Last fall, the California Legislature enacted Senate Bill 205 in an effort to more effectively control stormwater pollution from regulated industrial companies. Effective January 1, 2020, an industrial company will not be able to receive an initial business license or business license renewal unless it can demonstrate compliance with the National Pollutant Discharge Elimination System (“NPDES”) stormwater permit program.
I. The NPDES Program and Industrial General Permits
The federal Clean Water Act (33 U.S.C. §§ 1251 et seq.) prohibits discharge of stormwater containing pollutants except in compliance with a NPDES permit. The NPDES stormwater program regulates stormwater discharges from three potential sources: (1) municipal separate storm sewer systems, (2) construction activities that disturb more than one acre of land or discharges from smaller sites that are part of a larger common plan of development or sale, and (3) industrial activities.
The United States Environmental Protection Agency (“EPA”) delegates its NPDES permitting authority to the state of California. The State Water Resources Control Board (“SWRCB”) and Regional Water Boards implement and enforce the Industrial General Permit (“IGP”), which regulates industrial stormwater discharges and authorized non-stormwater discharges from industrial facilities in California. A number of industrial facilities typically must obtain IGP coverage, including, but not limited to, manufacturers, landfills, mining, steam generating electricity, hazardous waste facilities, larger sewage and wastewater plants, recycling facilities, and oil and gas facilities.
II. New Licensing Provisions Effective January 1, 2020
Senate Bill 205 amended the California Business and Professions Code by adding two new sections: Section 16000.3 for cities and Section 16100.3 for counties. The Legislature declared that because the bill addresses the health and safety of drinking water sources, a matter of statewide concern, the provisions apply to charter cities, charter counties, and charter cities and counties.
Pursuant to these new sections, a regulated business, defined by Water Code Section 13383.5, applying to its local city or county for an initial business license or license renewal must demonstrate compliance with the NPDES permit program by providing the following information:
- The name and location of facilities operated by the person of that business;
- All primary Standard Industrial Classification Codes (“SIC”), as defined in Health and Safety Code Section 25244.14, for the business;
- Any of the following for each facility operated by the person of that business:
- The stormwater permit number, known as the Waste Discharger Identification number (“WDID”), issued to the facility by the SWRCB;
- The WDID application number issued to the facility by the SWRCB;
- The “notice of non-applicability identification number” (“NONA”);
- The “no exposure” certification identification number (“NEC”) issued to the facility by the SWRCB.
(Bus. & Prof. Code § 16100.3, subd. (a)(3) and §16100.1, subd. (a)(3).)
This information must be provided under penalty of perjury.
When reviewing a business license application, a city or county will determine whether any of the primary SIC Codes are applicable to an IGP and, if so, confirm that the WDID, WDID application number, NONA, or NEC correspond to the business requesting the license or license renewal. Pursuant to the new sections, a city or county may develop a provisional license procedure that provides businesses three months to comply with the new requirements. Senate Bill 205’s requirements are not applicable to businesses in cities and counties that do not require a business license.
Senate Bill 205 also amended the Water Code by adding Section 13383.10. This new section requires the SWRCB to post a list of all SIC codes applicable to an IGP by April 1, 2020 on its website and update the list within 90 days of any final updates by the United States Department of Labor or EPA.
A list of current regulated SIC codes for the California’s stormwater program is accessible at: https://www.waterboards.ca.gov/water_issues/programs/stormwater/sic.shtml.
III. Why Senate Bill 205 Matters
Senate Bill 205 seeks to address stormwater pollution in California waters by aligning the local business licensing procedure with state-wide implementation of the Clean Water Act. While existing law requires each regulated business to have IGP coverage, many businesses have failed to file an IGP with the SWRCB. In Los Angeles County, for example, the California Coastkeeper Alliance estimates there are as many as 6,000 industrial facilities that are required to comply with the IGP but have not yet done so. (Senate Floor Analyses, 09/09/19.) Advocates of Senate Bill 205 hope the bill will level the playing field for the regulated community and help California achieve its mission of attaining safe and clean water.
Businesses in compliance with IGP should not be affected by Senate Bill 205. On the other hand, Senate Bill 205 could have disastrous consequences for non-compliant businesses, who risk not only being in violation of the NPDES program but also being barred from conducting business in California. It is therefore vital that industrial companies analyze their status of compliance with the IGP and take any necessary actions to comply prior to applying for a business license.
For more information, contact Mike Mills, Melissa Foster, or Lauren Neuhaus of Stoel Rives LLP.