State Administration of "Section 404" Permits
State Joint and Streamlined Permitting
Implementing Indiana Administrative Mediation
As part of its deliberations directed to permit streamlining, the Blue Ribbon Advisory Panel requested the Department of Natural Resources and Natural Resources Commission to research models from other jurisdiction for additional coordination and streamlining. In addition to discussing the successes of these efforts, the Panel asked that attention be given to failures or challenges encountered. A portion of the resulting research effort is set forth below:
State Administration of "Section 404" Permits
A growing number of states are assuming regulatory responsibility for implementation of Section 404 of the Clean Water Act.87 Two basic models apply to this trend: (1) state primacy; and, (2) general permits (perhaps most notably what the Army Corps of Engineers refers to as AProgrammatic General Permits).
One model which seeks to streamline this process, and at the same time shift many responsibilities from the federal to the state level, is through primacy. More commonly for Section 404 of the Clean Water Act, primacy is called "404 assumption." Two states have assumed primacy, Michigan in 1984 and New Jersey in 1993. The focus here is on the Michigan program.
The Michigan Department of Natural Resources entered into a Memorandum of Agreement to accept primacy in 1983. That agreement authorized the state to carry out the policies, regulations, and procedures needed to administer the program.88 The following year, the U.S. Environmental Protection Agency approved the program for most areas of the Michigan.
Excepted from state administration were the Great Lakes, connecting channels, and other waters connected to the Great Lakes over which the U.S. Army Corps exercises the federal navigational servitude. The excepted waters are essentially those subject to Section 10 of the Rivers and Harbors Act.89 A list of these waters was included in a 1984 Memorandum of Agreement between the U.S. Army Corps and the Michigan DNR. The Corps also retained jurisdiction over the wetlands adjacent to these waters.90
Today, Section 404 permitting is administered by the Michigan Department of Environmental Quality (MDEQ). Except for the referenced areas subject to the federal navigational servitude, the need for an Army Corps permit is waived throughout Michigan. On the Great Lakes and other waters subject to Army Corps permitting authority, both federal and state permits are required. The Army Corps and the Department of Environmental Quality use a joint application form (which is delivered to the MDEQ) and may issue a Joint Public Notice, but separate permit actions are taken by the two agencies.91
In light of the requests by the Blue Ribbon Advisory Panel, Margaret Bostwick, Michigan 404 Program Coordinator, was asked to share insights on Michigan state administration of the Section 404 program.92 After emphasizing that her insights did not necessarily reflect official Michigan policy, she made three primary points: (1) State assumption of a 404 Program (seeking primacy) is a complex, time-consuming process. (2) Overall the 404 program has been effective in Michigan. (3) On the rare occasions when a permitting process goes awry, primacy may aggravate efforts to solve the problem. These points were expounded upon.
An effort was also made to obtain perspectives from New Jersey concerning its experience with Section 404 primacy. Robert Piel, Assistant Director of the Land Use Program, Division of Water Quality, New Jersey Department of Environmental Protection, shared his personal perspectives.93 Once again, these perspectives should not necessarily be considered as reflecting official New Jersey policy.
The New Jersey experience with the process to seek primacy of the Section 404 program was similar to Michigan. Piel noted that successful completion of the application was both demanding and time-consuming. Difficulty was experienced in assuming the federal program even though New Jersey already had pervasive and detailed state wetlands legislation. Nearly all wetlands are protected, and the state legislature in 1987 had extended regulatory authority to include an upland buffer zone adjacent to wetlands. The buffer zone extended 50 feet from the wetland, unless a wetland contains a threatened or endangered species or reproducing trout, in which case the buffer zone extended 150 feet.94 Even so, New Jersey was required to demonstrate its program would be no less effective than the federal program administered by the Army Corps of Engineers.
Since primacy of the Section 404 program has been achieved by New Jersey, difficulties have been minimal. Only high-impact wetland projects yet require EPA and Army Corps participation: for example, where more than five acres of wetlands are to be filled or for wetlands adjacent to wildlife preserves. These permitting activities are a very small fraction of the overall number of permits, perhaps five to ten of the 3,000 handled annually by the state. According to Piel, "In my view, it's working rather well."95
New Jersey has acted upon the need to streamline government. Staffing has been trimmed in recent years, and currently approximately 20 persons address inland wetlands permitting in New Jersey for both state law and Section 404 primacy. Piel reflected that reporting requirements are modest; his staff has been able to meet most of these requirements by providing the Corps a computer printout of permitting activities under a cover memorandum.
