EPA’s final Municipal Separate Storm Sewer System (MS4) General Permit Remand Rule was published in the Federal Register (FR) on December 9. The final rule modifies the Agency's stormwater regulations that apply to small Phase II MS4 communities covered under general permits.

This Advocacy Alert outlines the key components of the final rule and the potential impacts on clean water communities covered under a Phase II general permit. This rule does not apply to communities whose states issue individual Phase II permits. Background information and a summary of EPA Phase II efforts and NACWA's engagement can be found in AA 15-21.

Background

EPA was required to make changes to the existing Phase II program to address a judicial court order mandating that the regulations provide adequate public notice, the opportunity to request a hearing, and adequate permit authority review to ensure the permit meets the Clean Water Act's (CWA) requirements for municipal stormwater discharges to control pollutants to the maximum extent practicable (MEP) (the “MS4 permit standard”).

The final rule makes procedural changes to the Phase II MS4 program and endorses a “Permitting Authority Choice” option for issuing MS4 general permits. Based on the final rule, the National Pollutant Discharge Elimination (NPDES) permitting authority will choose between two alternative means of establishing permit requirements in small MS4 general permits, or a combination of those alternatives. This approach is similar to the “State Choice” option from the Agency’s January 2016 proposal.

Throughout the development of this rule, NACWA advocated heavily for a hybrid approach to provide flexibility and enable the public to have more meaningful opportunities to comment on Phase II permits, empower permitting authorities to exercise more oversight, and most importantly better position small MS4s to achieve their stormwater management goals and improve water quality. The final rule satisfactorily addresses many of the issues NACWA, its members, and the Stormwater Committee raised in comments on the proposed rule earlier this year. The final rule is also responsive to comments filed by the National Stormwater Advocacy Network (NSAN), which is a coalition of state and regional stormwater associations and is coordinated by NACWA.

Rule Overview

The final rule docket contains several documents, including the Rule itself that contains a lengthy preamble and the new regulatory language (1), a version of the regulatory language showing the modifications as a result of the rulemaking (2), a simplified fact sheet outlining the major impacts of the rule (3), and a document outlining how EPA responded to the many comments the Agency received on the proposed rule (4).

1. Remand Rule
2. Marked Up Regulatory Language
3. Fact Sheet
4. Response to Comment Document

When the pre-publication version of the Rule was announced, EPA simultaneously posted two compendia of permit examples they believe reflect the idea of “clear, specific, and measurable” permit requirements. In Part 1, the Minimum Control Measure examples note actions with required frequencies, mandated monitoring, and Best Management Practices (BMP) manual references. Part 2 contains both Phase I and Phase II MS4 permits that contain or encourage post-construction standards, similar to a broad compendium EPA released las spring and updated this summer, Summary of State Post Construction Stormwater Standards. The two types of numeric performance standards for stormwater discharges are identified as a treatment standard or a volume-based/retention standard, and are most often used by larger municipalities to address runoff from new and redevelopment. Part 3 has yet to be published but will address Water Quality-based Requirements, and will attempt to address how site-specific and Total Maximum Daily Load (TMDL)-driven requirements are covered in existing general permits. These compendia are not subject to full stakeholder review and comment – so should be viewed simply as examples, not as recommendations.

• MS4 Permits- Compendium of Clear, Specific and Measurable Permitting Examples
• Part 1: Six Minimum Control Measure Provisions
• Part 2: Post-Construction Standards 
• Part 3: Water Quality-based Requirements (coming December 2016)

Two Alternative Approaches

Based on the comments in response to the proposal, EPA chose to select Option 3 (the “State Choice Approach”) for the final rule, which it now calls the “Permitting Authority Choice.” The final rule establishes two approaches which a permitting authority (referred to as “state” for simplicity) can use to issue NPDES general permits for small MS4s sufficiently meeting the regulatory requirements and thus satisfy the court remand. In the Rule preamble EPA clarifies: “Regardless of which type of general permit is used to establish permit terms and conditions, every small MS4 general permit must include requirements that address the minimum control measures (40 CFR 122.34(b)), water quality-based requirements where needed (40 CFR 122.34(c)), and evaluation and assessment requirements (40 CFR 122.34(d)).” EPA goes on to note that no matter which approach a state chooses, the rule requires any permit conditions be “clear, specific, and measurable”.

