(2^nd Draft)

This Issue Paper considers how to better integrate environmental analysis into the project review process and assure that environmental analysis conducted during planning is relied upon to the extent justified in the project review process. It also examines how to consolidate state permit processes in a manner similar to and consistent with the consolidation that has occurred with local permit processes.

State Environmental Policy Act (SEPA) was adopted in the early 1970s, in part to ensure that government officials were aware of the impacts of their decisions. In the twenty-five years since its adoption, SEPA has become a fundamental part of this state’s system for reviewing the environmental impacts of nearly every type of governmental action, from the adoption of city and county ordinances, to the decision to build a sewage treatment plant, to the approval of an application to construct a building.

In the intervening twenty-five years, a number of laws addressing specific environmental issues have also been adopted, including issues such as the protection of the shorelines, air quality, hazardous waste control, solid waste control, and water quality. Some of these laws have resulted from federal requirements, others have been locally driven. In the early 1980s, the Legislature initiated a comprehensive review of SEPA that led to legislative changes adopted in 1983.

In 1990, the first stage of the Growth Management Act (GMA) was adopted, followed by additional provisions in 1991. As cities and counties have begun to implement the GMA, there have been efforts to evaluate the extent to which the different statutes have resulted in duplication of effort. Governor Lowry appointed in 1993 the Governor’s Task Force on Regulatory Reform, in part to address the project review process.

The Task Force proposed legislation that was ultimately adopted as ESHB 1724 by the 1995 Legislature. Besides creating the Land Use Study Commission, that measure also made some attempt to integrate the requirements of SEPA and GMA.

The Advisory Committee has discussed how the first steps taken in ESHB 1724 could be taken further. The issues discussed by the Advisory Committee can be broken into three broad categories: (1) the environmental review process; (2) the relationship between policy decisions made during the legislative process involved in adopting comprehensive plans, subarea plans, and development regulations and the review of project permits; and the coordination and integration of state and local project review processes.

SEPA requires a governmental entity, whether state or local, to analyze the environmental impacts of its major actions. The same basic rules apply whether the proposed action is legislative in nature, as in adopting an ordinance, or responding to a permit application. The Department of Ecology has adopted rules to implement SEPA.

One of the basic requirements of SEPA is the preparation of an Environmental Impact Statement (EIS) if the government agency determines that a proposed major action will have probable, significant adverse environmental impacts. The agency makes this determination through the threshold determination process. If the probable impacts are determined to be significant, an EIS must be prepared.

An agency’s decisions under SEPA are subject to review both administratively, if allowed by the agency, and judicially.

SEPA and the SEPA Rules do provide mechanisms to incorporate by reference relevant environmental documents.

ESHB 1724 included provisions that provided that certain land use decisions made in the GMA comprehensive plans and development regulations could not be revisited during project review. In addition, a city or county planning under the GMA may determine that SEPA’s requirements for the analysis of and mitigation for the specific adverse environmental impacts of a project action have been adequately addressed in the jurisdiction’s comprehensive plan and development regulations.

GMA also requires cities and counties to adopt critical areas ordinances to designate and protect five specific types of critical area. The ordinances must be based on the best available science. SEPA applies to the adoption of a critical areas ordinance. As with other GMA enactments, they are not approved by the state, although they are subject to review and comment by state agencies. A critical areas ordinance may be challenged before one of the Growth Management Hearings Boards.

In addition to critical areas ordinances, a variety of other local and state laws and rules may also apply to a particular project.

ESHB 1724 included provisions creating the Permit Assistance Center in Ecology, as well as adopting the Permit Coordination Procedures Act. In the early 1970s, the Environmental Coordination Procedures Act was enacted by legislature. After some initial interest, that law fell into disuse and was repealed by ESHB 1724. The replacement statute provides for a combination of information sharing and permit coordination. The later takes place only at the request of an applicant. The process includes the appointment of a project facilitator to work toward ensuring that timelines agreed to by the parties are met. The act sunsets in 1999.

