PA 10-158—sHB 5208

Commerce Committee

Planning and Development Committee

Appropriations Committee

AN ACT CONCERNING THE PERMIT AND REGULATORY AUTHORITY OF THE DEPARTMENT OF ENVIRONMENTAL PROTECTION AND ESTABLISHING AN OFFICE OF THE PERMIT OMBUDSMAN WITHIN THE DEPARTMENT OF ECONOMIC AND COMMUNITY DEVELOPMENT

SUMMARY: This act makes several changes to the process and practice for issuing regulatory permits and adopting regulatory requirements and standards. It requires expedited permitting for economic development projects that need environmental, public health, and transportation permits and the creation of a permit ombudsman office to coordinate the expedited permitting process.

The act sets timeframes for completing specific tasks in the environmental permitting process and requires the Department of Environmental Protection (DEP) commissioner to account for instances when those timeframes are not met. It also requires her to review timeframes for completing all processing tasks and report her findings and recommendations to the governor and the legislature by September 30, 2010.

The act authorizes various forms of regulatory relief. It allows the DEP commissioner to extend the expiration dates for general permits. It provides a procedure for canceling public hearing requests regarding environmental permit applications and requires the DEP commissioner to streamline the process for conducting public hearings. The act also authorizes DEP to establish a service advising people and entities about how to comply with environmental laws.

The act authorizes regulatory relief in other areas besides environmental protection. It requires all agencies to adopt and use the alternative regulatory methods they identified in the regulatory flexibility analysis that accompanies proposed regulations submitted to the Regulations Review Committee. The act also establishes a task force to develop a way for state agencies to identify and explain the difference between a proposed regulation and a comparable federal one.

Lastly, the act requires DEP to adopt water quality standards through the regulation review process instead of the statutory procedure provided under prior law. And it requires, instead of allows, the commissioner to adopt regulations allowing certain water discharge systems to operate without first submitting plans and specifications to her for approval.

EFFECTIVE DATE: Upon passage, except for the provisions governing the ombudsman, general permit extensions, water discharges, and alternative regulatory methods, which take effect October 1, 2010 and the requirement that DEP adopt water quality standards through regulations, which takes effect March 1, 2011.

3 & 12 — OFFICE OF PERMIT OMBUDSMAN

Eligible Projects

The act requires the Department of Economic and Community Development (DECD) commissioner to establish an office for expeditiously reviewing applications for state licenses and permits. The office, called the Office of the Permit Ombudsman, must do this for economic development projects that also require an environmental, transportation, or public health license or permit. The office must have the application for these licenses and permits expeditiously reviewed if the project:

1. creates at least 50 permanent, full-time equivalent non-construction jobs in any of the state's 17 enterprise zones or at least 100 such jobs elsewhere in the state;

2. cleans up and develops abandoned or underused property (i. e. , brownfields);

3. is compatible with the state's responsible growth initiatives;

4. develops a mix of different but compatible uses near transportation facilities and infrastructure (i. e. , transit-oriented development); or

5. develops green technology businesses (i. e. , a business that employs at least 25% of its workers in jobs that use or develop green technology or fall into DECD's or the Labor Department's occupation codes for green jobs).

The commissioner may provide expedited reviews for other types of projects based on their “economic impact factors. ” These include:

1. the project's proposed wage and skill levels compared to those in the surrounding area,

2. the extent to which the project will diversify and strengthen the local and state economy,

3. the project's total capital investment, and

4. the extent to which the project complements the municipality's and the state's strategic economic development priorities, as determined by the commissioner in consultation with the transportation, public health, and environmental protection commissioners.

The act explicitly excludes permit applications for specific types of projects from expedited review unless the commissioner decides they qualify based on economic impact factors. These projects are those whose primary purpose is to:

1. dispose of solid, biomedical, or hazardous wastes;

2. produce electricity, unless the production is incidental and not the project's primary function;

3. extract natural resources;

4. produce oil; or

5. construct, maintain, or operate an oil, petroleum, natural gas, or sewerage pipeline.

Projects that do not qualify for expedited review may still apply for permits under the regular permitting process.

Interagency Expedited Review Process

The act contemplates an interagency expedited review process involving the ombudsman office and the departments of Environmental Protection, Public Health, and Transportation. These departments must each designate at least one staff member to serve as a business ombudsman and liaison with DECD's permit ombudsman. They must do this with existing and available resources. DECD's ombudsman, at the commissioner's behest, may request help from any state department, board, commission, or other agency needed to implement expedited reviews. And these entities must make reasonable efforts to provide that help.

Memorandum of Understanding (MOU)

The act does not specify the process for expedited reviews, but instead requires the permit ombudsman office and the three departments to do so in a MOU, which they must prepare and execute. The MOU must specify each agency's role in the process and allow the public, where appropriate, to participate in it. The MOU must also allow the agencies to consolidate proceedings and hearings they usually hold separately and conduct them in one location. It must allow them to do so only to the extent feasible.

