The Nickel Report

Under the Clean Water Act’s National Pollutant Discharge Elimination System (NPDES) and California’s Porter-Cologne Water Quality Control Act, industrial facilities in California are required to obtain coverage under the state’s NPDES general permit for discharges associated with industrial storm water activities (General Industrial Permit) or justify why they are exempt. For regulated facilities, including manufacturing facilities, landfills, mining operations, steam electric power generating facilities, hazardous waste facilities, and oil and gas facilities, failure to obtain coverage under the General Industrial Permit is a potential violation of the Clean Water Act (in addition to state law), which could expose the owner or operator of the facility to potential civil penalties of up to $54,833 per day. Enforcement, however, largely is dependent upon agency inspections or enforcement by citizen groups. Based on estimates by the California Coastkeeper Alliance, many facilities in California may have failed to enroll in the industrial storm water permit program.

In early October, in a move that should increase enrollment in and compliance with the permit program, California Governor Newsom signed into law Senate Bill No. 205 (Hertzberg), which requires industrial businesses regulated by the NPDES storm water permit program to demonstrate compliance with the General Industrial Permit before they can obtain or renew a business license.

Starting January 1, 2020, when applying to a city or a county for an initial business license or business license renewal, that business operation, in an industry required to obtain coverage under the General Industrial Permit, will be required to provide specified information, under penalty of perjury, on its application, demonstrating enrollment with the NPDES permit program. Specifically, the following will be required:

• The name and location of facilities operated by the business.
• All primary Standard Industrial Classification (SIC) Codes for the business.
• Any of the following for each facility operated by the business:
  • The storm water permit number, known as the Waste Discharger Identification number (WDID), issued for the facility by the State Water Resources Control Board (State Board).
  • The WDID application number issued for the facility by the State Board.
  • The “notice of nonapplicability identification number” (NONA) issued for the facility by the State Board. (A business can file for a NONA if it takes other measures to control its storm water discharge, including retaining all storm water onsite or treating and discharging storm water as processed wastewater.)
  • The “no exposure certification identification number” (NEC) issued for the facility by the State Board. (A business can file for a NEC if it does not expose industrial waste to storm water discharges.)

Before issuing the business license or renewal, the city or county will be required to determine whether any of the primary SIC Codes provided by the applicant are applicable to the General Industrial Permit and, if so, must confirm that the WDID, WDID application number, NONA, or NEC corresponds to the business requesting the business license or renewal. The city or county must transfer compliance information provided by the applicant if requested by the State Board.

It remains to be seen how the new law will be implemented. Because of potentially long lead times with the State Board, businesses seeking new business licenses or renewals will need to engage the board well in advance of when they need their business licenses in order to obtain the required information (i.e., WDID, WDID application number, NONA, or NEC). And the new law raises a question about what happens if the city or county determines the SIC Code(s) provided by the applicant are not applicable to the General Industrial Permit (even though the applicant must think they are or would not have applied as a “regulated industry”). It is unlikely the applicant could rely on the city or county’s non-applicability determination in an enforcement action by the State Board if the applicant did not ultimately obtain coverage. Finally, the new law also could lead to an increase in citizen suits if new licensees/permittees don’t implement or comply with all applicable requirements.