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The Senate Committee on Natural Resources and Economic Development met to consider bills on the agenda. This report focuses on SB 709 (Fraser).
 
SB 709 (Fraser) – Relating to environmental permitting procedures for applications filed with the Texas Commission on Environmental Quality.

  • There is a committee substitute
  • Version of bill in last session that did not get through the process
  • Downscaled bill from last year
  • Trying to solve Texas competing with other states and it is a long process to get a permit
  • Making it more efficient and provide regulatory certainty
  • This bill retains current contested cases hearing process
  • Retains two rounds of public participation currently used at TCEQ
  • Sen. Estes – other states getting the permits out much faster than Texas – really the bills about economic development
  • Fraser – cannot match other states but point is to get more competitive

 
Public Testimony
 
Caroline Sweeny, TCEQ

  • Zaffirini – does this bill change burden of proof
    • They can say they met burden of proof in putting forward application then up to contesters to say the application will not meet legal requirement
  • Zaffirini – A draft permit will mean the finding of requirements met?
    • Yes 

 
Hector Rivero, Texas Chemical Council

  • Potential for jobs in Texas but typically barrier has been delay in obtaining environmental permits
  • Bill will ensure more timely permitting process
  • Current contested case process is being abused and being used as a delay tactic and some gaming the system for financial gain

 
Christina Wisdom, Texas Association of Manufacturers 

  • Bill does not change contested case hearing and does not limit ability of local citizen or government to participate
  • Does require for a person to have standing to contest to have submitted comments on the application but that is consistent with federal requirements
  • The bill does not switch the burden of proof – does not change the responsibility of any party
  • The bill does not impair or hinder the process of due discovery
  • Clarifying on 180 days – from date of preliminary hearing
  • Bill will facilitate shorter hearing process
  • Sen. Zaffirini – why do you consider process in place onerous/ do you see conflict with ED position
    • Because of lack of certainty around the process
    • The fact that it could take up to 2 years on top of the initial year means a facility could wait up to 3 years to get a permit
    • Law changed to enable ED to defend the draft permit which is more appropriate because it is put together by the TCEQ but once it goes back to TCEQ it is not up to ED
    • Disagree with assertion that this removes the level playing field – not removing permit requirements
  • Sen. Estes – how long would she tell a company it could take to get a permit, Louisiana vs Texas
    • Louisiana does not have a contested case hearing and can start turning dirt within 6-9 months, Texas up to 3 years
  • Sen. Nichols – we didn’t get here overnight, how long ago did this start dragging out
    • Not sure will look into it
    • The process still allows for cross examination
  • Sen. Fraser – is Texas process even more onerous than EPAs
    • Yes, much higher burden and fully on protestant
  • Sen. Hinojosa – still contested case process and 180 day frame
    • Does not take ability of ALJ judge to expand time if due process warrants it
  • Sen. Hancock – simplify steps in permitting, how many steps
    • Reviewed process – notice period, technical review portion, hire environmental consultants which includes modeling, etc – in depth process – a lot of information, 16 binders worth in one case
    • In Texas after going through entire process and TCEQ has determined the applicant meets requirements, they are still forced to go to SOAH and defend application 

 
Marian Taylor, Alliance for a Clean Texas

  • Not that many permit applications that are impacted by the contested case process – ½ of 1% of application received in calendar year
  • General trend in last 10 years is that there are less contested cases
  • Data shows air permit process is faster in Texas than many states including Louisiana

 
Tom Smith, Public Citizens Texas

  • Concerned about the bill for the last few sessions
  • Permitting requirements have been standardized and less than ½ of 1% of cases are contested
  • Sen. Estes – do you think there is no change needed to the current system?
    • Does thinks there are changes needed
    • Thinks bill fundamentally don’t have ability to do deep dive to make sure technology being used is as effective as possible
    • Thinks agency is not funded well enough for them to do the job
  • Sen. Hancock – are you taking credit for technologies companies are using to reduce emissions? The companies do this as part of using the technology that the process requires so the business complying with permitting process that is already in code
    • In contested case hearing Smith says there may be more efficient technologies that may be spotlighted and that kind of data and challenging is where you get the big emissions reductions
  • Sen. Hinojosa – SOAH appeals can be made to courts
    • Advantage of not having to wait for courts the time is compressed and nothing in bill changes appeals being made to courts
  • Sen. Zaffirini – do you support bill or would support after changes
    • Urges committee to vote against the bill
    • Previous legislation reduced number of contested case hearings
    • But do think the process does need to be changed on front end
    • Would change – how you treat burden of proof and hurdles to protest
    • Would change – in discovery there may be things you find out you want to comment on and it becomes an issue if it was not raised in initial comments
    • If this statute to pass as written means he has to put anything and everything in the initial comments thus overloading the staff but would need to do it to protect himself so he is not precluded from raising it at a later time

Sen. Estes – there are 34 cards submitted on the bill but not wishing to testify – all were entered into the record before continuing with public testimony
 
Public Testimony
Richard Mason, Shintech Incorporated, supports bill 

  • Example of building in Louisiana because they had certainty of timing in that state
  • Issue not necessarily amount of time it takes – it is because of the certainty

 
Eric Allmon, Frederick, Perales, Allmon & Rockwell

  • Provided details on Louisiana and noted some things of caution
  • 180 days no matter what and no matter how the industry hides the ball
  • The bill proposed would switch the burden of proof 
  • The effected person test is concern with bill

