Not So Fast! Oregon DEQ Objects to EPA’s Draft NPDES Permits for Lower Columbia River Dams

Posted on May 21, 2020 by Rick Glick

On May 15, 2020, the Oregon Department of Environmental Quality (“DEQ”) submitted a letter to the Environmental Protection Agency (“EPA”) in which it objected to EPA’s draft water quality discharge permits (“NPDES permits”) relating to four federal dams on the Lower Columbia River. The dams in question are Bonneville, The Dalles, John Day, and McNary. The U. S. Army Corps of Engineers (“USACE”) operates the dams, which are key elements of the Federal Columbia River Power System (“FCRPS”).

Section 402 of the Clean Water Act (“CWA”) requires a NPDES permit for discharges of pollutants from “point sources.” A point source is a defined conveyance for direct discharges of pollutants, like a pipe. Courts have considered dams to be nonpoint sources that do not require permits, as dams typically do not add pollutants, but merely pass upstream pollutants through their spillways. However, dams with hydroelectric facilities often discharge oily waste from onsite transformers, which could include PCBs.

On that basis, EPA has determined that each of the four Lower Columbia dams require a NPDES permit to cover the direct discharges resulting from power operations. EPA specifically did not address indirect discharges through the spillways or turbines.

Section 401(a)(2) requires that EPA notify states whose water quality may be affected by the permits, including Oregon. In its letter, DEQ notes that although the NPDES permits do not address pass-through pollutants, section 401 allows DEQ to consider potential violations of any water quality parameter resulting from total dam operations. DEQ therefore objects to the permits and requests imposition of certain conditions to meet numeric and narrative temperature criteria, total dissolved gas (“TDG”) levels, biocriteria, and toxics substances criteria.

For temperature, DEQ would require a temperature management plan with adaptive management elements to address a yet-to-be-developed Total Maximum Daily Load (“TMDL”). As expected, on May 18, EPA initiated the process for establishing a TMDL for temperature in the Columbia and Lower Snake Rivers. We will be tracking this process and reporting in future posts.

For total dissolved gas, DEQ requests that EPA require the USACE to implement additional monitoring measures to increase compliance with the existing TDG TMDL through adaptive management. With regard to biocriteria, DEQ is asking USACE to allow the use of best technology available (“BTA”) or Oregon Department of Fish and Wildlife (“ODFW”) recommended technology to reduce fish entrainment and impingement. If the technology implemented does not reduce impingement, USACE would be required to develop an adaptive management plan and submit it to DEQ for approval. Finally, DEQ would require additional measures to reduce PCB discharges from each project to ensure compliance with Oregon toxics substances criteria.

DEQ’s objection letter is the latest development in a long-running dispute involving the effects of FCRPS operations on salmonid species listed under the Endangered Species Act (“ESA”). Oregon is an intervenor plaintiff in a lawsuit brought by the National Wildlife Federation alleging that the 2014 Biological Opinion, and later iterations, violated the ESA.

Under the Clean Water Act, EPA will now be required to hold a hearing to address DEQ’s objections and requests. By extending its section 401 authority to the FCRPS saga, DEQ has raised the bar for the seemingly endless tension between the benefits and consequences of this massive public power system, which was established in an era preceding our organic conservation statutes. It has been a bumpy ride and will continue to be for the foreseeable future.

Supremes Let Hoopa Stand, Leave Door Open for EPA to Reshape CWA 401

Posted on December 10, 2019 by Rick Glick

On December 9, the Supreme Court denied certiorari to review the D. C. Circuit Court of Appeals ruling in Hoopa Valley Tribe v. FERC.  As reported in this space, in January the D.C. Circuit roundly rejected the common practice of withdrawing and then refiling applications for state water quality certification to avoid the one-year limit for state action under Section 401 of the Clean Water Act. 

Under Section 401, applicants for federal authorizations that could result in a discharge to navigable waters must first obtain certification from the state that applicable water quality standards would be met.  States must act on Section 401 applications within one year, or they are deemed to have waived their authority.  State authority under Section 401 is broad and presents an opportunity to superimpose state policy on federal licenses or permits, an opportunity many states are eager to exercise.

