HD23 - Implementation of the Chesapeake Bay Preservation Act

Executive Summary:
The Chesapeake Bay is North America's largest estuary (an area where fresh and salt water mix), and it is the third largest estuary in the world. About half of the Bay's water comes from the Atlantic Ocean, while the other half drains from the streams and rivers of six states that are part of the Bay's watershed: Delaware, Maryland, New York, Pennsylvania, Virginia, and West Virginia (the District of Columbia is also part of the watershed). By some estimates, approximately 60 percent of the land area in Virginia drains into the Chesapeake Bay.

The General Assembly enacted the Chesapeake Bay Preservation Act (Bay Act) in 1988 as a partnership between the State and 84 of Virginia's eastern-most localities that are located in the Chesapeake Bay watershed (see figure, page ii). The primary focus of the Bay Act is to guide local land use decisions in a manner that promotes the water quality of the Bay and its tributaries while not unduly restricting the rights of landowners to develop their property. The Code of Virginia vests the localities with the primary responsibility to initiate and implement the Bay Act. The State is responsible for providing financial and technical assistance to the localities and ensuring that the provisions of the Bay Act are appropriately enforced.

The degradation of the Bay, it is believed, has occurred over a few centuries. Human activities from about the mid-1700s initiated a downward trend in the Bay's health. The 1983 Chesapeake Bay Agreement, the first in a series of multi-State agreements to improve the conditions of the Bay, and Virginia's 1988 Bay Act came into existence after the extent of the environmental degradation of the Chesapeake Bay became more fully understood during the 1970s and the 1980s. By that time, summertime dissolved oxygen levels in the Bay (necessary for the survival of most aquatic plants and animals) were found to be severely depleted. Submerged aquatic vegetation (an indicator of the Bay's health), which had once covered shallow parts of the Bay, had almost disappeared. Both of these trends, it was concluded, stemmed in large part from increased loadings of nutrients due to land uses in the Bay watershed. For numerous reasons that included the impact of pollutant loads on water quality, seafood catches from the Bay also dramatically decreased over the decades. These findings led to public policy commitments to undo these trends and restore the health of the Bay.

Virginia's Bay Act has served as a vehicle for addressing State water quality goals and the State's commitments under various Chesapeake Bay Agreements with the federal government and other states to clean up the Bay. Through the Bay Act and the Bay Agreements, the State has set forth a policy indicating that the Bay is worth saving. It has also set forth the policy that the State and localities are to be cooperative partners in Virginia's efforts to establish a Bay Act program and help restore the water quality of the Bay.

As the degradation of the Bay occurred over centuries, and given continuing population growth in the watershed, it is widely recognized that a long-term effort will be necessary to bring substantial and lasting improvement to the water quality of the Bay. Virginia's Bay Act program in the Tidewater region is a small but potentially important piece of the multi-State effort to restore the Bay, and it also is potentially important from the standpoint of improving local water quality. Even at this relatively early stage in the existence of this program, it appears useful to assess the progress that has been made to date in implementing and enforcing the program.

House Joint Resolution 622, approved by the 2001 General Assembly, directs the Joint Legislative Audit and Review Commission (JLARC) to conduct such an assessment. The mandate requires that JLARC assess the Chesapeake Bay Local Assistance Board's (CBLAB) oversight and enforcement practices concerning local compliance with the Act. (The Board is assisted in performing its responsibilities by the staff of the Chesapeake Bay Local Assistance Department, or CBLAD.) The mandate also requires an evaluation of the implementation and enforcement of the local Bay Act programs, focusing especially on the frequency and rationale of permitted encroachments into the vegetated buffer area.

Finally, an assessment of the current resources necessary at the State and local level for implementation and enforcement of the Bay Act is also required. As part of the process for determining the scope of JLARC's review of State spending issues, JLARC members indicated at a July 8, 2002, meeting of the Commission that the issue of CBLAD's potential merger into the Department of Conservation and Recreation (DCR) should also be considered as part of the review.

The JLARC staff assessment of the implementation and enforcement of the Bay Act to date has resulted in six major findings that may be useful to policy-makers in considering the State's future approach to its supportive role under the Act. These findings include the following:

• The process by which localities have achieved consistency with Bay Act requirements has been slow, but gradual progress has been made. In part, slow progress has been due to the complexity of achieving the required tasks, which included mapping environmentally sensitive areas, adopting the performance criteria required by the Bay Act into local ordinances, and adopting water quality protections into local comprehensive plans as required by the Code of Virginia.

