History

• The push to promote renewable energy in Michigan began in earnest in 2002 when Michigan created a tax exemption for businesses with alternative energy property (generally defined as: alternative energy system, alternative energy vehicles and the personal property of an alternative energy technology business). The exemption applied to taxes levied after December 31, 2002 and before January 1, 2013.
• In 2008 a spate of legislation was passed that was designed to promote renewable energy, including Act 270 which amended the Michigan Business Tax Act and provided a tax credit to any photovoltaic manufacturing business that entered into an agreement with the Michigan Economic Growth Authority to construct a new manufacturing plant.
• One of the larger pieces of “sustainable/green” legislation enacted in 2008 – Public Act 295 – included a modest renewable portfolio standard that was designed to increase the use of renewable energy in Michigan by requiring electrical utilities to source 10% of their electrical production from renewable energy systems such as wind or solar.
• In 2010 Michigan revised its construction code to adopt ASHRAE Standard 90.1-2007, which sets forth more energy efficiency requirements than the prior ASHRAE Standard that Michigan relied upon for years.

Recent Developments
Since 2010, the push for sustainability based legislation appears to have tapered off – in fact, it seems to have been put in reverse. For example, two bills introduced in 2011 that initially received a lot of press, have fallen off the radar screen: House Bills (HB) 4286 and 4049.

HB 4286 would have provided a taxpayer with a tax credit equal to 50% of the cost of constructing a “green building”. Similarly, HB 4049 proposed a tax credit for builders of energy efficient homes. However, neither bill made it out of the Committee on Tax Policy.

Moreover, HB 5447, proposed by State House Representative Franz in February, 2012, would repeal Michigan’s 10% renewable energy standard. The bill, however, is opposed by a wide variety of groups so its fate is unclear.

Are these actions (or inactions as the case may be) due to economic factors (we just went through one of the biggest recessions/depressions since 1929)? A shift in concern? Or is it something deeper – such as a growing public distrust along the lines of Arizona SB 1507 which would ban any state sustainability initiatives whatsoever? (An interesting video of the AZ Senate Judiciary Committee hearing on this bill can be viewed here.)

If there is a shift away from sustainability initiatives, it’s most likely due to a variety of factors. Nonetheless, at least one study, performed in Canada, shows that our neighbors to the north are becoming less concerned with environmental issues. If the same thing is occurring in the U.S. and Michigan, it could explain the recent legislative activity that appears to be shifting away from publically funded sustainability measures. Given the impact such a trend could have on “green” and “sustainable” businesses in Michigan, we will continue to monitor it and provide updates.

The post Is Legislative Support for Sustainability Initiatives on the Decline? appeared first on Dawda PLC.

The following is a transcript of my interview with Gary on Groundwater/Surfacewater Interface (“GSI”):

Q 1. You have followed the issue of GSI for many years. Please give us a brief overview of what GSI is and what is the scope of this exposure pathway?

GSI in the context of contaminated properties is a potential exposure or hazard pathway at locations where site groundwater provides a transport mechanism to move hazardous substances into surfacewater. It is not a relevant pathway at all properties but is frequently the case at hundreds if not thousands of Part 201 and Part 213 sites in Michigan. Michigan’s site remedial action program has for years required groundwater quality to meet standards established to protect surface water resources, and these standards, along with drinking water standards, regularly determine whether or not groundwater cleanup is required. Because it is often the case that potential drinking water pathway hazards are addressed by imposing restrictions on the use of site groundwater as a water supply source, the “GSI” criteria regularly becomes the most challenging (and costly) aspect of completing site cleanup obligations.

As GSI focuses on the “interface” between groundwater and surface water, variable groundwater, and particularly surface water, hydrologic factors (flow, elevations, etc.). At sites in Michigan, the GSI is often a dynamic transition zone between groundwater and surface water. Within this zone various geochemical and biological reactions can be acting to transform the nature of substances originating from upland locations.

Q 2. MCL 324.20120e sets forth Michigan’s statutory requirements regarding “Groundwater Venting into Surfacewater”. Under the current statute, what problems has the regulated community had with complying with this exposure risk pathway and criteria?

