1. The Chesapeake Bay TMDL: Coming to an Impaired Water Near You? Sean M. Sullivan Williams Mullen 301 Fayetteville Street, Suite 1700 Raleigh, NC 27601 (919) 981-4312 ssullivan@williamsmullen.com

2. Major Topics TMDL Basics Key Legal Issues in a TMDL Is the Chesapeake Bay TMDL the New Normal? Implications for Impaired Waters in NC

3. TMDL Basics Section 303(d) of the Clean Water Act contains the critical water quality-related provisions. This section creates: –Requirement to identify impaired waters. –Requirement to develop Total Maximum Daily Loads (TMDL) when technology based effluent limits are insufficient.

4. TMDL Basics States must develop impaired waters lists and TMDLs for impaired waters. States submit the lists and then the TMDLs to EPA for approval. EPA is supposed to develop lists and TMDLs when states fail to act. Significant litigation in the 1990s about failures of states to develop lists and TMDLs. –Citizens groups filed suit against EPA when EPA failed to act for the states.

5. TMDL Basics TMDL – maximum amount of a pollutant that an impaired water can accept every day without causing a violation of water quality standards. –D.C. Circuit Decision in Friends of the Earth held that TMDLs must be set on a daily basis.

6. TMDL Basics Historical Context of TMDL Program –Before 1972, the CWA focused primarily on achieving compliance with water quality standards. Program was an utter failure. –Beginning in 1972, Congress directed EPA to focus on technology based effluent limits for point sources. Water quality program was relegated to safety valve status.

7. TMDL Basics Historical Context of TMDL Program –A remnant of the pre-1972 CWA is the state- centric nature of the water quality program. –Historically, EPAs ability to force states to act on TMDLs or impaired waters has been limited. –Cases from several circuits have held that EPAs authority is limited to: Objecting to NPDES permits. Withholding grant money from states.

8. TMDL Basics The final TMDL has three components: –Waste Load Allocation (WLA) – the portion of the daily load allocated to point sources. –Load Allocation (LA) – the portion of the daily load allocated to non-point sources. –Margin of safety. The big question is whether the modeling is sufficiently accurate to set a meaningful TMDL that will achieve compliance with the water quality standard.

9. TMDL Basics Once you determine the TMDL for a particular pollutant, it represents a cap on total daily discharges into that waterbody. State must then reduce discharges of that pollutant sufficient to comply with the cap. –Can come in the form of reductions from point sources or non-point sources.

10. Major Topics TMDL Basics Key Legal Issues in a TMDL Is the Chesapeake Bay TMDL the New Normal? Implications for Impaired Waters in NC

11. Key Legal Issues in a TMDL Point Sources versus Non-point Sources –Point sources are sources that discharge through a pipe, ditch or other discrete conveyance. –Contrast to uncontrolled sheet flow. –EPAs authority under the CWA extends only to point sources.

12. Key Legal Issues in a TMDL Point Sources versus Non-Point Sources –States may authorize entities like DENR to regulate non-point source pollution, but many states do not. –And, one of the primary culprits for nutrient pollutant loads is non-point sources. –Key Legal Question – how do you implement a TMDL if you cant regulate the primary sources of pollutant loads?

13. Key Legal Issues in a TMDL Agriculture –CWA prohibits EPA from regulating most water discharges from agricultural operations. Excluded from definition of discharge. Many states follow suit. –For waters impaired by nutrient pollution, this is another significant source of pollutants that is beyond the existing regulatory structure.

14. Legal Issues in a TMDL Reasonable Assurances –Despite lack of regulatory authority, states have attempted to use reductions in non-point source discharges to show compliance with the TMDL. Sometimes through voluntary programs or public education. –When EPA reviews a proposed TMDL that relies on non-point source reductions, EPA demands reasonable assurances that the reductions will occur.

15. Legal Issues in a TMDL Reasonable Assurances (contd) –Typically, EPA will look at the states existing regulatory authorities and will make a judgment about whether: The non-point source reductions have a reasonable chance of being implemented. The non-point source reductions are sufficient to achieve compliance with the TMDL.

16. Legal Issues in a TMDL Implementation –Again, if a state fails to implement an approved TMDL, EPAs options are limited. –EPA cannot enforce programs that states fail to implement. –EPAs best weapon is to object to every NPDES permit for every direct discharge into the waterbody.

17. Major Topics TMDL Basics Key Legal Issues in a TMDL Is the Chesapeake Bay TMDL the New Normal? Implications for Impaired Waters in NC

18. The Bay TMDL Bay TMDL Basics –Each state must develop, and EPA must approve, a Watershed Implementation Plan (WIP). –The WIP describes the regulatory programs each state will use to achieve compliance with the TMDL. EPA threatened to impose federal backstop requirements if the WIP is ineffective. –Backstop is even more stringent than the WIP.

19. The Bay TMDL Major Consequences of the Virginia WIP. –Wastewater treatment plants must make upgrades to meet stricter discharge limits. Higher utility fees and property taxes. Plants in the James River watershed face even stricter requirements in 2016 via a James River TMDL. City of Lynchburg said compliance with EPAs preferred option would cost $50MM.

20. The Bay TMDL Major Consequences of the Virginia WIP (contd). –Stricter requirements for onsite sewer / septic systems. Must achieve 50% reduction in Nitrogen discharges via alternative systems. Promote use of community-wide onsite systems rather than individual systems. Tax credits and loans to encourage upgrades and repairs to existing systems.

21. The Bay TMDL Major Consequences of the Virginia WIP (contd). –New / re-development cannot cause increases in pollutant discharges. –States will require additional stormwater controls and increases in utility fees to fund improvements to municipal systems. –Restrictions on commercial and private application of non-agricultural fertilizers.

22. The Bay TMDL Virginia will also expand its nutrient credit trading program. –New discharges must have offsets to comply with the cap. –Allow other sources of pollutant discharges to generate credits through reducing their discharges. Voluntary reductions for agriculture in Virginia.

23. The New Normal? EPA has said repeatedly that the Bay TMDL is a model for future TMDLs throughout the country. Significant question as to whether EPA has authority to threaten states with a backstop allocation or to implement such a program. –Traditionally, EPAs authority has been viewed as being limited to objecting to individual NPDES permits.

24. The New Normal? For the Bay TMDL: –EPA has been a much stronger driver in terms of implementation strategies. –EPA has threatened to implement its backstop rule if state WIPs are unsuccessful or are not implemented. –EPA is proceeding in the face of widespread objections to the sufficiency of the agencys modeling. Justified by imposing extra margin of safety.

25. Major Topics TMDL Basics Key Legal Issues in a TMDL Is the Chesapeake Bay TMDL the New Normal? Implications for Impaired Waters in NC

26. Daily means daily for a TMDL. If pollutant load reductions will come from non-point sources: –Expect higher scrutiny of methods to achieve these reductions. –Demand for details regarding TMDL implementation prior to approval. –Possibility of a backstop rule.

27. Contact Information Sean M. Sullivan Williams Mullen 301 Fayetteville Street, Suite 1700 Raleigh, NC 27601 (919) 981-4312 ssullivan@williamsmullen.com