Neither Michigan nor New Jersey identified any loss of federal revenue which would result from the administration of a Section 404 program. On the other hand, a state which assumes a program does not receive federal assistance for its administration.
Programmatic General Permits
A "Programmatic General Permit" (or "PGP") is a general permit issued by the Army Corps that authorizes for the purposes of Section 10 of the Rivers and Harbors Act, Section 404 of the Clean Water Act, and Section 103 of the Marine Protection, Research, and Sanctuaries Act (33 USC 1413) certain federal projects that are also regulated by a state or local authority. A PGP is the written document which identifies the terms, limitations, and conditions under which classes of projects may be authorized under the Army Corps regulatory program with a "much more efficient and abbreviated review by the Corps." A PGP is designed to do the following:
Programmatic General Permits have been developed with states for a variety of purposes. Examples are projects regulated under North Carolina's Coastal Zone Management Program and under a wetlands regulatory program in Massachusetts.97 Since 1982, a memorandum of understanding between Wisconsin and the Army Corps has also addressed wetlands, and other PGPs between Wisconsin and the Corps cover cover issues which are "industry specific;" for example, a PGP covers mint farming operations.98 In April 1996, the Army Corps proposed a regulatory guidance document which would establish a structure for consistent and flexible application among state and local jurisdictions.99
A Programmatic General Permit has both advantages and disadvantages relative to state primacy. A PGP offers greater flexibility. A PGP may be applied to a class of permit or geographic area within the state, while primacy of Section 404 requires the state to have authority to assume, and to actually assume, full legal and geographic jurisdiction. A PGP may be applied to areas subject to the federal navigational servitude, a matter which may be of particular interest to Northwest Indiana with a view to projects within Lake Michigan and its navigable channels and tributaries. On the other hand, federal oversight is more pervasive with a PGP than primacy, with a PGP anticipating periodic Army Corps review of state or local permitting activities. Typically, a permittee under a PGP would continue to be subject to the terms of a federal permit, albeit a general rather than specific permit. For primacy, the state permit is the only permit. In both instances, enforcement would typically be performed at the state level, but federal jurisdiction to pursue a violation would also be present.100
The Indiana Department of Natural Resources met with the Detroit District of the Army Corps of Engineers on November 19, 1996 to discuss a variety of issues pertaining to Northwest Indiana. The meeting was occasioned both by suggestions from the Blue Ribbon Advisory Panel and the Lake Michigan Marina Development Commission. One of the items discussed in November with the Army Corps was the possible development of Programmatic General Permits for Indiana or for particular activities within Northwest Indiana. Gary Manesto, Chief of the Regulatory Branch for the Detroit District, emphasized that the guidance document pertaining to Programmatic General Permits was yet in draft form but that his office was agreeable to considering the vehicle as a means for achieving permit streamlining once finalized. Manesto indicated his office would provide the Indiana DNR with a copy of the final guidance document when available.101
Primacy Under the UIC Program
Primacy under the Safe Drinking Water Act was discussed previously in this chapter. As referenced there, Indiana has not sought primacy of the portion of the SDWA directed to the Underground Injection Contol Program (other than for Class II wells as administered by the Department of Natural Resources).
In response to a request by the Blue Ribbon Advisory Panel, Ohio was contacted in an effort to evaluate the success of primacy in that state. Mary Lou Rochotte, UIC Unit Supervisor within the Ohio Environmental Protection Agency, said all five Classes of UIC wells are permitted and enforcement actions are taken at the state level. Mary Lou Rochotte, UIC Unit Supervisor, Division of Drinking and Ground Water, Ohio Environmental Protection Agency, was contacted for a state perspective on full primacy of the Underground Injection Control Program. She said that in Ohio, all five Classes of UIC wells are permitted and enforcement actions are taken at the state level. The Ohio EPA administers Class I, IV, and V wells. The Ohio DNR administers Class II and Class III wells. Primacy was obtained by Ohio in 1985.102
Rochotte said although the process for obtaining primacy is demanding, once primacy is obtained, state administration can be more responsive to local and regional needs. There is more accountability to local interests and to the business community. "I think having a state-run program, once it's up and going, is preferable."
Rochotte also reflected that, "Financial resources are always an issue." The federal government does provide some assistance for administration of the UIC program, but the formula for determining the amount of assistance is based upon well inventories provided by the state to U.S. EPA, and the formula is arcane. The amount of assistance is very limited. Partnerships must be developed developed among state agencies, and between state and local agencies, to make administration of the program as cost-effective as practicable. Particularly with respect to Class V wells, which have a significant potential for pollution but which are not always taken seriously, Ohio has emphasized outreach to help demonstrate that their proper maintenance is in the operator's own best interests.
