The amendments adopted by the Senate 26 to 24 Thursday to the Tax Code bill-- House Bill 542 (Thomas-D-Philadelphia) -- include provisions creating a special Advisory Committee that must approve any air quality general permits for oil and gas operations before they go into effect and directs DEP to set up a third-party permit review program for all its permits.
The net impact of the changes would be to emasculate the ability of the Department of Environmental Protection to regulate pollution under any of its programs and sets up significant conflicts with the ability of the agency to continue to administer any of its federal regulatory programs.
The amendment also directs DEP to take all fees collected by the agency over the last calendar year for any permits considered delayed and transfer those funds to the third-party reviewers, further cutting DEP’s operating budget.
These changes are on top of the 40 percent cut to DEP’s budget over the last 13 years made by the General Assembly and Governors and the loss of over 22 percent of its staff.
Now the Senate amendments propose to take away DEP’s permit fees and its authority to issue environmental permits and create another private bureaucracy of third-party reviewers and allow a permit applicant to pick the reviewer he wants, including picking a landscape architect or land surveyor to review a hazardous waste permit. There are no provisions for supervision of these individuals or for accountability.
All, of course, with no resources to administer this new private bureaucracy.
The provisions were no doubt deliberately put in the Tax Code bill, which only has to do with taxes not administrative issues, along with the natural gas severance tax to make it much more difficult for the Governor to veto.
All, of course, with no resources to administer this new private bureaucracy.
The provisions were no doubt deliberately put in the Tax Code bill, which only has to do with taxes not administrative issues, along with the natural gas severance tax to make it much more difficult for the Governor to veto.
Air Quality Permit Advisory Committee
One amendment would create a new 7-member Air Quality Permit Advisory Committee dominated by 6 members appointed by the Senate and House and one member by the Governor (Section 2401-B, page 46 of the amendment).
The language requires the Committee to approve all general air quality permits meant to regulate air emissions from oil and gas operations.
It was meant to address the ongoing disagreement with some in the General Assembly and DEP over its proposed methane emission control general permits covering oil and gas operations.
This is the first time in history a legislatively-dominate body has veto authority over any environmental regulation or permit short of a vote to pass new legislation or a resolution that is then presented to the Governor for his action.
Mandatory Third Party Environmental Permit Reviews
Another amendment to the bill directs DEP to within one year establish a program for third-party review of any permits (not licenses or certifications) issued by the agency (Section 2401-C, page 47).
DEP is required to review all permit decisions already made (issuances, denials changes in ownership, transfers, renewals, amendments) and permit decision delays (beyond the permit guarantee deadlines or 30 days if not included in that program) in the prior calendar year and submit that report to the Chairs of the Senate and House environmental committees within one year.
DEP is required to contract with third-party permit reviewers and transfer its report on all permit decisions and permit decisions delays to those reviewers.
The third-party reviewers are required to be licensed professionals defined as “an individual licensed by the Commonwealth as a professional landscape architect, engineer, land surveyor or geologist.”
Any permit fees collected by DEP for permit considered delayed are directed to be turned over to the third-party reviewers.
The third-party reviewers are designated an “agent of the Commonwealth” for purposes of resolving each permit application which is subject to a permit decision delay and permit decisions.
There are no provisions for any supervision of these individuals or for accountability.
There are no conflict of interest provisions that would prevent a consultant from reviewing his own application, and if DEP added even a basic conflict provision would they be going beyond their statutory authority?
There are no provisions dealing with public participation. Since the third-parties are now handling a permit application will they make the decision on holding a public hearing or extending a comment period when a legislator calls?
There are no deadlines for permit review actions by the third-parties and no provision requiring them to follow procedures, many times hammered out with federal agencies, to assure permit review integrity.
There are no provisions for any supervision of these individuals or for accountability.
There are no conflict of interest provisions that would prevent a consultant from reviewing his own application, and if DEP added even a basic conflict provision would they be going beyond their statutory authority?
There are no provisions dealing with public participation. Since the third-parties are now handling a permit application will they make the decision on holding a public hearing or extending a comment period when a legislator calls?
There are no deadlines for permit review actions by the third-parties and no provision requiring them to follow procedures, many times hammered out with federal agencies, to assure permit review integrity.
The permit applicant may also select his own permit reviewer (an “individual licensed by the Commonwealth as a professional landscape architect, engineer, land surveyor or geologist”) among those third-party reviewers contracted with DEP.
These third-parties are accountable to no one, according to the language in the bill. There is no provision to even require the third-parties to communicate with DEP on what their decision was or to allow DEP access to the documents they sent to permit applicants.
