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Wave of Retroactive Storm Water Suits Halted in Vermont
The impact of an Aug. 25 decision by the Vermont Supreme Court reversing a state regulatory ruling requiring a permit under the federal Clean Water Act for storm water discharges will prevent environmentalists from filing whole-sale lawsuits against home builders and home buyers in the state and pursuing that litigation strategy across the country.
The lawsuit had important national implications, according to Tayt Brooks, government affairs director for the Home Builders and Remodelers Association of Vermont, because it would have opened the door to Clean Water Act permitting requirements in cases where those permits have never been needed before — post-construction.
This would have meant that even storm water retention ponds maintained by home owners’ associations could have required federal permitting in addition to any state or local requirements for maintenance and repair. If HOAs didn’t apply for federal permits, they could have been sued or fined, with the money going to the complainants — in this case, the Conservation Law Foundation (CLF), a New England environmental advocacy group.
“They wanted the ability to take people to court,” Brooks said. “They wanted to take home owners to court and collect the penalty money. It’s fairly cheap for environmental groups to litigate in a small state like Vermont, and a favorable ruling would have opened up a way to take it nationwide.”
If that happened, any person or organization owning property that included impervious surfaces of more than one acre — including home owners’ association-administered developments with numerous driveways and private roads — could have found themselves subject to a lawsuit.
The case began in 2003, when the Conservation Law Foundation petitioned the Vermont Agency of Natural Resources to use its “residual designation authority” (RDA) to require storm water permits for certain discharges into five impaired bodies of water. Believing that its RDA was discretionary, not mandatory, the agency denied the petition.
The foundation then appealed to the Vermont Water Resources Board, which reversed the agency decision, and the agency then appealed to the Vermont Supreme Court.
NAHB joined the HBRA of Vermont in a friend-of-the-court brief filed with the Supreme Court. It explained that the RDA, which originates in the Clean Water Act, is not a mandatory authority and even when exercised does not oblige the permitting agency to issue permits to control all storm water discharges. Agreeing with NAHB’s position, the court reversed the decision of the Water Quality Board and sent the matter back to the Agency of Natural Resources.
The irony of the case is that Vermont already had one of the strictest storm water management permitting processes in the country, requiring builders and developers to demonstrate “net-zero” discharges into the state’s rivers and streams, said Ernie Pomerleau of Pomerleau Real Estate in Burlington, one of three partners to the original lawsuit.
Vermont’s heavy emphasis on mitigating the environmental impact on already damaged waterways convinced business groups — including home builders and resort developers — to work with environmental advocates and unanimously pass stringent storm water permitting legislation. Without the new safeguards, “we realized that it would have shut down development in Vermont,” Pomerleau said.
The net-zero requirement was “a process that was very difficult for developers to swallow, but at least you had a shot at a permit” if an effective storm water management system could be achieved, Pomerleau said. “Despite that, CLF wanted a federal permit, so it brought that appeal to the Water Resources Board."
“What was upsetting to us was that we had worked in tandem, businesses and environmental groups, to create the highest storm water standards in the country, only to have the board make the decision without public review,” he said. “What most people didn’t understand was the fact that this was simply a staging ground to use Vermont — to spill over the borders on this storm water issue. It could have been huge. If you were a 20-year-old project that had never required a storm water permit, you would have been instantly trapped in the web. You could have had a $35,000 fine per incident going back — well, we can’t figure out how long.”
For more information, e-mail Calli Schmidt at NAHB, or call her at 800-368-5242 x8132.
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