[Federal Register Volume 74, Number 187 (Tuesday, September 29, 2009)]
[Rules and Regulations]
[Pages 49809-49813]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-23281]
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SUSQUEHANNA RIVER BASIN COMMISSION
18 CFR Parts 806 and 808
Review and Approval of Projects
AGENCY: Susquehanna River Basin Commission.
ACTION: Final rule.
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SUMMARY: This document contains amendments to the project review
regulations of the Susquehanna River Basin Commission (Commission)
including provisions restricting the use of docket reopening petitions
to avoid abuses of process; amending the ``Approval by Rule'' (ABR)
process to allow for project sponsors to utilize approved water sources
at approved drilling pad sites without the need for modification of the
ABR; clarifying that the public hearing requirement for rulemaking
shall be applicable to the proposed rulemaking stage of that process;
and further providing for the time period within which administrative
appeals must be filed. These amendments were first proposed in a Notice
of Proposed Rulemaking (NOPR) that appeared at 74 FR 31647 on July 2,
2009.
DATES: These rules are effective on November 1, 2009.
ADDRESSES: Susquehanna River Basin Commission, 1721 N. Front Street,
Harrisburg, PA 17102-2391.
FOR FURTHER INFORMATION CONTACT: Richard A. Cairo, General Counsel,
telephone: 717-238-0423, ext. 306; fax: 717-238-2436; e-mail:
[email protected]. Also, for further information on the final rulemaking,
visit the Commission's Web site at http://www.srbc.net.
SUPPLEMENTARY INFORMATION:
Background and Purpose of Amendments
The Commission convened public hearings on August 4, 2009, in
Harrisburg, Pennsylvania and on August 5, 2009, in Elmira, New York. A
written comment period was held open until August 15, 2009. Comments
were received at both the hearings and during the comment period. A
summary of the comments and the Commission's responses thereto follows.
Comments by Section, Part 806
Section 806.4 Projects Requiring Review and Approval
Comment: The Commission's proposal to require review and approval
for any hydroelectric project regulated by the Federal Energy
Regulatory Commission (FERC) and initiating a licensing or licensing
amendment is defective and should not be adopted because: (1) As
currently worded, the
[[Page 49810]]
proposed amendment to 18 CFR 806.4 (a) would exceed the Commission's
project review powers under Section 3.10 of the Susquehanna River Basin
Compact (Compact); (2) The proposed amendment to 18 CFR 806.4 (a) would
produce duplicative and redundant licensing proceedings for review of
hydroelectric projects and run afoul of the intent of Congress under
the Federal Power Act and paragraph (w) of the Federal Reservations to
the Compact to retain sole, unimpeded licensing authority in FERC; and
(3) the Commission already has sufficient powers under its existing
regulations and its compact authority to review aspects of
hydroelectric and nuclear projects that affect water resources, and
there is no need to single out these facilities for review in the
proposed amendment to 18 CFR 806.4 (a). Despite the Commission's claim
in the Notice of Proposed Rulemaking (NOPR) that it is merely codifying
its current practice, the proposal represents a break with past
Commission practice regarding both hydroelectric facility and nuclear
power plant review without any explanation or justification for the
change, and is therefore arbitrary and capricious.
The NOPR seeks to infringe on the exclusive authority of FERC
granted to it under the Federal Power Act and reserved by Congress when
it consented to the Compact. Nothing in the Compact provides, or even
suggests, that the United States and the other parties to the Compact
intended to grant the Commission review and approval authority of
licensing or license amendment proceedings before FERC. There is no
need for the additional language proposed in the NOPR in that the
Commission has ample authority to review and approve ``projects'' that
are separately undertaken and that affect the water resources of the
basin under its existing regulatory program. With regard to projects
regulated by the Nuclear Regulatory Commission (NRC), the Compact, the
Commission's existing regulatory program and current practices are
clear enough, well-established, and fully recognized by NRC, thus
questioning the need for the suggested modification.
