RD352 - FY 2014 Chesapeake Bay and Virginia Waters Clean-Up Plan


Executive Summary:
This report was developed to comply with consolidated water quality reporting requirements set forth in § 62.1-44.118 of the Code of Virginia. This section requires the Secretary of Natural Resources to submit a progress report on implementing the impaired waters clean-up plan as described in § 62.1-44.117 of the Code of Virginia. This consolidated report also includes the “Annual Report on the Water Quality Improvement Fund” by the Department of Conservation and Recreation (DCR) and Department of Environmental Quality (DEQ) pursuant to § 10.1-2134 of the Code of Virginia and incorporates the report on “Cooperative Nonpoint Source Pollution Programs” required in subsection D of § 10.1-2127 of the Code of Virginia. The report also encompasses the Department of Conservation and Recreation’s report of “Annual Funding Needs for Effective Implementation of Agricultural Best Management Practices” pursuant to subsection C of § 10.1-2128.1 of the Code of Virginia. This report also satisfies reporting requirements in § 2.2-220.1 of the Code of Virginia regarding the Chesapeake Bay 2000 Agreement.

Water Quality Improvement Fund and Cooperative Nonpoint Source Pollution Programs

For FY 2014, DCR allocated over $21.3 million in agricultural cost-share funds to Soil and Water Conservation Districts. This included $600,000 in Conservation Reserve Enhancement Program (CREP) cost-share funds to be disbursed by Districts as state match for completed projects. Of the $21.3 million, approximately $19.4 million was distributed to farmers through the Virginia Agricultural Cost-share Program for implementation of best management practices (BMPs). The funding for FY14 was generated from recordation fees on deeds filed and from state surplus general funds deposited to the Virginia Natural Resources Commitment Fund (VNRCF). Practices installed on farms during FY14 will result in estimated edge of field nitrogen reductions of approximately 3.2 million pounds, phosphorus reductions of approximately 742,862 pounds and sediment reductions of approximately 589,494 tons. In addition during FY14, out of the $21.3 million, DCR allocated $1.275 million in grants related to local (outside the Bay watershed) Total Maximum Daily Loads (TMDLs).

Under the Water Quality Improvement Fund (WQIF) Point Source Program, DEQ currently has 67 signed agreements which obligated $744 million in state grants ranging from 35% to 90% cost-share, for design and installation of nutrient reduction technology at Bay watershed point source discharges.

Funding Needs for Effective Implementation of Agricultural Best Management Practices

Funding projections for the Chesapeake Bay were developed in coordination with stakeholders based on a detailed analysis of practices in the Chesapeake Bay Phase II Watershed Implementation Plan (WIP). The Southern Rivers needs projections were based on the funding split prescribed in the Virginia Natural Resources Commitment Fund (VNRCF). The implementation schedule focuses on full implementation by 2025, recognizing the need to significantly expand program capacity by 2017 to demonstrate the Commonwealth’s commitment to reducing agricultural loads. For the fiscal years 2016 – 2021, an estimate of $1.55 billion may be required from state and federal funds as well as farmer financial contributions to meet statewide water quality goals by 2025. Approximately 50% of this total could be needed from State sources, the vast majority of which is direct funding provided through the Virginia Agricultural Cost-Share Program.

Actual FY15 allocations from state sources for implementation of agricultural best management practices had the following breakdown:

FY 2015 (Program Name – agency project code – amount)

• Virginia Agricultural Cost-Share program funding (50323) - $24.9 million
• District Technical Assistance (50322) - $2.8 million
• District Financial Assistance (50320) - $6.8 million

FY15 support figures exclude engineering support via DCR staff, IT support, and training /certification assistance (e.g. Resource Management Plan Technical Review Committee training).

Projected funding needs from state sources for implementation of agricultural best management practices from FY16 through the FY17-FY18 biennium are estimated to be $333.65 million with the following breakdown:

FY 2016
• Cost-Share program funding (50323) - $51.7 million
• District Technical Assistance (50322) - $16.5 million
• District Financial Assistance (50320) - $9.1 million
• Program Support (50301) - $650,000

FY 2017
• Cost-Share program funding (50323) - $98.9 million
• District Technical Assistance (50322) - $17.1 million
• District Financial Assistance (50320) - $9.1 million
• Program Support (50301) - $650,000

FY 2018
• Cost-Share program funding (50323) - $102.5 million
• District Technical Assistance (50322) - $17.7 million
• District Financial Assistance (50320) - $9.1 million
• Program Support (50301) - $ 650,000

This funding schedule will not provide the estimated funding necessary to achieve 60% of the Chesapeake Bay agricultural implementation by 2017 as was indicated in Table 5.4-4 of Virginia’s Phase I WIP. Despite this fiscal challenge, it is anticipated that the Commonwealth’s 2017 Bay goal will still be met by over-achievement in other sectors, specifically wastewater treatment plants. Improved tracking of voluntarily installed practices, technological improvements in practices, program efficiency, other cost reduction strategies, and changes to improve the Bay Model are difficult to quantify, but all are expected to reduce overall costs and close this 2017 gap. Further, it seems unlikely that the federal funding needed to support a broad expansion of implementation effort will be available in the near term.

Chesapeake Bay and Virginia Waters Clean-Up Plan Report

During FY14, many strategies were implemented to reduce pollutants entering the Chesapeake Bay tributaries and Southern Rivers basins. Significant progress was made in reducing point source discharges from sewage treatment plants, installing agricultural best management practices with a continuing focus on livestock exclusion practices, and implementing revised Stormwater Management Regulations. The implementation of Virginia’s Phase II Watershed Implementation Plan (WIP) continues. Virginia agencies successfully completed many of the 2012-2013 WIP milestones, and developed the 2014-2015 milestones. In FY14, significant efforts were made in addressing the coal ash spill in the Dan River and ensuring the safety of other similar coal ash ponds throughout the Commonwealth.

Chesapeake Bay 2000 Progress Report

The reporting requirements in § 2.2-220.1 of the Code of Virginia are being incorporated into this consolidated Chesapeake Bay and Virginia Waters Clean-Up Plan Report. The Chesapeake Bay 2000 Agreement has been replaced by the new Chesapeake Bay Watershed Agreement, which was signed on June 16, 2014. This plan for collaboration across the Bay’s political boundaries establishes Goals and Outcomes for the restoration of the Bay, its tributaries and the lands that surround them. Virginia has committed to participating on all of the Outcomes in the new agreement.

The Outcomes of the new agreement will be incorporated into the Chesapeake Bay and Virginia Waters Clean-up Plan (§ 62.1-44.117 of the Code of Virginia) revision that is currently underway. Once the plan revisions are complete, the progress reporting requirements of § 62.1-44.118 of the Code of Virginia will serve to inform the General Assembly oversight committees of progress made in implementing the provisions of the new Agreement and an assessment of projected state funding necessary to meet the goals and commitments therein.