The Sunset Advisory Commission has concluded interviews with the Texas Commission on Environmental Quality (TCEQ) staff as well as their own analysis and audit and has published the staff report. The overall purpose of the Sunset Advisory Commission’s review is to assess the need to retain the agency, look for potential duplication of programs within the TCEQ and other state agencies, and consider changes to improve agency operation.
Upcoming Key dates:
December 15-16, 2010 — hear testimony from Sunset staff, the TCEQ, and the public about the agency.
January 12, 2011 — adopt management and statutory recommendations regarding the TCEQ.
The statutory recommendations adopted at the January 12th Sunset Advisory Commission hearing will be considered in Sunset legislation by the 82nd Texas Legislature in 2011.
Following is the summary from the Sunset Staff Report:
The Texas Commission on Environmental Quality (TCEQ) is no stranger to controversy. As the state agency that oversees Texas’ environment and ensures compliance with state and federal regulations, TCEQ has a large, complex, and difficult job. The challenges and criticisms the agency must face are an inevitable part of its job balancing the often competing interests of protecting the environment without unduly affecting the State’s economy. These inherent challenges make reviewing TCEQ’s performance a formidable task, especially considering that at the time the Sunset review of the agency occurred, TCEQ encountered specific trials in implementing its many programs.
TCEQ must implement state environmental law while satisfying federal requirements in all major program areas, including air, water, and waste. Concurrent with the Sunset staff review, TCEQ has been embroiled in several controversies that collide with the Environmental Protection Agency’s (EPA) requirements for approval of federal programs, most noticeably TCEQ’s air permitting program, including its flexible permit program. EPA has taken issue with some aspects of the program, as described in Appendix A, TCEQ Air Permitting and the EPA. EPA and TCEQ have been working together to come to agreement on how to proceed with EPA’s objections to Texas’ program. Separately, lawsuits have been filed challenging EPA’s actions. Those negotiations and lawsuits are ongoing.
As this row plays out, TCEQ is facing separate tests in meeting federal requirements as EPA begins permitting greenhouse gases and revises its 8-hour ozone standard within the next year. The State has asserted that it will not implement EPA’s proposed greenhouse gas permitting requirements by January 2, 2011. This decision leaves open how Texas’ permitting program will work after the EPA deadline. Although these matters relating to the air permitting process create real problems and uncertainty for TCEQ and all stakeholder groups, they are ultimately high-level political and policy issues that do not easily lend themselves to objective staff-level analysis and solution. Of further complication, solutions to these issues would be moving targets that are almost impossible to hit through a review aimed at evaluating TCEQ’s operations. Sunset staff simply could not insert itself into such complex negotiations and sensitive legal disputes related to TCEQ’s air permitting program. TCEQ has been embroiled in several controversies that complicate the assessment of its performance.
The Sunset review of TCEQ also occurred at the same time that the State Auditor’s Office (SAO) was performing an in-depth audit of TCEQ’s Texas Emissions Reduction Plan (TERP) grant program. More than one-third of TCEQ’s entire budget is pass-through money for the TERP program, making its effectiveness vital to ensuring that it serves the agency’s environmental mission and that state funds are well spent. Because of SAO’s extensive work in this area, and to leverage legislative oversight resources, Sunset staff opted to scope out a detailed review of the TERP program from its broader review of TCEQ. As SAO concludes its work, the Sunset process could be a way to address any system or statutory problems identified with the TERP program.
Another undercurrent of the Sunset review of TCEQ is the changing landscape of the industries that affect the environment. This is perhaps best exemplified by technological advances that have led to increased natural gas drilling activity in the urban areas of North Central Texas in developing the Barnett Shale. Other formations are being similarly developed in South and East Texas. This increased activity has brought intense scrutiny to the jurisdictional split of environmental regulation between TCEQ, which oversees air emissions, and the Railroad Commission of Texas (RRC), which is responsible for all other environmental regulation of oil and gas drilling, and which is also under Sunset review.
The timeliness of these two reviews enabled an assessment of any potential gaps in the regulation of oil and gas drilling. Ultimately, Sunset staff determined that while the split can seem confusing and ungainly from the outside, the agencies have processes in place to make the situation work, and have applied lessons learned from the Barnett Shale to improve coordination as they move forward. Sunset staff determined that barring a wholesale merger of the economic regulation of the oil and gas industry with the broader environmental regulations at TCEQ, sufficient reason exists to retain the current split.
TCEQ’s activities in the Barnett Shale also highlighted criticisms of its interaction and responsiveness to public concerns about its regulatory responsibilities. After its initial flat-footed response, TCEQ has made an effort to make its regulatory activities related to air emissions in that area accessible to the public, including creating an interactive air monitoring map on its website. Despite this seeming lesson learned, these criticisms did bring to light deficiencies in TCEQ’s focus on public assistance, as discussed in this report.
In staff’s analysis, the Legislature has largely given TCEQ the spectrum of statutory tools needed to successfully regulate the environment, although this report identifies needed changes in several areas. Criticisms of TCEQ’s approach to regulation, including permitting and enforcement, often lie with the Commission’s implementation of these tools, since in many cases the Commission has ample statutory leeway. While debates stemming from such criticism are important and will continue as the Sunset process proceeds, the assessment of TCEQ’s use of these tools and the impact that TCEQ has on environmental quality is not only technically difficult, but also a hotly debated subject of studies and rhetoric. Ultimately, Sunset staff did not delve into the overarching issues relating to environmental policy of the Legislature, EPA, or the Governor-appointed Commission.
As a result, the recommendations in this report focus on the agency’s operational functions. The goal is to put structures in place to ensure TCEQ has a more robust and focused public assistance function and can effectively identify and take action against regulated entities as appropriate to enforce State law and agency regulations. TCEQ also needs to be better able to address water quantity issues as they become increasingly critical to the State, and it needs proper funding mechanisms to meet its regulatory responsibilities and be compliant with federal law.
As guided by the Sunset Act, staff also analyzed TCEQ functions that may duplicate other state agency functions. Continuing work started in the review of the Public Utility Commission (PUC), staff looked at the placement of water and wastewater utility regulation, and found that while such utility regulation currently works at TCEQ, this kind of economic regulation is simply not within its wheelhouse. Recommendations to realign all utility regulation within PUC are included in the Supplement to the Sunset S
taff Report on PUC, included in this report.
The report also includes recommendations regarding the On-site Wastewater Treatment Research Council, which was subject to a separate Sunset review. This Council, which receives administrative support from TCEQ, issues research grants for improving onsite wastewater treatment processes. While staff found that Texas can still benefit from the grants the Council gives, it did not find a continuing need for an independent structure to do so. The material on the following pages summarizes the recommendations from the TCEQ and On-site Wastewater Treatment Council reviews.
For the complete report, including issues and recommendations: http://www.sunset.state.tx.us/82ndreports/tceq/tceq_sr.pdf
Sunset TCEQ Documents such as staff report, agency comments as well as public comments when available: http://www.sunset.state.tx.us/82.htm#tceq
TCEQ Updates: http://www.tceq.state.tx.us/agency/sunset/index.html
