Plaintiffs Drop Stormwater Lawsuit Against EPA: NAIOP Applauds Decision & Remains Opposed to RDA as Regulatory Tool

Yesterday, the Conservation Law Foundation and Charles River Watershed Association, plaintiffs in Conservation Law Foundation, Inc., et al v. United States Environmental Protection Agency, et al., voluntarily dismissed the lawsuit without prejudice. NAIOP Massachusetts filed a Motion to Intervene in the case.

The plaintiffs in that case sought to compel EPA to impose a new regulatory program that would have required owners of commercial, institutional, industrial and high density residential properties in the Charles River watershed with one acre or more of impervious area (parking lots, roofs, sidewalks) to apply for a stormwater discharge permit through the use of EPA’s rarely used “Residual Designation Authority” (RDA). NAIOP decided to intervene in the case given the significant impact this duplicative and burdensome regulatory program would have had on property owners in a watershed that includes 35 communities and covers 310 square miles.

“NAIOP has long supported the overall objective of improving water quality throughout the Charles River Watershed, but with compliance costs estimated to be in excess of $1 billion, the RDA approach is simply not the right tool,” said David Begelfer, CEO of NAIOP Massachusetts. “We are pleased the plaintiffs dropped the suit. Such important policy decisions should not be negotiated behind closed doors. NAIOP urges EPA to carefully think through this issue, seek feedback from affected stakeholders, and ensure any potential programs are cost-effective, feasible and fairly allocate the regulatory burdens and costs.”

NAIOP will continue to monitor this issue closely and keep members informed of any new developments.

NAIOP Files to Intervene in Costly Charles River Watershed Stormwater Court Case

NAIOP Massachusetts recently filed a Motion to Intervene in Conservation Law Foundation, Inc., et al v. United State Environmental Protection Agency, et al. The plaintiffs in that case seek to compel USEPA to impose a new regulatory program that would require owners of commercial, institutional, industrial and high density residential properties in the Charles River watershed with one acre or more of impervious area (parking lots, roofs, sidewalks) to apply for a stormwater discharge permit. NAIOP decided to intervene in the case given the significant impact this duplicative and burdensome regulatory program would have on property owners in a watershed that includes 35 communities and covers 310 square miles.

On April 28, the Conservation Law Foundation and the Charles River Watershed Association filed a complaint in federal court alleging that nutrients, including phosphorus, in runoff from a number of “commercial, industrial, institutional, and high density residential” properties are polluting the Charles River. The goal of the lawsuit is to force EPA into using its rarely used “Residual Designation Authority” (RDA) in the 35 communities that make up the Charles River Watershed to create a new stormwater permitting program. This proposed program would be in addition to the recently issued stormwater permitting program for municipal separate storm sewer systems (MS4s), which collect and manage a substantial portion of the stormwater discharged into the Charles River from developed properties. In this case, CLF is incorrect; EPA does not have a requirement to use the RDA.

This will affect all privately owned commercial and multifamily properties in the Charles River Watershed (communities including Boston, Cambridge, Needham, Newton, Natick, etc.) with more than one acre of impervious area.

In 2010, EPA proposed an RDA pilot stormwater permitting program in the towns of Milford, Franklin and Bellingham. As proposed, this program would require property owners to construct costly, retrofitted stormwater treatment systems. EPA funded a study to determine the potential costs to comply with its proposed permitting program. Though the pilot program targeted sites with two acres or more of impervious area, compared to the one acre threshold now being considered, the total cost in the three communities to comply with the draft permit was astronomical. EPA’s own consultants estimated that the costs would be at least $180 million for the three communities. Expanding such a program to all 35 communities in the Charles River Watershed would easily move that number into the billions. Costly and substantial retrofits of privately owned property would be immediately required if this is implemented. We estimate the costs to be at least $150,000 per acre for compliance. This would apply to existing owners, even if they are not redeveloping or renovating their property.