• The enforcement record of localities under the Act is mixed. Key problem areas identified in this review included localities permitting development in environmentally sensitive areas, and not adhering to the regulations concerning: (1) the pumping out of septic systems, and (2) the use of Best Management Practices (BMP) agreements when addressing permitted encroachments into sensitive lands.

• The majority of local governments responding to a JLARC staff survey indicated that CBLAD provides appropriate technical assistance concerning their programs. However, CBLAD staff may not be able to continue providing this level of assistance as a result of current and potential budget constraints.

• State oversight and enforcement of the provisions of the Bay Act and the regulations have been weak, and recent efforts by CBLAB and CBLAD to focus more on these issues could be jeopardized by budget cutbacks.

• Four options for consideration are discussed in the report regarding CBLAD's placement and responsibilities. These include consideration of CBLAD's future status as an agency and a potential merger with DCR. It appears that some small cost economies and increased levels of coordination on some technical issues may occur as a result of such a consolidation. However, there are also concerns about the impact of such a change on the short-term performance of, and long-term priority given to, the Board and the agency. In view of these concerns and the commitments the State has made to protect the water quality of the Chesapeake Bay, it may be more appropriate to allow CBLAD to continue performing its core functions as a separate entity.

• State and local policy-makers will likely need to decide whether to expand the geographic coverage of the Bay Act in the absence of fully conclusive benefit and cost data. In light of the State's budget difficulties, a prudent course may be to pursue limited expansion activity, by achieving consistency in participation among planning district commissions with localities already under the Act, or by working with localities interested in pursuing land use planning without the compulsion of a State mandate.

In sum, local programs that are considered fully consistent (at least on paper) with the Bay Act have only been established during the past decade in Tidewater. The difficult work of enforcing the requirements, ensuring the maintenance of effective water quality protection measures, and measuring long-term results still remains, as does the question of whether the geographic coverage of the Act should be extended. A higher State priority to enforcement of the Bay Act, which CBLAB and CBLAD will implement through a new compliance review process contained in the board regulations, should be helpful in maximizing the impact of the program. A merger of the agency into a larger agency at this time may hamper the achievement of this objective in the short-term and reduce the visibility and priority given to the Bay Act in the long term.

Implementation of Local Bay Act Programs Was Slow

The Code of Virginia places the primary responsibility for implementing and enforcing the provisions of the Bay Act on the 84 Tidewater local governments. The Tidewater localities meet this responsibility by developing and implementing their own local programs. A key component of the Bay Act requires localities to designate and protect Chesapeake Bay Preservation Areas (CBPAs) using performance criteria established by CBLAB. In addition, the Code of Virginia authorizes local governments to use their police and zoning powers, including civil penalties, to enforce violations of their local programs. The Code also allows localities outside the Tidewater region to incorporate elements of the Bay Act program into their comprehensive plans and land use ordinances. However, according to CBLAD staff, Albemarle County is the only non-Tidewater locality to adopt elements of the Bay Act program.

To facilitate local implementation of the Bay Act, CBLAB established a "three-phase implementation process" that localities follow to develop Bay Act programs. In Phase I, localities designate CBPAs and adopt CBLAB performance criteria to protect these areas. In Phase II, localities incorporate water quality protection measures into their comprehensive plans, and in Phase III, localities achieve initial completion of their Bay Act programs by revising all land use ordinances to make certain they are consistent with the Bay Act and board regulations.

Despite adoption of a Code requirement to complete Phase I within 12 months of adoption of the initial regulations (which became effective in 1991), it was not until 1997 that all 84 localities had designated Chesapeake Bay Preservation Areas and adopted ordinances to implement the program requirements. Upon review by CBLAB, some of these local programs were found to be provisionally consistent, with some local program language or elements needing further improvement to achieve full consistency. While implementing the ordinances they had adopted, these localities worked with CBLAD staff to accomplish the needed program changes. The last of these localities finally achieved full consistency with Phase I requirements in 2002, according to CBLAD staff.

While virtually all localities have now achieved initial consistency with Phase II requirements, six years passed between when the first locality achieved Phase II consistency and the time that most localities achieved this consistency (in 2001). CBLAB postponed requiring localities to begin the final implementation phase because it adopted revised regulations in December 2001, giving localities until March 2003 to amend their programs to comply with the new requirements. Factors that contributed to the slow progress on Phases I and II are numerous, but appear to include: the complexity of the task, inadequate resources, limited locality commitment, a limited State priority for CBLAD's activities, and differences in the sophistication of the local comprehensive plans and ordinances. Furthermore, concerns related to the issue of private property rights are frequently encountered by localities when administering the Bay Act provisions.