Also in response to an inquiry by the Blue Ribbon Advisory Panel, Timothy Method, Deputy Commissioner for IDEM reflected upon why Indiana has not sought primacy for other than Class II wells. He responded that Class I wells are for "deep injection of hazardous wastes; i.e., injection below any water bearing formation defined as an underground source of drinking water." He said the limited number of Class I wells in Indiana did not justify a state program.
Method said that "With respect to Class III wells, or wells which inject fluids for the extraction of minerals (e.g. solution mining), it has been our assumption that primacy for this program would logically be within the Department of Natural Resources." He said IDEM was not aware of any Class III wells in Indiana.103
James Slutz, Director of DNR's Division of Oil and Gas, said he agreed with these perspectives as applied to Class III wells. Although formations are believed present in Indiana which would support underground mining through the injection of fluids into minerals, no activities of this type were believed to exist in the state. To be noted in this regard is that federal law does not allow a state to seek primacy for Class III wells apart from primacy for Class I, IV, and V wells. Whether IDEM or DNR were to administer a program directed to Class III wells, there must also be an initiatve directed to Class I, IV, and V wells.104
Method reflected that Class IV injection wells, or wells that inject hazardous waste directly into or above an underground source of drinking water, are prohibited by federal regulation.105 "Therefore, it has been determined there is no need to pursue primacy for this program."
Method reflected that EPA estimates there are over 10,000 Class V injection wells in Indiana. "[T]o pursue regulation of this expansive inventory would be infeasible with the grant funds available." He said IDEM had discussed the possibility of pursuing primacy with Illinois, and Illinois advised "that we would need to secure substantial State funding to maintain the program. For example, the State of Illinois attempted to return primacy for the Class V UIC program to U.S. EPA Region 5 due to lack of resources and the workload required by Region 5."106
Limited funding is available to assist a state in the exercise of primacy under the Underground Injection Control Program. Funding is not available, however, to assist in the development of a state primacy program.107
State Joint and Streamlined Permitting
Wisconsin Programmatic General Permits and Joint Permits
A prototype for the concept of Programmatic General Permits is provided by Wisconsin, and this prototype forms an important element in its efforts to achieve joint and streamlined permitting. The PGP between the Army Corps and Wisconsin is outlined previously. In addition, Wisconsin currently utilizes a joint application form which seeks to cover both state and Corps permitting requirements for waterway issues. When an application is received which does require both state and Corps approval, Wisconsin does needed copying and sorting then forwards the application to the Corps on behalf of the citizen. Separate permits are yet required but early coordination is facilitated.108
Wisconsin has explored the possibility of a new approach which would result either in a single site-specific permit issued by the state or by the Army Corps. Under the proposal, Wisconsin would suspend approval of all nationwide permits offered by the Corps, and require site-specific permitting to projects affecting fewer then three acres of wetlands. Wisconsin would make jurisdictional permitting determinations. The Corps would provide a PGP for these activities.
Wisconsin estimates that the great majority of permitted projects have small geographic impacts. Half of all permit applications issued since 1991 are for projects impacting less than 0.15 acres of a wetland or other waterway. Roughly 80% of projects impact less than ¾ of an acre. For major projects, those impacting three or more acres, Wisconsin would defer all permitting functions in favor of the Army Corps.109
Pennsylvania Permit and Enforcement Streamlining
Another model for addressing permit and enforcement streamlining is provided by the Commonwealth of Pennsylvania. Members of the public often perceived the Pennsylvania Department of Environmental Protection and the Pennsylvania Department of Natural Resources as being slow and unresponsive. There were complaints concerning the time required for permit processing, and there were claims that in some cases permit fees were paid but permit reviews did not occur. The state had a back log of permits.110
The Process Improvement Team (PIT) was formed to study permitting and compliance processes by the Pennsylvania Department of Environmental Protection. This initiative made recommendations on ways to increase environmental protection while improving the efficiency, reducing the backlog of permits, and seeking more effective ways for achieving compliance. The PIT focused on four main program areas:
To formulate the 22-member PIT, membership criteria were developed. Members were sought to ensure equal representation from the agency's central office and its regional offices, as well as to provide a balance between permitting experts and employees with an outside perspective. Based upon these criteria, nominations were made to the Special Assistant to the Secretary of the PDNR as to whom in the agency should participate. The Special Assistant then appointed the PIT members. Members underwent extensive training and worked with a consultant hired to help the PIT through an intensive three-month process. Members worked on the PIT full-time.
