Vested Rights For Stormwater Regulations

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1 Vested Rights For Stormwater Regulations Snohomish County v. Pollution Control Hearings Board, 187 Wn.2d 346, 386 P.3d 1064 (2016) March 24, 2017 Presented by Kristin L. French, Attorney (360)

2 Stormwater Regulation Overview Wastewater discharge permits are required for disposal of waste material into waters of the state, and for certain industrial users that discharge industrial waste into sanitary sewer systems. Permit types NPDES Permit In 1972, Congress enacted the National Pollutant Discharge Elimination System (NPDES) as part of the Clean Water Act (CWA). The NPDES program requires that all entities have an NPDES permit if they discharge pollution into Washington State Waters. Originally, the NPDES program included only individual permits, written for specific discharges at specific locations. In 1979, the EPA created a class of permits called general permits, and authorized Washington State to use the general permit approach in General permits provide streamlined and uniform permitting of wastewater discharges. In 1990, Congress amended the Clean Water Act to require permits for stormwater discharges, and general permits are used to deal with permitting of stormwater discharges. Within this general permit category regulating stormwater discharges, two phases (Phase I and Phase II) were established that regulate discharges from municipal separate storm sewer systems.

3 Applicability By Jurisdiction WESTERN WASHINGTON CITIES AND COUNTIES Phase I Cities and Counties: Seattle, Tacoma, Snohomish County, King County, Pierce County, Clark County Phase II Cities: Aberdeen, Algona, Anacortes, Arlington, Auburn, Bainbridge Island, Battle Ground, Bellevue, Bellingham, Black Diamond, Bonney Lake, Bothell, Bremerton, Brier, Buckley, Burien, Burlington, Camas, Centralia, Clyde Hill, Covington, Des Moines, DuPont, Duvall, Edgewood, Edmonds, Enumclaw, Everett, Federal Way, Ferndale, Fife, Fircrest, Gig Harbor, Granite Falls, Issaquah, Kelso, Kenmore, Kent, Kirkland, Lacey, Lake Forest Park, Lake Stevens, Lakewood, Longview, Lynden, Lynnwood, Maple Valley, Marysville, Medina, Mercer Island, Mill Creek, Milton, Monroe, Mountlake Terrace, Mount Vernon, Mukilteo, Newcastle, Normandy Park, Oak Harbor, Olympia, Orting, Pacific, Port Angeles, Port Orchard, Poulsbo, Puyallup, Redmond, Renton, Sammamish, Sea Tac, Sedro-Woolley, Shoreline, Snohomish, Snoqualmie, Steilacoom, Sumner, Tukwila, Tumwater, University Place, Vancouver, Washougal, Woodinville Phase II Counties: (Phase II county permits apply to urban areas around permitted cities): Cowlitz County, Kitsap County, Skagit County, Thurston County, Whatcom County

4 Applicability By Jurisdiction EASTERN WASHINGTON CITIES AND COUNTIES Phase II Cities: Asotin, Clarkston, East Wenatchee, Ellensburg, Kennewick, Moses Lake Phase II Counties: (Phase II county permits apply to urban areas around permitted cities): Asotin County, Chelan County, Douglas County, Spokane County, Walla Walla County, Yakima County

5 Primary Issue in Case If a project gets approved and moves forward and then a new NPDES permit becomes effective, should the project be required to comply with the new NPDES permit standards?

6 Parties to Case Snohomish County, King County, and Building Industry Association of Clark County v. Pollution Control Hearings Board, Washington State Department of Ecology, Puget Soundkeeper Alliance, Washington Environmental Council, and Rosemere Neighborhood Association

7 Attorneys and Firms Involved in the Litigation Janette K. Brimmer, Jan Erik Hasselman, Earthjustice, Ronald L. Lavigne Jr., Phyllis Jean Barney, Office of the Attorney General, Dionne Padilla-Huddleston, Office of the Attorney General, James Denver Howsley, Jordan Ramis, PC, Joseph B. Rochelle, III, Attorney at Law, Devon N. Shannon, Darren E. Carnell, Office of the Prosecuting Attorney, Alethea Hart, Laura Colthurst Kisielius, Snohomish County Prosecutor's Office, Nancy Bainbridge Rogers, Randall P. Olsen, Cairncross & Hempelmann PS, as Amicus Curiae on behalf of Master Builders Association of King and Snohomish Counties, Brian Trevor Hodges, Pacific Legal Foundation, Ethan Blevins, Attorney at Law, as Amicus Curiae on behalf of Pacific Legal Foundation, Nathan Graham Smith, Attorney at Law, George Richard Hill, McCullough Hill PS, Aaron Matthew Laing, Schwabe Williamson & Wyatt PC, Adam R. Frank, BIAW, as Amicus Curiae on behalf of Building Industry Association of Washington, Bill Clarke, Attorney at Law & Government Affairs, James A. Tupper Jr., Lynne Michele Cohee, Tupper Mack Wells PLLC, as Amicus Curiae on behalf of Washington Realtors.