The process provides for the coordination of state permits. A local government may be invited to participate in the process, but may not be required to do so.

Although SEPA and its implementing rules distinguish between environmental review for projects from that required of legislative (non-project) actions, some of the requirements imposed on non-project environmental review are not necessarily useful. For example, the alternatives analysis required for an EIS may not be useful in cases where an agency is required to adopt a comprehensive plan. Discussing the alternative of not adopting a comprehensive plan is not an option that the local government can realistically consider.

A significant percentage of the GMA plans and development regulations that have been adopted by cities and counties have not undergone thorough environmental review. In some cases, cities and counties have determined that the plans or regulations do not have significant impacts, and thus did not prepare the more detailed analysis provided for in an EIS. This may be an appropriate decision for some types of plans or regulations. In others, the failure to conduct thorough environmental review prevents the plan or regulation from providing guidance for environmental review of project decisions.

A jurisdiction that has not conducted detailed review will not be readily able to take advantage of the provisions of ESHB 1724, that allow, and in some instances require, the jurisdiction to rely on its prior policy choices.

SEPA uses the threshold determination as a means to determine whether additional detailed environmental review is necessary. A threshold determination that a proposal will have significant adverse environmental impacts leads to the preparation of an EIS. This can be a lengthy and expensive process. As a result, a project proponent may attempt to mitigate the impacts of a project, either before it is proposed, or during the threshold determination process, in order to avoid the need to prepare an EIS.

Although ESHB 1724 provides a process by which a GMA jurisdiction, during project review, may rely on its plans and regulations to have adequately addressed environmental impacts, the process is sufficiently uncertain that it has not been used often.

One reason suggested for this failure is that the cities and counties have been provided little guidance to assist them in conducting the environmental analysis on a comprehensive plan. The SEPA rules do not provide a useful procedure for reliance on previous studies. Because of the uncertainties involved, in addition to the expense, few cities or counties have undertaken the effort.

In addition to requirements under GMA to designate and protect critical areas, the state and cities and counties implement a number of other state and federal requirements designed to protect the environment. These include provisions to manage and protect the shorelines, regulate stormwater, and protect streams and wetlands. In some instances, although not always, the requirements have been adopted after thorough environmental review.

During project review, a project proponent may be required to study the impacts of the project covered by existing regulations, even though the regulations may have been designed to address those impacts and provide for mitigation.

The Coordinated Permit Process is underutilized despite its significant potential. First, applicants are often not familiar with the process, and are unaware of its value in managing multiple permits, time schedules, hearings, and appeals. Second, although many of the permits for projects are the responsibility of local agencies, local agencies are not required to participate in the process.

The major value of the Coordinated Permit Process is the "internal coordinator" feature. The coordinator serves as the main point of contact for the permit applicant and manages procedural aspects of the process. The coordinator assures that the applicant has sufficient information to apply for multiple permits, coordinates the review of those permits by the participating permit agencies, ensures that timely decisions are made, and assists in resolving any conflict or inconsistency among project permit requirements and conditions.

In contrast, the Achilles Heel of the Coordinated Permit Process may be its formality. The formal commitment to timelines can cause reluctance on the part of both the applicant and the agencies to sign the agreement until they are sure they can meet the agreed to commitments. While this may not prevent the permitting processes from moving forward, the negotiation can occupy hundreds of hours of governmental and private sector staff time.

The Coordinated Permit Process is approximately two years old. The Process has led to cooperative review of four projects, and one has completed permitting. With more experience, the Process may be suitable for mandatory application to certain classes of high impact, multi-jurisdictional projects.

Each of the options described below address different aspects of the issues described above.

Conduct environmental analysis during preparation of comprehensive plan, subarea plan, and development regulation. The analysis would look at system-wide and cumulative impacts.

The analysis at the planning stage should be relied on in preparing development regulations. Analysis during project review should only need to look at issues not already addressed.

