Energy Finance Report

Advanced Approaches to Stormwater Runoff Management Through Green Infrastructure

Posted by Jerry Muys on 8/4/17 11:24 AM
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Green infrastructure refers to, among other things, the utilization of sustainable forestry and agriculture as elements of a cost-effective compliance strategy for meeting the National Pollutant Discharge Elimination System (“NPDES”) permitting requirements, as authorized by the Clean Air Act (“CWA”), and its state counterparts. Natural systems and processes such as constructed wetlands and phytoremediation have long been used as tools for meeting NPDES discharge standards; however, the advent of the Environmental Protection Agency’s (“EPA’s”) more rigorous “Phase II” stormwater management requirements has spurred renewed interest in such systems among a new and more expansive set of permittees.

Stormwater discharges first became subject to NPDES permitting requirements as a result of the 1987 amendments to the CWA. “Phase I” of the program began in 1990, and applied only to large and medium municipal separate storm sewer systems and 11 industrial categories, including construction sites disturbing five acres of land or more.  In March 2003, Phase II of the program began, applying to a much broader set of municipal sewers and construction sites including those disturbing as little as one acre of land.  Phase II also expanded certain exemptions that were originally available under Phase I.

EPA has authorized the NPDES stormwater program to 46 states, with EPA largely relegated to an oversight capacity. Because states with delegated programs may impose stormwater management requirements more stringent than those promulgated by EPA, a number of states, led by California, have established Phase II requirements significantly more rigorous than EPA’s rules. 

For example, California requires Phase II stormwater permits for wide-ranging categories of facilities that meet certain broad criteria, including industrial facilities that fall within almost every conceivable Standard Industrial Classification (“SIC”) code. Requirements typically include the preparation of a Storm Water Pollution Prevention Plan, the implementation of best management practices (including technology-driven environmental cleanup obligations), and training, sampling and reporting obligations.

Most states have elected to impose the Phase II requirements through issuance of general permits that apply to categories of facilities rather than to specific facilities and employ benchmark compliance targets rather than definitive cleanup standards. However, it appears that a number of states have begun moving toward the establishment of specific numeric action levels governing the extent of response measures required in the event of permit exceedances, and some have even begun to incorporate Total Maximum Daily Loads (“TMDLs”) into their permit obligations.  

A decision to include green infrastructure as part of a stormwater discharge compliance program should not be made without first conferring with regulators and conducting a preliminary desktop evaluation to determine whether the permitted facility is well-suited for such an approach. If the answer is in the affirmative, the next step is to prepare a working document identifying the essential project scope and associated deliverables.  This should include, as determined necessary, the performance of an initial pilot study to establish proof of concept and the conduct of a “pre-design” study to evaluate the range of costs and feasibility of the project.

Subject to the outcome of the initial pilot study and the pre-design study, the next step is the preparation of a “pre-development agreement” setting forth in more detail the project work scope and cost projections, including calculations that would allow the project sponsor to quantify the likely avoided operating and/or regulatory costs resulting from incorporating green infrastructure components into the project. Upon completion of the work scope and cost projections, a legally-binding “master development agreement” should be negotiated among interested parties, addressing the financing, design, construction, and operation and maintenance requirements of the proposed project.

At critical junctures during the preparation of the various project documents referenced above, the project sponsor will need to consult with counsel if only for the limited purposes of performing the legal aspects of any necessary project due diligence and regulatory analysis. Finally, it is prudent to involve counsel in any negotiations with relevant government agencies and other stakeholders leading up to the preparation of a binding legal document, particularly in light of the fact that the project will almost certainly diverge from the standard regulatory approaches employed by the regulators.

There are several states currently using green infrastructure as the means to comply with stormwater discharge requirements. For example, pilot projects in the Anacostia River Watershed in Maryland have utilized infiltration and bio-retention best management practices to manage urban runoff.  In Seattle, Washington, streets have been redesigned to include more trees and shrubs, reflecting natural draining patterns.  In Portland, Oregon, stormwater curb extensions were added to residential streets, allowing stormwater to flow into the bioswales to be filtered.  Lastly, Chicago, Illinois has been using several low impact development practices, such as rain gardens, wetland rehabilitation, permeable alleys, and rooftop gardens.

Jerry Muys is a partner and Leigh Ratino is a law clerk with Boston-based law firm Sullivan & Worcester LLP.

Topics: Green Infrastructure, Stormwater Runoff Management, National Pollutant Discharge Elimination System, Clean Water Act

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