Virginia Real Estate, Land Use & Construction Law : Virginia Construction Lawyers & Attorneys : Bean Kinney & Korman Law Firm : VA Real Estate, Land Use & Zoning

The US EPA was forced to withdraw a portion of its proposed storm water management regulations in the context of a pending court challenge by the National Association of Homebuilders (NAHB) and other parties.  In the pending appeal to the United States Court of Appeals for the Seventh Circuit, the EPA filed an unopposed motion to vacate part of its final rule regarding "Effluent Limitations Guidelines and Standards for the Construction and Development Point Source Category".

The rule proposed to establish a numeric effluent limitation on pollutants from construction and development.  The rule limited turbidity to an average daily level of 280 "nephelometric turbidity units" (NTUs).  EPA concedes in its motion that, "[T]he Agency has concluded that it improperly interpreted the data and, as a result, the calculations in the existing administrative record are no longer adequate to support ..." the rule.

While we are not in a technical position to evaluate engineering and cost impacts of these regulations, NAHB has quoted, and ABC has supported, an estimate of up to $10 billion in cost annually to meet the overall national regulations as proposed by EPA.  We just commented on the regulations generally last week and we believe this is a very significant issue for the construction and development industry.  Ann Cosby at Sand Anderson's Environmental Law blog has a nice summary post of the negotiations in Virginia over sediment limits for the Chesapeake Bay Watershed.

By agreement, the motion requested that the case be held in abeyance for 18 months until February 15, 2012, to allow EPA to address the flaw.  It will be quite interested to see whether the partial retreat by EPA sets off a chain reaction of challenges or delays in other aspects of the pending regulations.

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The Environmental Protection Agency is in the process of developing proposed national rulemaking to strengthen its stormwater program. The proposed rulemaking, which was previously announced in the Federal Register on Dec. 28, 2009, could dramatically alter the playing field for development of all types.

This is particularly true in the D.C. region given its placement in the Chesapeake Bay watershed. The EPA has recently proposed sediment limits for the Chesapeake Bay in addition to previously issued limits for nitrogen and phosphorous.

I previously commented on the Bean Kinney law blog regarding Virginia’s efforts to regulate stormwater impacts from development, the resulting pushback and modification of those regulations, and the eventual tabling of those regulations in the wake of the election of Gov. Bob McDonnell. Others have noted that the EPA efforts appear to go far beyond the limited regulatory changes proposed and dropped by Virginia.

Supporting developers in their efforts to combat tightening run-off regulations may feel a bit like suing Santa Claus to many, but this regulation could be extremely expensive and burdensome. Some very conscientious builders have indicated to me that the regulations do little if anything to attack primary nitrogen sources, such as air pollution from vehicles, agriculture, or fertilizers used by existing home owners.

As a LEED AP and father of two young children, I am definitely a believer in sustainability in development and construction but a balanced approach is important as is the economy. The building industry is a very easy regulatory punching bag for what is a truly systemic problem.

Commercial developments certified by U.S. Green Building Council under the LEED program may already be subject to some of the requirements to use best practices to minimize construction erosion or even to improve storm water quantity or quality. Some urban localities pay more attention to storm water management issues.

Even so, commercial developers, builders, site work contractors, property owners and the public should study this issue carefully. A dramatic change in stormwater regulations could have very significant cost impacts to the development industry. The regulations will hit an important economic segment that is already beaten down. Worse still, the regulations will hit a market that is very soft and arguably unable to absorb and pass on additional expenses to eventual purchasers or tenants. Interested parties should definitely speak up on this issue early, regularly and often to pass along their points of view.

This article is copyrighted 2010 by the Washington Business Journal, used by permission and originally posted here.

PS - as an interesting post-script, I received an update from ABC this morning that EPA has apparently been forced to make changes in its Effluent Guidelines Limitations in the context of pending litigation.  This story is going to continue to resonate and we will provide updates and the change to comment as received.

