Saturday, March 19, 2011

Irrigation bills come before Senate committee

Wednesday this week, the Senate Resources & Environment Committee examined several pieces of legislation dealing with irrigation issues. H136 made changes to existing processes in order to increase efficiency for the Idaho Department of Water Resources (IDWR) and the irrigation districts. The bill proposed that when a water master is re-appointed in consecutive years, he does not have to re-take the oath each time which saves time and money for IDWR and the districts which don’t have to process identical paperwork every year. In addition, the bill allows the appointment of a water master without the requirement of a written petition; allows districts to present yearly budgets 14 days before their annual meetings and to submit only the final approved budget to IDWR. In addition, districts that have budgets of $7500 or less are allowed to have the water master also serve as the treasurer.

The committee sent the bill to the Senate floor with a do-pass recommendation.

H 137a dealing with channel alterations brought more questions from the committee. The legislation allows work by districts to repair diversions and keep water flowing to begin without a permit from the county. According to IDWR rules (which are 36 pages long), cleaning, maintaining, and clearing debris does not require a permit. This exemption has not been recognized in Blaine County which requires a separate permit process without any exemption for cleaning & maintenance type work. It can take 1-3 months to get such a permit from the county commissioners. This puts a burden in the way of water delivery. Recognizing the exemption for cleaning, maintaining and clearing debris does not wipe out the existing city and county permit system that requires permits for substantial work in streams.

According the Tom Bowman, Blaine County Commissioner, the county requires permits for substantial work that has an impact on the flood plain and threatens flood insurance. Blaine County does not see a need for this legislation and are concerned when routine maintenance turns in to substantial work that abuses the permit.

The legislation as amended is opposed by the Idaho Association of Counties (IAC) which agrees that removing debris and routine maintenance does not need a permit but constructing or using equipment in the water which could cause a possible loss of flood insurance under FEMA rules requires a permit.

The dispute seems to have been caused by work that was supposed to be routine rebuilding of a diversion and cleaning debris but did extensive modifications using heavy equipment in the stream and altered the flow of the stream. The committee voted 5-4 to hold the bill for one week to allow the parties to negotiate a compromise.

Ag Affairs addresses "rock snot" and other invasive species

Senator Corder presented SCR101 to the House Committee on Agricultural affairs. The resolution highlights the threat of aquatic nuisance species to Idaho’s lakes and streams. Senator Corder specifically pointed out the threat of an invasive algae, Didymo, otherwise known as “rock snot,” which has decimated prized salmon spawning areas in New Zealand, and has recently been found in Priest River, likely from the contaminated felt soles of waders commonly worn by fly fishermen.

Senator Corder noted that herbicides are ineffective because of the lack of ability to maintain contact with the species in moving water.

“The best solution is to keep an invasive species from being introduced,” he said.
Amy Ferriter, ISDA. Invasive Species. Coordinator, gave the committee an update on efforts to stave off invasive species in Idaho waters such as quagga and zebra mussels.

Before January 2007, these organisms were not in the western United States. Now they’re in Lake Mead. Anything touching the water, including infrastructure in Hoover Dam, Parker Dam and Davis Dam, are covered shortly after immersion. Divers have to chip the organisms off on a regular basis.

This year is a bumper crop of quagga muscles at Lake Mead, Ferriter says. Boat owners are beginning to lift their boats out of the water for storage. Western states including Washington, Oregon, Wyoming, Idaho and Montana are still quagga free. Idaho set a trend in initiating sticker fees. Oregon and Wyoming are following our lead. Oregon is not allowed to do mandatory inspection stops, all of their inspection stations at boat ramps are voluntary. Our stops are roadside. Oregon does more expensive boat launch inspections. Washington has mandatory roadside blitzes as funding is available. The passport program has helped expedite boaters through the inspection stations.

Questionnaires show that every state except Delaware has sent boats to Idaho.
The large, moored boats that leave the state for the winter are the highest risk boats. Ferriter’s office is working with the department of transportation and training the port of entry inspectors.

Friday, March 18, 2011

House Ag looks at privacy for dairy farmers

The House Agriculture Affairs Committee on Thursday passed HB269, which will provide the
same private information protection to dairies nutrient management programs that the beef industry has been granted. Representative Boyle noted that such information may have very little to do with a violation of rule or law, but may contain proprietary information.