Local Enforcement of the Bay Act Appears Mixed

One key element of the CBPAs is the Resource Protection Area (RPA). RPAs consist of environmentally sensitive lands along shorelines or perennial streams that serve as ''filters'' by removing pollutants from runoff before they enter the Bay and its tributaries (see figure below). CBLAB regulations strictly limit development activities from encroaching into the RPAs due to the important function these areas perform in reducing nonpoint source pollution.

JLARC staff conducted a file review at 11 selected Tidewater localities to assess the extent of encroachment activity. It was not feasible as part of this file review to systematically review records and collect data pertaining to denied applications as the localities, for the most part, did not maintain this information. However, a JLARC staff review of the files maintained by these localities for FY 2000 and FY 2001 indicated that these localities approved a substantial amount of encroachments into the RPA during those years (see table on page vi). Furthermore, 30 percent of the files reviewed allowed encroachments for non-exempt applications into the seaward 50-feet of the vegetated buffer.

Localities also enforce their Bay Act programs through application of the CBLAB performance criteria. Results of the JLARC staff survey of the Tidewater localities suggest that local application of two of these performance criteria is not consistent across the localities. Responses by Tidewater localities indicate that enforcement of the requirements for septic tank pump-out and the use of best management practices agreements when addressing permitted encroachments has been irregular.

Recommendation. The Tidewater localities should seek to preclude land-disturbing activities in the Resource Protection Areas when possible. In cases where RPA encroachments are appropriate, CBLAD should ensure that Tidewater localities are appropriately applying the regulations to development activity that is permitted in the 100-foot Resource Protection Area buffer. The Tidewater localities should ensure that maintenance agreements are required whenever Best Management Practices (BMP) are used to mitigate land disturbances resulting from RPA encroachments. Local governments should also periodically inspect these BMPs to ensure that property owners maintain them. In addition, Tidewater local governments, CBLAD, and the Virginia Department of Health should work to ensure that residential septic systems are identified and periodically maintained in accordance with board regulations.

CBLAD's Provision of Technical Assistance Has Been Appropriate, But Overall the Program Has Lacked Resources and Direction

The Code of Virginia requires CBLAB and the department to provide financial and technical assistance to the localities, planning district commissions (PDCs), and other governmental entities in the Tidewater designation as they implement the provisions of the Bay Act and regulations. A substantial majority of respondents to the JLARC staff survey of Tidewater localities indicated that CBLAD staff provides appropriate and timely assistance. However, local staff also indicated that CBLAD needs to continue to present Tidewater-wide educational and training opportunities.

Localities indicate that their programs lacked the resources necessary to better address the Bay Act's provisions. More than half of the 49 respondents to the JLARC survey question about staffing adequacy indicated that their programs had too few staff to perform the primary functions required by the Bay Act. Several localities also reported that CBLAB's revised regulations create new requirements that will likely stress their current resources. These include staffing and funding public hearing requirements and on-site delineation of the Resource Protection Areas. Furthermore, a new local implementation review program being developed by CBLAD will require localities to maintain and report information regarding their programs in ways that they were not previously required to do.

Likewise, CBLAD staff also indicated that inadequate resources have made it difficult for them to ensure that the provisions of the Bay Act and regulations are being appropriately implemented and enforced. Within the natural resources functional area, the agency has not received much priority over the years, and it has not received consistent direction in furtherance of its goals. The agency reports that it has used cost savings from such factors as position vacancies and turnover to fund a historical gap in its non-grant funding level for non-personnel costs. This means that the department is in a poor position to meet budget cuts by not filling vacancies that occur as a result of routine turnover. Further, the department has been meeting its information technology assistance needs by using one of its engineering positions, diverting a substantial amount of time away from the position's assigned engineering responsibilities.

The future viability of certain agency functions may be greatly impacted by these identified funding issues. For example, the agency's Polecat Creek water quality monitoring project, located in Caroline County, may be eliminated as a result of recent budget cuts, according to the agency's acting director. Also, the 2002 General Assembly's substantial funding reduction in the amount CBLAD makes available for local governments, PDCs, and Soil and Water Conservation Districts may make it even more difficult to get locality compliance with the Bay Act and regulations. Finally, language in the Code of Virginia may need clarification to better identify State and local responsibilities regarding the provision of financial resources for this program.

Recommendations. The department should seek to fill its vacant locality liaison position. CBLAD should also prepare a progress report on the Polecat Creek water quality monitoring project outlining its past costs and estimated future costs, analytic results, and advantages and disadvantages of continuing the project. In addition, as the State's fiscal position improves, CBLAD should make budget requests to restore funding for its financial assistance to localities program, in light of the potential cost impact to local governments as they begin their participation in the Local Program Compliance Review process.