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After much back and forth, the Soil and Water Conservation Board announced on January 14th that they voted to suspend their hotly debated changes to stormwater regulations to permit an additional 30-day comment period.  The stage was formally suspended on January 26, 2010 which means that the status will be stuck in suspension until a new round of comments opens from February 15 through March 17.

We reported on the both the initial regulations and later changes to the proposed regulations which eased some of their impacts on the home building industry.  The Home Builders Association of Virginia indicates that they mobilized significant response and opposition to even the later round of regulations.

In addition to the underlying technical tug-of-war, there are two interesting political subtexts which may sweep this issue off the table.  First, in the intervening time since the regulations were first proposed, the Republican former Attorney General, Bob McDonnell, has won the Governor's race, Governor Tim Kaine has left office,  and Governor McDonnell has been sworn in.  The impact of the new Governor on these regulations is unknown at this point, but the suspension may be a significant indicator of future direction.

The import of state regulation may be swept away by federal intervention.  The US Environmental Protection Agency has sought comments and then transmitted a second notice on specific stormwater management regulations.  Chesapeake Bay run-off continues to generate active press and political reaction, so the states may ultimately be preempted by federal action in this arena.

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As noted in our previous stormwater regulation discussion, The Virginia Soil and Water Conservation Board has been considering amending their regulations.  Per the Virginia Association of Counties, the Board adopted an amended version of the regulations last night.  The extensive amendments will translate to a new public comment period to begin on October 26.  The Board is scheduled to vote on final adoption "sometime around December 9" according the VACO.

Amongst other changes, the VACO reports the following changes to the rule:

• The phosphorus limit was raised from 0.28 ounds per acre per year to 0.45 pounds in areas outside the Chesapeake Bay watershed
• Sites under an acre of disturbed land will be allowed phosphorus run-off of 0.45 pounds per acre per year as opposed to the original blanket 0.28 pounds
• Redevelopment projects required to reduce predevelopment load of phosphorus by 20%
• Local governments can adopt urban development areas permitting 0.45 pounds

It appears from the changes that concerns raised by local governments and the home building industry gained some traction.  It is particularly interesting that the argument that the original structure of the regulations actually encouraged sprawl seems to have taken some root with the urban development districts and using a reduction model for redevelopment projects.  (Hat tip to Andrew McRoberts editor of the Virginia Local Government Law blog for passing along this breaking news yesterday on Twitter).

Image by Frames-of-Mind

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The Virginia Department of Transportation and the Virginia Soil and Water Conservation Board are each respectively in the process of examining and issuing regulations impacting the development and construction industry.  The proposed VDOT regulations cover access management and relate to minor arterials, collectors, and local streets.  The public comment period began September 15, 2009 and is set to end on October 14, 2009.

The Soil and Water Board's stormwater regulations include significant amendments to stormwater management and were designed to address water quality and quantity and local stormwater management criteria.  Public comment ended on August 21, 2009 resulting in 408 comments.   The very significant level of commentary reflects a high degree of citizen and business interest and involvement.  The comments range from general but impassioned calls to defend the environment to quite a bit of substantive critical comments from design professionals, builders, and ordinary citizens regarding the regulations and their potential resulting economic impact.    

In a conversation with me today, Barrett Hardiman, Vice President/Director of Regulatory Affairs for the Home Builders Association of Virginia, encapsulates much of the flavor of the home building industry's reaction to the proposed new stormwater regulations:

"We want a regulation that is best for both the environment and the economy.  What they are proposing does not do much for the environment and does serious damage to an already fragile economy and home building industry.  It does not benefit the [Chesapeake] Bay and will likely cost Virginia billions to squeeze the last bit of phosphorus out of new development."

While the public comment period has officially ended, the Soil and Water Conservation Board has scheduled a special public hearing for further discussion of the suggested changes.  That meeting will be held on Thursday, September 17 at 9:30 am. The meeting will be held at the MCV Campus Molecular Medicine Research Center, 1220 E. Broad Street, 1st Floor Multipurpose Room, Richmond, VA 23219. 

Given the uncertain current status of the proposed regulations and their potential dramatic impact on the development process, proponents and opponents would both be well advised to represent their positions at these continuing meetings.

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