Legislature(1997 - 1998)
01/23/1997 10:02 AM House O&G
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 51 - REGULATIONS OF DEPT OF ENV. CONSERVATION Number 2060 CHAIRMAN HODGINS announced the next order of business would be HB 51, "An Act relating to the Department of Environmental Conservation." Number 2213 REPRESENTATIVE ROKEBERG, sponsor of HB 51, thanked Chairman Hodgins for scheduling the bill in a timely manner. He said it is unfortunate he has to be before the committee one more time as the bill had been reviewed last session. House Bill 51 is a permutation and a slight adjustment from what was HB 342 which was vetoed by the Governor last session. Hopefully, with some minor revisions the bill will proceed and gain the support of the Administration. He said HB 51 is an important piece of economic development legislation and regulatory reform. Representative Rokeberg said it was the centerpiece of regulatory reform in the Nineteenth Legislature and, hopefully, will be the first of several major pieces of legislation regarding regulatory reform in the Twentieth Legislature. The intent of HB 51 is to foster resource development within the state by endeavoring to simplify the regulatory process. Under the Department of Environmental Conservation's (DEC) current regulatory system, adoption of federal changes in regulation can take a considerable length of time. Representative Rokeberg pointed out that there isn't a mandate in statutes that requires a repeal of regulations if there is a change in federal regulations. That is one of the primary intents of the bill which is to more closely track the Environmental Protection Agency (EPA) as the baseline because of the primacy of federal law that the state deals with. Representative Rokeberg stated we may not need any more stringent restrictive requirements than what is allowed by federal law which we are required to follow anyway. However, the bill does make provisions for deviating from federal EPA standards and placing more restrictive, less restrictive or other standards within the body of water quality standards within the state of Alaska. There is substantial flexibility if the situation requires or warrants the more stringent standards. REPRESENTATIVE ROKEBERG said during last session there was an estimate between six and eight regulations that were more stringent or deviated from the EPA requirements. Hopefully, there will be a better count on that. He said the bill is supported by the 18 member Alaska Oil and Gas Association, the Resource Development Council, a number of small placer miners as well as the Alaska Mining Association. REPRESENTATIVE ROKEBERG explained the first portion of the bill is the intent section which is to provide the DEC with a view of the legislature. One reason he introduced the bill last session was that the prior Administration had promulgated regulations and had hoped to have them adopted. When the present Administration came into office, and on the protest of a environmental legal group, they stopped the promulgation of those regulations and went into meeting on various issues on the regulations. Over a period of approximately 1.5 years there were what he considers closed door meetings between members of the Resource Development Council, the Sierra Club Legal Defense Fund and the Administration. They came up with some changes to those regulations and also agreements to further examine some regulations. Representative Rokeberg said his feeling for the proper form for establishing state policy is the legislature whereas the public has the right and ability to testify before a committee expressing their views about state policy should be formulated. He said he thinks decisions should be made with full public input. Number 2381 REPRESENTATIVE ROKEBERG informed the committee the bill which lists a number of water quality standards and measurements the must be taken into account when proposing, adopting and implying water quality standards in this state. The bill provides that after receiving a request from a permit application that the DEC shall, within 90 days or another mutually agreeable time, change the regulations in the state to conform with federal legislation or propose new state regulations which my be more stringent, but they must go through the procedure as outlined in the bill. REPRESENTATIVE ROKEBERG said he believes that testimony on HB 342 is evidenced by a letter of testimony which was given to the committee from the environmental community indicates a lack of understanding on the part of a number of people as to what the bill does. Everybody seems to think on first reading of the statutory language that the DEC must make this change within 90 days and they only have this very short period of time to do this when a petitioner comes in and asks for a change. He stated that is not the case. The 90 day window is for them to take action, but that action can be either to simply adopt the federal regulation, which they have statutory authority to do under the bill, or propose a new regulation. If they do so, they have to go through the standard Administrative Procedures Act which can be quite lengthy and provides for maximum public input. If there is a change, they drop into the process provided under the bill. They would have to go through the public process, have public hearings, look at the various criterion and standards set up in the bill to make a more restrictive standard if it's warranted. Representative Rokeberg said this could take a period of well over a year. There is a great misconception of what the 90-day language means. Number 2381 REPRESENTATIVE ROKEBERG explained that the bill establishes that water quality criteria and measurements that must be made by the federal EPA methods or allows for a substantially equivalent methods to be used by the DEC. The bill also authorizes the commissioner to establish a discharge standard of sediments and establishes the volumetric Imhoff Cone method as the measurement for settleable solids in discharged water. Representative Rokeberg indicated last session this was a highly controversial