Option 1, "Comprehensive Permit":

This option is like the “Traditional Permit” option in the proposal. It requires the state to establish all necessary permit terms and conditions to require the MS4 operator to meet the MS4 permit standard upfront, in one comprehensive general permit. This permit is then publicly noticed and the public is given an opportunity to comment and to request public hearing, before the permit is approved.

The permittee would then submit a “notice of intent” (NOI) to be covered under the permit. The NOI would not be required to include additional information on how the permittee will comply with the permit, for instance the BMPs that will be implemented and the measurable goals for each control measure, as a prerequisite to authorizing the discharge. Under 40 CFR 122.28(b)(2)(ii), the NOI is purely a procedural mechanism to document operator/permittee eligibility, certify accuracy of information, and to formally confirm and accept the permit terms and conditions that apply to the permittee as laid out in the general permit.

Option 2, "Two-Step General Permit":

The second option allows the permitting authority to first issue a base general permit that contains terms and conditions applicable to all small MS4s covered by the permit. A second step is then necessary, via the NOI process, to establish specific permit terms and conditions for individual MS4s that go beyond the base general permit.

Under this option, the exact details an MS4 permittee must submit in an NOI will be determined by the state when establishing the base general permit. However, the procedure for NOI submittal and review must follow the steps laid out in 40 CFR 122.28(d)(2), as follows:

1. The permittee submits their NOI with the information about its activities as specified in the base general permit. At minimum, the NOI must describe the BMPs that would be implemented for each minimum control measure (MCM) during the permit term, and the measurable goals associated with each BMP.
2. The state reviews the NOI to verify that the information is complete and proposes additional permit requirements if necessary to meet the MS4 permit standard.
3. The state must provide public notice of and opportunity to comment and request a public hearing on the proposed additional permit terms and conditions and their basis, the NOI and other relevant information submitted by the permittee (see 40 CFR 124).
4. Upon completion of step (3), the state may then authorize the discharge from the permittee. The permittee is subject to both the requirements of the base general permit and the final requirements established in the second step.

Some of the necessary permit requirements can be established within the base general permit at permit issuance, while the remaining set of requirements are developed during the process of authorizing individual MS4 discharges in the second step. Alternatively, the state may include very little in the base general permit and rely on the full NOI process above to establish the permit terms for a particular permittee. The less information included in the base general permit, the more the “Two Step Permit” begins to behave like an individual permit, so a state following this approach may want to include as many requirements in the base general permit as possible.

Stormwater Management Plans

NACWA’s comments emphasized the role of the Stormwater Management Plan (SWMP) document as a planning tool for the permittee. In response, the final rule clarifies that the details included in the permittee’s SWMP document are not directly enforceable as permit limits. The SWMP document is intended to be a tool that describes the means by which the permittee will establish its stormwater controls and engage in the iterative, adaptive approach to permit compliance.

EPA’s acknowledgment that SWMPs are not enforceable as permit limits, provides important flexibilities to MS4s in using these planning documents as adaptive management tools.

Timing and Implementation

The rule becomes effective on January 9, 2017, which is 30 days after publication in the FR. States are not required to reopen permits currently in effect to comply with the requirements of this final rule. This includes any states that have proposed a permit, are in the final stages of issuing a new permit (e.g., after the close of the public comment period), or have issued a final permit before this rule becomes effective.

Moving forward, states have one year to make the necessary changes in their permitting process to incorporate the rule’s new requirements. Once the state has updated its procedures, any new permits are expected to be compliant with the requirements of the final Rule.

A state may be able to develop or modify necessary permit terms and conditions consistent with the final rule based on its existing statutory authorities. However, if states must change their legal authorities before they can act, the existing regulations at 40 CFR 123.62 provide states up to up to two years to make the changes.

Interface with Other Rulemakings

The NPDES Electronic Reporting Rule, finalized in 2015, requires NPDES permittees to submit various elements of their permit data in electronic format to their permitting authorities. Due to the procedural changes in the Phase II regulations, various data fields in the e-Reporting appendices relevant to Phase II General Permit reporting requirements will need to be modified. Phase II communities are not required to electronically report until 2020, which leaves EPA ample time to make the needed changes.

Rule Analysis

Final Rule Addresses NACWA Concerns

EPA made changes between the proposed and final version of the Rule that addressed significant concerns raised by NACWA and the NSAN. First and foremost, EPA agreed with NACWA’s firm position that the final rule remain procedural in nature and not make any significant substantive changes to the MS4 program. The substantive standard has not changed (i.e., the MS4 permit standard); the final rule simply clarifies the way in which permit terms and conditions that comply with the standard must be expressed and how they are established.

