Legislature(2003 - 2004)
04/21/2004 01:53 PM FIN
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HOUSE BILL NO. 546 An Act relating to regulation of the discharge of pollutants from timber-related activities under the National Pollutant Discharge Elimination System; relating to waste treatment and disposal permits; making conforming amendments; and providing for an effective date. ERNESTA BALLARD, COMMISSIONER, DEPARTMENT OF ENVIRONMENTAL CONSERVATION (DEC), explained that Governor Murkowski has discussed permit streamlining. The Governor envisions efficient and effective resource development while maintaining the State's environmental goals. This bill would help to ensure achievement of those goals. Commissioner Ballard informed the Committee that the National Permit Discharge Elimination System (NPDES) program is designed in the Clean Water Act for delegation to the states. Forty-five states have delegation, but Alaska is one of the five states without it. The Clean Water Act intends that permitting be done at the state level where a state regulatory agency can be in contact with industry and municipal dischargers to make the important risk-based decisions effective in protecting a state's waters. Commissioner Ballard pointed out that the key parts of the Clean Water Act fall under Sections 402 and 401. Section 402 allows the permit to be written and issued, while 401 is the "heart" of the program that requires the state to certify that the permit will protect the state's waters. The DEC issues the 401 certification and currently the Environmental Protection Agency (EPA) issues the 402 permit, which requires a state applicant to get two permits. In the 45 states with delegation, only one permitting action is necessary because the state issues the 402 permit and the 401 certification. Both of these water protection actions are based on a state's water quality standards. Commissioner Ballard explained that the DEC is seeking primacy for only a portion of the industries that receive permits in the State because the Department is not ready for the other industry segments to submit a full primacy package. The timber industry requested partial primacy to give them the services it needs from the DEC. She noted that this would allow other industries to observe how a regulatory package comes together. The Department intends to use this as a pilot project and to seek full primacy in the future. Commissioner Ballard referred to the fiscal note, and pointed out that it is "frontloaded" with the first two years requiring a more concentrated effort by the DEC to write regulations and negotiate with the EPA. The bill has a relatively small fiscal impact in future years because the timber industry is currently small. Representative Chenault referred to the fiscal note reflecting in the Analysis Continuation one full-time position from FY 2005 to FY 2010 and one permanent position. He questioned the two long-term non-permanent positions under Contractual, noting the change from $300 thousand to $56 thousand for those two positions. Commissioner Ballard explained that during the first two years, FY 05 and FY 06, the contractual positions would write regulations and would not remain part of the staff. The permanent position would work with the regulation writers and stay on with the Department. DAN EASTON, DIRECTOR, DIVISION OF FACILITY CONSTRUCTION AND OPERATION, DEPARTMENT OF ENVIRONMENTAL CONSERVATION, thought that the Committee might not have an accurate fiscal note. Representative Chenault said that the fiscal note in his packet was dated 3-9-04, and Commissioner Ballard clarified that it was the fiscal note she was discussing. Commissioner Ballard continued explaining that the frontloading expense would allow contractors to complete the regulatory package under the Department's supervision. The remaining staff position is a permanent state employee. In response to a question by Representative Chenault, Commissioner Ballard explained that $56 thousand is in the Department's budget as an RSA to the Department of Law for on-going legal expenses. RON WOLFE, CORPORATE FORESTER, SEALASKA CORPORATION, spoke in support of HB 546 that would allow timber primacy for the NPDES program. The Corporation believes that the action would help a struggling industry whose survival is important to Alaska's healthy economy. He pointed out that the timber industry is also important to the Native communities who receive revenues under ANCSA in the form of dividends. State primacy would give local access to the regulators on permit issues rather than the EPA in Seattle. Mr. Wolfe said that the Sealaska Corporation's NPDES permits for log transfer facilities were completed three years ago and amended last year. Co-Chair Harris asked if it would be possible to change the $177 thousand in General Funds for this year's budget to Receipt Supported Services on the fiscal note. Commissioner Ballard explained that it would be difficult to charge for the services of writing regulations. In future years, the Department would propose a fee structure as it has done for other permit programs. Co-Chair Harris pointed out on the fiscal note that only $30 thousand is indicated in later years. Commissioner Ballard said that the DEC would propose to the Legislature a modified fee structure similar to its other permitting programs that have a "slightly stronger contribution" made by the permit holder. Representative Croft asked if there would continue to be a significant General Fund component and the DEC would not be fee-based. Commissioner Ballard commented on balancing the General Fund subsidy of a permit program having the public effect of protecting the state's resources but also the direct effect of benefiting a municipal or industrial discharger. She pointed out that the DEC has General Fund support of all its permit programs, and said that the Legislature's intent would be some continuing level of General Fund support for the Department's permitting programs. Future administrations would discuss the issue, she said. Representative Foster MOVED to report CSHB 546(JUD) out of Committee with individual recommendations and the accompanying fiscal note. There being NO OBJECTION, it was so ordered. CSHB 546(JUD) was REPORTED out of Committee with individual recommendations and one previously published fiscal impact note.