The Commission appears to be proposing that before an application
can even be submitted to FERC or the NRC, application and approval must
first be obtained from the Commission, which directly and materially
interferes with FERC and NRC's procedures and processes.
Response: The Commission exercises concurrent jurisdiction with
FERC and the NRC and believes that its exercise of same is both
appropriate and authorized under the Compact. Furthermore, it has no
intention of exercising that authority in a manner that conflicts or
interferes with that exercised by these two federal agencies. Nor was
it the intention of the proposed change to require Commission approval
prior to the submission of licensing applications to the federal
agencies. Rather, the intention was to have the initiation of federal
licensing likewise initiate project review by the Commission. As was
the case in a recent hydroelectric facility licensing process, the
Commission undertakes a single, coordinated review with all federal and
state resource agencies that serves both regulatory schemes.
However, it is apparent from the comments received and the
Commission's own reconsideration that the proposed changes, as drafted,
do not provide the clarification originally sought. Therefore, the
Commission believes it is appropriate to suspend final action on this
element of the NOPR so that it can be re-drafted, particularly to
ensure that it does not interfere with FERC and NRC procedures. (This
is especially the case with respect to the comment that the proposal
could be interpreted as requiring both review and approval prior to
initiating licensing actions.) The Commission will move forward with
publication of a new NOPR at such time as it completes development of a
revised set of proposed changes for projects involved in licensing
procedures.
Licensing and licensing amendment actions are projects that often
have significant effects upon the water resources of the basin and the
SRBC Comprehensive Plan. Federal Reservations, Section 2, paragraph w
of the Compact, while preserving the authority of federal licensing
authorities, also makes clear that use of the waters of the basin shall
be subject to approval in accordance with the terms of the Compact.
Both the Compact and the Commission's current regulations require
review and approval for, but not limited to: (1) Projects on or
crossing the boundary between signatory states; (2) projects in one
signatory state having a significant effect on the water resources
within another signatory state; and (3) projects included in the
Commission's Comprehensive Plan or which would have a significant
effect upon the plan. All hydroelectric and nuclear facilities in the
basin meet one or more of these requirements. The Commission will
therefore continue, as appropriate and as it has done in the past, to
exercise concurrent authority with federal licensing authorities to
review and approve such projects.
Comment: The deletion of the existing Sec. 806.4(a)(8) language,
which requires Commission review and approval of any natural gas well
development project targeting the Marcellus or Utica shale formations
and involving a withdrawal, diversion or consumptive use of water,
regardless of quantity, was alarming. The Commission's acknowledgement
that the deletion of Sec. 806.4(a)(8) was a drafting error, the public
recognition of the error it posted on its Web site upon discovery of
the error, and its willingness to correct the error at the final
rulemaking stage is appreciated.
Response: The Commission regrets the inadvertent proposed deletion
of the provision and any confusion resulting from the error. Given that
the Commission is not moving forward with any revisions to Sec.
806.4(a)(8) as a part of this final rulemaking action, the error is of
no effect and the provision in question remains effective. At such time
as the Commission moves forward with revisions to Sec. 806.4 as part
of a new NOPR, it will be certain not to repeat the error.
Section 806.22 Standards for Consumptive Use of Water
Comment: Deletion of the contiguous landowner notification
requirement in exchange for a display ad newspaper notice would leave
such landowners without direct or effective notice, nor any guarantee
that newspaper notification would provide adequate time for meaningful
participation in the Approval by Rule (ABR) process. Any participation
in the process would be markedly diminished, even though they remain
the citizens most immediately affected. Moreover, some contiguous
landowners do not reside on the affected land and thus may not be
reached by the general newspaper notice. And as more newspapers fold as
a result of declining readership and advertisement revenue, such notice
will become increasingly inadequate.
Do not eliminate the requirement that project sponsors notify
contiguous landowners as part of the ABR process; it is only fair that
notice be given to the persons who are directly affected by such
projects, and adjacent landowners are well placed to inform the
Commission about potential adverse impacts of the approval.