item, but a report that was issued in July, 1996, did adopt the EPA standard for measurement of settleable solids of the volumetric Imhoff Cone. He pointed out HB 51 reflects the now adopted standard. REPRESENTATIVE ROKEBERG said the main element of the bill establishes a process for the DEC to use when they propose regulations. It allows the DEC to adopt regulations that are more restrictive than the federal criteria going through procedures as outlined in the bill. Secondly, it allows the DEC to establish a water quality standard for which there is no corresponding federal standard. In other words, they're authorized if there is a believed need and a unique situation at stake that they have the authority to go ahead and do that. Representative Rokeberg stated the bill also allows the DEC to establish a state water quality measurement different from the measurement than the EPA recommends. Lastly, the bill sets up a transitional review of the state water quality regulations that coincides with the department's triennial review process. In other words, every three years the department, by the Federal Water Quality Act, is supposed to review their existing regulations. Currently, under statute, they are given four years because they are a little bit behind in that process. TAPE 97-1, SIDE B Number 001 REPRESENTATIVE ROKEBERG referred the committee to page 2, Section 3, and said he had understood that the DEC wanted to take over the task of the permitting process of the National Pollutant Discharge Elimination System (NPDES) in the state. He said if the committee would review the fiscal note, apparently the DEC may want to do this but it would be rather costly and there is $3.2 million addition to the fiscal note for the undertaking of this process. Representative Rokeberg noted after public testimony is taken, he will be bringing forth an amendment to delete that section from the bill. He also pointed out that Representative Pete Kelly is also a sponsor of the legislation. REPRESENTATIVE ROKEBERG noted the proposed committee substitute in the committee member's file reflects some changes since the original submitted draft. Number 133 REPRESENTATIVE BUNDE moved to adopt the referenced committee substitute, Version (F), as the committee's working document. Hearing no objection, it was so ordered. Number 158 REPRESENTATIVE ROKEBERG stated that these changes were the result of discussions with staff, along with input from DEC. On page 1, line 13, the following words were added, "the department considers whether compliance with regulations are economically feasible..." He explained that they tried to do is lessen the impact, especially a financial one, by allowing the department to consider this rather than mandate a specific use. Also, on line 15, the word "science" replaced the phrase "scientifically measurable criteria," in order to make a strong point that the regulation is based on science. He stated that this seemed like a simple notion, but that it had caused some difficulty in the past. REPRESENTATIVE ROKEBERG continued, "On page 2, line 16, we've changed the word (indisc.) "background condition." And there is a long history (indisc.-paper shuffling) and there is a long history (indisc.-paper shuffling) believe this more properly serves the vernacular and terms of art used within water quality standard criteria language. Mr. Chairman, unfortunately my involvement -- I know more about these things which are very very complex than I care to know - but - and I still have and I know nothing." CHAIRMAN HODGINS indicated confusion and asked Representative Rokeberg if he was referring to line 16. REPRESENTATIVE ROKEBERG indicated for clarification purposes that he mistakenly referenced the wrong version of this legislation. He indicated he should be speaking to the new CS, line 26, Section 46.03.085. Water Quality Standards on page 2, line 21. He proceeded to outline the specific changes to this section by referencing the previous version of this legislation instead. REPRESENTATIVE ROKEBERG noted that on page 2, line 18 of the original bill that the words "and," and "criteria" were deleted. Under this same section, subsection 5 the words, "procedures," and "permitting" were added. An "s" was added to the word "regulation" to read "regulations," as well. Also, on page 3, line 6 of the original legislation (indisc.-paper shuffling on the microphone). Additionally, on page 3, line 13 (indisc.-paper shuffling on the microphone), he continued to explain the inclusion of the word "initiate," change was related to the 90 day period allowed under this section. Number 321 REPRESENTATIVE ROKEBERG continued that on page 2 of the CS regarding the language which defines "background condition" a new subsection was added. He said he would probably bring an amendment to this section of the legislation as well. Number 395 REPRESENTATIVE BUNDE asked for clarification about the federal regulations and whether or not they have supremacy over state regulations. He said he also thought Representative Rokeberg had stated that this legislation would allow the state to establish its standards, the same as, more stringent than or less stringent than the federal regulations. REPRESENTATIVE ROKEBERG responded that under this form of the bill "less" has been taken out, but "historically, there has been situations, particularly like we're currently having a battle over arsenic where there's a differential or a difference between the federal government, the scientific community, the mining community and the DEC. So there's an on-going controversy. REPRESENTATIVE BUNDE noted that the purpose of his question was not that he had all that much confidence in the federal standards, it's just if the federal government will have supremacy and the legislature encourages a lower standard. He indicated concern for more lawsuits. Number 447 REPRESENTATIVE RYAN referenced the economic feasibility of the regulations and said the department's fiscal note was $297,600 to justify the hiring of three economists, two full-time and one part- time to ascertain economic feasibility. He