Texas Commission on Environmental Quality – June 12, 2019

The TCEQ Commissioners met on June 12, 2019 to take up a full agenda. This report covers all items taken up.

This report is intended to give you an overview and highlight of the discussions on the various topics the committee took up. It is not a verbatim transcript of the hearing but is based upon what was audible or understandable to the observer and the desire to get details out as quickly as possible with few errors or omissions.

 

Item 1 (Proposal for Decision)

Consideration of the Administrative Law Judges’ Proposal for Decision and Order regarding the applications of GCGV Asset Holding LLC, for new Air Quality Permit Nos. 146425, PSDTX1518, 146959, and PSDTX1520, pursuant to rules of the Texas Commission on Environmental Quality and Texas Health & Safety Code chapter 382. The proposed petrochemical manufacturing complex, including a main site and plastics logistics center, would be located in Gregory, in San Patricio County. The Commission will also consider timely public comments and the Executive Director’s Response to Comments; the record, timely related filings, exceptions and replies. (Sierra Redding)

 

Applicants – Derek Seal, Winstead Law Firm, representing Gulf Coast Growth Ventures (GCGV)

• Supports the Administrative Law Judges (ALJ) proposed order.
• GCGV prepared their applications in a typical fashion for this kind of application.
• There is nothing unique or different about this application compared to other, similar applications.
• AP-42 emissions factors are “conventional”.
• Request that permits be given an accelerated effective date.

 

Protestants – Elon Lavine, representing residents near the plant

• ALJ fact 55 finding is wrong as a matter of law.
• There are numerous issues with the confidential permit applications.
• Should add OGI to enhance leak repair.

 

Protestants – David Frederick, Counsel for Sierra Club

• Public Information Act should allow for citizens to appeal for access to confidential business info without undue burden.
  • Current process creates an undue burden on citizens seeking the information.
  • The PIA is not practically enforceable with regard to this case and the executive director’s recommendations should not be given much weight.
• Estimated emission values are inaccurate. This is not a strong enough reason to deny the application, but it is “sloppy and unprofessional” and should be fixed before approval.

 

Sierra Redding, TCEQ Staff Attorney, speaking for the Executive Director

• Recommends the adoption of the ALJ proposed decision.
• Jon Niermann, TCEQ Chairman – Provide clarification on the issue around confidential business info?
  • Redding – PIA requires documents marked as confidential to be treated as such by TCEQ. Citizens have the right to appeal to the AG and get access to that info.

 

Jeff Greif, TCEQ Air Permits Division

• Niermann – Is there any reason to turn to special condition 39?
  • Greif – It is listed in the merit tables.

 

Garrett Arthur, OPIC

• Any issued permit should require fence-line monitoring.
• OPIC recommends the effective date and appeal deadline be the same.
• Niermann – Is there precedent for TCEQ allowing an earlier effective date?
  • Arthur – In the past ordering language has aligned the effective date and the appeal date.
• Niermann – Suggesting confidential info should be public?
  • Arthur – No, suggesting non-confidential parts of the application would be more enforceable if cross-referencing to confidential portions was reduced.

 

Applicant rebuttal – Derek Seal

• Object to the use of “Exxon” by the protestants, GCGV is the applicant.
• The record is clear that confidential info is typical for this kind of permit.
• OGI has never been used in Texas and it is not backed in Texas.
• Fence-line monitoring has never been done for a chemical plant in Texas, it is only used for refineries.
• If people want OGI and fence-line monitoring it should be done as an upfront policy decision, not added on the back end of a permitting process on an ad-hoc basis.

 

Chairman Niermann and Commissioner Lindley analysis

• Niermann – There needs to be some means of maintaining confidentiality of certain info. Understand the protestants point of view, but not convinced by their arguments on this point.
  • Commissioner Lindley – Agree.
• Niermann – On the thermal oxidizer issue, any enforcing agency will understand that special conditions should be enforced along with the rest of the permit and merit tables. “At peace” with the thermal oxidizer issue.
• Lindley – AP-42 is appropriate for this type of application.
• Niermann – Many of the protestants’ arguments were about what the policy should be and were not about what the law is.
• Niermann – The ALJ conclusions that the draft permits meet legal requirements is correct. See no reason to change any of the ALJ rulings.
• Lindley – Would be comfortable granting the accelerated effective date request. Made clear this would not change the appeal date.
  • Niermann – Also comfortable granting the accelerated effective date.
• Niermann – Will consider any request for a rehearing. The applicant would bear the risk if they move forward with construction and a rehearing is granted.
• ALJ recommendations adopted. Effective date changed to the date the order is signed by the Commission. Permit applications granted.