Contiguous landowners need to have notice concerning water
withdrawals since the presence of streams, pond or wetlands, and
groundwater, contributes significantly to the value of the property.
They should be entitled to notice and allowed a sufficient amount
[[Page 49811]]
of time to comment on the impact of proposed withdrawals.
If the Commission wants to enhance public transparency, it should
make information concerning applications submitted to it available on
the Commission's Web site. In addition to providing information on the
name of applicants, amount of water requested, location of withdrawals,
date, and details of final action taken by the Commission, it should
also plot withdrawals on a map display so that it is easy to see how
much water is being withdrawn in a given area.
Response: The Commission acknowledges the concerns raised in the
comments, but notes that there is some confusion about the scope of the
ABR process. First, the process does not involve approvals for
withdrawals from surface or groundwater sources. A number of the
comments received spoke to the legitimate right of contiguous
landowners to receive notice of proposed withdrawals because of the
potential impact of their use and enjoyment and potentially diminished
value to their land. Withdrawals are regulated separately by the
Commission, they require separate docket approval, and contiguous
landowner notification is required in advance of any Commission action.
The proposed revisions do not modify those notification provisions in
any way.
The ABR process involves an administrative approval for consumptive
use at the natural gas well drilling pad site and enables the
Commission to track all sources of water transported to the site, the
quantities used in development of the well, and the fate of flowback
and produced fluids. These data are important to assess the cumulative
impact of this industry's activity on the water resources of the basin.
A number of the comments received, however, spoke to the
appropriateness of landowner notification if well drilling and
hydrofracing activity was occurring adjacent to their property. The ABR
process does not involve approval to drill or hydrofrac; it is limited
to regulating the consumptive use of water involved in either of those
activities. Approval to drill (and to undertake the related
hydrofracture development activity) is a separate governmental action
undertaken by the Commission's member states in the form of gas well
permitting.
The impetus behind the Commission's proposal to modify contiguous
landowner notice provisions in the ABR process stem from the fact that
they have been problematic, administratively burdensome, and often lead
to confusion at the landowner level. And while those shortcomings are
pronounced with the ABR process, given the recent level of natural gas
development activity, the Commission acknowledges that a number of
those shortcomings are likewise present with its contiguous landowner
notification requirements for docket applications as well. Therefore,
after review and consideration of the comments received, as well as its
own reconsideration of the appropriate scope of amendments to its
existing notification procedures, the Commission believes it is
appropriate to suspend action on this element of the NOPR as part of
this final rulemaking action. Accordingly, it will move forward with
publication of a new NOPR at such time as it completes development of a
revised set of proposed changes to its general application notification
requirements.
With respect to public transparency, please note that the
Commission continues to increase the amount of information contained on
its Web site, www.srbc.net, for the benefit of the public. Further
improvements are underway and are anticipated to be completed by the
end of 2009 that will afford greater access to approvals, requests for
approval, lists of approved water sources by project sponsor, location
information about approved withdrawal and consumptive use sites, and
mapping features to display information to better inform the public.
Comment: The flexible use of approved water withdrawal sources by
gas well developers at various drill pad sites without modification of
their pad site ABR under proposed regulation Sec. 806.22 (f) (11 & 12)
will mean that such withdrawals, and the ABR approved well pad sites
they serve, will receive less regulatory scrutiny.
Response: All such withdrawals will have already been fully
reviewed and approved by the Commission prior to any use and will have
met all public notice requirements at the time of their initial
approval. This means that the impacts of withdrawals will have been
fully evaluated and appropriate conditions such as passby requirements
included. All users of these approved sources will be subject to the
same limitations and conditions contained in the approved docket.
In approving a withdrawal, the Commission exercises continuing
regulatory oversight and can, at any time, reopen the docket approval
and add new conditions or make further orders to meet any changed
conditions and otherwise protect the public welfare and the
environment. In addition, the main purpose of the proposed change is to
simplify administrative procedures without compromising regulatory
oversight.