 
Byron Fredrick, resident of Coldwell County

  • Have not yet heard the question – what about the people
  • They have a landfill in their county and nothing they can do to stop it according to TCEQ
  • Permitting at TCEQ takes no account of the people in the process
  • TCEQ has public meetings but do not record public comments
  • Contested case hearing is the only avenue people have in short of going through the expensive civil courts
  • Landfills are complex and technical issues and cannot be lumped together
  • Sen. Zaffirini asked for more details about the landfill in the community
    • They do not have access to records to verify what landfill is saying

 
Derek Seal, Texas Oil and Gas Association

  • Worked as general counsel at TCEQ for some years
  • Some discussion is misplaced – the application process is onerous refers backs to volumes of application detail
  • Bill allows industry to not start from square one if going to contested case process
  • Bill does not change right to trigger hearing or judicial review 

 
Andrew Dobbs, Texas Campaign for the Environment, against the bill

  • Believes this bill would also cover waste permits
  • 180 days may not be enough to cover vast complexities of a waste facility
  • Sen. Hancock – you said the contested case hearing brings up ability for “negotiations”, could this also lead to financial settlements
    • It could but do not know of it ever happening

 
Carol Burch, Public Citizen, against the bill

  • This bill fundamentally alters the nature of the process and puts burden on protestants
  • Draft applications have had no input from the public and ED making that decision would be party in contested case
  • Limited length to 180 days without extension would deny due process rights
  • Sen. Zaffirini – how does setting up the draft application shift burden
    • Deems applicants burden of proof has been met so then it switched over to the protestant
    • Applicant does not need to bring witnesses if they already met burden of proof
    • Witness was previous ALJ in SOAH gave examples of cases that would have been negatively impacted if the bill being proposed was law (needed discretion to admit individuals as a party or extend the 180 day timeline)
  • Sen. Zaffirni – do you agree that draft permit would/should mean all legal and technical standards met
    • Absolutely not
  • Sen. Nichols – may not be able to cross examine witness
    • Maybe not – if person has ability to find and subpoena witness
  • Sen. Uresti bill does say ALJ has flexibility with 180 days
    • Flat denial in committee substitute and removes the flexibility of the judge extending it
  • Sen. Birdwell asked about impacting water rights, river authorities
    • Believes it relates to air permits, waste and water but not water rights
    • Birdwell intent to make sure bill does impact water rights – bill author said it does not

 
Lou McNaughten, individual in Caldwell

  • Landfill in county and cannot look at history of applicant which includes multiple accusations of malfeasance
  • No protesting parties will have a chance
  • Landfill has 50% more lobbyists than Google

Sen. Hancock confirmed that hearing can still be extended past 180 days and that was not changed in the bill
 
Lon Burnam, Public Citizen

  • State does inadequate job of regulating emissions

 
Sen. Estes Recalls TCEQ
Caroline Sweeny, TCEQ

  • Sen. Estes – bill requires ED to support evidence of draft permits – does it shift costs away from applicant and onto the state
    • No
  • Sen. Estes – TCEQ bill impact statement says 180 days will compress time for discovery – when is discovery done
    • Discovery is usually during hearing process
  • Sen. Estes – Is there additional discovery that needs to happened after hearing
    • Maybe
  • Most cases are referred in 180 days and more complex cases are done in 9 months
  • Sen. Hinojosa asked for clarification under the bill being proposed – does SOAH judge have ability to extend time frame to ensure due process
    • In statute already is ability for SOAH judge to extend hearing for certain issues and would say it is still in play with the bill
  • Sen. Fraser said he believes it is still in current law and his bill does not impact that
  • Sen. Birdwell does average citizen have tools on TCEQ website to help inform them
    • Yes and will send link
  • Sen. Uresti – for clarification that SOAH judge has ability to extend 180 day deadline
    • Under original statutory provision the judge does have that ability
    • May be good to clarify in bill

 
Public Testimony
Cyrus Reed, Sierra Club, against bill

  • This bill covers waste transfers, landfills and not necessarily the big economic engines
  • Very rare instance when air permits go to contested case hearings
  • Most concerned about burden of proof – kinda does transfer it
  • Thinks 9 months is much more reasonable than 6 mo
  • Language in bill relating to affected parties

 
Elizabeth Golde, resident of Belvedere subdivision

  • Concerned will weaken ability to protest

 
Leigh Thompson, Texas Public Policy Foundation, support

  • Bill does not stop ability for public participation

 
Myron Hess, National Wildlife Federation  

  • 180 days still too short
  • Reviews process and illustrates need for time
  • Thinks bill is codifying bad policy

 
David Weinberg, Texas League of Conservation Voters, against bill

  • Limiting issues for hearing on merits and does not see how these limits will speed up the process and bring any regulatory certainty

 
Robin Schneider, Texas Campaign for the Environment

  • 180 day language in bill ties ALJ hands in committee substitute
  • Waste permits are on www and not all TCEQ permits are available and it is very burdensome for people to contest the permits

 
Karen Darcy, individual

  • Reviews experience in Montgomery County in commercial waste permit
  • Urges careful consideration of any bill that would change the contested case process
  • Sen. Nichols – will make sure they have the right and ability to keep contesting  

 
Stephen Minick, Texas Association of Business

  • Should fix permitting process to address issues
  • Process should make sure what happens is what is on the books is properly reflected