NAIOP supports the overall objective of improving water quality throughout the Charles River Watershed. However, any regulatory program developed to achieve that objective must be cost-effective, feasible and fairly allocate the regulatory burdens and costs. As we learned through the pilot program, the RDA approach is not the right tool. NAIOP has long championed alternative approaches that focus on public education, source control, and Best Management Practices. We actively supported the recent legislation restricting the use of phosphorous-containing fertilizers. Our intervention in the lawsuit will provide an important stakeholder group with an opportunity to have a seat at the table as these important policy and economic issues are being discussed.

Climate change legislation will cause a flood of regulations

The following Op Ed appeared in the Boston Business Journal on July 31, 2015.

As we saw in New York City with Hurricane Sandy, climate change can have significant impacts affecting the overall economy; directly, by damaging structures, and indirectly, by compromising transportation systems, communications, and utilities. An increasing number of extreme weather events and future sea level rise may lead to more frequent and extensive flooding along the East Coast.

A primary role for city and state governments should be to ensure the continuity and protection of public infrastructure and public safety. The business community, and the community at large, need to have a clear understanding of the government’s responsibilities and its plans for preparing infrastructure and critical services for these potentially cataclysmic events.

NAIOP Massachusetts, The Commercial Real Estate Development Association, has long been one of the leading business groups advocating for a coordinated approach between the public and private sectors with respect to climate change planning.

However, we are very concerned about a bill that was recently passed by the Senate to establish a far reaching planning and regulatory process for addressing climate change. Senate Bill 1979 contains very subjective, vague, and expansive language that could have extremely negative consequences for the Massachusetts economy today and into the future.

We believe the open-ended language the bill contains could lead to widely varying interpretations of how the legislation should be implemented, creating uncertainty and potentially stalling projects for years to come. While we believe that climate change planning is an important issue, this bill is not the solution. Under the legislation, all grants, permits, licenses, approvals, or actions of any kind for any proposed projects, uses or activities issued by any state agency or state authority could be challenged and held hostage to these ambiguous goals. This would open the “regulatory door” to a wide range of proposals, substantially changing and exceeding well established standards and procedures – with few having any direct connection to climate change.

Given how this vague and confusing language could be interpreted, the potential for lengthy and costly legal challenges is quite high.

For these and many other reasons, the bill, as written, cannot and should not be passed into law.

Addressing climate change and sea level rise requires coordination at the highest level of state government and the participation of many state agencies. There needs to be a balance of adequate planning and a risk-based, cost-benefit analysis to ensure that funds are prudently expended by the public and private sectors when considering climate change-related investments. Through such an effort, climate change resiliency will become a more attainable goal.

NAIOP Applauds Legislature for Budget with Important T Reforms

Last night a $38.1 billion state budget (H. 3650) was released from conference committee. NAIOP applauds the conference committee members (House Ways and Means Chairman Brian Dempsey, Senate Ways and Means Chairwoman Karen Spilka, Sens. Sal DiDomenico and Vinny deMacedo and Reps. Stephen Kulik and Todd Smola), Senate President Stan Rosenberg, and Speaker of the House Robert DeLeo for their leadership in passing a bill that includes important reforms for the MBTA.

One of the most important aspects of the bill (and something NAIOP has championed) is the creation of a MBTA Fiscal and Management Control Board chaired by the Secretary of MassDOT. The budget states that the Fiscal and Management Control Board shall “initiate and assure the implementation of appropriate measures to secure the fiscal, operational and managerial stability of the authority and shall continue in existence until June 30, 2018.” A two year extension beyond 2018 could be granted if needed. The Board shall formulate and recommend a plan to the secretary of transportation to stabilize and strengthen the finances, management, operations and asset condition of the authority. The Fiscal and Management Control Board will also develop performance metrics and measure items included in the plan. NAIOP believes the creation of the Control Board will provide greater accountability and transparency for the T’s governance and management practices and is critical to ensure a safe, reliable, fiscally stable, modern transit system for Massachusetts.

The budget also suspends the Pacheco Law for three years. The Pacheco Law requires a vetting process before privatization of services at the MBTA and, according to a report released today by the Pioneer Institute, it has cost the MBTA at least $450 million since 1997. NAIOP strongly supports this important reform.

The House and Senate are expected to approve the budget today and then it goes to Governor Baker for his review. He then has 10 days to review it review it before signing it and announcing amendments and vetoes.