 

Item 2 (Hearing Requests)

Consideration of the application by City of Star Harbor for new Texas Pollutant Discharge Elimination System (TPDES) Permit No. WQ0014268002 to authorize the discharge of treated domestic wastewater at a daily average flow not to exceed 240,000 gallons per day. The facility will be located approximately 3,050 feet west of the intersection of Briarwood and Farm-to-Market Road 3062, and 3,500 feet south of the intersection of Farm-to-Market Road 3062 and Jupiter Road, in Henderson County, Texas 75148. The Commission will also consider requests for hearing or reconsideration, related responses and replies, public comment, and the Executive Director’s response to comments. (Julian Centeno, Jr., Michael Parr)

 

Chairman Niermann and Commissioner Lindley

• Will not hear oral arguments.
• Niermann – Suggest granting all four hearing requests. All four have identified relevant material issues.
• Lindley – Agree with Niermann. The City of Malakoff could have done a better job explaining why they were materially affected but will send it to a hearing.
  • Niermann – Agree, the Malakoff decision was more of a “close call” than the other three.
  • Lindley – Would hope this kind of issue would get worked out before it gets to the Commissioner level, but since it did not get worked out sending it to a hearing with a referral to alternative dispute resolution seems most appropriate.
• Niermann – In granting the hearing request we will deny the request for reconsideration. Would suggest a 180 day hearing duration.
• Hearing requests granted in all four cases. Deny request for reconsideration. Application referred to SOAH for contested case hearing.

 

 

 

Item 3 (Hearing Requests)

Consideration of application by Texas LNG Brownsville LLC, for Air Quality Permit No. 139561 to authorize the construction of the natural gas liquefaction and export terminal on State Highway 48 approximately 12.2 miles to the east of the intersection of State Highway 48 and State Highway 550. The facility is on Brownsville Ship Channel located in Cameron County, Texas 78521. The Commission will also consider requests for hearing or reconsideration, related responses and replies, public comment, and the Executive Director’s Response to Comments. (Sushil Gautam, Sierra Redding)

 

Chairman Niermann and Commissioner Lindley

• Will not hear oral arguments.
• Niermann – There are several requesters on this item. All of the requesters are well beyond the point where they could claim a personal justiciable issue except the City of Port Isabelle.
• Lindley – The argument is a bit of a stretch, but if it is well laid out it could be enough to deem Port Isabelle as an appropriate party for a hearing. While the facility is a minor source, but it does back up completely to the ETJ of Port Isabelle and they have made a decent argument.
  • Niermann – Facility is actually within the ETJ, just outside the city limits.
• Niermann – This is a close call. The facility is adjacent to the city limits and is within the ETJ. The better reading and more defensible position is to identify the city as an affected person.
  • Lindley – Agree, the more defensible approach is to refer it to SOAH and to have the City as the only party that we refer.
• Niermann – Would identify the following issues: Is the permit protective of health and safety of residents and employees, is the permit protective of all flora and fauna in the ETJ, and does the permit adequately protect against nuisance dust.
• Lindley – Would want to refer the matter to the ADR program.
• Niermann – Will deny request for reconsideration.
• Lindley – Set hearing duration at 150 days.
• Grant hearing request filed by the City of Port Isabelle. Deny all other hearing requests and requests for reconsideration. Refer matter to TCEQ alterative dispute resolution. Refer the application to SOAH for a contested case hearing. Hearing set for 150 days.

 

Item 4 (Emergency Order)

Consideration of whether to affirm, modify, or set aside the Emergency Order Appointing a Temporary Manager of a Water Utility issued on May 3, 2019, by the Executive Director of the Texas Commission on Environmental Quality pursuant to Tex. Water Code chs. 5, 13, Tex. Health & Safety Code ch. 341 and the rules of the Texas Commission on Environmental Quality, to address the abandonment of a public water system (“Utility”) by Perrin Water Systems, Inc. and Texas Rain Holding Company, Inc.; TCEQ PWS ID No. TX1190005; RN102681897; to ensure continued operation of the Utility and to provide continuous and adequate service to the customers. The Utility is located at 215 South Smith Street, Jack County, Texas. The Emergency Order appointed Mark Patterson as temporary manager of the Utility. (Logan Harrell, Janice Hernandez)

 

Logan Harrell, attorney representing Executive Director

• Gave overview of the timeline of the issue at hand.
• Requests the adoption of the emergency order appointing Mark Patterson as temporary manager of Perrin Water, with the modifications provided by the Executive Director.

 

Mark Patterson, Patterson Water Supply, temporary manager of Perrin Water

• Anything the TCEQ as a group or the PUCs can do to alleviate these issues in a timelier manner would be appreciated by the citizens.