Oversight of Local Programs Should Be Strengthened

Despite being required by the Code of Virginia to evaluate and enforce the implementation of the local programs, it does not appear that the board has properly prioritized this responsibility. Prior to 1997, the department had no formal review process for assessing how well a local program addressed the intent of the Bay· Act and the regulations. Beginning in that year, the board adopted a complaint-driven procedure that placed too much responsibility outside the agency to identify potential noncompliance at the local level. In fact, the department has identified this program as "essentially impossible to ensure effective local compliance" as a result of its reactive nature.

Several factors may have impacted the provision of oversight and enforcement by CBLAB and the department. Staff have indicated that the availability of resources required them to choose between performing consistency reviews or local program evaluations and, as a result, they prioritized consistency reviews. Board members and staff also told JLARC staff that the Bay Act is a partnership between the State and the local governments, and therefore, it is better to work with the localities rather than threaten them with legal action. They noted that delays in the board's attempts to promulgate regulations also reduced the board's desire to take legal action against non-compliant localities.

Since enactment of the Bay Act, the board has involved the State's Attorney General in two cases of locality non-compliance, both of which were settled prior to the court hearing date. In November 2001, the State's Attorney General issued an opinion clarifying the legal mechanisms available to the board for ensuring compliance among the localities. The opinion stated that CBLAB can (1) bring legal action to stop development based solely on a site plan, (2) file an injunction against a site developer when there is a violation of the Bay Act or regulations, and (3) seek a court order prohibiting a locality from issuing permits for land disturbance activities until that locality is compliant with the Bay Act. Nonetheless, the board's willingness to use these powers is unclear.

CBLAD is currently in the process of trying to implement a Local Program Compliance Review process. The process would require localities to report on the implementation and enforcement of their Bay Act programs related to the performance criteria and other requirements. Initially, the program is scheduled to focus on site visits by CBLAD and locality staff to assess administration of the local program's provisions. CBLAD staff have stated that the first round of local program reviews is scheduled to take three to four years to complete.

Recommendations. The Chesapeake Bay Local Assistance Board and Department should continue to pursue their new focus on compliance review. The Department should provide training to the Tidewater localities on the requirements of the new Local Program Compliance Review process. This training should include a description of the potential administrative and legal options available to the Chesapeake Bay Local Assistance Board in dealing with instances of local non-compliance.

Potential Changes in the Structure of the Chesapeake Bay Local Assistance Department

Currently, consideration is being given to potential structural changes in the way the State administers the Bay Act. During the course of this JLARC review, discussions concerning the organization of CBLAD within the State's water quality control efforts have occurred. Through the Appropriations Act, the 2002 General Assembly required that the Secretary of Natural Resources develop a plan for consolidating CBLAD within the Department of Conservation and Recreation's Division of Soil and Water Conservation. In addition, the General Assembly also reduced the CBLAD appropriation by one million dollars. At a July 2002 meeting, JLARC members reviewing State spending issues asked that JLARC staff review the issue of CBLAD's placement as part of the HJR 622 review.

CBLAD's mission and functions are an important concern in assessing the agency's placement. In a response to the JLARC report on the Natural Resources Secretariat in 1998, CBLAD provided comments that still appear to accurately reflect the agency's central mission and also address some key activities that are unique:

[CBLAD's] mission and staff workload is directed at assisting local governments in meeting the land management requirements of the Chesapeake Bay Preservation Act. These requirements include RPA buffer management, more sensitive site design, and incorporating water quality protection objectives into local comprehensive plans and zoning and subdivision ordinances.

CBLAD has a central role in fulfilling the State's responsibilities to the cooperative State-local partnership envisioned by the Bay Act. If the State wishes to maintain a proactive involvement with the Bay Act then it appears that the functions performed by CBLAD will need to continue to exist, irrespective of where those functions are housed. There are some concerns that consolidation of CBLAD with another agency would bring limited benefits that may not justify this major structural change.

While some small cost economies and increased coordination of erosion and sediment activity may occur through consolidation, it does not appear that these benefits will be large. CBLAD is a small agency. Most of the staff have technical skills, the need for which is not anticipated to diminish in the foreseeable future under the responsibilities given to the State by the Bay Act and under the responsibilities given CBLAD by Bay Act regulations. The technical assistance provided by CBLAD staff is generally rated well by localities. The potential for limited savings from efficiencies in administrative tasks could largely be realized without merging CBLAD with another agency. For example, if local assistance grants are anticipated to be minimal or non-existent over the next few years, then the agency's need for a grants program manager is questionable.