NAIOP will continue to actively advocate for transportation reforms that support roads, bridges, public transit – and economic growth.

NAIOP Testifies in Support of Transportation Legislation

Yesterday, building off of our ongoing advocacy on this issue and the statement we recently signed with 24 other business groups, NAIOP testified before the Joint Committee on Transportation urging legislative leaders to fix the the Commonwealth’s broken public transit system by adopting the recommendations outlined by the Governor’s Special Panel to Review the MBTA. We will continue to work with the Baker Administration, legislative leaders and business groups to advocate for real reforms that will quickly address the needs of the Commonwealth’s citizens and businesses.

NAIOP’s testimony from the hearing follows:

NAIOP Massachusetts, The Commercial Real Estate Development Association, Supports House Bill 3347
May 11, 2015

NAIOP Massachusetts, The Commercial Real Estate Development Association, would like to express its support for House Bill 3347, An Act Relative to a Reliable, Sustainable Massachusetts Bay Transportation Authority.

NAIOP Massachusetts represents the interests of companies involved with the development, ownership, management, and financing of commercial properties. NAIOP’s 1,600 members are involved with more than 240 million square feet of office, research & development, industrial, mixed use, retail and institutional space in the Commonwealth.

This winter, businesses across Massachusetts felt the impact of the Commonwealth’s failing transportation infrastructure. Employees simply could not get to work. The T, in particular, illustrated the negative impact an unreliable transit system has on the economy. Those who normally relied on the T, but had the option of driving, caused roadways to be more congested and commuting times to grow exponentially. There is no question that without a reliable public transit system, the economic wellbeing of the Commonwealth will continue to suffer. The time for action is now.

NAIOP and 24 other business organizations from across the state recently signed a statement urging policymakers to act quickly to make the changes needed to transform the MBTA into a modern, world-class public transit system. House Bill 3347, which includes many of the recommendations outlined by the Governor’s Special Panel to Review the MBTA, would be an important first step in the right direction.

The bill contains a number of important provisions. It will provide greater accountability and transparency for the T’s governance and management practices through the establishment of a Fiscal and Management Control Board. It sets performance metrics so progress can be measured and goals can be achieved in a reasonable amount of time. It addresses the T’s procurement and maintenance practices so that the system is safe, reliable and in a state of good repair. Most importantly, it requires the Control Board to implement a plan designed to stabilize and strengthen the finances, management, operations and asset condition of the MBTA and to ensure a safe, reliable, fiscally stable, modern transit system for Massachusetts.

We urge the Committee to give this bill a favorable report and to take the steps needed to create a world class public transit system that will meet today’s needs and accommodate the growing demands of future economic growth.

President Obama Signs Energy Efficiency Improvement Act of 2015

Energy BillPresident Obama recently signed into law the Energy Efficiency Improvement Act of 2015 (S. 535), which creates a new “Tenant Star” to encourage energy efficiency in leased commercial spaces. Tenant energy usage can account for 50 percent or more of a building’s total energy usage. Like its predecessor, “Energy Star”, Tenant Star is a voluntary, market based, cost free program that is expected to encourage optimum energy efficiency in leased commercial spaces, helping the environment by cutting greenhouse gases.

This program has been championed by the real estate industry through the direct efforts of the Real Estate Roundtable. The U.S. Environmental Protection Agency, in consultation with Department of Energy, will start developing standards for the Tenant Star designation within 180 days.

Along with Energy Star (which is aimed at encouraging energy efficiency within the building core), this new designation will encourage office tenants with their landlords to design and construct cost-effective energy investments in the building’s leased spaces.

NAIOP believes that the Tenant Star program can be an effective educational program that leads to voluntary, smart, cost-effective energy efficiency investments.

