By: Smith of Harris, et al. H.B. No. 86
(Senate Sponsor-Armbrister)
(In the Senate - Received from the House March 21, 2005;
March 30, 2005, read first time and referred to Committee on
Natural Resources; May 3, 2005, reported adversely, with favorable
Committee Substitute by the following vote: Yeas 8, Nays 1;
May 3, 2005, sent to printer.)
COMMITTEE SUBSTITUTE FOR H.B. No. 86 By: Lindsay
A BILL TO BE ENTITLED
AN ACT
relating to compliance histories for and incentives to reward
compliance performance by entities regulated by the Texas
Commission on Environmental Quality.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 5.752(1), Water Code, is amended to read
as follows:
(1) "Applicable legal requirement" means an
environmental law, regulation, permit, order, consent[,] decree,
or other requirement.
SECTION 2. The heading to Section 5.753, Water Code, is
amended to read as follows:
Sec. 5.753. STANDARDS [STANDARD] FOR USING [EVALUATING]
COMPLIANCE HISTORY.
SECTION 3. Section 5.753, Water Code, is amended by
amending Subsections (a), (b), and (d) and adding Subsections (f)
and (g) to read as follows:
(a) Consistent with other law and the requirements
necessary to maintain federal program authorization, the
commission by rule shall develop standards [a uniform standard] for
using [evaluating] compliance history.
(b) The components of compliance history must include:
(1) enforcement orders, court judgments, [consent
decrees,] and criminal convictions of this state [and the federal
government] relating to compliance with applicable legal
requirements under the jurisdiction of the commission, including
requirements regarding emissions events under Sections 382.0215
and 382.0216, Health and Safety Code [or the United States
Environmental Protection Agency];
(2) notwithstanding any other provision of this code,
orders issued under Section 7.070;
(3) to the extent readily available to the commission,
enforcement orders, court judgments, consent decrees, and criminal
convictions relating to violations of environmental rules [laws] of
the United States Environmental Protection Agency [other states];
and
(4) changes in ownership.
(d) For purposes of listing compliance history or using
compliance history in any escalation of penalties, the commission
may not include as a notice of violation deviations or violations
provided by a person to the commission, such as deviations set forth
in Discharge Monitoring Reports or Title V Deviation Reports,
unless the commission issues a written notice of violation. For
purposes of using compliance history in any escalation of
penalties, the commission may not use notices of violation unless
the commission takes subsequent action or the person is a repeat
violator as determined pursuant to Section 5.754(c)(2) of this
code. If the commission includes notices of violations in
compliance history, the listing shall be preceded by the following
statement prominently displayed: "A notice of violation represents
a written allegation of a violation of a specific regulatory
requirement from the commission to a regulated entity. A notice of
violation is not a final enforcement action nor proof that a
violation has actually occurred." [The set of components shall
include notices of violations.] A notice of violation
administratively determined to be without merit may [shall] not be
included in a compliance history. A notice of violation that is
included in a compliance history shall be removed from the
compliance history if the commission subsequently determines the
notice of violation to be without merit.
(f) Compliance history available on the Internet website of
the United States Environmental Protection Agency is considered to
be readily available to the commission for the purposes of
Subsection (b)(3).
(g) Except as otherwise specifically provided, this section
does not prohibit the commission from using any components of
compliance history the commission considers appropriate for
permitting or enforcement purposes.
SECTION 4. The heading to Section 5.754, Water Code, is
amended to read as follows:
Sec. 5.754. [CLASSIFICATION AND] USE OF COMPLIANCE HISTORY.
SECTION 5. Sections 5.754(c), (e), (g), and (h), Water
Code, are amended to read as follows:
(c) In using [classifying] a person's compliance history,
the commission shall:
(1) determine whether a violation of an applicable
legal requirement is of major, moderate, or minor significance;
(2) establish criteria for classifying a repeat
violator for the purposes of Subsection (f), giving consideration
to the size [number] and complexity of the site at which the
violations occurred, and limiting consideration to violations of
the same nature in the same environmental media [facilities owned
or operated by the person]; and
(3) consider the significance of the violation and
whether the person is a repeat violator.
(e) The commission by rule shall provide for the use of
compliance history [classifications] in commission decisions
regarding:
(1) the issuance, renewal, amendment, modification,
denial, suspension, or revocation of a permit;
(2) enforcement;
(3) the use of announced inspections; and
(4) participation in innovative programs.
