The 2011 legislative session began as the “Jobs Session” ended in disagreement over the next state budget. In between, legislators and the Governor worked together to adopt important improvements to Minnesota’s environmental permitting and environmental review processes. The changes had broad bipartisan support, a good sign for those who believe that Minnesota’s regulatory system needs updating to match the needs of Minnesota businesses competing in a global economy.

150 Day Permit Goal:

The two agencies primarily responsible for issuing major environmental permits in Minnesota, the Department of Natural Resources (“DNR”) and the Pollution Control Agency (“PCA”), now have a goal of issuing or denying permits within 150 days of receiving a complete permit application. The agencies have 30 days to review an application for completeness and can return it to the applicant if something is missing. While this is only a goal, the new legislation requires semi-annual reports documenting why the goal was not met for a given application. Based on observations of MPCA’s early implementation of this requirement, MPCA is taking concrete actions designed to meet the 150 day goal. Permit applicants should understand that this process puts extra emphasis on submitting complete permit applications. MPCA has already made it clear that they will to be much more diligent in rejecting incomplete applications.

Environmental Impact Statement Preparation:

Project proposers are now allowed to submit a preliminary draft EIS prepared by their consultants, with an appendix containing “all studies and other sources of information used to substantiate the analysis contained in the preliminary draft….” Prior to this change, a proposer’s consultant normally prepared most of the studies and substantive work needed to prepare the Draft EIS but were not allowed to convert that work into the text of a Draft EIS. The consultant for the responsible government unit for the EIS had sole responsibility for DEIS drafting. This change will eliminate significant duplication and inefficiencies, saving project proposers significant costs (since proposers pay the bill for their consultant AND the government consultant) and will speed up the drafting process.

The reviewing governmental authority may require additional studies and information and retains full authority to review, modify and determine completeness and adequacy of the draft EIS. During legislative hearings on the change, one witness testified that his company had expended millions of dollars to complete environmental review for a project, a substantial portion of which was spent on its own consultants, the government’s consultants and the government personnel involved with completing the review. This change does not reduce regulatory scrutiny by the government, including its ability to engage consultants to advise it (the costs of which are paid by the project applicant) nor does it alter any environmental standard applicable to the proposed EIS.

Permit Decisions Following an EIS:

Government permitting agencies must now make final decisions on pending permit applications within 30 days of completing an EIS, reducing the decision time from the old 90 day time limit. In order to take advantage of this schedule, project proposers should make sure that permits are listed in the EIS documents as required for the project and that information needed for permit issuance is developed concurrently with preparation of the EIS.

EAW Appeals to Court of Appeals:

Through a quirk of legislative history, an appeal of a government decision on an EAW has in the past been heard by a district court judge near the location of the proposed project. In other legal areas, appeals of government decisions are normally heard by the Minnesota Court of Appeals. Under the past law, EAW appeals nearly always required hearings in local district court followed by an appeal by the losing party to the Court of Appeals. The new law provides that appeals will go directly to Court of Appeals. Such court cases usually involve a well-established record compiled during the underlying agency review and do not require the “fact finding” capacity of the district court in order to render a fair and impartial decision. This change will likely shave many months and tens of thousands of dollars off the cost of completing environmental review, without reducing protections afforded by the judicial system.

Construction Allowed in Advance of Receipt of a Wastewater Discharge Permit:

Project proposers can now begin construction without a wastewater discharge permit. Past Minnesota law required project proposers to obtain a wastewater discharge permit prior to starting project construction. Nearly all other states allowed the start of construction, following the federal Clean Water Act provision, allowing the start of construction but preventing any wastewater discharge until a permit was issued. The new law contains a few exceptions that should be reviewed prior to the start of construction. Also, project proposers still need to comply with pre-construction stormwater permit requirements.

Comparison of State and Federal Environmental Standards:

When the MPCA proposes rules to adopt standards for air quality, water quality, solid waste or hazardous waste, the MPCA’s supporting documents must now assess the difference between the proposed standard and existing federal standards, similar standards in bordering states and other states in U.S. EPA Region 5(Illinois, Indiana, Ohio and Michigan). The MPCA must also describe the need and reasonableness of each difference. The new law will provide valuable information to the public regarding MPCA’s setting of environmental standards.