The generic criteria for the GSI pathway is the most stringent of all the Part 201 groundwater cleanup criteria, along with the drinking water pathway criteria. But in many cases drinking water exposure is not an exposure pathway of concern due to available alternate water supplies at the sites, so the GSI criteria routinely determines what can be a sufficient completion endpoint for closure for Part 201 sites.

I characterize two primary problems in complying with the GSI pathway and criteria as:

(a) the application of a “permitable surface water discharge paradigm” to the decision making relative, to the need for a groundwater cleanup to protect surface water resources; and

(b) the application of the GSI criteria in groundwater near sewer systems even when there is no chance for substances at that location to adversely impact surfacewaters.

The “permitable surfacewater discharge paradigm” evaluates groundwater venting to surface water as if a groundwater plume is a point source discharge for which an NPDES permit would need to be issued. The consequences of this approach have been that surfacewater quality standards that are meant to protect surfacewater flora and fauna have to be met in the groundwater even though no such resource exists at that location. This has been a large barrier to getting cleanups completed because parties are unwilling to invest the resources necessary to meet standards for which there will not be any demonstrated environmental improvement and benefit.

Q 3. You have been involved with multiple discussion groups regarding these problems with regulating the GSI pathway. Are there any groups currently reviewing statutory revisions that would affect the GSI pathway regulations or criteria?

There are two recent efforts: one is the review by the Office of Regulatory Reinvention that was initiated per the Governor’s Executive Order in 2011. The second is the Collaborative Stakeholders Initiative (“CSI”) that was initiated by the MDEQ at the start of this year. Follow up on the recommendations of those two efforts is continuing. (The recommendations are summarized here.) Draft amendments to Part 201 to address these issues and this pathway have been developed and are poised for consideration by the legislature. (A recent version of the draft legislation appears here.)

Q 4. Can you provide us with a brief overview of the overall goals of your CSI issue group, in proposing revisions to MCL 324.20120(e)?

The overall goal of our work group was to revise and improve the way the GSI pathway is addressed in order to facilitate closure and final cleanups, rather than the pathway being the issue that prevents closures and completion of actions.

Q 5. How would these proposed changes affect the efficiency and reliability of site remediation?

It will be possible to more efficiently reach appropriate decisions as to the need for groundwater cleanup to protect surfacewater resources. As a result, there will be earlier and sooner closure of site cleanups and a better return on investments and stewardship of legacy site conditions. There are certainly hundreds to thousands of sites that face this issue.

Q 6. What is your understanding as to the status of any legislative efforts to pass a statutory change to GSI?

There is a very good prognosis for future legislative action to address the issue, perhaps even before the summer recess of the current legislature. I understand there is at least one sponsor of the legislation of potential amendments that has been identified. .

Q 7. What might these proposed statutory changes mean to the regulated community if they’re passed?

In my mind it means that many long-standing, unresolved site cleanups could be brought to a closure with a reasonable investment of additional resources. The key will be Remediation Division recognizing the “permitable surface water discharge paradigm” is not applicable to decision-making for this pathway, a position acknowledged by MDEQ and stakeholders participating in the CSI.

Q 8. What sites do you think would benefit the most from this statutory change?

Any sites that are unresolved due to the groundwater/surfacewater interface pathway. This is certainly the case most often at sites that are adjacent to rivers, lakes and other waterways of the state. It will also include many sites that have been held up on this issue even if they aren’t near a waterway, but they happen to be near an indirect conveyance to waterways such as storm and sanitary sewers. These sites have essentially been held hostage to the old approach on the issue, for which the proposed legislative changes provide a much better basis for appropriate protection of surface water resources along with completing site cleanups.

Q 9. What were the big highlights of the recommendations that came out of your CSI issue group?

There were several. The recommendations include

(1) The addition of two other methods for evaluating whether or not there is a need to do groundwater cleanup to bring a site to closure relative to the GSI pathway by:

• Performing an ecological evaluation of the surfacewater conditions;
• Performing an modeling evaluation to determine the potential for adverse impacts to the surface water.

