NCC000001_Neuse River Foundation Formal Objection_20050224

February 24th, 2005
Mr. Alan Klimek
Director,the Division of Water Quality
1617 Mail Service Center
Raleigh,NC 27699-1617
Dear Alan,
The Neuse River Foundation formally objects to the recent modification of the Neuse
River Compliance Association permit regarding the reallocation of the Bay River MSD
(formerly permit#NC0066109)nitrogen credits into DHHS/Butner's Estuary TN
Allocation. The Division of Water Quality made a major modification without issuing
public notice. In doing so,the Division acted improperly and must go through a formal
NPDES permit modification process in which the public is notified. In light of the recent
controversy surrounding Butner's proposal to purchase nitrogen pollution credits from
Bay River and transfer 61,130 lbs/yr of nitrogen into the upper end of the Neuse River
Basin,the Division should recognize the clear public interest in this and similar issues
and act appropriately by informing the public. In addition,the Environmental Protection
Agency has previously objected to such modifications as they considered them to be
major modifications,not minor,therefore requiring public notice.
The Neuse River Foundation also feels the DWQ acted improperly by reallocating
additional nitrogen credits before the completion of the Falls Lake study. While the
Division suggests that"Butner can not apply the added allocation to its discharge,"it is
clear the purchase of these nitrogen pollution credits are now"counted as part of the
Association's group allocation"in the upper part of the Neuse Basin(Falls Lake). It is
also listed as Butner's Estuary TN Allocation. Yet, the permit is vague and does not
specify DHHS's Discharge TN Allocation. Once the reallocation is finalized in the
permit, Butner and other upstream dischargers will likely pursue the use of these
additional credits. At the very least, it creates more of an incentive to leverage the use of
these pollution credits.
According to Part I under"Special Conditions"A.1. Definitions, section D,Discharge
TN Allocation means the"TN Allocation specified at the point of discharge(or"end of
• pipe"). A Co-Permitee Member's discharge allocation is equivalent to its Estuary TN
Allocation divided by the applicable Transport Factor." Considering that DHHS's
estuary allocation is stated at 6,113 lbs/yr,this permit by definition would allow DHHS to
use at least a portion of this allocation at the point of discharge(or"end of pipe"). The
Neuse River Foundation feels that any increase of additional nitrogen(reallocation)
would violate the nitrogen cap for Falls Lake stated in the Neuse TMDL Rules (15 A
NCAC 02B.0234).
The Neuse River Foundation feels DHHS's reallocation should not be issued without
explicit numerical data indicating their overall"Discharge TN Allocation,"which is
currently listed as"N/A."It seems to imply,based on the transport factor,that DHHS's
discharge allocation could potentially increase to the full 61,130 lbs/yr,but it is not clear.

This is not how NPDES permits are intended to work. When would this increased
discharged allocation be issued? Would it be issued without public comment? The Neuse
River Foundation feels these concerns need to be addressed before the Division should
even consider reallocating the Bay River MSD credits.
The NC Division of Water Quality also needs to clarify how it intends to protect waters
between the estuary and the discharge pipe(in this case DHHS) as to prevent localized
"hot spots"from occurring. The primary focus of this permit considers only those waters
in the Neuse Estuary. There needs to be specific language or a mechanism in the
Association permit indicating mere ownership of pollution credits does not guarantee the
right for dischargers to use the credits. These concerns only highlight why considerable
objections were raised at the recent public hearings regarding pollution trading and the
Neuse River Compliance Association permit, as it allows unrestricted pollution trades to
occur throughout the entire Neuse River Basin.
By issuing this permit modification,the Division of Water Quality has taken a major step
toward allowing the largest pollution trade/transfer ever proposed in the US to occur with
out the ability of the public to weigh in on this matter. We feel this is unacceptable and
look forward to your response.
Sincerely,
Dean Naujoks
Upper Neuse Riverkeeper
Neuse River Foundation
112 S. Blount Street
Raleigh NC 27601
Larry Baldwin
Lower Neuse Riverkeeper
Neuse River Foundation
220 S. Front Street
New Bern NC 28560
CC Jimmy Overton,Mike Templeton,Mayor Charles Meeker,Dee Stewart(EPA Region
IV),Marshall Hyatt(EPA Region IV), Senator Janet Cowell, Senator Neal Hunt, Senator
Richard Stevens, Senator Scott Thomas,Representative Rick Eddins,Representative
Deborah Ross,Representative Jennifer Weiss,Representative Alice Underhill,
Representative William Wainwright,Representative Steven LaRoque,Representative
Marion McLawhorn and Representative Jeanne Farmer-Butterfield.