Alternatives that would need to be considered at each subsequent stage of environmental analysis would be limited by the decisions made at the earlier stage of the planning process.

A specific proposal is included as an illustration of one means by which this would be accomplished. It would provide for a new environmental element to be included in a comprehensive plan.

The specific proposal would satisfy the requirement for an EIS on the covered plans and regulations. The proposal provides an alternative method for developing the type of information an EIS might generate.

The type of detailed analysis called for in the proposal will raise questions about funding.

Setting high standards for environmental review will make it more expensive and difficult for local governments to meet the standards and make it easier for the local government decisions to be challenged.

The proposal addresses only the procedural components of SEPA.

Much of the proposal could be accomplished without legislation. Is legislation desired or necessary?

Certain land use issues may not be reviewed during project review

Updated SEPA checklists identify development regulations that do apply

Create a rebuttable presumption that development regulations adequately analyze environmental impacts and provide adequate mitigation, with a list of exceptions including: there is no development regulation, or it has been found invalid by a court or a GMHB; the site presents unusual circumstances; the proposal presents unusual features; or the proposal will use more than its share of anticipated resources.

The proposal should be linked to Proposal 1, which provides a process for assuring environmental review of comprehensive plans and development regulations. The process described by Proposal 3 might also provide a means for assuring that the plans and development regulations meet a quality test before the presumption is created.

Question remains of knowing whether a development regulation adequately addresses environmental issues.

There is a question also of understanding how the proposal will affect other agencies that have responsibility for the same element of the environment.

Should there be a distinction between creating a rebuttable presumption for the analysis conducted as part of the development of the plan or regulation and creating a rebuttable presumption as to whether the mitigation is sufficient?

In order to take advantage of substantive and procedural SEPA reforms, GMA jurisdictions would submit critical area ordinances, GMA plan and development regulation docketing process, and citizen participation program to state for approval.

Critical area regulations would be evaluated for compliance with performance standards established by relevant state agencies. Citizen participation programs would need to meet a set of defined criteria., including workshops, citizen participation grants, implementation of a variety of outreach and programs flexible public involvement opportunities, and citizen involvement committees for the review of amendments to plans and development regulations.

A departure from the GMA standard that provides that GMA plans are "valid upon adoption." Might be acceptable in limited circumstances, perhaps with respect to issues that are of state-wide concern.

Is citizen participation of such significant state interest that "state-certification" of county and city citizen involvement programs is justified?

Should compliance with this proposal be a prerequisite for taking advantage of other proposals?

The proposal is silent as to its impact on "substantive" SEPA.

Develop an enhanced checklist that identifies probable adverse impacts as well as the environmental documents and development regulations that apply.

The notice of application, allowing for a period of public comment, would include a preliminary scoping determination identifying probably adverse impacts of the proposal, development regulations that apply and non-SEPA studies that will be required, and identifies any unusual aspects not addressed by development regulations or existing studies

The final scoping determination is issued as part of threshold determination. It identifies impacts which need no further study because they are minor, have been determined acceptable under a plan, regulation, or SEPA policy, or that the applicant has addressed through modification of the proposal. Impacts that will be studied further also identified. May provide for a DNS or mitigated DNS.

A DS may be issued if the agency determines impacts will not be mitigated below level of significance. Additional studies may not be necessary if the impacts have already been adequately analyzed.

The lead agency may determine that existing documents or additional studies are inadequate and issue a determination of inadequacy. The applicant may appeal the determination.

The agency issues its decision on the merits and, if the permit is issued, may impose any conditions to mitigate adverse impacts. The agency may impose conditions allowed under its development regulations, or to extent SEPA policies allow, additional conditions necessary to mitigate impacts not otherwise addressed.

The applicant may appeal the final scoping determination, the threshold determination, and a determination of inadequacy at the time made. Other parties may appeal these decisions at the time of an appeal on the decision on the merits.

The applicant may appeal conditions imposed on the project. Other parties may also appeal failure to impose mitigation to extent authorized under development regulations. Whether a party should be able to appeal failure to impose conditions under SEPA needs to be addressed.