In the proposal, EPA had proposed deleting the word “narrative” when describing the appropriate type of effluent limitations that should be included in MS4 permits, and proposed deleting the language from the existing regulations stating that narrative effluent limitations “are generally the most appropriate form of effluent limitations.” In response to NACWA’s comments, EPA modified the final language of 40 CFR122.34(a) to again include “narrative” and also added language that “…terms and conditions may include narrative, numeric, or other types of requirements…” which supports states’ ability to use a variety of permit compliance approaches. EPA also removed references to “benchmarks” in the final rule.

EPA declined to establish minimum substantive requirements or “floors” in both the proposal and the final rulemaking, despite requests from some stakeholders to include a BMP menu or other required design standards or post construction standards. NACWA indicated in its comments that including such minimum requirements was not appropriate in this rulemaking, and is pleased that the Agency agreed.

Certain small MS4s have additional permit obligations when discharging to impaired waters through TMDL Waste Load Allocations (WLAs). NACWA expressed concern in its comments about incorporating TMDL WLAs into a general permit, and it is still unclear exactly how this issue will be addressed under the final rule. When it comes to incorporating WLAs and other site-specific requirements, the final rule Preamble consistently refers to the “Two-Step Permit” as a likely de facto approach.

Some existing MS4 general permits do currently address WLAs, typically by including the various TMDLs and associated stormwater dischargers in an appendix. But there is still confusion from stakeholder groups, permittees and permit authorities around how WLAs will be addressed under the new rule via either the “Comprehensive General Permit” or the “Two Step Permit” approach. At this point, it appears EPA is encouraging an approach some states have already adopted, which requires MS4s to first develop and propose something like a TMDL implementation plan, followed by a step where the state reviews and approves the plan to make it an enforceable part of the permit. We will have a better sense of how this issue may be addressed when EPA publishes the Part 3 compendium to the rule related to water-quality based requirements in the next few weeks.

Potential Impacts

Despite the positive changes and flexibility in the final rule as noted above, there are numerous times through the rule and the associated compendiums where EPA suggests that states consider more specific permit terms as a way to achieve a “clear, specific, and measurable” standard. While EPA itself does not provide a definition of what “clear, specific, and measurable” means, the following are some potential ways these terms could be interpreted.

• Clear: Permit requirements will need to be expressed in mandatory language such as “must” as opposed to caveat language like “if feasible”. Simply stating “maximum extent practicable” will likely no longer be sufficient – and states’ will need to more thoroughly establish what constitutes MEP.
• Specific: The state will likely need to proactively provide level of detail that portrays a certain level of effort required to fulfil the MS4 permit standard. As an example, verbatim adoption of the 6 MCM requirements in a permit would not be considered specific enough - rather the permit must show how compliance will be evaluated instead of prescribing how a permittee will fulfil the requirements.
• Measurable: Permit requirements will also have to be measurable in the sense that compliance with them can be assessed over the course of the permit term. This won’t necessarily entail mandatory monitoring or inspections, but tracking mechanisms will be more common than currently found in general permits.

Each state will choose to implement the rule differently. This makes it even more critical for small MS4s to be engaged with state agencies as they begin to make changes to the next general permit.

It is likely that states already using a robust general permit will incorporate the additional permittee/category-specific requirements and make necessary language changes to comply with the “Comprehensive Permit” approach. On the other hand, states that rely more heavily on NOI’s may likely go with the “Two-Step Permit” approach, which will still require modifications to the base general permit, but in most cases, will entail much more involved review and public engagement.

It is unclear how states will incorporate these changes with limited resources. EPA estimates “the impact to states which are NPDES permitting authorities may range from $558,025 and $604,770 annually, depending upon the rule option that is finalized.”

It is also unclear at this point exactly how the environmental activist community will react to the final rule. Many of these groups actively pushed for very robust substantive changes to the MS4 program as part of the rule, including a clear federal definition of the MEP standard. The fact the rule did not do these things will likely disappoint the activist community, and it is possible they could litigate over the final rule. NACWA will closely monitor any legal developments.

NACWA thanks all of its members and partner organizations that engaged throughout the rulemaking process and helped in reviewing and commenting on the rule. The Association strongly supported a hybrid permitting concept to allow for maximum flexibility for both permitting authorities and MS4s, and is pleased EPA has adopted this “Permitting Authority Approach” in the final rule. If you have any questions on the final rule, please contact This e-mail address is being protected from spambots. You need JavaScript enabled to view it .