(g) Rules adopted under Subsection (e) for the use of
compliance history shall provide for additional oversight of, and
review of applications regarding, facilities owned or operated by a
person whose compliance performance is unsatisfactory according to
commission standards [in the lowest classification developed under
this section].
(h) The commission by rule shall, at a minimum, prohibit a
person whose compliance history is unsatisfactory according to
commission standards [classified in the lowest classification
developed under this section] from[:
[(1) receiving an announced inspection; and
[(2)] obtaining or renewing a flexible permit under
the program administered by the commission under Chapter 382,
Health and Safety Code, or participating in the regulatory
flexibility program administered by the commission under Section
5.758.
SECTION 6. Section 5.755(b), Water Code, is amended to read
as follows:
(b) The strategically directed regulatory structure shall
offer incentives based on:
(1) a person's compliance history [classification];
and
(2) any voluntary measures undertaken by the person to
improve environmental quality.
SECTION 7. Section 5.756, Water Code, is amended by adding
Subsection (e) to read as follows:
(e) Any information or data about a site that is placed on
the Internet under this subchapter is subject to a quality
assurance and quality control procedure, including an opportunity,
not to exceed 30 days, for the owner and operator of the site to
review the information before it is placed on the Internet.
SECTION 8. Sections 5.758(a), (b), and (h), Water Code, are
amended to read as follows:
(a) The commission by order may exempt an applicant from a
requirement of a statute or commission rule regarding the control
or abatement of pollution if the applicant proposes to control or
abate pollution by an alternative method or by applying an
alternative standard that is:
(1) as [more] protective of the environment and the
public health as [than] the method or standard prescribed by the
statute or commission rule that would otherwise apply; and
(2) not inconsistent with federal law.
(b) The commission may not exempt an applicant under this
section unless the applicant can present to the commission
documented evidence that the alternative the applicant proposes is
as protective of the environment and the public health as the method
or standard prescribed by the statute or commission rule that would
otherwise apply [of benefits to environmental quality that will
result from the project the applicant proposes].
(h) In implementing the program of regulatory flexibility
authorized by this section, the commission shall:
(1) promote [market] the program to businesses in the
state through all available appropriate media;
(2) endorse alternative methods that will clearly
benefit the environment and impose the least onerous restrictions
on business;
(3) fix and enforce environmental standards, allowing
businesses flexibility in meeting the standards in a manner that
clearly enhances environmental outcomes; and
(4) work to achieve consistent and predictable results
for the regulated community and shorter waits for permit issuance.
SECTION 9. Section 361.084(a), Health and Safety Code, is
amended to read as follows:
(a) The commission by rule shall establish a procedure to
prepare compliance summaries relating to the applicant's solid
waste management activities in accordance with the method for using
[evaluating] compliance history developed by the commission under
Section 5.754, Water Code. A compliance summary shall include as
evidence of compliance information regarding the applicant's
implementation of an environmental management system at the
facility for which the authorization is sought. In this
subsection, "environmental management system" has the meaning
assigned by Section 5.127, Water Code.
SECTION 10. Section 361.088(f), Health and Safety Code, is
amended to read as follows:
(f) Notwithstanding Subsection (e), if the commission
determines that an applicant's compliance history under the method
for using [evaluating] compliance history developed by the
commission under Section 5.754, Water Code, raises an issue
regarding the applicant's ability to comply with a material term of
its permit, the commission shall provide an opportunity to request
a contested case hearing.
SECTION 11. Sections 361.089(a), (e), and (f), Health and
Safety Code, are amended to read as follows:
(a) The commission may, for good cause, deny or amend a
permit it issues or has authority to issue for reasons pertaining to
public health, air or water pollution, or land use, or for having a
compliance history that is unsatisfactory according to commission
standards [in the lowest classification] under Sections 5.753 and
5.754, Water Code, and rules adopted and procedures developed under
those sections.