The authority to deny as well as impose conditions should apply to all projects that are not categorically exempt, not just to those that have had an EIS prepared.

Develop an enhanced checklist that identifies probable adverse impacts as well as the environmental documents and development regulations that apply.

The notice of application, allowing for a period of public comment, would include a preliminary scoping determination identifying probably adverse impacts of the proposal, development regulations that apply and non-SEPA studies that will be required, and identifies any unusual aspects not addressed by development regulations or existing studies

The final scoping determination is issued. It identifies the probable adverse impacts of the proposal as well as the impacts which need no further study because they are minor, have been determined acceptable under a plan, regulation, or SEPA policy, or that the applicant has addressed through modification of the proposal. Impacts that will be studied further also identified.

The applicant prepares any additional required studies and incorporates them into an environmental study. The study summarizes conclusions reached in attached detailed environmental studies Lead agency could require a period for notice and comment before making a decision on the adequacy of the studies or a decision on the merits.

The lead agency may determine that existing documents or additional studies are inadequate and issue a determination of inadequacy. The applicant may appeal the determination.

The agency issues its decision on the merits and, if the permit is issued, may impose any conditions to mitigate adverse impacts. The agency may impose conditions allowed under its development regulations, or to extent SEPA policies allow, additional conditions necessary to mitigate impacts not otherwise addressed.

The applicant may appeal the final scoping determination and a determination of inadequacy at the time made. Other parties may appeal these decisions at the time of an appeal on the decision on the merits.

The applicant may appeal conditions imposed on the project. Other parties may also appeal failure to impose mitigation to extent authorized under development regulations. Whether a party should be able to appeal failure to impose conditions under SEPA needs to be addressed.

The authority to deny as well as impose conditions should apply to all projects that are not categorically exempt, not just to those that have had an EIS prepared.

The amount of time an agency will have to prepare the notice of application under the proposal will be important. Current standards – 14 days from a determination that there is a complete application – is probably not sufficient to complete the tasks required under the proposal.

The value of a threshold determination is that it sets a threshold below which impacts do not warrant a detailed study. The proposal to eliminate threshold determinations may only replace one concept – "non-significant impacts" – for another "deminimus impacts".

The proposal does not adequately address situations where other governmental entities may also have permitting authority. Will they be able to comment on the adequacy of studies they must rely on for making the decision? How does the determination of inadequacy affect studies required under other statutes? These are also issues under current law.

The proposal raises questions of whether the public will receive enough information at the beginning of the process to make meaningful comments on the proposal. The proposal does recognize that additional time for public comment may be needed.

Limiting "procedural" appeals for parties other than an applicant until the decision on the merits can have impacts on other parties. There is a balancing of the interests of all parties that needs further consideration.

To the extent that the proposal would expand authority ESHB 1724 limited to GMA jurisdictions, there needs to be an evaluation of whether this is appropriate.

Much of the proposal could be accomplished without legislation. Is legislation desired or necessary?

The Environmental Permit Assistance Act should be reauthorized. Specific consideration should be given in the future of whether state and local agencies and applicants should be required to use the coordinated process for certain types of proposals.

Cost-recovery should be allowed for agencies other than the coordinating agency.

A single appeal process should be provided for appeals and hearings involving coordinated permits that are heard by the boards under the umbrella of the environmental hearings office.

The permit assistance center should continue to develop and improve the coordinated permit process scheduling agreement and use multi-agency teams to streamline projects that do not use the formal coordinated permit process.

The following ideas should be considered in the future: general permits and permits by rule; delegation of authority to local governments where possible; pilot programs to allow local government administration of a single permit process to deal with overlapping regulatory programs; delegation of some federal programs to the state; and additional methods to achieve consistency between state, local, federal, and tribal regulatory programs.

The proposal retains the current system of multiple permits from different agencies and governments. Another alternative would be to delegate all permit authority to the local government.