referred to Representative Rokeberg's testimony where he mentioned that on page 1, line 15, and said this was a regulation based on science as a concept for the department. He asked if Representative Rokeberg had consulted with the department about how much it was going to cost to hire the scientists necessary to ascertain whether or not this is reasonable. REPRESENTATIVE ROKEBERG responded that he had not consulted with the department concerning this issue. He said that this question would be better directed to the department. Number 499 REPRESENTATIVE KEMPLEN referred to the fiscal note and said he had understood that Representative Rokeberg would be introducing an amendment to this legislation regarding the substantial costs identified by the department in relation to the NPDES. He asked Representative Rokeberg to address some of the other costs identified by the department, such as legal and regulation costs. He asked if those are accurate assessments in his mind. REPRESENTATIVE ROKEBERG answered, "No." He believed that there would be further discussion on this issue. Representative Rokeberg felt that the existing department budgets, personnel and so forth, in a large part can accomplish a substantial (indisc.). There may be some relatively modest costs to go through the regulatory procedures which would result under the Administrative Procedures Act from implementation of the statute. As to the fact, for example, the need for a full-time attorney, he doesn't agree with that. Number 576 REPRESENTATIVE KEMPLEN stated that he attended the Resource Development Conference held recently in Anchorage. A representative from the mining community mentioned that the efforts to reduce the available resources to the DEC could be significantly detrimental to the mining industry because of their ability to get permits through the system. This gentleman's suggestion was that be very careful about reducing the budget of this department. He noted Representative Rokeberg's statement about these costs associated with this new legislation could be absorbed by the department seems to run contrary to the statement which he had heard early. He said he'd like to be assured that industry will not be negatively affected because of the governmental Administration is burdened with too many responsibilities and not enough resources. REPRESENTATIVE ROKEBERG responded that he appreciated and shared these same concerns. It is not the intention of this bill in any way to have a negative impact on the ability of the department to meet the needs of the private sector when they come forward for their permitting process. He continued that the committee members, Chairman Hodgins and Representative Kemplen, should find after a longer tenure with the legislature that there seems to be a desire on the part of bureaucracy to find rationales and abilities to increase their monetary income which is only a natural function of any bureaucratic organization. The ability of the department to act properly is a case to be made before their budget subcommittee. He said he would like the chair to know that fundamentally the same bill with the exception of NPDES permitting section left the Senate Finance Committee or was waived by Senate Resource Committee with its fiscal of $60,000 last session. This argument about fiscal impact will go on during the course of this bill. Number 726 BECKY GAY, Executive Director, Resource Development Council (RDC), testified by teleconference from Anchorage. She explained that the RDC is a federally funded, non-profit statewide organization which works on resource issues of all kinds. Ms. Gay referred to the position statement which was submitted to the committee and agreed with Representative Rokeberg that over the interim, since the former bill HB 342, which was the water quality bill that passed last year and was vetoed, that they have been working closely (indisc.) RDC as a regulating community, as well as with other agencies and other segments of the public to address what perceived short comings there were in the bill. To the extent that the parties were able to agree, changes were made. MS. GAY added that she hoped the legislature understood that much of the work on this legislation is in response to the decline in budget revenues and not just to the DEC, but to the whole state. Although RDC works primarily on the revenue side of the budget, such as promoting more industry in Alaska, they are not shy in mentioning where costs can be cut. In the regulatory arena, the RDC believes that some of this cost cutting can be useful, but also painful. They are here to help guide the way through these rocky seas, hopefully with the legislature, the Administration and the regulating communities being able to come to some agreement. She said she feels there needs to be more congruence in the state about what we're going to do with regards to use and protection of water in particular. MS. GAY said that this would minimize a lot of wasted effort from all parties and it will strengthen the agency's internal resolve to do what is necessary and mandated. This type of congruence will also show a united front to the EPA and perhaps reduce some of the lawsuits which are always threatened because of vagueness and ambiguity in direction from the legislature, from which these regulations are promulgated. Currently, there is no state adjustment policy, as Representative Rokeberg pointed out, on regulations. The legislature needs to decide what this policy will is. She felt as though a policy is clearly stated in this bill because the federal requirement is merely to adjust upward if they become more restrictive. This is a one way street for a state and if the regulations change at the federal level there is no similar requirement to somehow adjust downward when the federal government determines one of their criteria are lacking. MS. GAY continued she believes that this would become useful if and when the Clean Water Act is changed. However, this is just an adjustment policy. They believe that the legislature is the right place to debate what this policy will