(e) The commission may deny an original or renewal permit if
it is found, after notice and hearing, that:
(1) the applicant or permit holder has a compliance
history that is unsatisfactory according to commission standards
[in the lowest classification] under Sections 5.753 and 5.754,
Water Code, and rules adopted and procedures developed under those
sections;
(2) the permit holder or applicant made a false or
misleading statement in connection with an original or renewal
application, either in the formal application or in any other
written instrument relating to the application submitted to the
commission, its officers, or its employees;
(3) the permit holder or applicant is indebted to the
state for fees, payment of penalties, or taxes imposed by this title
or by a rule of the commission; or
(4) the permit holder or applicant is unable to ensure
that the management of the hazardous waste management facility
conforms or will conform to this title and the rules of the
commission.
(f) Before denying a permit under this section, the
commission must find:
(1) that the applicant or permit holder has a
compliance history that is unsatisfactory according to commission
standards [in the lowest classification] under Sections 5.753 and
5.754, Water Code, and rules adopted and procedures developed under
those sections; or
(2) that the permit holder or applicant is indebted to
the state for fees, payment of penalties, or taxes imposed by this
title or by a rule of the commission.
SECTION 12. Section 382.0215, Health and Safety Code, is
amended by amending Subsections (a), (b), and (f) and adding
Subsections (a-1) and (h) to read as follows:
(a) In this section:
(1) "Emissions[, "emissions] event" means an upset
event, or unscheduled maintenance, startup, or shutdown activity,
from a common cause that results in the unauthorized emissions of
air contaminants from one or more [an] emissions points at a
regulated entity [point].
(2) "Regulated entity" means all regulated units,
facilities, equipment, structures, or sources at one street address
or location that are owned or operated by the same person. The term
includes any property under common ownership or control identified
in a permit or used in conjunction with the regulated activity at
the same street address or location.
(a-1) Maintenance, startup, and shutdown activities shall
not be considered unscheduled only if the activity will not and does
not result in the emission of at least a reportable quantity of
unauthorized emissions of air contaminants and the activity is
recorded as may be required by commission rule, or if the activity
will result in the emission of at least a reportable quantity of
unauthorized emissions and:
(1) the owner or operator of the regulated entity
[facility] provides any prior notice or final report that the
commission, by rule, may establish;
(2) the notice or final report includes the
information required in Subsection (b)(3); and
(3) the actual emissions do not exceed the estimates
submitted in the notice by more than a reportable quantity.
(b) The commission shall require the owner or operator of a
regulated entity [facility] that experiences emissions events:
(1) to maintain a record of all emissions events at the
regulated entity [facility] in the manner and for the periods
prescribed by commission rule;
(2) to notify the commission in a single report for
each emissions event, as soon as practicable but not later than 24
hours after discovery of the emissions event, of an emissions event
resulting in the emission of a reportable quantity of air
contaminants as determined by commission rule; and
(3) to report to the commission in a single report for
each emissions event, not later than two weeks after the occurrence
of an emissions event that results in the emission of a reportable
quantity of air contaminants as determined by commission rule, all
information necessary to evaluate the emissions event, including:
(A) the name of the owner or operator of the
reporting regulated entity [facility];
(B) the location of the reporting regulated
entity [facility];
(C) the date and time the emissions began;
(D) the duration of the emissions;
(E) the nature and measured or estimated quantity
of air contaminants emitted, including the method of calculation
of, or other basis for determining, the quantity of air
contaminants emitted;
(F) the processes and equipment involved in the
emissions event;
(G) the cause of the emissions; and
(H) any additional information necessary to
evaluate the emissions event.
(f) An owner or operator of a regulated entity [facility]
required by Section 382.014 to submit an annual emissions inventory
report and which has experienced no emissions events during the
relevant year must include as part of the inventory a statement that
the regulated entity [facility] experienced no emissions events
during the prior year. An owner or operator of a regulated entity
[facility] required by Section 382.014 to submit an annual
emissions inventory report must include the total annual emissions
from all emissions events in categories as established by
commission rule.
(h) The commission may allow operators of pipelines,
gathering lines, and flowlines to treat all such facilities under
common ownership or control in a particular county as a single
regulated entity for the purpose of assessment and regulation of
emissions events.
SECTION 13. Sections 382.0216(a), (b), (c), and (i), Health
and Safety Code, are amended to read as follows:
(a) In this section, "emissions event" and "regulated
entity" have [has] the meanings [meaning] assigned by Section
382.0215.
