Allan Bakalian, Zeno Drake BakalianWhat happens when things go wrong

Puget Sound Area Safety Summit

abakalian@zdblaw.com

2

STORMWATER ENFORCEMENT AND COMPLIANCE

Allan BakalianZeno Drake Bakalian P.S.

4020 Lake Washington Blvd.Kirkland, WA 98033

425 822-1511

Allan Bakalian is a partner with Zeno Drake Bakalian P.S. in Kirkland, WA. He has practiced law in Washington and Oregon for over twenty years, specializing in environmental law, real estate and land use, regulatory compliance, hazardous waste investigations and cleanup, natural resource protection and environmental litigation. He earned his J.D. degree, with honors, from Lewis & Clark Law School in Portland, Oregon. He was an Assistant Regional Counsel for the U.S. Environmental Protection Agency in Seattle, Senior Corporate Counsel for Univar USA and has been in private practice since 2001. Mr. Bakalian has counseled and successfully represented individuals and business clients in numerous environmental, land use, regulatory enforcement and permitting matters, administrative appeals and litigation.

Stormwater - The Big Picture

STORMWATER LEGAL ISSUES

• Federal Enforcement by EPA• State Enforcement by Dept. of Ecology• Local Enforcement by counties and cities• Citizen Suits and Enforcement• Contractual Issues– (Owner/Developer/)Contractor

Federal Enforcement by EPA

• Clean Water Act• National Focus and Priorities• Multi-State Actions • Consent Decrees

EPA National Enforcement Priorities, 2008-2010

• Target stormwater discharge violations• Residential construction (national builders)• Big box store construction• Ready-mix concrete• Sand and gravel

Federal Enforcement by EPA

• Nationwide Cases• Civil Penalties • Consent Decree – Settlement– Agreed Compliance Steps– Stipulated Penalties

US DOJ/EPA Stormwater Enforcement Actions

• Home Depot - $1.3M, Feb 2008• Pattern of Stormwater Violations– Unpermitted discharges to storm sewers– Failure to maintain SWPPP– Silt Fence violations

• Consent Decree with Nationwide Compliance Program

US DOJ/EPA Stormwater Enforcement Actions

• Centex, Pulte and KB Homes– Unpermitted discharges to storm sewers– Failure to develop adequate SWPPP– Failure to install SWPPP BMPs– Incorrect installation of BMPs– Failure to maintain BMPs– Failure to routinely inspect BMPs

US DOJ/EPA Stormwater Enforcement Actions

• Centex (VA, MD, TN, MS, CO, UT, NV)

– $1.485 Million civil penalty• KB Homes (VA, MD, CO, NV)

– $1.185 Million civil penaltyConsent Decree with Nationwide Compliance Program

• Implement a management and reporting system to ensure greater oversight and compliance

• Trained site managers• Three stormwater management tiers

– SWPPP criteria– Pre-construction inspections (on EPA forms)– Stormwater training programs

US DOJ/EPA Stormwater Enforcement Actions

• KB Homes (VA, MD, CO, NV)

– $1.185 Million civil penalty– Implement a management and reporting system to ensure

greater oversight and compliance– Trained site managers– Three stormwater management tiers– SWPPP criteria– Pre-construction inspections (on EPA forms)– Stormwater training programs

EPA Stormwater Settlement Policy

• Expedited Settlement Offer for Stormwater Construction Violations

• Sites up to 50 acres• Penalty calculation worksheet not greater than

$15,000• No evidence of significant impacts (turbidity)• First time violators• No ‘non-allowable’ stormwater discharges

US DOJ/EPA Stormwater Enforcement Actions

• Pulte (VA, MD, TN, CO, NV)

– $877,000 penalty / $608,000 SEP– Implement a management and reporting system to ensure

greater oversight and compliance– Trained site managers– Three stormwater management tiers– SWPPP criteria– Pre-construction inspections (on EPA forms)– Stormwater training programs

EPA Region 10 Enforcement

• Idaho DOT and Contractor (May 2006)• $895,000 settlement – 2004 lawsuit re construction runoff– Failure to adequately maintain BMPs– Compliance schedule

EPA REGION 10 Enforcement

• Tamarack Resort, ID (Jan 2008)• $185,000 settlement– Failure to timely apply for permit coverage– Discharging concrete truck wash to wetland– Discharging turbid water to creeks– Failure to adequately maintain BMPs– Failure to update SWPPP

