Northeast
The News Journal

New Coastal Zone rules clarify conditions for potential new industry

In August 2017, Gov. John Carney signed the Coastal Zone Conversion Permit Act into law, calling it a “big deal.” Now – nearly two years later – we are close to seeing if it will deliver on its promise of economic development and job creation.

Draft regulations to allow limited new industrial development in Delaware's Coastal Zone have been released for review. Contributor Jon Hurdle takes a closer look at these regulations, and would they could mean for development along the coast.

Delaware moved a step closer to reopening its Coastal Zone to new heavy industry after a ban lasting almost half a century when state officials published draft regulations that would allow new businesses to move into existing industrial sites under certain conditions.

The new rules would allow new industrial development at 14 sites where heavy industry was already doing business in 1971 when state lawmakers passed the original Coastal Zone Act. The law was designed to protect the coastal environment by preventing any new development; that prohibition has been lifted by the Coastal Zone Conversion Permit Act of 2017 which ends the ban while preserving or adding environmental safeguards.

The new law, for example, continues a ban on environmentally damaging facilities like incinerators or oil refineries. But it sets new standards on the protection of industrial sites from sea-level rise, allows bulk-product transfer in some locations, and requires companies to more than offset any environmental damage their new activities may cause in the Coastal Zone.

It will be implemented by the new regulations which were officially published by the Department of Natural Resources and Environmental Control on June 1, and are subject to a public-comment period that includes a public meeting on June 24. They are due to be finalized by Oct. 1 when potential new tenants will have clarity on the conditions for occupying the Coastal Zone, which runs 115 miles north to south, and two miles inland.

Gov. John Carney signed HB 190, which opens 14 sites within Delaware's Coastal Zone to new heavy industry development in August 2017CREDIT DELAWARE PUBLIC MEDIA

The regulations will apply to 13 sites in New Castle County including Sun Oil near the Pennsylvania border, Uniquema at the Port of Wilmington, and one, Delaware Storage and Pipeline, in Kent County.

Whatever the final details of the regulations, it’s not yet clear how much interest the coastal sites will attract from industrial companies that might be interested in setting up in previously off-limits locations in the heart of the U.S. northeast.

But the intention is to boost the state’s economy and create jobs by reviving the sites – many of which are abandoned and contaminated with industrial residue – while ensuring that the natural environment is protected, advocates said.

“It was my goal to help industry and business utilize some of these abandoned sites to create some jobs…but also taking into consideration our precious environment,” said Rep. Ed Osienski, (D-Newark), lead sponsor of HB190 which amended the 1971 law. “We tried to work that bill to balance that.”

Osienski said he launched the bill after hearing persistent complaints from the business community while realizing that heavy industry can be less polluting than it was in 1971 because it is now subject to more laws on air and water quality, and has more technology with which to operate cleanly.

Striking a balance between business and the environment was the goal of the Regulatory Advisory Committee, an 18-member panel representing interests such as business, city government, organized labor and environmental advocacy, which was charged with recommending regulations that satisfied as many interests as possible.

The panel appears to have hit that target, while producing recommendations that have been adopted by DNREC. “Looking at the report, I think all their voices were heard,” Osienski said, before the regulations were published.

Michael Globetti, a spokesman for DNREC, confirmed after the regulations were issued that the panel’s recommendations, completed in April, were adopted by the department.  “The Secretary had the option to accept or reject any or all of the recommendations. He accepted the regulations and the Department used them as a basis to draft the regulations,” Globetti said.

The draft regulations are seen by the business community as a step forward even if they retain restrictions that some would like to have done away with, said James DeChene, senior vice president for government relations at the Delaware State Chamber of Commerce.

DeChene said the legislature took a cautious approach to reopening the coastal zone, and imposed “significant restrictions” on the redevelopment of the 14 sites.

While some business advocates wanted fewer restrictions, the community is broadly satisfied with the committee’s recommendations, DeChene said, before the regulations were released.

“It was not meant to be opening the floodgates to a lot of deregulated development,” he said.

Now there’s a framework in place that will at least offer the prospect of land being available in the Coastal Zone even if it places many requirements on applicants, he said.

“Does it allow you the opportunity to apply for a permit to do something new? Yes. Are there a significant number of hoops to jump through in order to do that? Yes,” he said.

But he said it remains to be seen whether the regulations will provide enough incentive to attract new heavy industry or whether it will still be too restrictive.

In both the legislature and in the advisory committee, all sides quickly recognized that they weren’t going to get everything they wanted, and worked toward a compromise, DeChene said.

For the environmental community -- which staunchly defended the original law over the years -- HB190 presented a challenge to stop future industrial tenants polluting the Coastal Zone, and to ensure that those companies are not swamped by the rising seas that are forecast to inundate large sections of coastal Delaware in decades to come.

Although the law requires new industrial tenants of the zone to plan for sea-level rise, it doesn’t address whether companies should be building there at all, said Brenna Goggin, director of advocacy for the Delaware Nature Society, and a member of the committee.

During debate over the bill and in the advisory committee, environmentalists questioned the wisdom of allowing industry to build in areas that are vulnerable to sea-level rise, but they lost the argument to pro-business advocates, she said.

“The administration and the General Assembly both felt that reinvigorating sites to allow for opportunities for job growth trumped that,” she said, referring to the sea-level rise concerns. “We do not believe that building heavy industrial sites in our most vulnerable areas is the path forward.”

'We should be limiting the people and infrastructure that we are putting into places that are known to flood or are susceptible to coastal storms." Brenna Goggin, Delaware Nature Society.

On sea-level rise and other questions, the panel sought to strike a balance between creating the conditions for economic growth, and recommending measures that would protect both the natural environment and future industrial tenants, Goggin said.

Despite her concerns, the regulations set a host of requirements on sea-level rise preparations that have to be made by any new industrial tenant of the Coastal Zone. Companies would be required, for example, to describe areas that would be flooded during a “high sea-level rise” scenario, as determined by state scientists, and to estimate the costs of measures that would prevent the escape of pollutants if a site is exposed to that scenario.

“We should be limiting the people and infrastructure that we are putting into places that are known to flood or are susceptible to coastal storms,” she said.

Goggin said she had heard rumors that the industrial community is waiting for the regulations to be finalized before deciding whether to seek property in the Coastal Zone, but she was unaware of specific proposals.

See Delware Public Media article with audio . . .

See also Heavy industry eyes return to Claymont under Coastal Zone Act bill (Scott Goss, The News Journal, June 30, 2017)