Transcript CHESAPEAKE BAY PROGRAM EXECUTIVE COUNCIL GUNSTON HALL ▪ LORTON, VA ▪ JULY 9, 2012 Strategies To Meet Infrastructure Finance Goals Christopher D.

CHESAPEAKE BAY PROGRAM EXECUTIVE COUNCIL
GUNSTON HALL ▪ LORTON, VA ▪ JULY 9, 2012
Strategies To Meet
Infrastructure Finance Goals
Christopher D. Pomeroy
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3-Part Point Source Strategy
in Virginia
• Shared Financial Commitment
– Partial grant funding for Wastewater Plant upgrades
• Innovative Regulation
– One Watershed General Permit for all dischargers
• Market-Based Flexibility
– Flexible permittee-led trading with accountability
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1. Shared Financial Commitment:
Water Quality Improvement Grants
• Role of the Commonwealth of Virginia
– Fund Grants Program through State Budget
– Use cash (% of budget surplus, if any) or debt as needed
– Reimburse Localities for set % of construction costs
• Role of Locality (WWTP Owner)
– Plan, design and construct facility upgrade
– Operate facility to meet nutrient performance standards
– Finance local share (~ 50% to 75% of total project) usually
with 20 to 30-year debt
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Shared Financial Commitment:
Investment History
• A Reliable State-Local Partnership
– 16-year track record (1998-2013)
• State Contribution of $744 Million through FY13
– Average of $47 million per year
– FY13 Budget adds an above-average $88 million
• Locality Contributions (est.)
– State grants leveraged ~ $1.5 billion in local funds
– Over $2 billion (total) invested
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2. Innovative Regulation
• Watershed General Permit (WGP)
– A single permit covers all wastewater treatment plants
– Focuses on “significant” facilities first
• WGP Set a Common Schedule for All Facilities
– Set effective date of Jan. 1, 2007
– Set compliance deadline of Jan. 1, 2011
– Supports stable, predictable regulatory climate
• WGP Authorized Use of Trading for Compliance
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3. Market-Based Flexibility:
Point Source Nutrient Trading
• Participant-Run Trading Program
– Exchange Assn & Members create 5-year trading plan
– Member-operated Exchange facilitates most trades
– DEQ has oversight authority, but no direct role in trades
• Outstanding Results
– 75 Owners, 110 Facilities, and 100% compliance
– 246,000 N and 77,000 P credits traded and used in 2011
– Total credit value of $1.9 million for 2011
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Stakeholder Perspective on
Keys to This Success
• Reliable financial partnerships
• Willingness to change old regulatory models
• Predictable rules that focus on the big picture
• Appropriate flexibility for implementation details
• Long-term stable regulatory climate
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THANK YOU
FOR MORE INFORMATION
Christopher D. Pomeroy
[email protected]
www.AquaLaw.com
(804) 716-9021
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