(b) The commission shall establish criteria for determining
when emissions events are excessive. The criteria must include
consideration of:
(1) the frequency of the regulated entity's
[facility's] emissions events, taking into consideration the
regulated entity's size and complexity;
(2) the cause of the emissions event;
(3) the quantity and impact on human health or the
environment of the emissions event;
(4) the duration of the emissions event;
(5) the percentage of a facility's total annual
operating hours during which emissions events occur; and
(6) the need for startup, shutdown, and maintenance
activities.
(c) The commission shall require the owner or operator of a
regulated entity [a facility] to take action to reduce emissions
from excessive emissions events. Consistent with commission rules,
the owner or operator of a regulated entity [a facility] required to
take action under this subsection must either file a corrective
action plan or file a letter of intent to obtain authorization for
emissions from the excessive emissions events, provided that the
emissions are sufficiently frequent, quantifiable, and
predictable. If the intended authorization is a permit, a permit
application shall be filed within 120 days of the filing of the
letter of intent. If the intended authorization is a permit by rule
or standard exemption, the authorization must be obtained within
120 days of the filing of the letter of intent. If the commission
denies the requested authorization, within 45 days of receiving
notice of the commission's denial, the owner or operator of a
regulated entity [facility] shall file a corrective action plan to
reduce emissions from the excessive emissions events.
(i) In the event the owner or operator of a regulated entity
[facility] fails to report an emissions event as required by
Section 382.0215(b), the commission shall initiate enforcement for
such failure to report and for the underlying emissions event
itself. This subsection does not apply where an owner or operator
reports an emissions event and the report was incomplete,
inaccurate, or untimely unless the owner or operator knowingly or
intentionally falsified the information in the report.
SECTION 14. Section 382.0518(c), Health and Safety Code, is
amended to read as follows:
(c) In considering the issuance, amendment, or renewal of a
permit, the commission may consider the applicant's compliance
history in accordance with the method for using [evaluating]
compliance history developed by the commission under Section 5.754,
Water Code. In considering an applicant's compliance history under
this subsection, the commission shall consider as evidence of
compliance information regarding the applicant's implementation of
an environmental management system at the facility for which the
permit, permit amendment, or permit renewal is sought. In this
subsection, "environmental management system" has the meaning
assigned by Section 5.127, Water Code.
SECTION 15. Section 382.056(o), Health and Safety Code, is
amended to read as follows:
(o) Notwithstanding other provisions of this chapter, the
commission may hold a hearing on a permit amendment, modification,
or renewal if the commission determines that the application
involves a facility for which the applicant's compliance history is
unsatisfactory according to commission standards [in the lowest
classification] under Sections 5.753 and 5.754, Water Code, and
rules adopted and procedures developed under those sections.
SECTION 16. Section 401.110(a), Health and Safety Code, is
amended to read as follows:
(a) In making a determination whether to grant, deny, amend,
renew, revoke, suspend, or restrict a license or registration, the
commission may consider an applicant's or license holder's
technical competence, financial qualifications, and compliance
history under the method for using [evaluation of] compliance
history developed by the commission under Section 5.754, Water
Code.
SECTION 17. Section 401.112(a), Health and Safety Code, is
amended to read as follows:
(a) The department or commission, within its jurisdiction,
in making a licensing decision on a specific license application to
process or dispose of low-level radioactive waste from other
persons, shall consider:
(1) site suitability, geological, hydrological, and
meteorological factors, and natural [naturals] hazards;
(2) compatibility with present uses of land near the
site;
(3) socioeconomic effects on surrounding communities
of operation of the licensed activity and of associated
transportation of low-level radioactive waste;
(4) the need for and alternatives to the proposed
activity, including an alternative siting analysis prepared by the
applicant;
(5) the applicant's qualifications, including
financial and technical qualifications and compliance history
under the method for using [evaluation of] compliance history
developed by the commission under Section 5.754, Water Code, for an
application to the commission or the requirements of Section
401.110(b) for an application to the department;
(6) background monitoring plans for the proposed site;
(7) suitability of facilities associated with the
proposed activities;
(8) chemical, radiological, and biological
characteristics of the low-level radioactive waste and waste
classification under Section 401.053;
(9) adequate insurance of the applicant to cover
potential injury to any property or person, including potential
injury from risks relating to transportation;
(10) training programs for the applicant's employees;
(11) a monitoring, record-keeping, and reporting
program;
(12) spill detection and cleanup plans for the
licensed site and related to associated transportation of low-level
radioactive waste;
(13) decommissioning and postclosure care plans;
(14) security plans;
(15) worker monitoring and protection plans;
(16) emergency plans; and
(17) a monitoring program for applicants that includes
prelicense and postlicense monitoring of background radioactive
and chemical characteristics of the soils, groundwater, and
vegetation.