If a merger is pursued at this time, a concern is that CBLAB and CBLAD may lose momentum in the short term, and priority in the long term. For example, as indicated in this report, CBLAB and CBLAD recently revised the Bay regulations. These regulations provide for compliance review work, which appears overdue. If a merger is attempted, much time and effort may be diverted to accomplish the structural change.

There also is a related and longer-term concern -- that the State's commitment to address water quality protections through local land use planning and the use of mandatory requirements may be compromised. OCR has a much broader focus than water quality issues, including the management of State parks. Its water quality efforts have focused on voluntary measures, particularly outside of the area covered by the Bay Act. It is unclear what priority OCR would give to Bay Act land use planning functions over the long term. There is a concern that a reduction in the visibility and priority of the Bay Act functions may result from CBLAD's incorporation into a larger entity. Therefore, the State may wish to give serious consideration to allowing CBLAD to continue performing its core functions as a separate entity.

Regardless of structural considerations, two of CBLAD's core functions should be ensured: (1) providing assistance to local governments with land use planning needs, and (2) enforcement of Bay Act regulations. There also will be a continued need to shift more of the focus to rigorous enforcement, in order to ensure that the desired water quality protection measures are actually undertaken.

The State May Wish to Pursue a Limited Approach to Expanding Geographic Coverage Under the Act

CBLAD was required by HJR 622 to develop a report on the benefits and costs of a westward expansion of the geographic coverage of the Bay Act in Virginia (beyond the existing Tidewater coverage area). For this review, JLARC staff assessed CBLAD's report.

CBLAD's report appears to represent a legitimate effort directed toward fulfilling a difficult task. However, the report also has some limitations. It does not succeed in overcoming a fundamental obstacle to meeting the study request. This obstacle is a lack of adequate information upon which to draw definitive conclusions about the benefits and costs, and the effects upon local governments that are entailed in a westward expansion.

The report uses an analysis prepared by the Department of Planning and Budget (DPB) to indicate that estimating the costs resulting from an expansion of the Bay Act would be almost impossible. The underlying assumption of the report, that fully and accurately quantifying the costs of an expansion is not feasible at this time, appears to be correct. However, the report could have gone further in providing estimates of the typical costs associated with some of the land use or best management practices that likely would be required, and estimates of the reductions in sediments, nitrogen, and phosphorus that might be achieved. This type of information has been estimated by State agencies in the past in conducting tributary strategy planning work.

The report also makes several references to the proven effectiveness of the Bay Act program in Tidewater in preventing nonpoint source pollution from entering the Bay and its tributaries. The report states that a perspective on the effectiveness, efficiency, and appropriateness of the Bay Act program can be gained from considering recent data which shows few impaired stream miles in Tidewater (where the Act operates) compared to the proposed expansion area. However, this argument is weak. The report does not demonstrate that the Bay Act is responsible for this difference, and it does not mention that hydrologic and land uses between Tidewater and some areas in the western part of the watershed are likely to account for a major part of the difference.

Still, CBLAD can point to numerous studies showing that certain practices which the Bay Act promotes, such as the use of buffer zones, can be effective in protecting water quality, and have some potential in the expansion area if applied appropriately. Based on the water quality studies that have been done, the CBLAD report could have gone further in identifying the various factors that appear to typically impact the relative successfulness of the types of protection activities used in the Bay program. This kind of information might help localities better gauge whether the factors that tend to promote success are or are not prevalent in their locality.

Ultimately, however, the western expansion of the program is a policy decision that must be decided in the absence of fully conclusive data. There are factors that cannot be fully known prior to implementation, including the extent to which the measures required by the Bay Act will be established as called for and effectively maintained over time.

JLARC staff identified four primary options available to the General Assembly as it considers whether to expand the geographic scope of the Chesapeake Bay Preservation Act. These include: (1) not expanding the Bay Act to include additional localities, (2) adopting CBLAD's proposed expansion scenario to make 104 additional local governments subject to the provisions of the Bay Act, (3) expanding the Bay Act to include the 13 localities in planning district commissions that are already subject to the Bay Act, or (4) allowing CBLAD staff to work with local governments in the western watershed that are interested in developing land use planning activities similar to those of the Bay Act. Given that there is an absence of fully conclusive cost and benefit data, and given the State's current budget situation, it may be prudent to seek a limited expansion effort as envisioned under options three and four. Some effort directed toward an expansion appears appropriate to fulfill the State's commitment to use sound land use management to achieve water quality improvement under the Bay Agreement and to help meet local aspirations to achieve local water quality goals.