Testifying on behalf of the bill were Roger Batt of Food Producers of Idaho, and Brent Olmstead of the Milk Producers of Idaho, pointing out that last year's testimony on behalf of a similar bill relating to the beef industry applies here. Information such as how a dairy farmer manages his fields, tests his product and transports waste is proprietary information, similar to a business plan, with information that could give a competitive advantage to one dairy over another. Wally Butler, range and livestock specialist for the Farm Bureau Federation, also voiced his organization's support for the bill.

Idaho Conservation League's Courtney Washburn said her organization opposed last year's cattle bill as well as this one, in what she said is interest in protecting public health and the environment.

"I’m not convinced nutrient management plans are trade secrets," she said.

When Washburn was questioned further by committee members about similar legislation that affords Micron exemptions to the public records law, she noted that ICL had the same opposition in the case of that legislation.

ICARE's Alma Hasse noted that two bills were not similar, however.

"Cow chips and micro chips are two completely different things," she said. "Any time that an industry feels the need to make every aspect of it’s industry proprietary, especially when it’s cow dung, I don’t see how it helps the public, especially rural communities that are battling water and air quality issues."

Hasse noted that her organization conducted an audit that showed approximately a third of the time a dairy is in noncompliance, it is not listed as such but revealed to be so by inspectors' notations. Such notations would be considered proprietary under the new law.

"If you want the public to know what’s going on in these sites, then this is a bad bill," she said.

John Foster representing the Idaho Press Club expressed his opposition to the bill, but only reluctantly, noting that this bill in particular has come up too quickly for them to have the opportunity to work with the industry to accomplish their objectives but still allow access to information.

"The Press Club likes to position itself as an organization that utilizes the public records law," he said, "The assumption is that the persons making the request and those fulfilling the request are both fulfilling the common good ... We just wanted a seat at the table to help avoid anything inadvertent."

House Energy, Environment and Technology looks at the impacts of tax incentives for wind projects

The impact of Idaho tax incentives for renewable energy projects was the focus of presentations to the House Environment, Energy and Technology Committee this week.

A study from the Boise State University Center for Business and Economic Research was commissioned by a consortium of alternative energy producers. Another presentation from John Church of Idaho Economics followed, focusing on Exergy Development Group, developer of wind projects in Idaho.

The first study utilized data collected from projects of various sizes and from different locations combined and averaged into representative projects representing a 160 MW wind project and a low impact hydro project of 2.5 MW. The study included costs of permitting, construction and operations, as well as how much of the expenditures were local, and projected revenues over the life span of the project. Also considered were the types of jobs created when energy projects come into the state, the corresponding increases in income and expenditures. The study focused particularly on the impacts in rural areas.

Not surprisingly, much of the costs of renewable projects come from the construction phase. The representative wind company generated 380 jobs annually, with $36.7 million in labor income during the construction period. In the operations phase, the total fell to 94 jobs annually for the life of the project and $3.6 million in annual labor income.

The low head hydro project, in contrast, generated 92 jobs during the construction period with a labor income of $3.3 million. The operations phase represented one employee annually, with $50,000 in annual labor income.

The study concluded that Idaho’s tax exemptions and rebates for renewable energy projects have been successful in bringing more such projects to Idaho and have a net positive impact. But a prevailing question throughout the presentations dealt with the impact to the consumer when utility rates go up as a result of buying energy from these projects. Neither study took this factor into account. Committee members also questioned new job figures, some of which may represent workers brought in from other states to function in specialized fields, although they also represent a share of the consumer spending realized by communities in which such projects were sited.

Representative Anderson questioned the value of the incentives, is a 6% sales tax rebate truly what motivates such projects to locate here? Analysts noted that Idaho’s population centers and transmission capabilities typically factor into such decisions.

Idaho’s alternative energy projects have grown from 75 to 400 MW since 2006, and there does not appear to be a decline in new projects. Given what he describes as this “explosion of wind energy in the state,” Representative Simpson asked when we stop incentivizing such projects. Experts assert that developers are aware that this rebate is scheduled to sunset in 2012, and are continuing to locate in Idaho, based upon the assumption that the rebate will be extended.

But what of existing public utilities’ need to pick up the slack when the wind doesn’t blow, Chairman Raybould asked, perhaps rhetorically, pointing out traditional utility's ineligibility for tax incentives when they back up wind projects.

Dr. John Church's presentation focused on economic and fiscal impacts to the state from the perspective of Exergy Development's construction and operation of 300 MW of wind energy in Idaho.