There are no provisions dealing with appeals of permits by the applicant or public. Since third-parties are an "agent of the Commonwealth" and charged with "resolving each permit application" will there even be appeals and who defends a permit in court. Certainly not DEP under this program since they had nothing to do with the permit decision.
And just as certain, the third-parties will not defend permits for free although there is no provision for paying third-parties more than DEP permit fees.
These third-parties are accountable to no one, according to the language in the bill. There is no provision to even require the third-parties to communicate with DEP on what their decision was or to allow DEP access to the documents they sent to permit applicants.
There are no provisions dealing with appeals of permits by the applicant or public. Since third-parties are an "agent of the Commonwealth" and charged with "resolving each permit application" will there even be appeals and who defends a permit in court. Certainly not DEP under this program since they had nothing to do with the permit decision.
And just as certain, the third-parties will not defend permits for free although there is no provision for paying third-parties more than DEP permit fees.
DEP is authorized to adopt regulations to implement these provisions, but again, would adding common sense protections for the public be going beyond their statutory authority as written?
Click Here to read the amendment for yourself the amendment. Click Here for Senate Fiscal Note and summary)
What DEP Has Said About Third-Party Reviews
At a Senate Transportation hearing in February, DEP Deputy Secretary John Stefanko said there were several significant concerns with third-party reviews, not the least of which is the statutory requirements requiring DEP make its own independent determination when taking permit actions.
“Only the Commonwealth has constitutional obligations to the public and our natural environment,” said Stefanko. “Absent direct supervisory oversight and Commonwealth parallel review, the quality of review and application of constitutional, statutory and regulatory requirements is difficult to control. Sufficient QA/QC [Quality Assurance/Quality Control] requires time and personnel, likely eliminating any cost benefits and time savings assumed by the third-party review structure.”
He noted third-party reviews would required DEP to providing training of third party reviewers by the Department.
“The Department has made staff training a priority. This is a complex and time consuming activity. It will take a great deal of time, effort and energy to insure that the third party reviewers are properly trained and understand Department regulations and guidance,” explained Stefanko. “This time effort and energy would be better spent by enhancing Department staff capabilities to deliver training to both Department and County Conservation District staff.”
Stefanko also pointed out, during an appeal of a permit approved under a third-party review, that third party would be required to defend its actions before the Environmental Hearing Board and Commonwealth Court.
The third-party reviewer would not defend its reviews for free and impose additional costs on the agency. The third-party could also be responsible for attorney’s fees and other costs if they lose.
He also said there is a significant concern over potential conflicts of interest and ethics with third-party contractors.
Click Here for a copy of Stefanko’s written testimony. Click Here to watch a video of the hearing.
Oil and Gas Erosion Permit Reviews
Section 2403-A of the Tax Code bill (page 77) requires DEP to do several things with permits for unconventional oil and gas wells development--
-- Any permit which has not been denied by DEP within the statutory timeframe is deemed approved;
-- If the review period is extended for cause, DEP must refund the permit review fee to the applicant;
-- DEP is required to review well permits within 45 days (or 60 days with cause), general air quality permits within 30 days and an erosion and sedimentation permit within 53 days or 24 business days of submission for an expedited application.
Permit Review Reforms Without Destroying Environmental Protection
There are without doubt changes and reforms needed to speed DEP permit reviews and make them more consistent across the state.
Many of those reform initiatives were discussed at DEP’s budget hearings this year, separate committee hearings and at the confirmation hearing for DEP Secretary Patrick McDonnell. Click Here for a list of those initiatives.
At a Senate hearing on May 24 David Spigelmyer from the Marcellus Shale Coalition “applauded” efforts by Secretary McDonnell to help speed up permit reviews, while at the same time pointing out legitimate issues.
But without investment in technology and people, these changes will never be made.
The Senate the mark on this issue.
It is ironic this proposal comes out now, during the same week we are celebrating the 15th anniversary of the Quecreek Mine Rescue, a rescue by public employees doing their jobs and volunteers working cooperatively with private contractors to get a critical job done.
Just the opposite of this proposal.
NewsClips:
McKelvey: Legislative Measure Relaxes Environmental Oversight In Exchange For Severance Tax
Legere: Senate’s Severance Tax Bill Makes Major Changes To DEP Permitting
Senate Budget Measure Would Outsource Environmental Permit Review
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McKelvey: Legislative Measure Relaxes Environmental Oversight In Exchange For Severance Tax
Legere: Senate’s Severance Tax Bill Makes Major Changes To DEP Permitting
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