be and determine that fact. Also, HB 51 requires the DEC to set standards which are scientifically supportable. She said they cannot stress how important this is in order to be consistent with federal existing standards in conjunction with what is reasonable for Alaska. Ms. Gay noted that this is where the background language comes into play. This is the type of thing which will "Alaskanize" our regulations, which is what the Clean Water Act has asked each state to do. MS. GAY stated that where possible, HB 51 also gives statutory backing for efforts by the DEC that are already underway. The new fiscal note on NPDES has not been discussed legislatively enough, but she understood that it was the DEC's intent to take over NPDES. Ms. Gay said she knew that it is Region 10's intent to give it to the state if they want it. She thought this would be a useful debate. She didn't want them to scrap it too soon and suggested toning down the language such that they don't have to take it over for whatever reason. She felt it was useful to have in the bill for dialogue because the DEC keeps using this as a ultimate goal for other things. MS. GAY pointed out that the bill does specifically allow in two places for the state to have a stricter standard than the federal government. This is what the opposition seems to make the most noise about. If the DEC can prove scientifically that there is a reason to have stricter standards, then indeed they can have them. She noted that there is a process laid out by which to do so which is quite clear in her opinion. This also allows the DEC to have a standard which is not in law and this was their language. The DEC suggested that there should be such a thing. The council acquiesced to this last session. She wasn't sure why they were doing this already, but the council does not have a problem with them doing this if they can prove that they should. Ms. Gay said the bill also allows discharge water language to match the quality of the receiving waters. She said she believes that there has been a change in the CS, but would like to offer an additional change which would be a statutory mandate for mixing zones. She said the state is currently trying to promulgate regulations on mixing zones, but they don't really have clear statutory backing to do so. Number 1039 MS. GAY referred to the CS, page 1, Section 2, and said the RDC has been wishing the DEC would hire an economist. She said the economic argument is lost many times in the regulatory arena and that it is a real important aspect. She noted she doesn't think the department's fiscal note for hiring three economists is unreal. MS. GAY referred to page 2, Section 2, relating the "background condition," and said she believes this is good. She indicated she isn't sure what the last sentence means relating to "you can use a similar watershed." She noted she thinks it is important to come up with a definition for "background." Number 1159 MS. GAY referred to the addition of Section 3 to NPDES and said it is her understanding that it is the DEC's intent to take over NPDES at some point in time. She said she doesn't think the fiscal note is realistic in the sense it is one sided. It doesn't show any program receipts which they are supposed to get if they take over the NPDES program and it doesn't show any federal funds that might be associated with it. She noted she believes it would take statutory language to take over the program and legislative backing to give the department the money to do it. MS. GAY referred to page 2, line 22, "Clean Water Act," and said that was added because the DEC and (indisc.) made comments that it wasn't being referred to in that section. Now it's in there. Number 1233 MS. GAY referred to page 2, line 30 and 31. She said the concept of receiving water is still not in that message. The committee might want to add language that says, "receiving water." Ms. Gay said it is not just the water received by the user. MS. GAY referred to page 3, and said it includes mixing zones. She said lines 3, 4 and 5, is an example where the state is going to be stricter than the federal government. That was requested by the Alaska Department of Fish and Game (ADF&G) last year. They have pointed out that they are always stricter on shellfish beds. She referred to line 9 and said the 90 days was a number presented by the DEC. They don't necessarily want to defend that number now, but they did come up with the number themselves. She pointed out that the Administrative Procedures Act (APA) only has a 30-day time limit. Ms. Gay referred to wording on line 21 "approved in writing," and said she has read a letter from the EPA and they recommended deleting the wording "in writing." The EPA doesn't like to approve things in writing. She indicated she has a problem with deleting that wording. It would make more work for the EPA and they didn't like that. Ms. Gay referred to page 3, line 26, and said the Imhoff come method has been bought into by the state and their own studies. That is a moot point, but she wanted to noted the DEC brought that amendment forward last year. Number 1369 MS. GAY referred to page 4, and said the reference to being less restrictive was specifically taken out because the DEC couldn't and wouldn't defend it at the Governor's level in particular. If the DEC wants to be less restrictive than the federal government, they're going to have to come back and seek legislative approval on their own if they want to. Ms. Gay referred to wording on page 4 regarding transitional review and the triennial review. She said, "This was the DEC's change last year because when we came in with this bill we asked for a review of all regulations, historic and any ones they were in the middle of. DEC complained that would cost too much money and a long long fight over that during last session was (indisc.). What happened when we actually asked to their request to do it within the triennial review process, knowing full well that a triennial review, although that means three years, really takes about six years and sometimes maybe longer. So we feel we gave a lot