Section 401 is often invoked in the context of licensing and relicensing of hydroelectric power facilities before the Federal Energy Regulatory Commission.  Such facilities and their impacts are complex, and states struggle to complete their analysis within one year.  This has led to states offering applicants the choice of either withdrawing and refiling the application to reset the clock, or having their certification denied.

In the Hoopa case, PacifiCorp entered into a settlement agreement with the states of Oregon and California, and other stakeholders, concerning removal of four dams on the Klamath River.  As part of the settlement, PacifiCorp would annually submit a letter to withdraw its pending Section 401 applications before both states and simultaneously refile the application with no changes.  The D. C. Circuit found this practice a subversion of the plain statutory language limiting state action to one year.

So, with the Supreme Court’s denial of certiorari, the withdrawal/refile stratagem seems less viable.  Where do we go from here?  One answer is that when states need more time they will simply deny Section 401 applications without prejudice, meaning the applicant can reapply.  But that approach could also be seen by the courts as an evasion of the one-year limitation.

Another answer lies with EPA, which recently proposed new rules to constrain state authority under Section 401.  As part of the reform of Section 401 policy, the new rules would adopt time limitations “consistent” with the Hoopa decision:  “The certifying authority is not authorized to request the project proponent to withdraw a certification request or to take any other action for the purpose of modifying or restarting the established reasonable [i.e. no more than one year] period of time.”

Under the new rules, then, one year means one year.  However, the new rules, once adopted, will certainly be challenged.  Two related issues are whether EPA has authority to direct state implementation of Section 401 and, if it does, whether EPA’s interpretation is entitled to Chevron deference.

While all of this plays out, however, the D. C. Circuit’s decision in Hoopa stands, but many questions remain to be answered.  Did Hoopa effectively kill the withdraw/refile workaround?  Or should Hoopa be read narrowly and limited to the unique facts underlying the case?  And how will all this ultimately affect the timing and content of federal permits for major projects?  Stay tuned.

Deadlines For Permit Issuance Are Double-Edged Swords

Posted on January 29, 2019 by Seth Jaffe

On Friday, the D.C. Circuit Court of Appeals ruled that applicants for licenses under the Federal Power Act may not reach private agreements with states to circumvent the FPA requirement that states act on water quality certification requests under § 401 of the Clean Water Act within one year.

The facts are important here and somewhat convoluted.  The short version is that PacifiCorp operates a number of dams on the Klamath River.  In 2010, PacifiCorp reached a settlement with California, Oregon, and a number of private parties – not including the Hoopa Valley Tribe, the plaintiff here – to decommission certain dams and relicense others.  However, the decommissioning was dependent on certain third party actions, including, apparently, federal funding.  Part of the settlement required California and Oregon to “hold in abeyance” their § 401 certificate reviews.  Specifically, each year, PacifiCorp:

sent a letter indicating withdrawal of its water quality certification request and resubmission of the very same . . . in the same one-page letter . . . for more than a decade.

The Court was not pleased.

Such an arrangement does not exploit a statutory loophole; it serves to circumvent a congressionally granted authority over the licensing, conditioning, and developing of a hydropower project. … There is no legal basis for recognition of an exception for an individual request made pursuant to a coordinated withdrawal-and-resubmission scheme, and we decline to recognize one that would so readily consume Congress’s generally applicable statutory limit.

The Court limited its holding to the facts of this case; it does not apply, for example, to applications that are substantively amended and resubmitted.  It only applies to what PacifiCorp and the states unabashedly did here – reach a private agreement to get around the explicit provisions of the statute.

Nonetheless, it’s an important decision.  Based on data reported in the opinion, it may have a significant impact on a number of FERC licensing proceedings, where similar agreements may also be in place.

The decision also highlights an issue with these types of permitting deadlines.  These provisions follow a fairly well-trod path.  Some agency is slow in responding to permit applications.  A legislature responds by demanding that approvals be issued within a certain period of time.  The regulated community is happy.  Then, life moves on and, in the real world, parties realize that, for one reason or another, strict adherence to the statutory deadline is infeasible, impractical, or just plain not in anyone’s best interest.  They thus do what creative people do – they find a way around the deadline that was supposed to be protecting them.  Or, they try to do so until a court says no, no, no.

Be careful what you wish for.