Over a 2 year period, this project would create an additional 650 jobs throughout the state, including specialized workers from outside Idaho. Post construction, the jobs from wind projects shrink dramatically, representing another 125 in ongoing jobs in rural Idaho over a lifetime of 25 years.

This study also evaluated the net effect on state income for each $1 increase in personal income. Income to the state can be realized in sales tax, some in vehicle license fees, registration taxes and product taxes. The additional jobs represented by Exergy projects total $120 million in additional tax revenues from all sources.

Exergy also pays property owners a royalty for placement on their lands. A farmer with ten windmills would realize $60k per year.

Representative Simpson reiterated the prevailing concern about the impact of these projects on utility rates.

“I’m looking at the increased cost for the rate payers,” he said of the rebate. “They hurt everyone, and the end result is we’re paying more for utilities. There should be no net negative over the lifetime of the project to the rate payer . . . most of these projects aren’t base load projects, but intermittent projects, and they’re very costly. “

“I’m not advocating for this as the end-all for energy supply,” Dr. Church said, responding to Representative Simpson's comment and others about the intermittent nature of wind energy and the costs to the consumer.

“It (wind energy) may have some characteristics that are somewhat variable, as others are variable,” he said. “It is one piece of an ideal portfolio, the combination of wind and hydro. There are some synergies that could work very well together. These two are not incompatible in any stretch of the imagination.”

But for Representative Anderson, the question came back to whether or not tax incentives for such projects should continue, although this committee is focused on the energy supply in Idaho and it will be the job of the Revenue and Taxation Committee to deal with the issue of extending tax incentives.

“I’m not convinced with any of these studies that the rebate is the deciding factor,” Representative Anderson said. “I’m not there with whether or not to extend this rebate.”

Thursday, February 24, 2011

ICIE Workshop hones in on bull trout critical habitat rule

The latest of ICIE’s annual “Gold Room Workshop,” held earlier this month, focused on bull trout, nearly 20 years after the U.S. Fish & Wildlife Service was petitioned to list the species.

Brian Kelly and Ted Koch of the US Fish and Wildlife Service joined Nate Fisher of the Idaho Office of Species Conservation and Norm Semanko of the Idaho Water Users Association in providing historical context and highlighting key issues on the topic for a session of the House Resources and Conservation Committee. The presentation was made to the Senate Committee on Resources and the Environment on Monday.

Kelly described the process for designating critical habitat in Idaho, noting that the critical habitat designation that the USFWS made in 2005 excluded 75% of the area designated in the original rule. Lawsuits were filed and in 2008 the Inspector General found fault with the proposed plan. The new plan designates a total of more than 9,000 miles of streams and 170,000 acres of lakes and reservoirs in Idaho.

Kelly said the economic impact of this plan will be minimal since 94% of this habitat is occupied and protected by original listing regulations. The USFWS compiled the final rule, addressing more than 1,100 comments from 350 commentators including federal agencies, tribes, the state, and the general public all related to water use.

Kelly noted that the primary impact of establishing critical habitat is to focus recovery efforts, including educating the public, collaborating with partners to restore habitat and water flows, implementing improvements in stream habitat and water quality, and protecting the species from direct take. He maintained that so much of the state is designated as critical habitat precisely because Idaho’s bull trout population is in such good shape.

“Bull trout have been listed since 1998, and we have not made a jeopardy finding. In all the areas where bull trout is doing so well, a listing of critical habitat does help focus critical habitat dollars for things like piping or fish screens for ranchers, for example, that want to engage in those actions.”

Fisher contended, however, that efforts to downplay this extension of critical habitat as “no big deal” are disingenuous, otherwise, why sue the federal government to extend it?

“Conservation groups and the Fish and Wildlife Service say it (critical habitat extension) won’t do much since the species is listed anyway,” Fisher says, “We differ … Their estimate of $5 to 7 million in economic impact is a gross underestimate.”

Fisher also maintained that extending critical habitat will have an impact on efforts to curb invasive aquatic species such as milfoil.

“Under critical habitat designation,” he said, “what consultation will we have to undertake to control these species with pesticide? We cannot simply dismiss this as another procedural practice of a federal agency and move on.”

Semanko outlined several points of contention with the rule, including what he called the arbitrary and capricious decision of Secretary of the Interior to fail to exert his discretion to exclude any particular area from designation on the basis of economic impact, when industry experts estimate over a billion dollars in potential costs in southwest Idaho.