The initiative identified ten major issues: administrative changes; automated production and electronic storage for permit documents; data management; public notification and comment; standardizing and streamlining minor sewage permits; watershed toxics analysis and its relationship to the permitting process; an increased pollution prevention focus; fee structure; training and communications; and watershed teams. Recommendations were developed for each area.111
The PIT was not to be inhibited by limitations such as whether new rules would be needed. The recommended changes to the process did not, however, require regulatory changes. Mostly, the changes brought about a reassessment of the interpretations of regulations. All the recommendations made by the PIT were implemented.
The back log of permit applications has been eliminated with the assistance of PIT recommendations. A new policy had been set forth just prior to formation of the PIT. The policy said that if permit applications (NPDES and others) were not reviewed in a specified time frame, the application fee would be returned to the applicant, the manager who returned the fee would be photographed with the Secretary, and the photograph with a subsequent article would be published in a newspaper. There have not been any application fees returned and Stuart Gansell of the Pennsylvania Department of Natural Resources credits the PIT with helping to avoid this action.
Due to the success of the original PIT, PIT II was recently created. The second phase includes a smaller, less formal group. PIT II meets only once a month. Its membership involves representatives of the regulated community, as well as agency representatives. PIT II also includes the assistance of a consultant and will address three major items:
Other issues surfacing during PIT II revealed that there are numerous inconsistencies and inaccuracies in the permit document which will need to be addressed when the document is rewritten. In addition, significant policy matters not within the scope of PIT II must be addressed. PIT II recommended that a series of meetings be conducted with select participants from the Pennsylvania Department of Environmental Protection and the regulated community to discuss policy modifications.
According to Gansell, the changes have brought about a renewed public perception that the permitting processes are more efficient. By including some of the critics in the PIT II, they are able to see what agencies must do, and agencies have a better understanding of the applicants= views.112
Washington state has field-tested a streamlined permit application for activities near the state's shorelines, wetlands, and other waters. Local, state, and federal agencies came together to create a Joint Aquatic Resources Permit Application (or "JARPA"). The application brings into one form the information for several local, state, and federal permits. The application is not a new permit and required no new laws or rules to implement.113
The JARPA was a staff initiative of the Department of Ecology and the Army Corps of Engineers. The process to develop a joint application form took approximately two years. The first eight months were spent pulling together the appropriate participants and negotiating the requirements for a single form. The next six months were spent testing the application in the field. Following the test, another six months were spent surveying the applicants and jurisdictions were it was tested and making necessary revisions. Once revisions were made, a mass distribution was done to all 280 jurisdictions in the state where the permit would apply. Currently, Washington is undergoing another set of revisions and preparing the application for Internet access and for electronic filing with the agencies.114
Bonnie Shorin of the Washington State Department of Ecology emphasized that this is not a joint permit, where one agency issues one permit for all the agencies, but rather a uniform permit application which is circulated to each agency for review. A joint permit would have required one agency to assume the burden of issuing permits, as well as for arbitrating conflicting conditions placed by the different agencies. Without regulatory reform, the agencies could not develop a joint permit. The development of a joint application was possible without making modifications or additions to existing rules. Each agency with regulatory authority over aquatic resources still receives a permit application for review.
Permits that are incorporated into the JARPA include: local land use permits; Corps permits for Section 404 of the Clean Water Act and Section 10 of the Rivers and Harbors Act; State 401 water quality certification; short term water quality impacts; DNR leases; and NPDES permitting requirements. Recently, U.S. Coast Guard permits for navigable waters have been added. To date, 90 local governments have adopted the form as its shoreline application, as well as the Washington Department of Fish and Wildlife, Department of Ecology, Department of Natural Resources, and the U.S. Army Corps of Engineers.
Several benefits to the uniform permit application were identified by Shorin. Applicants now only need to complete one application form, instead of seven. The application can be obtained at any of the agencies and local units of government that have adopted the form. The applicant is immediately made aware, through a checklist, that more than one permit from more than one entity may be required for the activity. The joint application has also resulted in moving a sector of activities from violation into compliance, since the applicants now know that additional permits may be required for certain activities. The uniform application facilitates the review of activities that cross local jurisdictional boundaries. A "customer survey" indicated a 98% approval rate for the new process. Even so, 75% of those who approved of the process thought it was a good first step, and regulatory reform was necessary to truly improve the system. Only 2% of those surveyed expressed dissatisfaction with the new process.