The MOU may allow the agencies to waive or modify procedural rules governing forms, fees, procedures, or time limits for reviewing or processing the permit applications. But it limits their authority to waive or modify rules when they issue permits under federal rules. In these cases, the waivers and modifications must be allowed under those rules or be consistent with them. In no case can the MOU allow the agencies to waive statutory or regulatory environmental requirements. Nor can the MOU allow agencies to modify, qualify, or otherwise alter existing nonprocedural standards unless the law explicitly allows it.

Expedited Permitting Guidelines

Subject to the DECD commissioner's approval, the permit ombudsman must prepare guidelines for implementing an interagency expedited review process. At a minimum, the guidelines must provide:

1. agency contacts for filing applications and obtaining information about permit requirements;

2. names of the official(s) responsible for expediting permit applications;

3. single, coordinated project description forms and checklists;

4. an interagency agreement to reduce duplicative information requirements;

5. a fee structure for expedited permits; and

6. mandatory pre-application reviews.

The pre-application reviews must be designed to reduce conflict by providing applicants with information regarding:

1. the permits they need from each agency;

2. specifications for determining a site's suitability and limitations, planning and developing the site, and designing facilities; and

3. steps the applicant can take to expedite the process for obtaining permits and local comprehensive plan amendments.

When preparing the guidelines the permit ombudsman may ask for and receive help from private groups, including a statewide business association, the Office of Responsible Growth, and a small business association.

Annual Report

DECD must include the ombudsman's activities in its comprehensive annual report to the legislature. It must:

1. name the parties whose applications were expeditiously reviewed;

2. the date each party requested this review;

3. the reasons why they claimed they were eligible for expedited review;

4. the agencies that participated in the review;

5. the date for granting or denying the permit or deciding that the application did not qualify for expedited review; and

6. if applicable, the reasons why the applicant did not qualify for expedited review.

ENVIRONMENTAL PERMITTING

1(b) — Increased Certainty

By law, DEP must adopt regulations specifying schedules for completing different tasks in the environmental permitting process. The act specifies goals for completing some of these tasks. By law, DEP must review each application and notify the applicant in writing about any deficiencies. The act requires DEP to make reasonable efforts to complete these tasks within 60 days after receiving the application.

When DEP notifies the applicant about deficiencies, by law it may ask the applicant for additional information that addresses those deficiencies. If the applicant responds, DEP must issue a tentative determination to grant or deny the permit. The act requires DEP to make reasonable efforts to issue that determination within 180 days after it determined the materials were sufficient. But it specifies that the 180-day period does not include the time the applicant is compiling the information.

1(c) — Accountability

The act requires the DEP commissioner to account for each instance when DEP did not meet the act's goals for processing an application. She must annually compile information about instances in which the schedules where not met and report it on DEP's website. In doing so, she must sort the information by type of permit and explain why DEP did not meet the schedule.

1(a) — Comprehensive Review and Pilot Expedited Permitting Process

The act requires the commissioner to review the timeframes for processing individual permits, which DEP requires for activities that could affect the environment.

The commissioner must begin reviewing the timeframes within seven days after the act takes effect and report her findings to the governor and the Environment Committee by September 30, 2010. The report must:

1. propose a plan for a pilot expedited permitting process for at least 200 typical manufacturing or industrial facilities;

2. prescribe changes to DEP's schedules for reviewing individual permit applications; and

3. identify the additional resources, staff, and programmatic changes needed to implement these changes.

Proposed changes to the review schedule may include the time allotted for notifying applicants about problems with their applications and the likelihood that DEP will approve a revised application.

REGULATORY RELIEF

5 — Extending Expiration Date for General Permits

The act allows the DEP commissioner to extend the expiration dates for general permits by one year. But she must first notify the public that she intends to do so by renewing the permit. When the commissioner renews a permit, the act requires her to publish a notice to that effect at least 180 days before the permit's expiration date. She may charge a fee for extending the expiration date, but not for more than the amount of the permit's current fee.

A permit renewed under the act remains in effect until the commissioner decides whether to renew it as the law allows. But she must decide whether to do so on or before the 12th month after the expiration date. The permit automatically expires if the commissioner makes no decision by that time. The commissioner's authority to extend general permit expiration dates does not relieve people and organizations from applying for permits as the law requires.

7 — Withdrawing Public Hearing Request

Several statutes and regulations require the commissioner to hold a public hearing before acting on a permit application. Most require her to do so if at least 25 people sign a petition requesting a hearing. The act provides a procedure for canceling a scheduled hearing or ending one that was started and continued. The procedure starts with the parties petitioning for a hearing. Under the act, they may designate in the petition a person authorized to discuss the application and, depending on the outcome of those discussions, withdraw the petition.

If the designated person withdraws the petition, he or she and the commissioner must notify different parties to this action. The designated person must notify the commissioner in writing and serve a copy of that notice to all interested parties and intervenors. The withdrawal notice ends the hearing process unless the commissioner received other petitions to hear the application. In that case, the process ends only if all the other petitions are withdrawn.

The commissioner must notify the public that she is canceling or terminating the hearing. She must do so by publishing a notice or having one published at least once in a newspaper serving the affected area. The notice must indicate that the hearing is being canceled or terminated because the petition has been withdrawn. The commissioner must publish the notice at the permit applicant's expense.