SECTION 18. Section 26.028(d), Water Code, is amended to
read as follows:
(d) Notwithstanding any other provision of this chapter,
the commission, at a regular meeting without the necessity of
holding a public hearing, may approve an application to renew or
amend a permit if:
(1) the applicant is not applying to:
(A) increase significantly the quantity of waste
authorized to be discharged; or
(B) change materially the pattern or place of
discharge;
(2) the activities to be authorized by the renewed or
amended permit will maintain or improve the quality of waste
authorized to be discharged;
(3) for NPDES permits, notice and the opportunity to
request a public meeting shall be given in compliance with NPDES
program requirements, and the commission shall consider and respond
to all timely received and significant public comment; and
(4) the commission determines that an applicant's
compliance history under the method for using [evaluating]
compliance history developed by the commission under Section 5.754
raises no issues regarding the applicant's ability to comply with a
material term of its permit.
SECTION 19. Section 26.0281, Water Code, is amended to read
as follows:
Sec. 26.0281. CONSIDERATION OF COMPLIANCE HISTORY. In
considering the issuance, amendment, or renewal of a permit to
discharge effluent comprised primarily of sewage or municipal
waste, the commission shall consider the compliance history of the
applicant and its operator under the method for using [evaluating]
compliance history developed by the commission under Section 5.754.
In considering an applicant's compliance history under this
subsection, the commission shall consider as evidence of compliance
information regarding the applicant's implementation of an
environmental management system at the facility for which the
permit, permit amendment, or permit renewal is sought. In this
section, "environmental management system" has the meaning
assigned by Section 5.127.
SECTION 20. Section 26.040(h), Water Code, is amended to
read as follows:
(h) Notwithstanding other provisions of this chapter, the
commission, after hearing, shall deny or suspend a discharger's
authority to discharge under a general permit if the commission
determines that the discharger's compliance history is
unsatisfactory according to commission standards [in the lowest
classification] under Sections 5.753 and 5.754 and rules adopted
and procedures developed under those sections. A hearing under this
subsection is not subject to Chapter 2001, Government Code.
SECTION 21. Section 27.051(d), Water Code, is amended to
read as follows:
(d) The commission, in determining if the use or
installation of an injection well is in the public interest under
Subsection (a)(1), shall consider, but shall not be limited to the
consideration of:
(1) compliance history of the applicant and related
entities under the method for using [evaluating] compliance history
developed by the commission under Section 5.754 and in accordance
with the provisions of Subsection (e);
(2) whether there is a practical, economic, and
feasible alternative to an injection well reasonably available; and
(3) if the injection well will be used for the disposal
of hazardous waste, whether the applicant will maintain sufficient
public liability insurance for bodily injury and property damage to
third parties that is caused by sudden and non-sudden accidents or
will otherwise demonstrate financial responsibility in a manner
adopted by the commission in lieu of public liability insurance. A
liability insurance policy which satisfies the policy limits
required by the hazardous waste management regulations of the
commission for the applicant's proposed pre-injection facilities
shall be deemed "sufficient" under this subdivision if the policy:
(A) covers the injection well; and
(B) is issued by a company that is authorized to
do business and to write that kind of insurance in this state and is
solvent and not currently under supervision or in conservatorship
or receivership in this state or any other state.
SECTION 22. Sections 5.754(a) and (b) and 5.757, Water
Code, are repealed.
SECTION 23. Sections 382.0215 and 382.0216, Health and
Safety Code, as amended by this Act, apply only to an emissions
event that occurs on or after the effective date of this Act. An
emissions event that occurs before the effective date of this Act is
governed by the law in effect when the emissions event occurred, and
that law is continued in effect for that purpose.
SECTION 24. This Act takes effect immediately if it
receives a vote of two-thirds of all the members elected to each
house, as provided by Section 39, Article III, Texas Constitution.
If this Act does not receive the vote necessary for immediate
effect, this Act takes effect September 1, 2005.
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