Koch noted that so few exclusions were made to the new critical habitat designation because of the mechanisms needed in order to identify potential exclusions, like tribal management plans, did not exist in Idaho.

“We excluded from critical habitat designation those lands with a plan authorized by us with an endangered species permit, or Tribal management plan, and there were none of those in Idaho,” Koch said. “This is a simple fact – there is no judgment beyond that.”

Drawdowns of Dworshak Dam doesn’t impact one of the most healthy habitats for bull trout, Koch said. “So we would be hard pressed to find that this draw down would have an adverse impact.”

Semanko also pointed out that the designation of critical habitat as spelled out in the rule includes bankful streams and reservoirs. While the Bureau of Reclamation attempted to fix the rule by recognizing reservoir fluctuations, the USFWS didn’t concur. This decision, Semanko asserted, could be used to make the argument that drawing down reservoirs to deliver water constitutes “adverse modification of bankful streams and reservoirs.”

“The fact that an existing Federal project is not presently adversely modifying critical habitat does not mean that the same operations would not result in adverse modification under future circumstances,” he said.

Semanko said there are other adverse impacts of the rule, such as requiring federal agencies to ensure that their actions are not likely to destroy or adversely modify critical habitat. Federal regulations require federal agencies to re-initiate consultation on previously reviewed actions in instances where critical habitat has subsequently been designated. As a result, federal agencies may sometimes need to re-initiate consultation on actions for which formal consultation has been completed. This is exactly what happened with the Upper Snake Basin water project in southwest Idaho, Semanko said, which has undergone consultation pursuant to the Nez Perce Water Rights Agreement.

“It is unclear what new conditions may be required because of re-initiation of consultation,” Semanko said, “or whether such consultations will undo the existing biological opinions for salmon. This potentially impacts the entire region.”

Activities listed in the rules that may result in consultation include:
- Detrimental alteration of the minimum flow or the natural flow regime of any designated stream segment or water bodies,
- Alteration to designated stream segments or water bodies including construction, grazing, off-road vehicle use and mining,
- Detrimental alteration of channel morphology,
- Detrimental alteration to water chemistry,
- Activities that could spread invasive species,
- Activities that could create significant instream barriers such as diversions, impounds and hydropower generation.

Semanko invited USFWS to voluntarily remand this rule and examine potential economic and other impacts in Southwest Idaho for potential exclusion of reservoirs from the critical habitat designation.

Representative Boyle noted her chagrin that the new designation is so much more extensive than the last one. Koch countered that this 2010 modification is very similar to the originally proposed rule, from which the USFWS deleted 75%, an action which resulted in a law suit and with which the inspector general found fault.

Representative Boyle was unsympathetic.

“It appears to be a job protection for federal agencies and a job killer for Idaho,” she said.

Chairman Stevenson addressed the anxiety expressed by the committee members in attendance at the end of the presentation.

“You know why we seem a little spooked with talk about listing species,” he said. “We’ve been burned by the wolf issue.”

Friday, February 18, 2011

Centra Consulting and Bridge Energy present on oil and gas drilling in Payette County

On Monday, February 14, in a presentation for the Senate Resources & Environment Committee, Steve West of Centra Consulting introduced a geophysicist with Bridge Energy who talked about developing the first natural gas field in Idaho—in Payette County. They hope to get wells into production and also construct a pipeline.

The organization has drilled 11 wells. Four of which are unproductive, three are economically viable as they are and four could be viable with the use of fracturing, commonly known as fracing. Fracing is a process that stimulates a well so that the gas flows and the well can produce economically. In the process of drilling and placing the pipeline structure, the concrete and drilling mud block the pathways that connect the pores in the rock that contain
the natural gas. The process that Bridge is using is known as a mini-frac and is not nearly as extensive as the large shale fracturing process that has been in the press.

A mini-fracing process will clear pathways in those four wells to allow the gas to flow, analogous to a building like the Statehouse. The pores are the rooms which are reached through hallways. Fracing re-opens the doorway to the hallway so people can move between the rooms. The fracing that will be used only goes out about 150 feet from the bore hole and uses 3% of the fluid pressure volumes of the large shale fracs and the actual treatment takes 45 minutes.

The Payette County aquifers are 60 to 300 feet below the surface; the gas sands are between 2000 and 4000 feet and are separated from the aquifers by 1700 feet of impermeable shale.