The hope was that a uniform application would promote early coordination among agencies. Each agency would be receiving the same information at the same time. Agency concerns would then be worked out ahead of time, saving the applicant from sometimes being caught between conflicting conditions. However, early coordination has still not occurred at the anticipated level. One reason is different agencies have different notice requirements associated with their review processes. Changes must be made to the regulations in order to eliminate this deficiency.
Pulling together the various processes has helped identify where there is duplication that can be eliminated, and were regulatory reform is necessary to streamline the permitting process. A report of the modifications identified as necessary changes for improved streamlining is being prepared for the Washington state legislature. Staff is also looking for ways to incorporate Washington's CZM policies into the joint form.
Massachusetts Permit Streamlining Legal Advisory Committee
The Massachusetts Permit Streamlining Legal Advisory Committee was established by the state's Secretaries of Environmental Affairs and Economic Affairs and included representatives from business and environmental constituencies. The Committee prepared a report, highlights of which were:
During its October 1996 meeting, the Blue Ribbon Advisory Panel expressed interest in encouraging movement of the Army Corps offices from Detroit to a site closer to the regulated community in Northwest Indiana. Similar sentiments have been expressed by the Lake Michigan Marina Development Commission and by U.S. Representative Peter Visclosky.
During a 1996 meeting between the Detroit District of the Army Corps and the Indiana Department of Natural Resources, a discussion item was the possible relocation of its regulatory functions to Chicago. The Detroit District did not express support for the relocation but suggested its South Bend Field Office might serve a more prominent role. The functions of the South Bend Field Office were described as assisting in wetlands delineations, reviewing the qualification of projects for nationwide permits, investigating alleged unauthorized activities in regulated waters, providing compliance inspections, and providing site-specific information to permit evaluators in Detroit.116
In December 1997, the Detroit District reported that the South Bend Office had taken on an expanded regional role. "Our South Bend Office has had three people most of the summer. Our service has improved, and we are able to respond quicker than in the past."117
Northwest Indiana Liaison
The Blue Ribbon Advisory Panel also discussed the feasibility of establishing a permitting liaison through the Department of Natural Resources, at its field office in Michigan City, or at another suitable site. A single point of contact might serve a variety of functions, and which of these were most critical would help identify the needed professional credentials.
The site could be a repository for permit forms, with the individual familiar with the use of the forms and with related federal or local programs not covered by the state permit. Direct connections to regulatory agencies and to the Internet may be essential. The individual might possess knowledge of the legal inter-relationships among agencies and their regulatory programs. Crucial among these would be responsibilities exercised by the U.S. EPA, Army Corps of Engineers, FEMA, and Coast Guard; by the Indiana Department of Environmental Management, Department of Natural Resources, State Chemist, and State Department of Health; and by local entities such as municipalities, county drainage boards, and county boards of health.
The individual might help schedule early coordination meetings, particularly for more complex permitting activities, and might also be qualified as a mediator or facilitator to assist with problem resolution. Who is the appropriate individual or individuals is largely dictated by what would be the priority functions the individual or individuals would serve.
A tool available to improve coordination of federal activities with state planning is "federal consistency." This process empowers state and local government by giving them the right to review federal actions to help ensure the actions will be harmoniouswith a state's coastal zone management program. Access to "federal consistency" is available only to states having approved CZM programs but is not limited to the geography of that state. Because Michigan has an approved program, it could seek relief through federal consistency for an action in Indiana, even though Indiana does not have a program.118
Implementing Indiana Administrative Mediation
In 1996, the Natural Resources Commission opted to implement IC 4-21.5-3.5119 for all proceedings governed by the administrative orders and procedures act and for several other proceedings over which the Commission has jurisdiction (examples being the development of conservancy districts and rule making). The implementation was accomplished through guidelines published as a nonrule policy document.120
As described by the Commission, " establishment of these guidelines should be considered a pilot project and one which will likely require refinement if mediation is to achieve its full potential for dispute resolution and streamlining." The guidelines reflected that they were to "be construed liberally to achieve governmental streamlining and to help achieve consensus in the administrative functions of the agencies." Provision was made for the service of a mediator from the Natural Resources Commission or its Division of Hearings at no extra charge to the parties, and, at the election of any party, for the selection of a mediator from outside the agency with the costs of mediation then allocated among the parties. The Commission also recommended the development of a voluntary pool of mediators which could be shared among state agencies.
In 1998, the Emergency Medical Services Commission approved the use of mediation under IC 4-21.5-3.5. The Indiana Department of Environmental Management also gave support to a pilot program. A pool of state agency mediators has yet to be established.