IDEM’s application of new antidegradation rule raising ire

After more than 10 years of protracted and, at times, contentious debate, Indiana finalized protections for some of its most clean waters. But less than a year after taking effect, a short letter denying an antidegradation application has unleashed criticism that the state is not implementing the rule as intended.

The dispute between the Allen County community of Huntertown and the Indiana Department of Environmental Management arises from what is believed to be the first time the state has applied the new water antidegradation rule.

DeVoe

Indiana’s statewide water antidegradation rule took effect in June 2012 and received approval from the U.S. Environmental Protection Agency the following September. Every state is obligated by the federal Clean Water Act to formulate and institute such a rule.

The Hoosier state compiled a history of starts and stops before finally emerging with written definitions, conditions and instructions for protecting pristine water resources from being degraded, namely by a new discharge. The antidegradation rule governs discharges into streams, rivers and other bodies of water whose quality and purity is higher than what the state deems as clean water.

Martha Clark Mettler, IDEM deputy assistant commissioner for the Office of Water Quality, explained the goal of the rule is to preserve as much of the pristine quality as possible while realizing that people have to live on the planet as well.

Different groups came together during the rulemaking to help develop the language and conditions while also protecting their interests.

Jeffrey Hyman, staff attorney with the Conservation Law Center and faculty member at the Indiana University Maurer School of Law, was a member of the environmental coalition that participated in the rulemaking. Fredric Andes, partner at Barnes & Thornburg LLP’s Chicago office, represented the interests of industry and municipalities.

Although the discussions sometimes became heated, Hyman described the overall process as good, with IDEM making a tremendous effort to ensure that the many interests and perspectives were heard.

Still, many of the participants had reservations about the rule when it was finished.

“Nobody got everything they wanted out of this process,” Andes said. “At this point, the rule is done and it’s being implemented. The focus has shifted to, ‘Let’s see how this works.’”

Social and economic factors

That focus is now on Huntertown.

Currently, the municipality pipes its sewage 13 miles to the wastewater treatment plant in neighboring Fort Wayne. However when Fort Wayne decided to charge the small community retail rates instead of wholesale rates, Huntertown thought the best way to resolve the dispute was to build its own treatment plant.

That decision is not without controversy. Environmental groups and residents have questioned the wisdom of Huntertown building and operating such a facility. Even so, town officials moved forward with the process and notified IDEM for the first time in 2008 of its intention to disconnect from Fort Wayne and build its own treatment plant.

Two years later as the process got under way, IDEM indicated Huntertown would be required to submit an antidegradation demonstration.

Numerous comments and responses later, IDEM issued a tentative decision to deny the antidegradation application in August 2012. The final denial came in October and left attorneys representing Huntertown claiming the agency is pulling a reason from thin air.

Plews Shadley Racher & Braun LLP attorneys S. Curtis DeVoe and Amy Romig filed a petition for administrative review with the Indiana Office of Environmental Adjudication on behalf of Huntertown. DeVoe is confident Huntertown will prevail on its petition, but if the environmental adjudicator agrees with IDEM, DeVoe said his client will appeal to the state courts.

IDEM’s denial letter is just two pages and devotes the most space to describing the appeals process. Most bewildering to DeVoe is the explanation the agency gives for turning down the demonstration.

The letter states that the commissioner’s decision to deny Huntertown’s antidegradation demonstration “is primarily based upon a finding that cost effective measures are reasonably available that would prevent or minimize the proposed significant lowering of water quality in Geller Ditch.”

Based on that written communication, DeVoe charges IDEM is not implementing the antidegradation rule correctly.

The language in the final rule states the IDEM commissioner shall deny an application for degradation on the grounds “it is not necessary because cost-effective measures that would prevent or minimize the proposed lowering of water quality are reasonably available … .”

DeVoe argues because “cost-effective” and “reasonably available” are not clearly defined, IDEM must consider social and economic factors that the rule requires antidegradation demonstrations to analyze. The ambiguous terms are, in fact, defined by those additional considerations.

Andes

“They have denied this without addressing any factors in our very detailed antidegradation demonstration,” DeVoe said, calling IDEM’s decision “arbitrary, capricious and illegal.”

Moreover, by using the “necessary” provision as a kind of gatekeeper, requiring that antidegradation demonstrations first pass that test before looking at the other factors, the state agency is ignoring the complexity of the rule, he said.

IDEM’s Clark Mettler would not characterize the “necessary” clause as the gatekeeper provision. However, she did maintain that determining if a discharge is necessary is a significant question that has to be answered first.

Then, if the discharge meets the necessity test, the state agency will move on to decide if the degradation is justified by the social and economic benefit.

Discretion

Disagreement over how the rule is being implemented highlights the discretion contained in the document. IDEM does retain a great deal of ability to choose and decide. Both Hyman and Andes shared concerns about the amount of leeway the rule gives the state agency.

Yet the groups conceded the need for balance between flexibility and certainty. The discretion is the key to how the rule will be applied, and although some members of the rulemaking group would have liked to have included more specific language, that was not the outcome.

Clark Mettler reiterated the point of striking a balance, noting the agency has to have some freedom to avoid being boxed into a corner.

“If you’re too prescriptive, you always run the risk of not thinking of something,” she said. “Since this was a long rulemaking, you want to be careful.”

Some insight into how the rule was crafted comes from the de minimus provision. The rulemaking body spent a great deal of time on what constituted a de minimus, or discharge that has such a small impact it does not significantly degrade the quality of the water.

Environmental groups and industrial groups disagreed over what level of impact is insignificant.

Andes explained that the industry representatives agreed that a significant discharge of effluent should undergo an antidegradation review but were concerned the time spent on little projects will limit the time spent on bigger projects. It is an issue, he said, of focus and priority.

The rule defines de minimis, Clark Mettler said, and spells out how to calculate the standard.

And it will put all discharges through an antidegradation review. The rule provides that every increase or new discharge will have some level of review.

“It’s a stringent rule that business and communities in Indiana are definitely going to have to take careful note of and make sure any new project meets the requirements,” Andes said. •