Maryland Governor signs new environmental bills

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Summary

This week, Maryland Governor Martin O'Malley signed into law a number of important environmental bills that may require property owners, businesses and local governments to take additional compliance measures. The bills impact on-site sewage disposal systems, discharge to the Chesapeake Bay and other Maryland watersheds, future drilling in the Marcellus Shale and the sale and distribution of poultry feed.

On May 2, 2012, Governor O'Malley signed into law a series of environmental bills aimed at protecting human health and Maryland's watersheds, including the Chesapeake Bay. The laws also raise fees for certain property owners and require a range of entities to take additional compliance actions, from property owners to farmers to county and local governments. A few of the bills are summarized below.

Senate Bill 236 and House Bill 446 aim to reduce pollution discharge into the Chesapeake Bay, partially to comply with the Total Maximum Daily Loads (TMDLs) the Environmental Protection Agency developed for the Chesapeake Bay at the end of 2010. Senate Bill 236 establishes the Sustainable Growth and Agricultural Preservation Act of 2012. The Act authorizes local jurisdictions to adopt growth tier designations that limit the use of on-site sewage disposal systems in an effort to reduce nitrogen discharge from these systems.

House Bill 446 modifies the fee structure for the Bay Restoration Fund. Charges are assessed either on a monthly or annual basis, depending on whether the residential user receives a water bill, and range from $2.50 to $5.00 per month or $30.00 to $60.00 per year. Nonresidential users are assessed the fee based on an estimate of equivalent dwelling units of wastewater effluent generated if the user's wastewater bill is based on wastewater generated and not water usage. House Bill 446 also establishes an order of priority for funding from the Bay Restoration Fund after 2018 and after repayment of outstanding bonds. Upgrades of wastewater facilities with a design capacity of 500,000 gallons or more per day to enhance nutrient removal receive the highest priority, followed by similar upgrades that are the most "cost-effective" at wastewater facilities with a design capacity of less than 500,000 gallons per day. Next in priority is funding to repair failing on-site sewage disposal systems and, finally, grants to local jurisdictions to cover costs of the most "cost-effective and efficient" stormwater control measures.

In a similar vein, House Bill 987 applies to counties and municipalities subject to Phase I Municipal Separate Storm Sewer System (MS4) permits and requires them to establish watershed protection and restoration programs. To fund the programs, each county and municipality must assess a stormwater remediation fee from property owners within its jurisdiction. The type of fee (flat, proportional or otherwise) may be determined by the county or municipality, but it must take into account on- and off-site facilities, systems and activities that a property owner has in place to manage stormwater discharge, and must make exceptions for property owners demonstrating financial hardship. The stormwater remediation fee goes into a local watershed protection and restoration fund where it may be used, among other things, to improve county and municipal stormwater management systems, restore streams and wetlands, fund stormwater management planning and provide grants to nonprofit organizations performing certain watershed restoration projects.

The General Assembly also passed two laws related to drilling in the Marcellus Shale. Maryland currently has a de facto moratorium on hydraulic fracturing, or "fracking," in the Marcellus Shale while a study group analyzes the potential hazards and benefits of this process for extracting natural gas from deep rock formations. House Bill 402 requires, upon termination of a mineral interest, that the clerk of the court record all known information on each surface owner and each person who owned the mineral interest prior to termination. House Bill 1123 creates a rebuttable presumption that a water source that is within 2,500 feet of a gas well and is contaminated within 365 days after the last event of well drilling was contaminated by that well. In the event of contamination, the permitee must replace the contaminated water supply unless the permitee and property owner agree to another type of mitigation, including financial compensation. The permitee may rebut the presumption and, importantly, if the permitee, before drilling, seeks the property owner's permission to test the water supply and is refused, no presumption attaches.

Finally, relevant to Maryland's significant poultry industry, House Bill 167 prohibits the use, sale and distribution in the state of commercial poultry feed that contains arsenic, making Maryland the first state to ban arsenic-containing additives in poultry feed. The law was spurred by a United States Food and Drug Administration test that found trace amounts of inorganic arsenic in poultry after consuming feed that contained the additive Roxarsone. The law still allows for the use, sale and distribution of poultry feed that includes Histostat, which contains an arsenic-based additive called Nitarsone and is reportedly the only other arsenic-based poultry feed being marketed today.