State Seeks Expanded Enforcement and Penalty Authority Over City Water Supply Permits

March 21, 2022

A bill would increase fines and add other civil and criminal penalties, as well as mandatory infrastructure investments to actions the Department of Natural Resources and state courts can take.

HF 3761 (Rep. Becker-Finn, DFL-Roseville) is legislation put forward by the Minnesota Department of Natural Resources (DNR) that would substantially broaden their enforcement authority over water appropriation permits.

The bill has passed the required policy committees in the House and is now awaiting further action as part of a potential future budget and policy package. A companion bill has not yet been introduced in the Senate.

Current DNR administrative penalty authority applies to addressing unpermitted water uses when they occur. The bill changes the types of penalties and orders that DNR currently uses to mirror those the Minnesota Pollution Control Agency uses to enforce federal permits regulating the discharge of specific pollutants into lakes and rivers. The bill also expands that authority to apply to permit holders, not just unpermitted uses.

More punitive to cities

While compliance with state water appropriation permits is important and cities spend millions of dollars every year to meet the requirements of those permits, it is unclear why the state is seeking this expansion to become more punitive against cities.

It includes fines of up to $10,000 per day, additional civil and criminal penalties, and even the ability to mandate specific infrastructure improvements. A city would be required to implement those orders, with their only choice being how they will pay for it. And it could be ordered by either the DNR or a court.

Expanded penalties unnecessary

Permit holders with ongoing water appropriations have a very vested interest in staying in compliance with their permits. The state could otherwise deny the permit or place heavy conditions or volume reductions on it. That can be done with their current authority.

Making sure that unpermitted uses are stopped is also valued, as it makes sure that those who are playing by the rules are not put at a disadvantage to those who try to get around that system. This package goes too far, however, and puts cities at risk of heavy fines and mandated local tax increases even though cities are not part of the problem.

League opposes bill

The League testified against this proposal when it was discussed in the House Environment and Natural Resources Finance and Policy Committee. There are not examples of public water suppliers refusing or failing to address water appropriation permit issues identified by the state, yet the state wants greatly expanded ability to penalize those permit holders.

The department acknowledges that and says this authority is meant to strengthen their ability to stop unpermitted uses. It is also partially in response to the damage caused by a recent pipeline dewatering project and the company’s remediation efforts, which the state finds to be inadequate.

The League will continue to oppose this legislation and will work with the Department of Natural Resources, the legislative author, and other water permit holders to look for a remedy that focuses on the department’s ability to deal with unpermitted uses and egregious violations by short-term permit holders, which are the areas where DNR has had difficulty.

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