USEPA Cracks Down on Stormwater Violations – Levies Multi-Million Dollar Penalties.

In June 2008, the United States Environmental Protection Agency announced a $4.3 million dollar settlement against four national residential real estate development companies. The government alleged that those companies violated the federal Clean Water Act (“CWA”) requirements addressing the discharge of stormwater (i.e., rainwater/snow melt runoff) from construction sites. Under the CWA, a permit and a stormwater management plan are required for the discharge of stormwater from a construction site. The EPA alleged that the companies had either not obtained a permit before commencing their construction activities or failed to abide by the terms of permits they had obtained. This enforcement action follows several other recent high profile stormwater permit enforcement actions undertaken over the past several years that resulted in $4.4 million dollars in penalties against two national box retail stores.

The CWA generally requires that a developer obtain a stormwater discharge permit before starting construction activities at a property. It allows states to assume the role of the permitting authority for stormwater permits. Delaware, New Jersey, New York and Maryland have been delegated such permitting authority from the EPA. As such, the state environmental agency within a delegated state issues permits for stormwater discharges under the CWA. EPA retains oversight authority over the state stormwater permitting programs – that is why the recent enforcement actions were brought by the EPA.

In New Jersey, a construction project which will disturb more than one acre of land requires a stormwater discharge permit. The state Department of Environmental Protection (“DEP”) has established a general stormwater discharge permit for construction activities, through which the DEP pre-determined that any construction projects meeting the criteria for the general permit will be covered by the general permit. (There are also general stormwater permits for industrial facilities, concrete manufacturers and other business categories, which permits address stormwater runoff from the operation of covered facilities.) To obtain coverage under the construction general permit, the developer must submit a Request for Authorization to the local Soil Conservation District for their approval. This is unlike an individual discharge permit, which requires a detailed state engineering review.

Obtaining the general stormwater permit for construction activities is, however, only the first step towards compliance with the CWA’s stormwater requirements. Once the permit is in place, the permit holder must comply with the terms of that permit. Failing to abide by the terms of the permit is also a violation of law which exposes the developer significant penalties. The most important component of the general stormwater construction permit is the development and certification of a Stormwater Pollution Prevention Plan 

The SWPPP consists of a soil erosion and sediment control element and a construction site waste control component. The soil erosion and sediment control element is governed by a soil erosion and sediment control plan and includes controls such as silt fences to minimize soil runoff. The construction site waste control element contains requirements which address materials management to prevent or reduce waste and waste handling, which in turn reduces the potential for such waste materials to flow off-site with stormwater. Examples of construction site waste include waste building material and rubble, chemical waste, litter, sanitary sewage, contaminated soils and concrete truck washout.

By obtaining a permit for stormwater discharges at construction sites, and complying with the terms of the SWPPP, a developer will avoid a potentially costly enforcement action by the state or the EPA. The EPA has sent a very strong signal to the regulated community that it takes stormwater discharges and compliance with the CWA very seriously. A developer must ensure that its professional team, including engineers, construction managers and attorneys, are paying close attention to stormwater permitting requirements to avoid such costly mistakes.