BILL ANALYSIS C.S.H.B. 2491 By: Yost 04-19-95 Committee Report (Substituted) BACKGROUND Some feel that the current contested case process results in Texas having a competitive disadvantage in comparison to other states, due to what they feel are complex, time-consuming, and expensive permitting procedures. PURPOSE HB 2491 creates a less formal hearing process similar to what the federal Environmental Protection Agency uses. RULEMAKING AUTHORITY It is the committee's opinion that this bill expressly grants rulemaking authority to the Texas Natural Resource Conservation Commission (TNRCC) in SECTION 1 of the bill (Sec. 5.371, Water Code, Sec. 5.374, Water Code). SECTION BY SECTION ANALYSIS SECTION 1. Chapter 5, Water Code, is amended by adding a new Subchapter J as follows: Section 5.371 (a) States that this subchapter applies to commission procedures for an application for which public notice is required by Chapters 26 and 27 of the Water Code (water discharges and injection wells) and Chapters 361 and 382 of the Health and Safety Code (solid waste and air). (b) Permit by rule is authorized, consistent with federal law. (c) Rulemaking authority is granted to the TNRCC to identify categories of applications related to permits for which notice or opportunity for public hearing is not required. Lists conditions for permits to be exempt from notice and public hearing requirements. (d) For an exempted application, the commission by rule may provide for the executive director to take action on the application. Section 5.372 (a) Provides for the issuance of draft permits or notice of intent to deny by the TNRCC executive director. (b) A record of proposed decision shall be included with a draft permit notice or notice of intent to deny. (c) Copies of the record and proposed decision must be sent to the applicant, state and federal agencies and persons requesting copies. (d) An applicant may give public notice of application before the initial determination is completed. Allows the executive director to take final action. (e) A notice of intent to deny shall include reasons for the intended denial. (f) A draft permit shall contain all appropriate conditions, compliance schedules, monitoring requirements, and technical standards consistent with applicable commission rules. Section 5.373 provides for the preparation of a record of proposed decision which is made available at the time public notice is published. The record of proposed decision must include aspects of the procedures followed and aspects of the draft permit. Section 5.374 provides for public notice and a 30-day comment period which is automatically extended to the close of any public hearing. This notice requirement is in addition to existing notice requirements for wastewater discharges and solid waste facilities. This section also provides for resolution of issues by the executive director. The commission is given the authority to prescribe by rule additional notice requirements to conform with federal law. Section 5.375 (a) Provides for the opportunity for public hearing. (b) Interested persons shall be given the opportunity to present significant information, orally or in writing, and to examine testifying witnesses. (c) The executive director shall hold the public hearing if there is a significant degree of public interest, or it is determined that a public hearing should be held in order to clarify issues in the permit decision. (d) For hazardous waste permits only, the executive director must hold a hearing when a public hearing is requested in writing. (e) The executive director may designate a hearings officer or hearing panel. (f) Hearings held under this Chapter are exempt from the Administrative procedures and Texas Register Act. (g) Hearings shall be recorded, and transcribed upon request. (h) Record and transcript shall be available for review. (i) Person requesting record or transcript bears the cost. Section 5.376 (a) Authorizes bonds to pay for nonlegal costs of persons affected who provide information to the commission on the question of issuance of the permit. (b) Bonds for a new commercial hazardous waste management facility is $100,000. (c) Bonds for a new noncommercial hazardous waste facility is $20,000. (d) The executive director is to use current law [Sec. 361.0833(b), Health and Safety Code] to determine who is entitled to reimbursement of costs. (e) Nonlegal costs include the cost of a copy of the administrative record in the case. (f) Awarded costs are limited to the amount of the bond. (g) Units of local government are allowed to recover legal costs in addition to other costs. Section 5.377 (a) Requires the executive director to consider all comments. (b) The executive director may deny the permit in whole or in part and may provide reasonable conditions if the permit applied for does not meet applicable requirements, or the applicant refuses to agree to a permit condition the executive director determines is necessary after reviewing comments. (c) Upon