INSIGHT: California Industrial Companies—Your Business License Now Depends on Stormwater Permitting

Bloomberg Environment

January 27, 2020

California now requires businesses applying for a business license to show they have a national stormwater permit if one is required. Van Ness Feldman’s Andrew Cooper and EHS Support’s Maureen B. Hodson say compliance with the new law could delay business permits so businesses should consult environmental professionals early in the startup process.

new law in California took effect Jan. 1 and requires industrial business owners applying to a city or county for a new or renewed business license to demonstrate enrollment in a National Pollutant Discharge Elimination System (NPDES) stormwater permit, if it’s required.

This may seem rather pedestrian on its face, but the impact on California facilities is potentially significant and may even require retention of legal counsel and an environmental consultant in order to ensure compliance. Failure to comply will result in delay or denial of a business license, effectively prohibiting the business from starting its operations.

Stormwater Permits Still Required

What has not changed is that nearly all industrial facilities are typically required to obtain Industrial General Stormwater Permit (IGP) coverage. Industrial businesses, including but not limited to those operating facilities engaged in manufacturing, transportation, power generation, mining, recycling, sewage or wastewater treatment, landfill operations, or feedlots, are affected.

The IGP regulates industrial stormwater discharges and authorized non-stormwater discharges from industrial facilities in California. To do so, a facility must file a Notice of Intent (NOI) to comply with the State Water Resources Control Board (Water Board). What has changed is that the new sections in the Water Code (13383.10) and the Business and Professions Code (16000.3 and 16100.3) apply significant teeth to these longstanding requirements.

The new law, SB 205, prohibits California cities and counties from issuing a new or renewed business license until and unless the applicant can show that it has obtained IGP coverage. In other words, failure to comply with the IGP program could conceivably leave a facility with no valid business license to operate (until it comes into compliance).

Obtaining permit coverage typically requires the business to draft a Stormwater Pollution Prevention Plan (SWPPP), likely involves the assistance of a Qualified Industrial Stormwater Practitioner (QISP), and could also require taking steps to determine pollutant sources and levels and manage storm water discharges. The business owner must enroll the business under the IGP using the Stormwater Multiple Application and Report Tracking System (SMARTS).

90-Day Grace Period Optional

While a city or county can opt in to provide a business with a 90-day grace period, whether it does so is up to each individual jurisdiction. If the business falls within a regulated standard industrial classification (SIC) code, but the owner does not believe IGP coverage is required, the owner should contact the Water Board to determine whether the business qualifies for a Notice of Non-Applicability.

Businesses that are otherwise required to obtain coverage under the IGP but can certify that no industrial materials, equipment, or activities are exposed to storm water may be eligible for a No Exposure Certification. It is important to note that having a construction stormwater permit does not meet the requirements of SB205.

Stormwater permitting and evaluation can take time, so it is vital that industrial businesses consult with competent environmental professionals early on in the business startup process to ensure the permitting is in place by the time the business license needs to be in effect in order to avoid costly delays.

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