SRBC Proposes Regulations to Authorize General Permits

Cozen O'Connor
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The Susquehanna River Basin Commission (SRBC or Commission) issued a notice of proposed rulemaking on September 21, 2015 (available here) in which, among other things,1 the agency seeks to authorize general permits for projects that meet certain criteria. This is a significant shift from the agency’s longstanding practice of individual project review and approvals. If adopted, general permits may provide a path to simplify and accelerate SRBC approvals for oil and gas and other projects within the basin. Stakeholders with projects (or potential projects) within the basin may wish to review the proposed rules and consider attending the hearing scheduled for late October or submitting comments by early November.

The SRBC is a quasi-federal agency established by the Susquehanna River Basin Compact with jurisdiction over the withdrawal and use of water resources within the Susquehanna River basin. See Pub. L. No. 91-575, 84 Stat. 1509 (1970). The Compact signatories include the United States, Pennsylvania, New York and Maryland, all of which have representatives or designees that comprise the full Commission. The executive director is the Commission’s appointed chief executive officer who carries out delegated functions pursuant to the Compact and SRBC regulations.

Historically, the SRBC has reviewed and approved applications for project approval on an individual basis. In general, the SRBC must approve every project within the basin involving surface and groundwater withdrawals2 or consumptive uses3 that meet certain thresholds (100,000 gpd average over a 30-day period for withdrawals and 20,000 gpd average over a 30-day period for consumptive uses). See 18 C.F.R. § 806.4. In addition, the SRBC requires authorization by way of an approval-by-rule (ABR) process for “[a]ny unconventional4 natural gas development project in the basin involving a withdrawal, diversion or consumptive use, regardless of the quantity.” Id. § 806.4(a)(8); 18 C.F.R. § 806.22(f).

Unlike other federal and state regulatory agencies, the Commission has not used a general-permit program to approve projects. A “general permit” essentially is a standard permit drafted and adopted by an agency (usually after notice and comment procedures) that authorizes certain activities and imposes a set of standard permit conditions. A general permit is available as an alternative to individual project review and approval. Once adopted, sponsors of projects may apply for coverage under the general permit and, upon approval, the project may proceed. A general permit approval process tends to be more streamlined than individual review and approval of projects.

If adopted as proposed, the Commission would have the authority under newly established 18 C.F.R. § 806.17(a)-(f) to issue a general permit that would bear most of the hallmarks of general permits used by many federal and state agencies. The key features of the proposed general-permit regulation are as follows:

  • Authorization. The Commission would be authorized to issue a general permit “in lieu of issuing individual approvals for a specifically described category of diversions, water withdrawals and consumptive uses that: (1) Involve the same or substantially similar types of operations or activities, (2) Require the same limitations or operating conditions, or both. (3) Require the same or similar monitoring and reporting, and (4) Will result in minimal adverse impacts.” Id. § 806.17(a).
  • Issuing General Permits. If the Commission elects to issue a general permit, the Commission (a) must give 30-days’ notice of intent to issue (by publishing in the Federal Register and the equivalent gazette of the member states); (b) must provide at least 30 days for public comment; (c) may hold a hearing at the executive director’s discretion; and (d) (once adopted) publish notice in the Federal Register and the equivalent gazette of the member states of the as-adopted general permit along with its effective date. Id. § 806.17(b).
  • Contents of General Permits. Every general permit must describe how it applies to the particular diversion, withdrawal, or consumptive use and must set forth the conditions imposed upon the project. The general permit may also impose a term. Id. § 806.17(c)(1), (2).
  • Obtaining General Permits. To obtain a general permit, the proposed regulations would require that the project sponsor file a “Notice of Intent” (NOI) to obtain coverage under the general permit and meet existing notice requirements and standards for administrative completeness under the current regulations. The Commission also may require a fee. Id. § 806.17(c)(3), (5), (6), (7).
  • Decision on Coverage. The SRBC’s executive director has the authority to determine coverage under the general permit. If a project sponsor has coverage under an existing general permit and the Commission later modifies or amends it, the project sponsor essentially would be grandfathered in under the new general permit unless the Commission orders otherwise. Id. § 806.17(c)(4), (8).
  • Denial of Coverage. Under the proposed regulation at 18 C.F.R. Id. § 806.17(d)(1)-(5), the executive director would have the ability to deny coverage if:
  1. “The project or project sponsor does not or can no longer meet the criteria for coverage under a general permit.”
  2. “The diversion, withdrawal or consumptive use, individually or in combination with other similar Commission regulated activities, is causing or has the potential to cause adverse impacts to water resources or competing water users.
  3. “The project does not meet the requirements of § 806.21(a) or (b)” (requiring that projects be in the best interest of and not be detrimental to the basin’s water resources).
  4. “The project includes other diversions, withdrawals or consumptive uses that require an individual approval and the issuance of both an individual approval and a general permit for the project would constitute an undue administrative burden on the Commission.
  5. “The Executive Director determines that a project cannot be effectively regulated under a general permit and is more effectively regulated under an individual approval.
  • Requiring Individual Approvals. The proposed regulation would empower the executive director to deny or revoke coverage under a general permit. In that event, the executive director must notify the project sponsor in writing (including a brief statement of the reasons for the decision). If the executive director revokes a general permit, the notice must include a deadline for submitting an application for an individual approval. If the application is timely, the project sponsor may continue to operate under the general permit until the Commission rules on the application for an individual approval. Id. § 806.17(e).
  • No “Final Action” if General Permit Denied. The proposed regulations would not treat the denial or revocation of coverage under a general permit as a final Commission action. Instead, the Commission’s action becomes final (for administrative/appellate review purposes) when the Commission “takes final action on an individual approval application.” Id. § 806.17(f).

Given that the proposed regulations authorize a new general-permit approach to project approvals from the SRBC, the regulated community may wish to review the proposed regulations and submit comments. The SRBC has scheduled a meeting in Grantville, Pa., for October 29, 2015, at which members of the public may attend and discuss the proposed regulations. The public comment period for the proposed regulations closes on November 9, 2015. The proposed regulations linked in the introductory paragraph above offer additional details regarding the Grantville meeting and the process for filing comments.

1 The Commission also proposes changes to its notice requirements, its project-approval transfer regulations, and its requirements for modifying project approvals.

2 “Withdrawal” means the “taking or removal of water from any source within the basin for use within the basin.” 18 C.F.R. § 806.3.

3 “Consumptive use” is defined as “[t]he loss of water transferred through a manmade conveyance system or any integral part thereof (including such water that is purveyed through a public water supply or wastewater system), due to transpiration by vegetation, incorporation into products during their manufacture, evaporation, injection of water or wastewater into a subsurface formation from which it would not reasonably be available for future use in the basin, diversion from the basin, or any other process by which the water is not returned to the waters of the basin undiminished in quantity.” Id.

4 “Unconventional natural gas well development” means “[a] hydrocarbon development project undertaken for the purpose of extraction of gaseous hydrocarbons from low permeability geologic formations utilizing enhanced drilling, stimulation or recovery techniques.” Id.

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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