on that issue already - the triennial review process. At least there will be (indisc.) in place now." Ms. Gay thanked the committee for listening to her. Number 1520 MARILYN CROCKETT, Assistant Executive Director, Alaska Oil and Gas Association (AOGA), testified via teleconference from Anchorage. She explained AOGA is a trade association of 18 member companies who account for the majority of the oil and gas exploration production transportation of marketing activity in the state of Alaska. Ms. Crockett noted AOGA worked on the legislation last session. She stated AOGA continues to support the goal of HB 51 to establish reasonable and economically achievable and scientifically based state water quality standards that are no more stringent than the federal regulations, unless on a case-by-case basis there is evidence that justifies the more restrictive regulations. Specifically, they support legislation that would provide for state regulations and standards to be consistent with the federal requirements. If circumstances warrant a different standard at the state level than at the federal level, there should be some process in place that allows for consideration of science and economics in the demonstration of that more restrictive requirement. Ms. Crockett said she would point to the section that talks about the review that would undertaken for a standard that would be more restrictive than the federal regulations. She stated that section was crafted using language from the Alaska statute authorizing state assumption of the Title 5 Air Program. That legislation was drafted by a work group, prior to submittal by the Governor to the legislature, that reached consensus on the point that the regulations at the state level should be (indisc.) with the federal level. However, there may be situations where you may want to have a more restrictive regulation for whatever purpose. In those cases you have to go through a demonstration process. Ms. Crockett said there should be an official way to amend state regulations to match old regulations when they change. She said AOGA supports regulations that (indisc.) only EPA approved measurements. She said currently the state is required only to amend its regulations when changes to the federal regulations result in a more restrictive standard than we have at the state level. The state should ensure there is consistency with the federal requirements and the state should also be required to amend (indisc.) when changes occur to the federal standards which result in a less restrictive (indisc.) or when provisions are deleted from the federal regulations. Ms. Crockett stated federal regulations should be the basis as well as the boundaries for state regulations. If there is (indisc.) for more restrictive standards, then a process should be in place to ensure that (indisc.) economics are considered a part of that process. Ms. Crockett said HB 51 provides an appeal process which she believes is important to effect changes to the state requirements when changes to (indisc.) requirements are inaccurate. Number 1755 REPRESENTATIVE ROKEBERG asked Ms. Crockett if she knows of any debate going on in Washington regarding the revisions of the Clean Water Act. MS. CROCKETT said she isn't aware of what congressional activity is under way today on the Clean Water Act. Number 1799 REPRESENTATIVE KEMPLEN referred to the economic analysis that is to be performed and asked Ms. Crockett if she thinks a couple of courses in economics at the undergraduate level would be sufficient to provide an accurate assessment of the economic viability of the regulations. He asked her if she feels a trained economist is necessary. MS. CROCKETT said she doesn't feel she is qualified to answer the question as she isn't an economist herself. She noted at the EPA level and in other agencies there are requirements for consideration of economics and the economic impacts from regulations. Ms. Crockett said she believes guidance documents could be prepared which would spell specifically what must be considered as part of the regulatory development process. Number 1911 JANICE ADAIR, Director, Division of Environmental Health; Legislative Liaison, Department of Environmental Conservation, came forward to address HB 51. She said she would like to assure the committee that the DEC certainly agrees that it is the role of the legislature to set policy. The DEC sees the bill as being significantly different than HB 342 in two regards. The first is Section 2 which sets out the economic feasibility based on science. She said they agree that science is an important basis for any environmental regulation and Section 2 does apply to all regulations of the DEC, not just water quality but drinking water, pesticides, solid waste, contingency plans, oil transportation, contaminated sites, the entire gamut of environmental regulations adopted by the DEC. The primary basis of environmental regulation is protection of public health and no where in HB 51 is that concept included. Ms. Adair said when you have a choice between economic feasibility, particularly in some of the program areas like drinking water or protecting public health, they read Section 2 as always deferring to the economic feasibilities and that is of great concern. She said we know that led in drinking water is a health problem for children and there is the requirement that there be no led pipes, no led solder. That may not be economically feasible for the people being regulated, but she thinks it is an important health protection. She said cripto sporidium (sp.) exists in our surface sources in the state and we know cripto sporidium killed 100 in Milwaukee in 1993. The department requires this for filtration. It is expensive, but they think it is worth it. Their are choices that society makes about the protections of their environment and mixing zones is a perfect example. She said mixing zones are not a scientifically created entity. It is a societal choice. It is something that we have said, as Alaskans, we're willing to have a water body, have a single user - the person discharging into the