(2) Focus evaluation of conditions relative to indirect pathways to surfacewater such as via storm and sanitary sewers based upon whether or not the groundwater contamination has the potential to adversely impact the surfacewater resources, instead of focusing on whether or not the groundwater may enter the stormwater sewer at a concentration above surfacewater standards.

(3) Evaluate conditions relative to mercury based upon laboratory methods which achieve a quantitation limit of 0.2 ppb rather than the methods developed for ultra-low detection limits. This will assure that significant sources of potential release of mercury from groundwater into surfacewater are addressed. This will avoid having to address cases where mercury is detectable, but concentrations are so low that there really isn’t any benefit in investigating them further.

Q 10. What do we hope to see over the six months?

We hope that the legislation is enacted to affirms a sound scientific foundation and public policy for making decisions about whether cleaning up groundwater is needed to protect a surfacewater resource. This would put into practice evaluating the potential impacts to surfacewaters based upon the actual surface water impact rather than conditions in groundwater having to meet surface water quality standards.

What remains to be seen after such a foundation is laid out in the statute is exactly how that ends up being implemented by the agency. One issue not fully sorted out that may end up being an impediment to swiftly addressing the GSI issues is the issue of securing MDEQ’s approval for using the alternative methods proposed to be enacted in the statute.. The CSI work group wrestled with this a bit, but so far the proposal does not encompass any real changes from existing protocols for parties needing to secure MDEQ approval. There will certainly be ample opportunity to see how things actually work out, and whether or not the requirement for MDEQ approvals in certain cases ends up being an additional step that causes further delays in achieving closures at sites.

I’d like to thank Gary Klepper for providing this information on the status of proposed changes to Part 201 and regulation of the GSI in Michigan. We will continue to watch this issue as it evolves over the next 6 months.

The post Interview: Regulatory Change for Michigan’s Gsi Criteria appeared first on Dawda PLC.

On January 24, 2012, the Michigan Senate passed a bill to amend Michigan’s Part 213 by revising procedures for the cleanup and management of environmental contamination at LUST sites.

Significant points of the bills:
(1) A requirement that LUST be remediated pursuant to Standard Guide for Risk Based Corrective Action Applied at the Petroleum Release Sites (“RBCA”) which were developed by ASTM. The MDEQ would not develop its own classification system. The MDEQ is prohibited from implementing additional rules for Part 213 of the Act.

(2) The consultants shall submit an initial assessment report within 180 days following a release. The MDEQ would audit the closure report and final assessment and not other submittals or aspects of the corrective action;

(3) With respect to timing, the MDEQ would have 90 days after receipt of the closure report to determine whether it would audit and then have 180 days to complete the audit. The MDEQ would only have an opportunity to audit the report;

(4) If the MDEQ does not perform an audit and a written response, it will be deemed approved. If a report is denied, the owner and operator can revise the report and resubmit it for review. The owner and operator in the alternative, upon receipt of a denial, can seek review by the Response Activity Review Panel (which was established under Part 201), or petition the MDEQ’ s Office of Administrative Hearings for a contested case hearing;

(5) A person may be an innocent purchaser within the meaning of Part 213 if they conducted a BEA, making the UST program consistent with Part 201. It is the MDEQ’s burden of proof to establish liability under Part 213. Liable parties can seek contribution from other liabilities in a civil action.

(6) Parties that are liable could be at risk for up to $50 Million in damages for the destruction of natural resources. The penalty scheme has been revised so that the Attorney General, on behalf of the MDEQ, can commence a civil action against liable parties. The State may pursue a lien to recover costs and damages incurred as a result of a UST. The State’s lien would have priority over other liens;

(7) The State has the authority to enter into covenants not to sue with liable parties under certain circumstances;

The bill package as passed by the Senate has been referred to the House. The House has referred this bill to its Committee on Natural Resources, Tourism and Outdoor Recreation. The Committee will review the Senate Bill to determine whether to recommend approval by the House. We will continue to monitor the passing of these bills.

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