Again, as noted above, the ABR process involves an administrative
approval for consumptive use at the natural gas well drilling pad site
and enables the Commission to track all sources of water transported to
the site, the quantities used in development of the well, and the fate
of flowback and produced fluids. The substantive evaluation of
withdrawals and the conditions under which they may be undertaken
without impact to the environment or other users occurs under the
Commission's withdrawal regulations, and not the ABR process for which
changes are proposed under this NOPR.
Comment: The proposed changes to Sec. 806.22(f)(11) and (f)(12)
would eliminate core safeguards for the water-related values that the
Commission is committed to protect by allowing project sponsors to
shift water from one project to another without even registering the
transfer with the Commission.
Response: This is a misreading of the NOPR and implies that project
sponsors will be shifting water sources from one drilling pad site to
another without oversight by the Commission. To the contrary, what the
Commission is proposing is a system whereby each project sponsor
engaged in natural gas development will have an approved list of water
sources for which it has received docket approvals, with accompanying
conditions to properly limit and monitor its withdrawals from each of
those sources. The sources are added to the list at the time of docket
approval, which effectively registers them for use at the project
sponsor's approved drilling pad sites. The Commission sees no need to
require a separate registration action by the project sponsor when it
can be done administratively at the time of docket approval. All other
sources that the project sponsor may use at its approved drilling pad
sites must first be registered or otherwise approved by the Commission.
Comment: The proposed changes to Sec. 806.22(f)(12) would permit
project sponsors to share and trade water sources without obtaining new
or modified ABRs, and without certifying to the Commission their
intention to comply with all terms and conditions of each other's ABRs,
and would authorize new sources of water without modifying the existing
ABRs.
Response: The terms and conditions incorporated into every water
source approval, and every ABR issued by the
[[Page 49812]]
Commission, must be adhered to by project sponsors. The purposes of the
proposed modifications are to facilitate efficient water use and water
sharing by the natural gas industry, and to streamline administrative
processes so that the Commission's resources are better focused on
substantive review and management of water resources, not inefficient
bureaucracy. Issuing a single approval for a given water source and
allowing its use at any of the project sponsor's approved drilling pad
sites, with appropriate conditions and monitoring requirements, is far
preferable than requiring the project sponsor, and the Commission, to
modify each and every ABR issued to the project sponsor, which could
number in the hundreds over time. From a water resources management
standpoint, the issue is whether the source is approvable for use
without adverse effect, regardless of whether the project sponsor
intends to utilize the source at one site, or multiple sites. Allowing
water sharing limits the number of withdrawals across the basin and
limits tanker truck traffic by allowing project sponsors to use the
closest approved water source site, even if the withdrawal approval was
first issued to another operator. Adherence to all docket conditions,
and ABR recordkeeping and reporting conditions, will continued to be
required of all project sponsors, resulting in a full daily accounting
of all water withdrawn across the basin (by source, by date, by project
sponsor), where it was delivered to, and quantities used on site.
Comment: The new proposed subsections Sec. 806.22(f)(11) and
(f)(12)(ii) contain language requiring the project sponsor to obtain
all necessary approvals required for the project from the state agency.
However, such reference to the need for state agency approval is absent
from new proposed Sec. 806.22(f)(12)(i). For the regulation to be
internally consistent and for member state agency coordination
purposes, a sentence should be added at the end of Sec.
806.22(f)(12)(i) that is similar to the one contained in Sec.
806.22(f)(12)(ii), indicating that registrations ``shall be subject to
any approval or authorization required by the member State to utilize
such source(s).'' The proposed language would put the project sponsor
on notice that it would also need state-level authorization to use such
source at the time it is registered with the Commission and before its
use for natural gas well development.
Response: The Commission agrees with the commenter and the final
rulemaking incorporates the proffered language.