Officials noted that they were presenting to the committee with the hope that negotiated rulemaking would take place to set up the regulatory program to cover oil and gas drilling. The Idaho Land Board also serves as the Idaho Oil and Gas Conservation Commission. The Commission has not had to meet for at least 18 years. The Commission is made up of Governor Otter and the state’s top elected officials and has has oversight of oil and gas drilling. This same presentation was made to the Commission on Tuesday.

Changes to the anti-deg rule raise concerns about the public process among HEET committee democrats

In January, the House Environment, Energy and Technology Committee was given a heads up from the Idaho Department of Environmental Quality (DEQ) that a rule change was coming regarding water quality anti-degradation. The rule, and pending legislation would together address requirements of the Clean Water Act that Idaho have an anti-degradation implementation plan as well as the water quality standards already in place. The fact that such an implementation plan does not exists in Idaho is the subject of a lawsuit brought by the Idaho Conservation League, which touched off a flurry of negotiated rule making last summer.

Barry Brunelle representing Idaho DEQ, outlined changes to the originally proposed rule that he said would both pass muster with the EPA and strike language that gave industry cause for concern about stringency. Legislation in the form of HB153 would provide a subsequent mechanism to make connections to the rule and statute by accommodating some areas in the rule that were deleted.

The proposed changes to the rule address:
- Definition of degradation or “lower quality” water
- General permits
- Identification of Tier 2 water limits
- What constitutes significant versus insignificant discharges

Democrat committee members questioned the logic behind adopting a rule prior to hearing about the legislation designed to shore up the rule. They also questioned the rulemaking process. Was there adequate public input? Brunelle responded that between 60 and 80 people participated in the rulemaking sessions.

“I’m not sure how we can vote to reject portions of the rule without understanding what we’re
going to replace it with,” Representative Brian Cronin noted.

Chairman Raybould, IACI and DEQ representatives explained that HB 153, which would be considered by this committee pending the outcome of this rule change, was put together to accommodate areas in the rule that were being deleted. The deletions were from the proposed additions brought about in the rule making process this summer. They don't constitute new rule making, Raybould noted, but a process whereby DEQ and IACI agreed upon changes in the rule that each could live with.

Alan Prouty, speaking on behalf of the IACI environmental committee, noted that the deleted sections represented major actions to those in the “permitting world,” that caused anxiety.

Representative Jaquet proposed a substitute motion to hold the rule, noting that as a member of the committee she had not been consulted about the proposed changes and how they came about.

“I don’t think it’s appropriate when you have negotiated rule making and someone goes through making changes and I think we should hold this rule until people feel comfortable,” she said.

Representative Schaefer asked about the possibility of creating a temporary rule. But Raybould noted the urgency created by ICL's lawsuit and the need to have an anti-degradation plan in place. Without this rule and a companion bill, he said, there is a risk that permits written in the interim would be more stringent than necessary, creating a hardship on those seeking permits.

Jaquet’s motion to hold the original motion failed, and the original motion to approve the water quality standards rule passed, with dissent from all three Democrats on the committee.

Chairman Raybould then presented his companion bill, HB 153 to address the rule changes.

Prouty, representing IACI and the regulated community, outlined the key properties of the bill:
- It maintains consistency with the Federal CWA, in reference to navigable waters of the US
- It defines “degradation” or “lower water quality,” providing replacement language for that which was stricken in the rule
- It provides language about how general permits are defined , clarifying how general permits are evaluated by the department for meeting anti-degradation requirements
- It identifies Tier 2 or high quality water, recognizing that there are certain water bodies that may not meet the definition of high quality water for isolated reasons but otherwise might meet that standard
- It replaces language for what was rejected in the rule regarding significant versus insignificant discharge

Brunelle noted that there were three specific policy areas this bill addresses:

- Where classification of the waters is being looked at with respect to what pollutant for which it was listed, it gives leeway to the department to move a water body from a Tier I to a Tier II definition, in recognition that there may be one element that is off, but that the body has a robust ecology
- It addresses special resource waters
- It includes language defining insignificant discharges. The rule deletes this part. The assumption is that the assimilative capacity could be split up between discharges. This rule would allow the current discharger to be deemed as an insignificant discharger, while future sources of discharges would not.

ICL’s Justin Hayes noted that while the DEQ feels the rule and this bill would pass muster with the EPA, should they be approved, the ICL will challenge them. Referring back to the rule changes that had recently been passed, he noted that they erode the potential that the rule will be approved.

“I think that the rule was very delicately balanced and may have been approved, but with this legislation, it won’t. By passing it you are placing permit seekers at peril,” he said.