issuing a final decision, the executive director must issue a response to the comments the commission receives. (d) The response must be available to the public. (e) Notice of final decision on the application must be mailed to the applicant and to each person who commented. (f) A final decision on a permit application becomes effective 30 days after the date the notice of decision is mailed. Section 5.378 (a) The commission shall review the executive director's final decision as provided by this section. (b) A petition for review must be filed on or before the 30th day after the notice of final decision is mailed. (c) The petition must include a statement of the reasons that support commission review of the decision. (d) The commission must act on a petition within 60 days after the notice of final decision is mailed. (e) If the commission grants the petition for review, the commissioner shall give notice to the petitioner and each person who commented. (f) If the commission modifies or rejects the executive director's decision, the commission must issue a written decision that includes the reason and legal basis. (g) A petition does not affect the validity of a permit issued until the commission modifies or rejects the executive director's decision. Section 5.379 (a) A person affected by the executive director's final decision or the commission's action on that decision may petition for judicial review. (b) Failure to petition for commission review in a timely manner is bar to judicial review. (c) Judicial rule is under the substantial evidence rule. (d) The filing of an appeal does not stay any action required by the commission's decision. (e) Stipulates what must be included in the record of appeal. SECTION 2. Chapter 2001, Government Code, is amended by adding a new Section 2001.226 which provides an exception within the Administrative Procedure and Texas Register Act to apply to permits under this bill. SECTION 3. Emergency clause. COMPARISON OF ORIGINAL TO SUBSTITUTE The committee substitute for HB 2491 is a Legislative Council draft of the original bill. The substitute creates a new Subchapter J (rather than I) of Chapter 5, Water Code. The following chart shows the changes between the original and the substitute: HB 2491 Committee Substitute HB 2491 Authorizes permit by rule and consolidated permits. Authorizes permit by rule (not consolidated permits). adds the following which is not in the original bill: Gives rulemaking authority for the commission to identify categories of applications related to permits for which notice or opportunity for public hearing is not required. Lists conditions for permits to be exempt from notice and public hearing requirements. For an exempted application, the commission by rule may provide for the executive director to take action on the application. adds the following which is not in the original bill: An applicant may give public notice of application before the initial determination is completed. Allows the executive director to take final action under stipulated circumstances. After public notice that a draft permit or notice of intent to deny has been prepared, a 45 day comment period is allowed. After public notice that a draft permit or notice of intent to deny has been prepared, a 30 day comment period is allowed. Re: a draft permit or notice of intent to deny for a hazardous waste management permit - upon request, the executive director shall hold a public hearing within 45 days. Re: a draft permit or notice of intent to deny for a hazardous waste management permit - upon request, the executive director shall hold a public hearing on or before the 30th day. SUMMARY OF COMMITTEE ACTION HB 2491 was considered by the House Committee on Environmental Regulation in a public hearing on April 11, 1995. The following persons testified in favor of the bill: Paul Seals, representing himself and the Texas Chemical Council. Jon Fisher, representing the Texas Chemical Council. Mary Miksa, Vice President of Governmental Affairs, representing herself and Texas Association of Business and Chambers of Commerce. James Terrell, representing Texas Association of Dairymen. Buck Wayne, attorney, former Texas Water Commission Chairman, representing himself. The following persons testified against the bill: Ken Kramer, representing the Sierra Club. Les Breeding, representing Sierra Blanca Legal Defense Fund. The following persons testified neutrally on the bill: Jim Phillips, Director of the Office of Hearings Examiners, TNRCC, representing himself. Roliff Purrington, lawyer, representing himself. Without objection HB 2491 was left pending. HB 2491 was considered by the House Committee on Environmental Regulation in a formal meeting on April 19, 1995. The committee considered a complete substitute which was adopted without objection. HB 2491, as substituted, was reported favorably with the recommendation that it do pass and be printed, by a record vote of seven (7) ayes, no (0) nays, no (0) pnv, and two (2) absent.