Section 806.32 Reopening/Modification
Comment: This procedural change will allow interested parties' to
fully participate in Commission processes, while avoiding unnecessary
or duplicative proceedings.
Response: The Commission agrees.
Comment: Due process requires that the Commission narrowly construe
its proposal to prevent persons whose administrative appeals are denied
from petitioning for reopening of the approval seeking the same or
similar relief absent new facts not known or readily discernable at the
time of the appeal. Concern is raised about the use of the term
``similar'' being applied in such a way as to frustrate legitimate new
claims, and the term ``functionally equivalent'' is recommended to be
inserted in its place.
Response: The Commission agrees and the final rulemaking
incorporates the proffered language.
Comment: We oppose the proposed restrictions to petitioning and
reopening a docket.
Response: The Commission believes that any interested party should
have the right to petition for a reopening of a project approval, but
believes that parties attempting to use this provision to obtain
administrative review of matters for which administrative appeals were
denied constitutes an abuse of process and should be restricted.
Comments by Section, Part 808
Section 808.1 Public Hearings
Comment: We agree that the Commission should hold at least one
public hearing within a reasonable period after rules revisions are
initially proposed. The rule leaves open the option of convening
additional hearings if, for example, the Commission recommends
substantial changes in response to comments on the initial proposed
rulemaking.
Response: The Commission agrees with the interpretation of the
commenter. As structured, the rule would require the Commission to
convene at least one additional hearing in the event changes to an NOPR
are substantial and result in re-publication.
Section 808.2 Administrative Appeals
Comment: The proposed constructive notice rule allowing the appeal
period for persons other than project sponsors to run 30 days from the
date of publication of the action in the Federal Register is respectful
of due process rights and is commendable.
Response: The Commission agrees that this modification advances the
due process rights of interested parties and has retained it in this
final rulemaking action.
Comment: This procedural change will maximize interested parties'
ability to fully participate in Commission processes.
Response: The Commission agrees.
List of Subjects in 18 CFR Parts 806 and 808
Administrative practice and procedure, Water resources.
0
Accordingly, for the reasons set forth in the preamble, the Susquehanna
River Basin Commission amends 18 CFR Parts 806 and 808 as follows:
PART 806--REVIEW AND APPROVAL OF PROJECTS
0
1. The authority citation for Part 806 continues to read as follows:
Authority: Secs. 3.4, 3.5(5), 3.8, 3.10 and 15.2, Public Law 91-
575, 84 Stat. 1509 et seq.
Subpart C--Standards for Review and Approval
0
2. In Sec. 806.22, revise paragraph (f)(11) and add paragraph (f)(12)
to read as follows:
Sec. 806.22 Standards for consumptive use of water.
* * * * *
(f) * * *
(11) A project sponsor issued an approval by rule pursuant to
paragraph (f)(9) of this section may utilize any water source approved
for use by the project sponsor for natural gas well development
pursuant to Sec. 806.4 or this section, at the applicable drilling pad
site subject to any approval or authorization required by the member
state to utilize such source(s).
(12) The following additional sources of water may be utilized by a
project sponsor in conjunction with an approval by rule issued pursuant
to paragraph (f)(9) of this section:
(i) Water withdrawals or diversions approved by the Commission
pursuant to Sec. 806.4(a) and issued to persons other than the project
sponsor, provided any such source is approved for use in natural gas
well development, the project sponsor has an agreement for its use, and
at least 10 days prior to use, the project sponsor registers such
source with the Commission on a form and in a manner as prescribed by
the Commission, and provides a copy of same to the appropriate agency
of the member state. Any approval issued hereunder shall be further
subject to any
[[Page 49813]]
approval or authorization required by the member state to utilize such
source(s).