Business Coalition Urges Governor and Legislature to Create World-Class Transit System

A broad coalition of 25 business associations representing large and small employers from a wide range of industries today issued the following statement urging the Governor and the Legislature to adopt the recent recommendations made by the Special Panel to Review the MBTA and to swiftly begin the task of fixing the state’s public transit system:

Business Coalition Statement in Support of a World-Class Transit System

The Challenge
The winter of 2015 highlighted the Commonwealth’s transportation vulnerabilities, particularly for the MBTA. While school and business cancellations, a dramatic drop in retail sales, and an increase in public safety risks result from many major winter storms, the complete shutdown of the MBTA followed by a prolonged reduction in services for the subways and commuter rails are not the norm.
The unreliability of our public transit system caused many businesses to lose substantial revenues from the loss of productivity due to delays and/or the inability of workers to get to work. Many hourly workers forfeited wages; many retailers forfeited sales; many restaurants forfeited patrons; and the Commonwealth forfeited the income, sales and meals tax associated therewith. A sub-optimal public transit system also caused roadways to be more congested than usual and commuting times to grow to unreasonable lengths for those who opted to drive or were transporting goods. The adverse financial impacts totaled in the billions of dollars. This is unacceptable and must not be repeated.

The Framework
Due to the urgency of fixing the MBTA and the need for the public transit system to be reliable and fully functional, the undersigned business organizations are requesting policy makers to address the following issues:
• Make the T a customer-focused organization that provides first-rate service and clear communication while instilling confidence in its ridership.
• Provide greater accountability and transparency for the T’s governance and management practices to ensure the entity is efficiently and effectively run while employing a productive workforce.
• Develop a long-term strategic and capital plan for the T that efficiently uses its resources to enhance the current capabilities and future needs of the T, businesses and workers, while providing sufficient funding to cover the costs.
• Overhaul the T’s procurement and maintenance practices so that the system is safe, reliable and in a state of good repair.
• Establish metrics, milestones and regular reporting to ensure proper implementation of the T reforms within a reasonable period of time.
• Ensure that the T balances its operating budget without the need for ever-increasing state assistance each year.

The Solution
The undersigned support this position and urge the Governor and the Legislature to act swiftly so we can begin the arduous task of fixing the state’s public transit system.

Following a thorough analysis of the various recommendations from the Governor’s Special Panel to Review the MBTA, and measured against the principles outlined above, we endorse the Panel’s proposal and urge the Legislature to adopt the plan immediately.

The following business organizations support this statement:
495/MetroWest Partnership
Affiliated Chambers of Commerce of Greater Springfield
American Council of Engineering Companies of Massachusetts
Associated Industries of Massachusetts
Associated Subcontractors of Massachusetts
Construction Industries of Massachusetts
Environmental Business Council
Greater Boston Chamber of Commerce
Greater Boston Real Estate Board
Massachusetts Biotechnology Council
Massachusetts Chemistry & Technology Alliance
Massachusetts High Tech Council
Massachusetts Lodging Association
Massachusetts Petroleum Council
Massachusetts Restaurant Association
Massachusetts Taxpayers Foundation
Massachusetts Technology Leadership Council
Massachusetts Business Roundtable
Metro South Chamber of Commerce
NAIOP Massachusetts, The Commercial Real Estate Development Association
National Federation of Independent Businesses
Neponset Valley Chamber of Commerce
North Shore Chamber of Commerce
Retailers Association of Massachusetts
South Shore Chamber of Commerce

Quotes from Business Coalition Members:
“The unreliability of the public transit system has caused many businesses to lose substantial revenues from the loss of productivity due to delays and the inability of workers to get to work,” said Richard Lord, President and Chief Executive Officer of Associated Industries of Massachusetts (AIM).

Eileen McAnneny, President of the Massachusetts Taxpayers Foundation, said, “Now that the breadth and severity of the problems confronting the MBTA have been revealed and the price of inaction is evident, we have a real opportunity to move forward with a plan for transforming the MBTA into a modern, world-class public transit system.”

“The transit system experienced a ‘stress test’ and failed. The time is right to not only fix today’s MBTA, but ensure that it will meet future demands,” said David Begelfer, CEO of NAIOP Massachusetts, The Commercial Real Estate Development Association.

“The MBTA is critical to Greater Boston’s economy. Workers, customers, patients, students and tourists depend on it every day. We need to take the T to the next level right away,” said Paul Guzzi, President and CEO of the Greater Boston Chamber of Commerce.