1. S A L T L A K E C I T Y | R E N O | B O I S E | L A S V E G A S | P A R S O N S B E H L E . C O M
Your Environmental
Permit to Operate:
Recent Developments
in Utah Legislation
Michael A. Zody
Jacob A. Santini
Keli Beard
Wednesday
May 30, 2012
Salt Lake City
2. Backdrop to DEQ Revisions
Seeing more permit challenges, with more active
NGOs
– Putting pressure on DEQ staff, and AG
lawyers who represent DEQ
Earlier responses
– 2008 shift to ALJ hearing process, with AG
lawyers serving as ALJs
– 2011 rulemaking to match ALJ law and
consolidate administrative procedures
• R306-5 2
3. What SB11 and 21 Do
SB 21 the “Boards” bill
– Restructures the DEQ Boards
– Shifts adjudication to DEQ Director, but
preserves board rulemaking power
SB 11 the “Record Review” bill
– Shifts from discovery and evidentiary hearings
to record review proceedings, modeled on
EPA permit appeal process (40 CFR Part
124)
– Goal is to streamline and shorten the appeal
process 3
4. What They Don’t Do
SB 11 and 21:
– Do not revise any of the permit requirements
– Do not revise the permitting process
But, the revisions in the Record Review bill will
– Cause parties to file more detailed public
comments
– Put more pressure on the permitting process
4
5. Another Round of Rulemaking
DEQ is working on rules to implement
SB11 and 21
Is also considering revisions to
administrative rules enacted last summer
Expect to start seeing draft rules and an
upcoming public comment period
5
6. The Boards Bill
Changes to the Boards
– In approving SB 21, the Utah Legislature
imposed significant revisions to the citizen-
based boards created under the umbrella of
the Utah Department of Environmental Quality
6
7. The Boards Bill
UDEQ Boards
– Utah Air Quality Board
– Utah Radiation Control Board
– Utah Drinking Water Board
– Utah Water Quality Board
– Solid and Hazardous Waste Control Board
7
8. The Boards Bill
Board Composition
– All Boards now will have 9 members
– The DEQ Executive Director is a member of
each Board. But the Executive Director can
only vote to break a tie between the other
members
– Executive Director may designate a UDEQ
employee to sit in her place
– Does away with “Executive Secretaries” of the
Boards, uses label “Division Directors” 8
9. The Boards Bill
Timeline for Re-composition of the Boards
– July 1, 2012
• Radiation Control
– March 1, 2013
• Air Quality; Water Quality; Solid and
Hazardous Waste
– May 1, 2013
• Drinking Water
9
10. The Boards Bill
Air Quality Board Composition (pre-S.B. 21 – 11
members)
– Executive Director
– 1– professional who is either (1) a Utah-licensed physician,
professional engineer, or scientist
– 2 – government representatives
– 1– representative from the mining industry
– 1– representative from the fuels industry
– 1– representative from the manufacturing industry
– 1 – public representative (environmental/community interest
NGO)
– 1– public health representative
10
11. The Boards Bill
Radiation Control Board Composition (pre-S.B.
21 – 13 members)
– Executive Director
– 1– health physicist or radiation safety professional
– 2 – government representatives
– 1– representative from the radioactive waste industry
– 1– representative from the uranium milling industry
– 1– representative from the regulated industry
– 1– public representative (environmental/community interest
NGO)
– 1– public health representative
11
12. The Boards Bill
Drinking Water Board Composition (pre-S.B. 21
– 11 members)
– Executive Director
– 1– Utah-licensed engineer
– 2 – elected officials representing municipal government
– 1– representative from an improvement, water conservancy, or
metropolitan water district
– 1– representative from an entity that manages/operates a public water
system
– 1– representative from the water research community or higher
education
– 1– public representative (environmental/community interest NGO)
– 1– public health representative
12
13. The Boards Bill
Water Quality Board Composition (pre-S.B. 21 –
11 members)
– Executive Director
– 1– Utah-licensed physician, professional engineer, or scientist
– 2 – government representatives
– 1– representative of the mineral industry
– 1– representative of the manufacturing industry
– 1– representative of the agricultural/livestock industry
– 1– public representative (environmental/community interest
NGO)
– 1– public health representative
13
14. The Boards Bill
Composition of the Solid and Hazardous Waste
Control Board (pre-S.B. 21 – 13 members)
– Executive Director
– 1– Utah-licensed professional engineer
– 2– government representatives
– 1– representative from the manufacturing, mining, or fuel industry
– 1– representative from the private sold/hazardous waste disposal
industry
– 1– representative from the private hazardous waste recovery industry
– 1– public representative (environmental/community interest NGO)
– 1– public health representative
14
15. The Record Review Bill
Only Applies to “Permits” (not NOVs)
– “Permit” means any of the following issued
under this title:
(i) a permit
(ii) a plan
(iii) a license
(iv) an approval order
(v) another administrative authorization made
by a director
15
16. The Record Review Bill
What is a “Permit”
– “another administrative authorization made by
a director”
– Broad language, not substantially different
from prior rule
Permits will no longer issue from
Executive Secretaries
– Will issue from Division Directors
16
17. The Record Review Bill
Substance of the Permit Application
– Legislation does not change the substantive
requirements for an application
17
18. The Record Review Bill
Notice and Comment Requirements
– Still look to primary statute/rules
– i.e., R307-401-7 governs notice and comment
for air permits
18
19. The Record Review Bill
Preservation – Standard Not Substantively
Different
– Prior Rule (R305-6-105):
Comments are sufficient to preserve the right
to contest an order, for each issue raised, if
the comments provide sufficient information to
give notice to the agency to allow the agency
to fully consider the issue before making a
determination