mixing zone and preclude other uses of that waterbody for fishing, shellfish growing, swimming, et cetera. Ms. Adair said those are important concepts for them and things that they try to balance between when they go out with a regulatory proposal. Number 2135 MS. ADAIR referred to the NPDES delegation language in Section 3 and said the DEC thinks that NPDES run by the state would be good for the state, but because it is expensive they haven't done it. She said the fiscal note is their honest assessment of what they think it would take and that is why they don't do it. It is very expensive. She said the fiscal note doesn't reflect any federal grants because typically, there are no federal grants for running the program. The fiscal note also doesn't reflect any program receipts because the department doesn't have any program receipt authority for it nor does the legislation propose that, so they had to go with what was written which would all come from general funds. She informed the committee members the DEC is going out with a contract to have a look at what it would really take to have NPDES. Ms. Adair noted the fiscal note reflects the department's best estimate, but she thinks it is a few years old as she recalls. The department needs to get a handle on it because there is a lot of interest in having the state run NPDES. Ms. Adair said the fiscal note should not be read as an indication from the department that they don't want it. MS. ADAIR explained the bill says that water quality standards shall protect human health and the propagation of fish, but the Clean Water Act requires that water be protected for a variety of other uses. The department doesn't see those uses in the bill and that is a concern. She questioned that if they were to try to obtain delegation of the NPDES program, would they actually be able to do it if HB 51 were to become law. Ms. Adair explained the Clean Water Act requires that water be protective of wildlife, recreation, domestic water supplies, drinking water, agricultural, industrial and navigational uses. She noted those are all the things that must be considered when adopting water quality standards. The Act also says that the discharged water can't be of higher quality than the background condition of the receiving water and the DEC thinks that is probably okay, but this is something that needs to be clarified with the EPA and they haven't had the opportunity to do so yet. Ms. Adair explained that in some cases, the EPA requires a technology based limitations on the affluent and without regard to the receiving waters. So that could be a problem and it is something the DEC would need to look into. Ms. Adair said it requires that standards be reliably measured. In theory, that is sound, but we do have narrative standards. They're not a measurement, it is not a numeric standard. It is color, taste, it's aesthetics. She pointed out there are some standards that go to non-detect. Ms. Adair explained personally she thinks you could reliably measure non-detect, but she isn't sure if the Attorney General's office would agree with her. She noted they haven't had the opportunity to their review. MS. ADAIR explained it is correct that the DEC has adopted within their regulations the requirement that settleable solids be measured with the Imhoff Cone method, but one of the reasons the department likes to have specific requirements in the regulations is because if somebody comes up with a better mouse trap or for some reason if somebody wants to do something different, their hands are tied if it is in statute. TAPE 97-2, SIDE A Number 001 MS. ADAIR informed the committee members that there is currently in the Administrative Procedures Act a methodology for people to come forward and ask the DEC to change their regulations. She stated it was through the Administrative Procedures Act that Trustees for Alaska - the Sierra Club Defense Fund came forward and challenged the state's water quality regulations. It was a result of the former Commissioner Burden put together a group to look at the water quality standards, see what the issues were and how they could be addressed. Ms. Adair referred to the Administrative Procedures Act and said the person making the petition has to give the DEC the information they need to evaluate the petition. In HB 51 there is no such requirement. So any of the scientific data, any of the technical information, any of the research would have to be done by the department and they are not funded to do that kind of work. MS. ADAIR said she would also like to point out that the state water quality regulations also give people the ability to come in and petition for a lower standard where the background is lower than the federal or state standard. So there is currently the ability for people to come in and get some different standard based on what they're actually finding in their waterbody. Ms. Adair said those are some of the problems the DEC sees with HB 51, and to the extent the legislation is unclear, it's is hard for the department to make specific recommendations on how to fix it. She said to the extent that unclear legislation becomes unclear statutes, it increases the cost for implementing for everybody including the permittees who have to go through the process. So rather than improving anything, it just adds confusion and inefficiencies reducing the DEC's ability to be responsive and effective. The bill is also very process oriented, it creates duplicative processes over and above the Administrative Procedures Act. Ms. Adair said the DEC sees the bill coming with more process and more costs and they are not sure of the value of either since they are not certain of the intent of the sponsor. Number 255 REPRESENTATIVE KEMPLEN referred to the issue of whether or not sufficient resources exist in the DEC to adequately administer the regulations. There is a perception that there is slack in the department and they could absorb additional responsibilities and additional process. He questioned whether industry or members of the public have come forward to express concern that the