(ii) Sources of water other than those subject to paragraph
(f)(12)(i) of this section, including, but not limited to, public water
supply, wastewater discharge or other reclaimed waters, provided such
sources are first approved by the Executive Director pursuant to this
section. Any request to utilize such source(s) shall be submitted on a
form and in a manner as prescribed by the Commission, and shall be
subject to review pursuant to the standards set forth in subpart C of
this part. Any approval issued hereunder shall be further subject to
any approval or authorization required by the member state to utilize
such source(s). The notice requirements related to agencies of member
states, municipalities and counties contained in paragraph (f)(2) of
this section, and the notice requirements contained in paragraph (f)(3)
of this section, shall likewise be applicable to any request submitted
hereunder.
Subpart D--Terms and Conditions of Approval
0
3. In Sec. 806.32, revise paragraph (a) to read as follows:
Sec. 806.32 Reopening/modification.
(a) Once a project is approved, the Commission, upon its own
motion, or upon petition of the project sponsor or any interested
party, may at any time reopen any project approval and make additional
orders or otherwise modify or impose such additional conditions that
may be necessary to mitigate or avoid adverse impacts or to otherwise
protect the public health, safety, and welfare or water resources.
Whenever a petition for reopening is filed by an interested party, the
burden shall be upon that interested party to show, by a preponderance
of the evidence, that a significant adverse impact or a threat to the
public health, safety and welfare or water resources exists that
warrants reopening of the docket. Notwithstanding the foregoing, any
petition filed by a party who previously sought the same or
functionally equivalent relief identified in the petition pursuant to
the administrative appeals process under Sec. 808.2 will not be
eligible for consideration by the Commission absent new facts not known
or readily discernable at the time of consideration of the petitioner's
previous request for administrative appeal filed pursuant to Sec.
808.2.
* * * * *
PART 808--HEARINGS AND ENFORCEMENT ACTIONS
0
4. The authority citation for Part 808 continues to read as follows:
Authority: Secs. 3.4, 3.5(5), 3.8, 3.10 and 15.2, Public Law 91-
575, 84 Stat. 1509 et seq.
Subpart A--Conduct of Hearings
0
5. In Sec. 808.1, revise paragraphs (a)(2) and (c) to read as follows:
Sec. 808.1 Public hearings.
(a) * * *
(2) Proposed rulemaking.
* * * * *
(c) Notice of public hearing. At least 20 days before any public
hearing required by the compact, notices stating the date, time, place
and purpose of the hearing including issues of interest to the
Commission shall be published at least once in a newspaper of general
circulation in the area affected. Occasions when public hearings are
required by the compact include, but are not limited to, amendments to
the comprehensive plan, drought emergency declarations, and review and
approval of diversions. In all other cases, at least 10 days prior to
the hearing, notice shall be posted at the office of the Commission (or
on the Commission Web site), mailed by first class mail to the parties
who, to the Commission's knowledge, will participate in the hearing,
and mailed by first class mail to persons, organizations and news media
who have made requests to the Commission for notices of hearings or of
a particular hearing. With regard to rulemaking, the Commission shall
convene at least one public hearing on any proposed rulemaking it
approves for public review and comment. For any such hearing(s),
notices need only be forwarded to the directors of the New York
Register, the Pennsylvania bulletin, the Maryland Register and the
Federal Register, and it is sufficient that this notice appear only in
the Federal Register at least 20 days prior to the hearing and in each
individual state publication at least 10 days prior to any hearing
scheduled in that state.
0
6. In Sec. 808.2, revise paragraph (a) to read as follows:
Sec. 808.2 Administrative appeals.
(a) A project sponsor or other person aggrieved by any action or
decision of the Commission or Executive Director may file a written
appeal requesting a hearing. Except with respect to project approvals
or denials, such appeal shall be filed with the Commission within 30
days of the action or decision. In the case of a project approval or
denial, such appeal shall be filed by a project sponsor within 30 days
of receipt of actual notice, and by all others within 30 days of
publication of notice of the action taken on the project in the Federal
Register.
* * * * *
Dated: September 16, 2009.
Thomas W. Beauduy,
Deputy Director.
[FR Doc. E9-23281 Filed 9-28-09; 8:45 am]
BILLING CODE 7040-01-P