e-Bulletin: Second Appellate District Rules Los Angeles Regional Water Quality Control Board's NPDES Permit Issued to Local Agencies for MS4s in Los Angeles County Is Not Subject to CEQA Review

On November 6, 2006, the Court of Appeal for the Second District in County of Los Angeles v. California State Water Resources Control Board held that National Pollution Discharge Elimination System (NPDES) permits for municipal separate storm sewer systems (MS4s) are not subject to the California Environmental Quality Act's (CEQA) provisions.

Under the federal Clean Water Act (CWA), which is administered through California's Porter-Cologne Act, local agencies must require homeowners and businesses to comply with NPDES permits to reduce storm water and runoff discharges into MS4s. In California, the State Water Resources Control Board oversees nine regional boards that establish wastewater discharge requirements having the same authority as NPDES permits under federal law.

Beginning in 2003, Los Angeles County, 32 LA County cities, the Los Angeles Flood Control District and two building trade associations filed a series of lawsuits against the Los Angeles Water Quality Control Board ("Regional Board") and the State Board for failing to comply with CEQA, among other things, when the Regional Board issued its NPDES permits for MS4s to the county, the flood control district, and 84 cities ("Permittees").

NPDES Permit Issued for Los Angeles County MS4s

The NPDES permit includes a statement of discharge prohibitions, a listing of receiving water limitations, and a Storm Water Quality Management Program. Permittees are required to prohibit non-storm water discharges into their MS4s with a few exceptions, e.g., if the discharge is covered by an NPDES permit for non-storm water emission. Permittees had to implement the Storm Water Quality Management Program, which reduces pollutants in storm waters to the maximum extent possible (MEP) with the use of best standard management practices. As part of the program, Permittees were required to adopt a storm water and urban water ordinance applicable to homeowners and businesses. Permittees were also obligated to eliminate all illicit connections and discharges to the storm drain system.

NPDES Permits Are Not Subject To CEQA Reveiw

The Court of Appeal disagreed with the Permittees' argument that the Regional Board's NPDES permit for MS4s is subject to limited CEQA Review. The Court held that it is "beyond question" that Water Code section 13389 states regional boards are not required to prepare an environmental review document (e.g., Environmental Impact Report (EIR)) required under chapter 3 of CEQA "prior to the adoption of any waste discharge requirement" (e.g., NPDES permit). The Permittees argued the regional boards are, however, required to engage in an environmental assessment of NPDES permits under Chapter 1, which sets forth the policies behind CEQA, and Chapter 2.6, which requires "public agencies" to conduct environmental review of discretionary projects. The court concluded the legislature never intended to impose a duty on regional boards to engage in any form of environmental review because the obligation imposed on State agencies to conduct environmental review existed in chapter 3 before the adoption of Water Code section 13389 and remained there after future amendments to CEQA.

The Court further disagreed with the Permittees' argument that CEQA requires "limited" review of NPDES permits. Public Resources Code section 21080.5, also found in Chapter 2.6 of CEQA, partially exempts from environmental review an activity adopted under a state agency's certified regulatory program that includes protection of the environnment. A state agency's program must be submitted to the Secretary of Resources for certification in order to qualify for the exemption. Once the program is certified, the agency may use a substitute document to analyze the environmental impacts of a proposed activity (in lieu of either an EIR or a Negative Declaration) so long as it is the functional equivalent of an EIR or Negative Declaration. The Secretary of Resources, however, has never recognized the NPDES permit system as a certified program. Thus regional boards are not required to conduct environmental review prior to the issuance of NPDES permits.

Regional Boards Have Jurisdiction to Issue NPDES Permits.

The Permittees argued only the State Board has jurisdiction to issue a NPDES permit under federal law giving state agencies the authority to issue such permits and under state law giving regional boards limited jurisdiction over water quality. The Court disagreed, holding that the federal government delegated authority to issue NPDES permits to the State Board, which authorized its nine regional boards to issue NPDES permits.

Regional Boards May Require Local Agencies to Consider Impacts of Storm Water Runoff from Development in Their General Plans and CEQA Analysis.

The Regional Board's NPDES permit for MS4s requires Permittees to update their general plans to include watershed and storm water runoff considerations in the land use, housing, conservation and open space planning sections. The Permittees are also required to amend their CEQA process to insure review of development's effect on storm water runoff. The Permittees argued these requirements violate the separation of powers doctrine. The Court disagreed, holding regional boards are part of the state and federal process to enforce the CWA's water quality standards. There is no separation of powers violation so long as a regional board's decision falls within federal and state water quality mandates resulting from express legislative action.

Impact of Second District's Decision

The Court of Appeal for the Second District has determined that NPDES permits issued by regional boards are not subject to CEQA review. The Regional Board's present NPDES permit for MS4s expires on December 13, 2006. Though NPDES permits have significant impacts on residential and commercial development, the Court's decision allows the Regional Board to bypass environmental review of its new NPDES permit for MS4s. In addition, the decision limits the ability of local agencies throughout the State to challenge NPDES permits issued by regional boards.

The Court also reaffirmed the Regional Board's authority to issue NPDES permits and to require local agencies to consider impacts of storm water runoff development in their general plans and CEQA analysis. In other words, regional boards may require storm water consideration to be a mandatory component of local land use planning.

For more details on this decision or its implications on your project, contact an attorney with BB&K's Environmental Law & Natural Resources Practice Group.

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