essentially to operate it.

Right. And there's definitely some a couple of dust UPS happening right now with some of the agencies that have built structures under Measure W finding that now we're seeking O&M monies and maybe some type of amendment to how you could distribute from measure W or a new submittal requesting O&M funds postmortem. So that's there's definitely some some movement there. But I tell you, Wayne, this to me, this is earth shattering because these commercial facilities and industrial facilities that haven't been covered and institutional facilities like churches and universities, they have never seen something like this before where you have to enroll in develop a SWIP, implement BMP's, collect stormwater discharge samples, contract with the laboratory. All those things that go along with these NPDES permits, they've never had to do before. So this is I'm curious to see how this rolls down to these potential land owners or whoever the LRP is and how the how the forward disseminates this information to them and and who enrolls and who doesn't enroll. I mean, we had how many non filers enter the industrial general permit in 2015? Right.

It took them five years to wrangle all those folks up, right?

Well, the two thoughts here. One, I suspect the the non filers here are going to be much easier to find because all you have to do is to look at a zoning map, identify all the parcels that are zoned commercial or or institutional. If they're bigger than five acres, assuming it is the property owner that becomes the permit fee and they're in, I mean, you know, that's a pretty easy exercise. I think the the other side of this is and here I am speculating but it would not surprise me under option one if essentially the ultimate permit simply said buy into a regional project and you're done, you're not gonna have to do anything more on site. You're not gonna have the sample on site for all the reasons that that you indicate because I don't think that that you know when you start telling, you know, Sacred Heart Church. Ohh by the way. Now you're gonna have to prepare a stormwater pollution prevention plan and hire a quiz. Do this sampling etcetera, etcetera. You are now talking to the voters, and voters can get very, you know, have powers that generally industry doesn't have because they vote. I suspect that you're gonna see that. I think they're going to make it so up. So enticing to be an option, one that everybody's gonna look at the other options and go what? Are you kidding me?

Yeah, it it seems that the the overarching desire is to have funding for large regional treatment. So and I my timer just went off here. So we just got a couple of minutes, but I did want to find out one more thing. I think you could provide some nice perspective on the Ingos that brought the original suit that basically saying that these commercial facilities look a lot like industrials and they need to be covered as well. What's your sense of how they are feeling about this right now? Are they? Are they in? amenable to the larger product BMP's? Or do they wanna see parcel by parcel? What? What sort of your thoughts on where they're going to land with this in terms of happiness or not?

Well, OK, reading between the lines and and reading their comment letters because we've we've had the opportunity to at least read their comment letters. I think they are skeptical of the idea of a regional solution and this really me this, you know, this comes back to an issue that that's been out there for a while, which is they don't believe in trading. You know we as we have say in air quality where I I can I can buy credits, they really kind of see the world as each each generator of the way of a pollutant should be responsible for the waste the the pollutant that the generator generates. And so that's that's deeply ingrained in their thinking.

More skeptically, I think that that if everyone to were to go to the option one model, at least as we understand it today, the ability to bring citizen suits against those folks would be significantly narrowed. And that's the income stream for most of these NGO. So I'm going to. I will assume that that they they're reasons that they are more, more philanthropic, more, you know that that they are really concerned about the environment. Cause I think they are, but I also think that the as they think this through, they're also gonna come to the realization that if if everybody goes with option one, they're gonna have to find some other income strain.

Right. And then just good point. And then just wrapping up, what's the next step here? So we we have the draft version out, public comments have been received. Allegedly, they're working on addressing these comments. So what? What are we looking at for a timetable moving forward approximately?

Well, much like the the the play waiting for Godot, we are still waiting. We have been promised that we're going to get a a revised draft permit. Well, I think we were supposed to get one in July and then in August and now maybe sometime in September. I I think that I suspect, and this is anecdotal supposition, that both the regional board staff and EPA UI have come to the realization that there are a lot of issues here that have to be resolved. Who's in? Who's out? Who's the permit? Tea. How do you really define? You know a regional project, all of those issues have, you know, I've really need still to be worked through with a great deal more clarity. There's also the question of whether or not EPA's and Memorandum is sufficient to trigger their residual designation authority, or whether they have to go through the Administrative Procedures Act process. So it's coming, folks. It's gonna come. It may not be today, may not be tomorrow, but this kind of permit is coming, and at least in California, the California legislature appears to be willing to take this kind of permit statewide for all urban areas. We saw that in the previous legislative session, although the governor vetoed the bill. At that point, I believe that once the the the the permit gets straightened out for these two watersheds, we can expect that permit to expand statewide. And what happens in California doesn't stay in California.

Right, exactly. Well, Wayne, thank you so much for joining today. I think what we wanna do is have you back as soon as we get the next version, we get the the second draft or the the official official version of this CII permit released to the public. I think we're gonna wanna have you come back and we'll take a deeper dive into some of the elements of that permit. But I thank you so much for joining today and I hope you have a great rest of your day.