EPA REGION 10 Enforcement

• September 2008 Civil Penalties at 2 Boise Construction Sites

• $13,000 settlement– Failure to apply for permit coverage– Failure to adequately prevent erosion– Failure to include permanent stormwater controls

in SWPPP

EPA REGION 10 Enforcement

• September 2008 Civil Penalties at 2 Boise Construction Sites

• $7,150 settlement– Failure to design adequate erosion and sediment

controls– Failure to manage water from fire hydrant

flushing and dust control discharges– Minor self-inspection deficiencies

WASHINGTON STATE ENFORCEMENT

• Chapter 90.48 RCW• WAC 173• Dept. of Ecology administers the NPDES

permit program• Local Jurisdictions (counties and cities)• Code Enforcement

DEPARTMENT OF ECOLOGY STORMWATER PERMITS

• Construction General Stormwater Permit• Municipal Stormwater General Permit• Industrial• Sand and Gravel

WA Dept of Ecology Construction General Stormwater Permits

• Compliance• Inspection• Enforcement• Punishment• Publicity

Inspection Target Points

• Permit and SWPPP• Tracking in Roadway• Soil stabilization- Lack of Cover• Sediment controls – Broken silt fence• Catch basins – sediment in street

Inspection

Soil Stabilization

Sediment Entering Catch Basin

Sediment bypassing hay

Improper Cover/Stabilization

Unstabilized Soils?Unprotected Catch Basin?

What happens when things go wrong

• Inspection report– No corrective action

• 2nd inspection– Possible 2nd chance possible Admin order

• Administrative order– Deadline for corrective

Ecology Enforcement

• The Red Zone – Administrative Order• 14 days to stabilize all soils and maintain BMPs• Includes yards and common areas unless sold

or permit terminated• Permanent Stabilization required on all lots

sole or built out

Ecology Administrative Orders

• Formal Action– Comply or Appeal– 30 days to file answer & request for hearing– Pollution Control Hearings Board (PCHB)– Citizen or homeowner intervention– Ongoing construction under microscope– Transfer or terminate no longer and option

Ecology Administrative Orders

• File Answer• Prehearing Statement and Issues• Ecology Settlement Negotiations• Homeowner negotiations• Hearing on Order• Increased costs• Publicity• Public record

Ecology Enforcement

• Notice of Violation and Order• Civil penalties – up to 10,000 per day– No permit– No SWPPP– No Docs – inspection reports, DMRs– If water quality or environmental impacts, less

likely to mitigate civil penalties

Response to Ecology Administrative Orders

• Inspection reports, orders and NOVs• Management Team– VP or President– Stormwater manager(s)– Lawyer– Consultant

Ecology Administrative Orders

• Address and comply with order• Prepare settlement proposal • Draft settlement agreement• Judicial Enforcement of Order• No admission of violations (no record)• Terminate permit if possible

Ecology Administrative Orders

• Alternate Actions if Settlement Not accepted– Comply with order– Voluntary dismissal of appeal– Stops Interveners– Stops Appeal– Accept the order on record

Ecology Notice of Violation and Civil Penalties

• Must appeal to mitigate• Must still comply • Penalty Policy• SEP• Ecology follow up action• Judicial Enforcement

Ecology Enforcement Actions

• $24,000 to Terra Venture (Feb 2008) for muddy stormwater discharges

• $12,000 to Camas Heights, LLC for muddy stormwater runoff at construction site

• $5,000 to Johns Port Homes for runoff

Enforcement Issues and Pitfalls• Operator and/or Owner liability• Employee and/or manager liability• Homeowner Association and homeowner

involvement and/or intervention• Incomplete construction during marketing and sale• Incomplete stabilization (liability for private property)Transfers (subject to written Agr. and approval)• Termination (100% stabilization or sale)

Lessons learned Avoid problems

– Have Documentation – Permit and SWPPP on site– Maintain site stabilization on private property and

common areas– Maintain inspection reports and DMRs– Keep it simple!– Oversight and inspection is critical– Address ALL homeowner complaints

Lessons learned

– Plat conditions• Homeowner Association

– Maintain control until permit terminated

• Work in Easements & Common areas– Access after sale difficult – Private property

» Include in sale agreement– Leave native vegetation and soils in place

• Know and comply with city ordinances and codes

Contract Considerations

– Duties and liabilities of Owner, Developer, and Contractor for stormwater violations

– Developer and homeowner duties regarding maintenance of Low Impact Development features

– Control over Native Growth Protection Areas and Soil and Vegetation Protection Areas

– Yard soils and lawn maintenance

44

FIVE POINT COMPLIANCE SUMMARY

1. Develop SWPPP Before Construction2. Implement SWPPP During Construction 3. Maintain or Update BMPs (and SWPPP)4. Respond timely to inspection reports and

compliance orders (and homeowner complaints)

5. Terminate or transfer permit as soon as possible

45

DUE DILIGENCE (how to avoid liability for permit violations)

1. Review stormwater permit and SWPPP before purchasing existing projects

2. Inspect BMPs 3. Determine who has responsibility for day to day

permit compliance (owner, developer, contractor)

4. Terminate permit upon completion of development or transfer stormwater permit as a condition of sale of any lots or site