8 Why Does This Matter? Image courtesy of SGA Engineering

9 Why Does This Matter? Image courtesy of Olson Engineering

10 Why Does This Matter? Image courtesy of Olson Engineering

11 The Perspective of the Development Community on This Question Stormwater facilities are so integrated into the rest of the design of the project that one cannot merely change that singular stormwater component without having significant impacts on other components such as roads, other infrastructure and the fundamental project design itself This would also add to the public expense incurred in review of approved projects

12 King and Snohomish County Position and Arguments Puts counties in a difficult position of potentially violating developers constitutional rights violates state vesting law Violates doctrine of finality On reply no federal preemption

13 Washington State Department of Ecology and Environmental Interest Groups Position and Arguments Stormwater regulations are environmental regulations Therefore, state vesting law does not apply Even if it did, state has overriding right to protect water quality Clean Water Act ( CWA ) creates federal preemption of state land use laws

14 Case History Summary Some permittees appealed permit conditions which compelled them to retroactively apply new stormwater regulations to completed development applications. Pollution Control Hearings Board: Held that the vested rights doctrine did not apply, and that permittees were required to meet the new stormwater regulations. Court of Appeals: Reversed the PCHB and held that the vested rights doctrine excused compliance with the new stormwater regulations because the storm water regulations were land control ordinances Supreme Court: Reversed the Court of Appeals, finding that stormwater regulations adopted pursuant to the NPDES municipal stormwater permit are not land use control ordinances subject to the state s statutory vested rights doctrine.

15 Supreme Court Consideration and Decision This case asks us to decide whether Washington s vested rights doctrine excuses compliance with the requirements of a municipal storm water permit. A unanimous decision by all 9 justices: (Chief Justice Barbara Madsen; Associate Chief Justice Charles W. Johnson; Susan Owens; Mary Fairhurst; Debra Stephens; Charles Wiggins; Steven Gonzalez; Sheryl Gordon McCloud; Mary Yu), authored by Justice Stephens. Decision issued on December 29, 2016.

16 Supreme Court Consideration and Held: Decision Stormwater regulations adopted pursuant to Washington State s National Pollution Discharge Elimination System ( NPDES ) Municipal Stormwater Permit are not land use control ordinances that are subject to the state s statutory vested rights doctrine. The State s Municipal Stormwater Permit is issued under the federal and state Clean Water Acts. Municipal Stormwater Permit requirements may be retroactively applied to previously vested projects. Impact: Generally, the decision requires vested projects to comply with updated stormwater regulations, which may require costly and lengthy project revisions. The required revisions may be inconsistent with the project s underlying land use entitlements. The required revisions may create a need to engage in project redesign and may create a need to obtain new project entitlements.

17 Supreme Court Consideration and Decision Analysis: This decision addressed the issue of whether a NPDES stormwater permit was a land use control ordinance that is subject to the vested rights doctrine. Prior to this decision, case law defined a land use control ordinance as something that exerted restraint or direct influence over the land. It seemed logical that stormwater regulations would fit in this case law definition. However, the Washington Supreme Court concluded that any vested rights analysis must begin with identifying the source of authority for a requirement (meaning identification of whether the source of the authority is at the local, state or federal level).

18 Current Example of Confusion and Conflict Related to Stormwater Regulation Our office is working on a Planned Unit Development and Subdivision. In conjunction with project permitting, SEPA review resulted in a Determination of Nonsignificance (DNS) by the local government (lead agency). Related comments were submitted by the Department of Ecology regarding stormwater. Those comments expressed concern that the jurisdiction s existing stormwater regulations (City is not subject to Phase I or Phase II municipal permits, but rather operates under separate stormwater manual provisions) will not provide reasonable assurance that the development will achieve compliance with State water quality standards and protection of the beneficial uses of receiving waters.

