A Pollution Diet For the Chesapeake Bay Watershed

Winter 2010

The U.S. Environmental Protection Agency (EPA) has outlined an aggressive approach toward placing the Chesapeake Bay on a "pollution diet" through a Total Maximum Daily Load (TMDL) that would regulate the discharge of nitrogen, phosphorus and sediment flowing into the Bay. The EPA intends to issue a final TMDL for the Chesapeake Bay and its tributaries by the end of 2010 with the goal of this new federal-state partnership having all practices and requirements in place by 2025.

The draft TMDL, released on September 24th for a 45-day public comment period, includes new water implementation plans (WIPs) submitted by the District of Columbia and the six states within the 64,000 square miles of Chesapeake Bay watershed -- Delaware, Maryland, New York, Pennsylvania, Virginia and West Virginia.

Although the states and the District have previously missed deadlines to self-regulate and clean up the Chesapeake Bay, the EPA would prefer that they continue to take the lead through the WIPs for regulating the Chesapeake Bay watershed. However, this time the EPA has also built in federal enforcement measures or "backstops" though the TMDL process to force pollutant reduction levels if the District’s and states’ WIPs fall short of meeting their goals.

These WIPs, designed to control pollution discharges into the Bay, are similar to state implementation plans for clean air. Commonly referred to as SIPs, they are federally approved plans by which each state outlines its strategy toward meeting air quality objectives, in this case, water pollution reductions. Through the TMDL process, EPA initiates an official rulemaking process to formally approve of the WIP, and once approved, it would then become federally enforceable.

The Commercial Real Estate Impact

The federal TMDL for the Chesapeake Bay, along with the WIP plans submitted by the states and the District of Columbia, would apply new water treatment requirements for both existing and future commercial properties. It would dramatically impact local land-use decisions and agricultural operations throughout the Bay’s watershed.

Recently, an article in The Washington Post noted that the states and local governments within the watershed have been placed on notice and will be required to take action to meet pollution reductions. This will require difficult decisions at the local level. Although there may be general agreement on cleaning up the Bay, mandated requirements remain a sensitive concern, particularly when they include increased taxes or new stormwater or sewer treatment fees.

It should also be noted that EPA’s initial review of the WIPs found that none of them contained the level of accountability or specific details necessary to meet the mandated reduction levels of nitrogen, phosphorus or sediment. While the District of Columbia and Maryland received only "some minor deficiencies" ratings, the remaining states received "serious deficiencies" ratings from the EPA. Each state and the District had until November 29, 2010, to modify and adjust their WIP to meet the pollution reduction levels set by EPA or be subject to federal backstop measures.

As EPA moves forward with a final TMDL that includes approved state WIPs and federal backstop measures, there are important issues that need further discussion:

  • An economic and cost assessment of meeting discharge reductions under the TMDL and WIPs;
  • Additional transparency and clarity on federal model assumption and conclusions;
  • A technical feasibility analysis;
  • A water quality credit and trading program; and
  • A fair and balanced sharing in pollution reduction requirements within the watershed.

The aggressive action taken by the EPA to finalize the TMDL for the Chesapeake Bay by the end of 2010 in order to begin phase one of the "pollution diet" in 2011 stems from the states and the District agreeing but failing to clean up the Bay. As a consequence, President Obama signed an Executive Order declaring the Chesapeake Bay a national treasure and instructing the federal government to work together in reducing pollution discharges and restoring the Bay.

The result is that the EPA has charted the strict timetable in issuing a final TMDL by the end of the year, irrespective of controversial model assumptions and a limited period for public review and comment. The EPA asserts existing authority under the Clean Water Act and allows them to move forward aggressively with the "pollution diet" for the Chesapeake Bay.

NAIOP recognizes the importance of the nation’s natural resources and ecosystems, including the Chesapeake Bay. However, serious issues remain regarding the Chesapeake Bay’s TMDL process, EPA’s model assumptions and the consideration and incorporation of legitimate implementation concerns. This includes the ability or feasibility of meeting discharge reduction targets, along with the costs given the current economic conditions. For example, Wetland Studies and Solutions Inc., a leading natural and cultural resources consulting firm in Northern Virginia, has indicated that the median cost per impervious acre for stormwater retrofits is 102,000 per acre in 2010 dollars. NAIOP will continue to work with the real estate community in order to educate federal, state and local officials on these issues and concerns.

NAIOP members need to understand EPA’s approach for cleaning up the Chesapeake Bay through state WIPs and its effect on existing commercial properties and future development. If the TMDL/WIP approach proves successful, EPA intends on using it as a national model for other parts of the nation.