The State of Alaska Department of Environmental Conservation (DEC) hopes to sell the Alaska State Legislature on a costly program to take over responsibility for federal permitting of wetland development. This comes at a time when the legislature faces a deficit of between $400 and $600 million, depending on the level of funding they arrive at for a boost to our education system. It also comes when the state lacks any credible fiscal plan to bridge the deficit gap aside from drawing down savings accounts.
The program DEC hopes to burden the state with is called “Clean Water Act Section 404 primacy”. The 404 permitting program regulates the dredging and filling of wetlands and waterways for construction projects, including large mining projects, often in sensitive salmon habitat. The federal government handles this responsibility for (almost) all states because the federal government has the resources to do the vast and complicated job. States generally do not have the resources. Alaska definitely does not. Exhibit A) $½ Billion deficit and no fiscal plan. Three states: Michigan, New Jersey, and Florida have assumed 404 permitting primacy, and all of these states are having trouble maintaining them.
Under the Clean Water Act, a state can apply to take over the program if it can demonstrate that the state program is equivalent to the federal program. Already, the lowball cost estimates that DEC has provided make it clear that Alaska intends to take over the program and do the bare minimum to meet the federal requirements. Currently, the federal program requires 49 staff with an annual budget of $7.9 million. DEC has requested $5 million for a program run by 28 staff. The likelihood that an understaffed and underfunded state permitting program will do a lousy job and be hit with lawsuits is absolute. Part of the DEC's rationale for wanting to assume the program is to “speed up” the permitting process. Remember that these are highly complex permits, often in sensitive salmon wetland habitat, in a state with the most wetland habitat. A state that is drawn together by salmon, if nothing else. The true cost of this program to state coffers has been grossly underestimated.
Lawmakers in the House Finance Committee saw the wisdom of denying the proposed $5 million increment increase to create a new DEC bureaucracy and took it out of the budget, allocating the money to a program that actually has a proven track record: Head Start. The budget then moved to the full House floor and the wild and wooly full House amendment process, where it was added back in through some clever political maneuvering on a vote of 18 against, 22 for. The hypocrisy is rich in lawmakers acceding to the creation of a new bureaucracy with only the vaguest idea about outcomes - especially those who bemoan “outcomes” in education while voting to starve that critical system.
If the idea is that DEC wetland permitting will improve economic outcomes for Alaska, one has to only look to our takeover of federal wastewater permitting. In the decade since we took over the responsibility for wastewater permitting, under the same rationale as today’s push for 404 primacy, our state’s economy has not been bolstered by more lax wastewater permitting. In fact, we have plummeted and are stubbornly at the bottom of most national rating systems as far as economic activity. The argument that assuming wetland permitting will ultimately pay for itself through increased permit issuance and permit fees is also a sham. Since DEC took over the federal wastewater permitting agency, funding has consistently dropped, causing many of its core programs to be severely underfunded. The legislature would do well by revisiting self-serving assumptions made by extractive industry boosters about the connection between permitting and the overall economy. To be open for business, a lot of actual choices will have to be made about broad-based individual taxes, closing corporate tax loopholes, and funding early childhood and social services programs. Creating a new state bureaucracy to craft shoddy development permits that will not protect salmon, will be constantly challenged in court, and will cost Alaskans well over the $5 million a year figure being foisted on the legislature (easily $10 million a year by some estimates) is no way to get there.
The state Senate still has yet to start working on its version of the operating budget. From there, the budget differences will be hashed out by House and Senate conference committees, so there remain plenty of opportunities to call on the legislature to remove the proposed money for DEC wetland permitting primacy. The fact that the House Finance Committee chose Head Start over creating more DEC bureaucracy should give us hope that many lawmakers in the Senate will choose the future instead of the past in their decision-making.
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