19 Current Example of Confusion and Conflict Related to Stormwater Regulation On this basis, Ecology requested an additional analysis (through a Determination of Significance) or additional mitigation (through a Mitigated Determination of Nonsignificance). We objected, and cited various provisions in SEPA, such as WAC (1), and case law such as Cougar Mountain Associates v. King County, 111 Wn.2d 742, 752, 765 P.2d 264 (1988) (En Banc); citing RCW 43.21C.060 and WAC The Cougar Mountain case emphasizes that governmental controls cannot ignore due process and fair treatment of landowners, and emphasizes that decision makers must cite the specific agency SEPA policy that is the basis of any condition or denial under the chapter. SEPA denial must be based upon policies identified by the appropriate governmental authority and incorporated into existing regulations, plans, or codes which are formally designated by the agency.

20 Relationship to SEPA WAC (1) provides: Any governmental action on public or private proposals that are not exempt may be conditioned or denied under SEPA to mitigate the environmental impact subject to the following limitations: (a) Mitigation measures or denials shall be based on policies, plans, rules, or regulations formally designated by the agency (or appropriate legislative body, in the case of local government) as a basis for the exercise of substantive authority and in effect when the DNS or DEIS is issued. WAC (1) (emphasis added). This provision prohibits local governments from imposing mitigation requirements based on a policy or regulation that is adopted after the DNS or DEIS is issued.

21 One Big Question (Of Many ) The Snohomish County v. PCHB case did not even include any reference to WAC (1)(a), and you can see how the decision therefore raises many questions regarding Washington s vested rights doctrine.

22 Status of Request for Consideration Snohomish County filed a Motion for Reconsideration and King County filed a Motion for Reconsideration and Clarification. The Master Builders Association of King and Snohomish Counties moved the Court for leave to file an amicus brief. These motions are currently pending.

23 Legislative Response ESB 5212 Sponsors: Wilson, Angel, Honeyford, Schoesler As originally proposed, the relevant portion of Senate Bill 5212 read as follows: **Note that the same new text content was proposed for proposed subdivisions of land under RCW

24 On February 28, 2017 a Floor Amendment Was Adopted Which Resulted in The Following Proposed Text **Note that the same content was proposed for proposed subdivisions of land under RCW

25 Amendment and Purpose of Amendment Adopted on February 28, 2017: Environmental and Development Regulations As you can see, the floor amendment added the term the environmental and development regulations explicitly as a category of regulations to which a fully complete building permit application (under Chapter RCW), and a fully complete application for preliminary plat approval of a subdivision or short plat approval for short subdivision (under Chapter RCW) vest at the time the fully complete application is submitted. Note that requirements for a fully completed application are generally defined by local ordinance (subject to some minimum requirements listed out under RCW ).

26 Amendment and Purpose of Amendment Adopted on February 28, 2017: State or Local Status of Regulation or Ordinance Does Not Matter The floor amendment also clarified that such vesting does not depend on whether the regulation or ordinance was enacted for the purpose of complying with state law.

27 Bill Analysis The Bill Analysis prepared for ESB 5212 states that this is an act relating to clarifying the scope of land use control ordinances for the purposes of vesting. It provides a background statement regarding vested right in the context of Washington land use, references the vested rights doctrine first established in common law, references statutory codifications for building permits and subdivisions, and explicitly references the 2016 Snohomish County stormwater case, as follows: In December of 2016, a unanimous Washington Supreme Court held that storm water regulations that permittees must implement as part of the National Pollutant Discharge Elimination System permitting program were not land use control ordinances under the building permit or subdivision vesting statutes. Some permittees had appealed permit conditions which compelled them to retroactively apply new storm water regulations to completed development applications. The Pollution Control Hearings Board held that the vested rights doctrine did not apply, the Court of Appeals reversed, finding that the vested rights doctrine excused compliance because the storm water regulations were land use control ordinances, and a unanimous Supreme Court reversed the Court of Appeals.

28 Bill Analysis In so doing, the Supreme Court determined that the legislative history and court precedent demonstrate that the vesting statutes were intended to restrict municipal discretion with respect to local zoning and land use ordinances. Because state and federal law direct the permittees to implement the storm water regulations at issue in this case, the regulations are not the sort of local municipal land use and zoning ordinances the legislature was concerned with. Indeed, the legislature s actions with regard to implementation of Ecology s [low impact development] techniques make it clear that the vesting statutes do not preclude compliance with the [permit]. **NOTE: ESB 5212 is a direct legislative response to counter the Court s decision in the Snohomish County stormwater case.

29 Current Status of ESB 5212

30 Summary Points The issue of vested rights remains highly unsettled and highly controversial Current and pending action by the courts and legislature will shape vested rights moving into the future The proposed legislation referenced in this presentation is representative of other proposed legislation that may influence this topic The Snohomish County case is a good example of how judicial decisions and legislative action shape land use practice, and how those decisions and actions impact various interest groups

31 Any Questions? Kristin L. French (360)

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