 

OPIC

• Recommends approval of the emergency order.

 

Chairman Niermann

• This is an “easy one”, need to affirm the appointment.
• EDC proposed order adopted.

 

Items 5-27 (Enforcement Docket)

Brian Sinclair, Enforcement Division

• Total assessed administrative penalties are $327,000. Request approval of these items.
• Lindley – When there is failure to submit an application for renewal at least 6 months prior to permit expiration, what is required of the company or permit holder? And how does it affect their compliance rating?
  • Sinclair – It will affect their compliance history rating once the violation becomes part of an effective order.
  • Niermann – When does it roll off?
  • Sinclair – Will roll off in five years. But if compliance is achieved there is a lessening of the effect in years three, four, and five.

OPIC

• Support approval of the proposed orders.

 

Chairman Niermann

• Support the adoption of the proposed orders.
• Items 5-27 adopted as recommended by the Executive Director.

 

Item 28 (Rule Matters)

Consideration for publication of, and hearing on, proposed amendments to Sections 222.1, 222.3, 222.5, 222.31, 222.33, 222.73, 222.75, 222.81, 222.83, 222.85, 222.87, 222.115, 222.119, 222.127, 222.157, 222.159, and 222.163 of 30 TAC Chapter 222, Subsurface Area Drip Dispersal Systems; and proposed amendments to Sections 309.1 – 309.4, 309.10 – 309.14, and 309.20 and new Sections 309.21 – 309.25 of 30 TAC Chapter 309, Domestic Wastewater Effluent Limitation and Plant Siting. The proposed rulemaking would allow an applicant for a Texas Land Application Permit the option to reduce the acreage required for land application of treated domestic wastewater by obtaining a “beneficial reuse credit” that accounts for offsite beneficial reuse. The proposed rulemaking would also include administrative changes to ensure current and accurate cross-references, improve readability, improve rule structure, and use consistent and industry accepted terminology. (Rebecca Moore, Michael Parr) (Rule Project No. 2016-042-309-OW)

 

Rebecca Moore, Water Quality Division on behalf of the Executive Director

• Proposed rulemaking would give an applicant for TLAP the option to reduce acreage required for land application of treated domestic wastewater by obtaining a “beneficial reuse credit”.
• Lindley – This came in 2016, why has this taken so long? Is it just a highly technical rule package?
  • Michael Parr for the Executive Director – The delay was caused because the City of Austin gathered stakeholder consensus after the initial petition. It was then a highly technical process of working out the request.
  • Niermann – Petitions for rulemaking do not always go as quickly as requests from the legislature.

 

Chris Harrington, Environmental Officer for the City of Austin

• This will be a step in the right direction to deal with population growth while maintaining water quality.

 

OPIC

• Recommends approval for publication of and hearing on the amendments pertaining to beneficial reuse credit.
• Niermann – Agree.
• Approved for publication hearing.

 

Items 29-33 (Quadrennial Rule Review)

Patricia Duron, Administrative Law Division representing the Executive Director

• Niermann – The obsolete rules identified all pertain to applications that were pending as of September 1, 1999, of which there are none?
  • Duron – Yes.
• Rules re-adopted without amendment. Direct Executive Director to eliminate obsolete rules.

 

Item 34 (Miscellaneous Matters)

Discussion of future actions to be taken in light of the Texas Supreme Court’s opinions delivered on May 3, 2019 in the matters of Brazos Electric Power Cooperative, Inc. v. Texas Commission on Environmental Quality and Richard A. Hyde, Cause No. 17-1003; and Texas Commission on Environmental Quality and Richard A. Hyde v. Brazos Valley Energy, LLC; Hays Energy, LLC; Ennis Power Co., LLC; Midlothian Energy, LLC; Wise County Power Co., LLC; Freeport Energy Center, LLC; Freestone Power Generation, LLC; and Tenaska Gateway Partners, LTD, Cause No. 18-0128.

 

Chairman Niermann

• This discussion will serve as guidance to staff for what to do in light of the Court’s decision regarding heat recovery steam generators. This is only a prospective process, we are not talking about applications subject to litigation or those that came in before nay rulemaking was adopted.
• “Agnostic” on the outcome. Equipment could be de-listed, provided with a minimal or substantial tax credit, etc. Have no opinion on those issues.
• Will try to find a legally defensible process out of this. Do not want to belabor this, need a new policy in place.
• Recommend that the Executive Director put out a notice with multiple viable paths so that there are no notice issues when TCEQ moves forward with a final rule.
• Direct staff to review the legally defensible responses and process in light of the ruling.
• No action taken.