Although the act allows the petitioners to withdraw the petition, the commissioner may still conduct, continue, or complete the hearing if she determines it serves the public interest.

10 — Regulatory Flexibility Analysis

The act changes the scope of the regulatory flexibility analysis all agencies must prepare before adopting a proposed regulation. When agencies prepared the analysis under prior law, they had to identify and consider using other methods to achieve the regulation's goal while minimizing the adverse impact the regulation could have on small businesses. The act, instead, requires agencies to use these other methods to the extent it is appropriate.

8 — Consulting Service Program

The act requires the DEP commissioner to establish a consulting service that is substantially similar to the one run by the Labor Department's Division of Occupational Safety and Health. That service helps businesses and state and local agencies comply with occupational safety and health standards without risking citations or penalties. It has no enforcement powers and does not exchange information with the staff that does. The DEP service must neither impose civil penalties on its clients nor issue violation notices to them for minor violations as long as they are making reasonable efforts to comply with environmental laws and regulations.

The commissioner must establish the service in conjunction with the U. S. Environmental Protection Agency (EPA). The act requires her to begin negotiating with EPA about creating the service by September 1, 2010. It also requires her to reallocate existing resources and adjust current policies needed to run the service by October 31, 2010.

If EPA's requirements are incompatible with delivering the service, the commissioner must consult with representatives of the regulated entities about other ways to help businesses and municipalities comply with environmental laws and regulations. The alternatives may include training sessions, materials available on DEP's website, best management practices manuals, and other forms of compliance assistance.

11 — Implementing Federal Standards and Procedures

The act establishes a task force concerning the kind of information state agencies must provide when proposing regulations for an activity subject to federal standards and procedures. When DEP proposes such regulations under existing law, it must identify and explain how they differ from the federal ones and include this information in the record it submits to the Regulations Review Committee. The task force must study how to impose similar requirements on all state agencies.

The task force must consist of the banking, transportation, social services, public health, and children and families commissioners or their designees. The governor must appoint the chairperson within 30 days after the act's effective date. The task force must report its findings and recommendations to the governor and the Regulations Review Committee by October 1, 2010. The findings must address how the additional disclosure requirements would affect state agencies. The task force terminates when it submits the report.

2(a) — Streamlining Environmental Permitting Process

The act requires the DEP commissioner to study the environmental permitting process and recommend how to streamline it, and to do so in coordination with people representing municipalities, the business community, and environmental groups.

The study must focus on the process for issuing general permits and how the Connecticut Environmental Protection Act (CEPA) affects businesses, the permitting process, and the environment. CEPA requires all state agencies to consider how a proposed action could affect the environment without mandating a particular outcome (CGS 22a-1a through 22a-1h). The study must assess how CEPA affects the:

1. business community,

2. time it takes to process a permit,

3. degree to which the permit processing time and its outcome are known, and

4. permitting process' ability to protect and preserve the environment.

The study must also recommend ways to improve the permitting process and reduce the time it takes to make a final decision about a permit application. The commissioner must develop these recommendations in consultation with the groups mentioned above.

The commissioner must report her findings, recommendations, and proposed statutory changes to the governor and the Environment Committee by September 30, 2010

2(b) — Streamlining the Public Hearing Process

The act requires the commissioner to improve DEP's process for conducting public hearings. Within 30 days after the act takes effect, she must implement procedures that:

1. increase the use of settlement conferences,

2. enforce the submission of prehearing evidence, and

3. require the filing of prehearing written testimony.

The act also requires her to analyze how DEP's Office of Adjudications conducts hearings. In doing so, the commissioner must consider appropriate ways for the public to participate in the process. For water permits, she must also consider appropriate ways to comply with the federal Clean Water Act's public hearing requirements. The act imposes no deadline for completing or submitting the analysis.

WATER STANDARDS

9 — Regulatory Standards

The act requires the DEP commissioner to adopt water quality standards in regulations instead of through the statutory procedure specified under prior law. The prior procedure required agencies to notify the public at least 30 days before proposing to adopt a regulation. The act requires DEP to notify the public at least 90 days before proposing a regulation adopting, amending, or repealing a water quality standard. The notice must specify that the public may inspect the documents upon which DEP based the proposed standards.

6 — Regulations for Exempting Discharge Systems

The act requires rather that allows the DEP commissioner to adopt regulations exempting businesses and other private entities from submitting plans and specifications for certain water discharge systems.

The law, unchanged by the act, allows the commissioner to exempt people, organizations, and municipalities from this requirement without adopting regulations if the discharge:

1. comes from a new system that is substantially the same as the current one as long as the current one is operated in compliance with a DEP permit,

2. is described in a general permit,

3. comes from a system the commissioner determines was not designed to treat toxic or hazardous substances, or

4. is one the commissioner determined by regulation is not likely to cause substantial pollution (see CGS 22a-430(b)).

Prior law also allowed her to exempt systems for other types of discharges. But it did so by allowing her to adopt regulations exempting these discharges. The act requires her to adopt such regulations by June 30, 2011. By law, these regulations may (1) set minimum standards for designing and operating a discharge treatment system and (2) impose reporting requirements on the system's operator.

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