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What Does MS4 Really Mean To You and Your Pocketbook?

January 2010
By Nancy Kierstyn Schreiner

There have been rumblings in the development and real estate industry in Ventura County as a result of the new countywide MS4 permit. The following provides a general overview of the permit requirements, effects, potential mitigations and necessary compliance action by the development and real estate industry in cooperation with local public entities.

The technical name of MS4 is the National Pollutant Discharge Elimination System Municipal Separate Storm Sewer System Permit. The permit was adopted by the California Regional Water Quality Control Board-Los Angeles Region (Regional Board) on May 7, 2009. The County of Ventura and all of the incorporated cities within Ventura County are co-permittees.

This permit is the cooperative result of the efforts of co-permittee public entities, some environmental groups and Regional Board staff over more than two years. Drafts of the permit were first available in December 2006 and public workshops were held by the Regional Board in Burbank and Ventura in 2007. These efforts were followed by a two-day stakeholder meeting in February 2008, and more recent stakeholder meetings in Fall and Winter 2008/09. The process has been well-publicized.

The permit applies to both public and private projects. It became effective August 5, 2009. However, the technical manual for the permit is still being drafted by the County’s Watershed Protection District (WPD). The WPD should provide the draft to the Regional Board by May 2010. Regional Board staff has recently indicated flexibility on the timeline for submission. The technical manual requirements are not effective until 90 days after approval by the Regional Board. This delay provides some valuable lead time for the land use and real estate community to act. The new Best Management Practices Performance Standards are applicable, though, as of the Permit’s effective date.

The intent of the permit is to fundamentally change development through use of “low impact development” (LID). All projects must capture, treat, retain and infiltrate runoff from storm events. Virtually no storm water runoff will be permitted during storm events!

Some of the more significant development requirements in the permit apply to: 1) creation of 5000 sq. ft. or more of impervious surface, which also includes redevelopment of a site if 50% or more of its impervious surface is altered; 2) automotive service facilities, retail gas stations and automotive dealerships, commercial nurseries and nursery centers, parking lots, and restaurants adding 5000 sq. ft. or more; 3) parking lots of 5,000 sq. ft. or more of impervious surface or with 25 or more parking spaces; 4) streets, highways and freeways installing or constructing 10,000 sq. ft or more of impervious surface; 5) single-family homes that add or replace 10, 000 sq. ft. of impervious surface; and 6) all development adjacent (i.e. within 200 ft. or less) or discharging directly to environmentally sensitive areas as defined in section 30107.5 of the Public Resource Code. Generally, an “Environmentally Sensitive Area” is an area in which plant or animal life or their habitat are either rare or especially valuable because of their special nature or role in the ecosystem and which could be easily disturbed or degraded by human activities and developments.

Significantly, for new developments, storm water runoff is limited to 5% of a site’s Effective Impervious Area (EIA) unless technically infeasible. EIA is defined in the permit as the portion of surface area that is hydrologically connected via sheet flow over a hardened conveyance or impervious surface without intervening medium to mitigate flow volume For all new development and all redevelopment sites for which the 5% EIA limit is infeasible, then the EIA is limited to 30% of the total project area and the remainder treated as runoff. What is meant by retain? The term means that runoff must either percolate, evapotranspirate or be captured, stored and reused to the extent of 100% of the full design treatment volume. There is no exemption to the 30% EIA requirement. There are additional requirements for on-site retention.

It is essential that developers engage the services of licensed professional civil engineers and consultants to navigate these highly technical requirements. There are several useful mitigation products currently on the market which can be utilized to meet the requirement. For example, one company makes cubes, which can retain and later dispel water after a storm and the cubes can be installed under parking lots that are capable of sustaining the vehicle weight. The product has been used within at least one California city. Over time, additional creative products will undoubtedly be introduced to the general market and with significantly reduced costs. This may take several years, however.

There exist limited exemptions to the MS4 permit. These exemptions include development applications deemed complete, vested projects and single-family hillside homes unless exceeding the 10,000 sq. ft. requirement. These are commonly referred to as “grandfathered projects.” These terms have been included within the last three permits and have been generally accepted within the county to mean project applications deemed “complete” in accordance with the Permit Streamlining Act, a vested tentative tract map application or vesting pursuant to an approved Development Agreement. The need for definitions for these terms in the technical manual has been stressed by this author and others. The WPD is considering such inclusion in the technical manual to avoid future confusion or inconsistency.

What should you do if your project is determined to be “technically infeasible” in retaining runoff on-site? The use of Alternative Compliance Programs is acceptable. First, a developer must prove that low impact development is technically infeasible. A developer still must create an EIA that is at least 30%, but financial contributions or construction to public or private offsite LID projects may be used as an offset. The Alternative Program Projects must be in the same watershed; complete construction by May 7, 2013; be approved by the Regional Board; and demonstrate a reduction of volume and load for the subwatershed, which is defined in the permit to be draining to the same hydrologic area in the basin plan. The development of Alternative Program Projects is critical to future development in Ventura County.

Action by the development and real estate industry in cooperation with the local public entities is mandatory. While the Technical Manual is being drafted, public entities must commence developing Alternative Compliance Program Projects. These efforts can represent a “win win” for both the public entities and the development community. Public entities must develop alternative projects within their communities and respective watersheds, which satisfy the following: 1) small enough and capable of being completed within 4 years of the certificate of occupancy for the first project contributing funds; 2) simultaneously avoid project piecemealing under CEQA and 3) keeping the contribution amounts economically feasible. This represents a large challenge, but can be accomplished with cooperation. Acceptable projects may include retrofit of existing storm drains, easement areas, recreation and parks areas, commercial and residential common areas, and private and public recycled water systems.

Failure to comply with the MS4 permit can lead to both civil and criminal penalties.

The MS4 permit may eventually prove to be a boom to public coffers in these difficult economic times and of legitimate assistance to the development community if contribution costs are within reason and can be timely accomplished. For example, the City of Oxnard had the foresight to develop a citywide and comprehensive recycled water pipeline. Treated recycled water may some day be injected into forebays to restrict saltwater intrusion, increase recharge, etc. Now is the time for thinking outside the box and to develop some creative and innovative mitigation projects. Public entities should consider joint projects with other entities to create a joint benefit.

In Ventura County, we are lucky to have a local representative on the Regional Board who understands development and the costs involved as well as the public agency perspective. These perspectives will be a valuable asset in having mitigation projects approved by the Regional Board.

In summary, this new permit will be a challenge at first, but in the long run can be seen as an ultimate benefit to water quality for all, as well as an opportunity for cooperative efforts between the development and real estate community and public entities which will provide rewards to both.

Nancy Kierstyn Schreiner is a partner in the Real Estate & Land Use Group and the Public Agency Law Group at Nordman Cormany Hair & Compton LLP. Founded in 1939, NCHC is Ventura County’s largest law firm.