department is not meeting its charge because of inadequate funding or inadequate resources. Number 337 MS. ADAIR said, "Yes and no. Of course to some extent people think it's a matter of how we set our priorities and if we did just what they wanted us to do, then we would have enough money, but then there would be someone else whose priority would not be ours and they would have a similar concern. I don't think that across the board the department -- I think that we're able to meet out charge in many areas. There are some of particular concern and this particular program area, water quality, is one of those." MS. ADAIR explained she used to work on the department's budget and it was the target of reductions for several years in a row. She said she really isn't sure why except that there has been a lot of dissatisfaction with how it operates in the state. She said the DEC could not absorb the running of this program the way it is established in HB 51. It would be impossible. Ms. Adair said she doesn't think that anybody in attendance wants to set the public up for expectations that can't be realized and she would hope that they wouldn't want to set the department up for failure as well. Number 443 REPRESENTATIVE KEMPLEN explained one of the things that the legislature is working very hard at doing is getting economic development to occur in the state, particularly the natural gas pipeline which is a multi-billion dollar project. If we are successful that is going to produce a lot of growth and development throughout the state. If such growth and development begins to occur, it will produce additional demands on the DEC to handle the permits, economic analysis, et cetera. Typically, when economic growth occurs it occurs fairly quickly. Representative Kemplen question how quickly the DEC could respond to adding the additional resources to meet that growth. Number 535 MS. ADAIR explained they see themselves as a partner in the economic development of the state. She said whether the state has the DEC or not, there are laws on the books about necessary permits or approvals from the state that are required before a variety of things can be done, most of which are associated with some kind of economic development. If those programs were gone, then people would simply be dealing with the federal government, the EPA out of Seattle and in some cases out of Washington, D.C. She said it really depends on the area you're looking at. She said they would see themselves as having a role to play in that economic development. REPRESENTATIVE KEMPLEN stated he and his constituents would not want to see environmental quality is sacrificed during periods of rapid economic growth because the DEC doesn't have the ability to monitor that economic growth. Number 744 REPRESENTATIVE BUNDE referred to Ms. Adair expressing some concern about the concept of receiving water and how it is something that needed to be looked at more thoroughly and said he needs more education. MS. ADAIR explained HB 51 says that the state could not require the discharge of water to be of a higher standard than the receiving water. She said the point of her concern is that the EPA, in its water quality standards, often sets technology based limits. It doesn't really matter what the receiving water is, but technology exists to clean that discharge up to a higher level. The standard is set based on that technology that exists rather than looking at the water that the discharge is going into. Number 744 REPRESENTATIVE BUNDE said, "I suppose that this is an extension of garbage in, garbage out kind of thing. If you've got a polluted water source that you're using in your industry, you're saying then that industry should in effect clean up the pollution that they've received as well as whatever they create." MS. ADAIR explained the way she thinks of it is that it's an opportunity to use technology to improve a waterbody as opposed to retaining a waterbody that may have pollutants. Number 798 REPRESENTATIVE OGAN referred to page 1, line 11 through 13, Section 2, "The department may not adopt a regulation under this sections unless the department considers whether compliance with the regulation is economically feasible for the person governed by the regulation;". He said, "I put myself in your shoes for a little bit and I tried to figure out how the heck you would determine, `Well, can we adopt a regulation on this? It might not be economically feasible for you.'" Representative Ogan said it is pretty subjective criteria for writing regulations. He said what is economically feasible for a multi-million dollar international mining company might not be economically feasible for "Joe six-pack placer miner." He asked how that determination is made. He also asked Ms. Adair if she sees this as a major obstacle in being able to write a regulation. MS. ADAIR said, "Yes indeed, and beyond that we have no ability to obtain any kind of economic data from companies that we're regulating or if we did, the ability to keep it confidential - it would become a public record upon their giving it to us. And so I wouldn't give it to a state agency to have it become a public record if it was my financial data about my company." MS. ADAIR explained the DEC regulates municipal drinking water systems whether it is in Tuntutuliak or in Anchorage. She noted there are vast differences in the resources of those communities. The department regulates solid waste facilities across the state. She said, "Do we look to the state then and say the state can afford this, therefore, a municipality can?" She said she wouldn't know how to approach it. Number 944 REPRESENTATIVE BRICE questioned how may other states have primacy over their NPDES program. Number 959 MICHAEL CONWAY, Acting Director, Division of Air and Water Quality Department of Environmental Conservation, indicated he would get the information for the committee. He added most state have NPDES primacy and there are only a few that don't. REPRESENTATIVE BRICE also requested some background as to what it cost those states to run the program. He noted he was also bothered