19
20. The Record Review Bill
Preservation
– Statutory Standard (new):
If a public comment period was provided during the
permit application process, a person who challenges
a permit order, including the permit applicant, may
only raise an issue or argument during the permit
review adjudicative proceeding that: (a) the person
raised during the public comment period; and (b) was
supported with sufficient information or
documentation to enable the director to fully consider
the substance and significance of the issue
20
21. The Record Review Bill
Preservation exception: issue was not
“reasonably ascertainable before or during
the public comment period”
Preservation – Quality of
Comments/Supporting Documentation
– Statute does not address what is required to
support a comment with “sufficient information”
– Department will likely address this issue by rule
21
22. The Record Review Bill
Change in Administrative Appeal
– Pre-S.B. 11
• Phase 1: ALJ review (recommended decision)
• Phase 2: Board review (final review)
– Post-S.B. 11
• Phase 1: ALJ review (recommended decision)
• Phase 2: UDEQ Executive Director (Amanda Smith)
(final review)
22
23. The Record Review Bill
Review before the adoption of S.B. 11
– ALJ presided over a trial-like proceeding
• Discovery
• Subpoenas
• Live testimony (allowing for “witness testimony,
cross-examination, oral argument,” and allowing
parties to “present evidence”)
23
24. The Record Review Bill
Method of review is significantly different
– ALJ conducts a permit review proceeding
“based only on the administrative record and
not as trial de novo”
– Executive director will also review the ALJ’s
recommended decision based on the
administrative record
24
25. The Record Review Bill
What is the Record?
– Information that was before the agency, and informed
the agency’s decision, including:
• the permit application, draft permit, and final permit
• each statement of basis, fact sheet, engineering review, or
other substantive explanation designated by the director as
part of the basis for the decision relating to the permit order
• the notice and record of each public comment period
• the notice and record of each public hearing, including oral
comments made during the public hearing
• written comments submitted during the public comment period
25
26. The Record Review Bill
What is the “Record” continued
• responses to comments that are designated by the
director as part of the basis for the decision
relating to the permit order
• any information that is:
» requested by and submitted to the director
» designated by the director as part of the basis for the
decision relating to the permit order
• any additional information specified by rule
• any information agreed to by the parties
• information allowed through supplementation
26
27. The Record Review Bill
The Record Can be Supplemented with:
– “technical or factual information”
– May include testimonial evidence
27
28. The Record Review Bill
Test for supplementation
– The party attempting to add new information
must prove
• Good cause exists to supplement
• Supplementation is in the interest of justice
• Supplementation is necessary for resolution of the
issues
28
29. The Record Review Bill
The standard governing the ALJ’s and
Executive Director’s review is unchanged
– The Division Director’s decision on the
contested issue shall be affirmed if
• “factual, technical, and scientific agency
determinations are supported by substantial
evidence taken from the record as a whole”
29
30. The Record Review Bill
Most procedures are unchanged
– Challenge to permitting decision – must be filed
(and received by agency) within 30 days of
issuance by the agency
– Stays – not automatic; a party must petition for a
stay
– Permittee is an automatic party
30
31. Practical Issues
Application to Permits in the Pipeline?
– Good argument that all permits in process as
of effective date, May 8, 2012, should come
under the new laws
– However, UDEQ has taken position that new
laws, in particular the Record Review bill, will
only apply if permit was open for public
comment after effective date
31
32. Practical Issues
Communicating with the agency
– Statutes do not prohibit pre-adjudication
communications
– However, once an adjudication commences
• ALJ – no ex parte communications
• Executive Director (Amanda Smith) – No ex parte
communications
» “The executive director may not participate in
an ex parte communication with a party to the
permit review adjudicative proceeding
regarding the merits of the permit review
adjudicative proceeding”
32
33. Responding to Adverse
Comments
Agency must respond directly and with
explanation; work with agency as much as
it will let you
Consider submitting your own comments
– If concerned agency will not adequately
address issues, but agency must respond to
yours as well
– Agency may not like getting comments from
applicant
33
34. Practical Issues
Responding to 11th-Hour Comments
– The rules generally do not give an applicant
the express ability to respond to comments
after the close of the comment period
• This may be addressed in rulemaking
– Consider whether agency can extend
comment period
– Safety Valves
• Ask agency to ask you for the information
• Move to supplement record in appeal
proceeding
34
35. Mistakes to Avoid
Not consulting legal counsel, particularly
on complex or controversial permits
Assuming agency knows the law
Not considering EPA over-filing potential
Unsupported agency assertions
– Agency has to state reasons, blanket
assertions are not enough
– Agency told us to do it that way, standing
alone, is not a defense
35
36. Other Mistakes and Issues
Agency departs from prior practice or guidance,
without good reasons in record
New terms in final permit
– opens door to new evidence on appeal
– if new substantive analysis in response to
comments, agency must consider if it must be
sent back out to public comment
Adverse terms in your draft permit
– You most likely must file comments in
opposition if you want to challenge those
terms
36