by the fiscal note and asked why there wouldn't be program receipts. Number 998 MS. ADAIR responded that the department doesn't have statutory authority for program receipts for NPDES. She said it would have to be added to their authority. REPRESENTATIVE BRICE said he thinks what the bill is trying to get at is to merge state and federal programs and not have duel programs. He asked what the department is doing regarding this. MS. ADAIR explained the only way to merge is to delegation of NPDES. She noted the Air and Water Quality Division is going out with a contract to try and summarize all of the issues that would be necessary for the department to address to develop a plan to see if it's feasible to have the delegation of the program. She said the DEC believes it to be an expensive program and there may not be the will to have it once the cost is determined. The EPA does have certain criteria that they use before they'll delegate a program to any state. She said we need to look at what their criteria is and see where there are matches and then make a plan to bring those things into alignment. Number 1095 REPRESENTATIVE RYAN referred to a couple of instances he knows of regarding mining operations in the Interior. On Ester Dome the naturally occurring runoff was 10,000 times of arsenic, the EPA minimum. That was allowed to occur and go into the (Indisc.) River because obviously it was an Act of God, but if it were a miner were to take that same water and use it to wash out (indisc.) mill products then they have to clean that water up to a drinking water standard before they could put it back into the system. Other miners, using water that came from glacial fed streams and rivers had to go with the requirements. He asked if the DEC would consider the criteria for the run of water discharged from a mining operation to be that what occurred naturally if you're taking in the background consideration or would they still have to meet the 21 turbidity units for a criteria for drinking water quality before it could be put back into the watershed. MR. CONWAY explained they have been able to work out through the placer mine general permit the ability to go to the background level. It's the reading that's taken above where there has been a disturbance. This was negotiated with the EPA by the DEC and the Alaska Miners Association. He said arsenic brings up one of the rules where the department's commission is now trying to petition the EPA, in an interim period while additional studies are done, to be able to use the DEC's numbers. Mr. Conway stated this is a case where the DEC's standard would be less than what the EPA standard current is. He noted they are bound by the national toxins rule to have those lower standards, but they have the ability through the EPA permit. Mr. Conway explained currently the EPA issues the NPDES permit. The state certifies that permit, so we have the ability to negotiate with the EPA and the applicant things like the background levels and what is economically feasible, et cetera. Number 1247 REPRESENTATIVE OGAN referred to the fiscal note and asked if he is correct in noting that there is an error in decimal points. MS. ADAIR indicated he was correct and stated the DEC has put out a corrected one. Number 1264 REPRESENTATIVE BUNDE said, "Brings me back to my earlier in receiving, Representative Ryan's question, that - Ms. Adair I thought I heard you say that the water coming in, we have the technology to clean it up - whoever uses is now responsible for cleaning it up, but yet you're telling me that if it's coming in naturally polluted, I guess would be the term I would use, then they only need to bring it back up to the receiving level. Is that...." MS. ADAIR explained she only meant to indicate that there are some water quality standards that are technology based, not all of them. In this case, it was a negotiated agreement through using the permit to go to background. It is not just one way or the other. REPRESENTATIVE BUNDE said it would depend on the EPA's judgement as to whether the user of the water would be required to bring water that they receive up to a higher standard if the technology existed. MS. ADAIR said she thinks those are actually established as a regulation. She said she doesn't think it is at their whim. Ms. Adair said she would get him more details and let him know. Number 1335 REPRESENTATIVE ROKEBERG said, "I am very disappointed to hear that the department doesn't, after of over a year of struggle, understand what the intention - my intention is in this bill and I am also concerned that the testimony is that the implementation of the bill would potentially paralyze the department and not allow it to do it's work. I mean that's certainly my intention nor is it the intention of the the vast number of people in the state that supports this legislation. Just on the contrary, it is not. So let me just ask the Chairman if we could ask of the Department of Environmental Conservation to submit in writing to this committee and to the sponsor any of your concerns you expressed in your testimony today, and to do so as rapidly as possible, and hopefully before we have the hearing next Tuesday - continue the hearing on the bill." CHAIRMAN HODGINS noted the committee would address the issue the following Thursday, January 30. REPRESENTATIVE ROKEBERG continued, "Next Thursday. At that time that will I think enable us to respond to any problems that are exhibited by your testimony. And also if in part and parcel of that, if after this length of time has your department been able to identify how many regulations exist in the Alaska regulatory scheme that are more restrictive than the EPA requirements." Number 1436 MS. ADAIR responded, "Mr. Chairman, Representative Rokeberg, we will get you that information by the thirtieth and I will defer to Mike on the water quality standard comparison. I know they were working on it." MR. CONWAY indicated he would make that part of the report. CHAIRMAN HODGINS announced HB 51 would be addressed again on January 30.
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