Regulate Dredge & Fill Activities in State Waters

The act requires the water quality control commission (commission) in the department of public health and environment (department) to promulgate rules by December 31, 2025, as necessary to implement a state dredge and fill discharge authorization program (program) and requires the division of administration (division) in the department to administer and enforce authorizations for activities that will result in discharges of dredged or fill material into state waters. The rules must focus on avoidance and minimization of adverse impacts and on compensation for unavoidable adverse impacts of dredge and fill activity (activity) and must incorporate the guidelines developed pursuant to section 404 (b)(1) of the federal "Clean Water Act", unless the commission determines, based on a demonstration at a public rule-making hearing, that the guidelines are not protecting state waters. The act specifies certain content that the commission must include in the rules and other content that the commission may include in the rules.

The act establishes duties for the division in administering the program. The division must issue individual authorizations consistent with the rules promulgated by the commission. The division must act upon an application for an individual authorization within 2 years after receiving a complete application, although this period may be extended under certain circumstances.

The division must issue general authorizations for the discharge of dredged or fill material into state waters from certain categories of activities that are similar in nature and have minimal individual and cumulative adverse impacts on state waters and the environment. Beginning January 1, 2025, until the rules are promulgated and the division issues general authorizations under the rules, the nationwide and regional general permits issued by the United States Army corps of engineers constitute valid authorizations to discharge dredged or fill material into state waters that are not subject to federal jurisdiction.

As expeditiously as is prudent and feasible, the division must issue a statewide general authorization for discharges to isolated wetlands, isolated ponds and impoundments, and isolated ordinary highwater mark reaches (isolated state waters). The statewide general authorization to isolated state waters does not include certain state waters, must identify best management practices to protect isolated state waters, must not require preconstruction notification, and must not authorize a project where the entire project's unavoidable adverse impacts exceed one-tenth of an acre of wetlands or three-hundredths of an acre of streambed. The authorization term of the statewide general authorization for discharges to isolated state waters is 5 years.

The division must include compensatory mitigation requirements in all individual authorizations and in general authorizations where the division determines that the proposed discharge of dredged or fill material will result in greater than one-tenth of an acre of unavoidable adverse impacts to wetlands or greater than three-hundredths of an acre of unavoidable impacts to streams. Compensatory mitigation must compensate for all functions of state waters that will be lost as a result of the authorized activity.

The division must utilize the existing structure of preconstruction notifications in the nationwide and regional permits established by the United States Army corps of engineers, including general authorizations for categories of activities that do not require preconstruction notification.

The division may include conditions in a notice of authorization, on a case-by-case basis, to clarify the terms and conditions of a general authorization or to ensure that an activity will have only minimal individual and cumulative adverse impacts on state waters.

The division may establish guidance to assist in administering the program. The division may, to the extent resources allow, establish one or more staff positions in the western slope region of the state to assist with dredge and fill program administration in that geographic area.

Until the rules become effective and the division issues general authorizations under the rules:

• The division's Clean Water Policy 17, "Enforcement of Unpermitted Discharges of Dredged and Fill Material into State Waters", continues to be effective;
• For certain activities, the division may issue temporary authorizations for the discharge of dredged or fill material into state waters; and
• Temporary authorizations must not exceed 2 years and must include conditions necessary to protect the public health and the environment and to meet the intent of the act.

The act deems certain activities exempt and therefore does not require a discharge authorization for, or otherwise require regulation of, such activities. The act also excludes certain types of waters from the act's regulatory requirements. The act clarifies that "state waters" includes wetlands.

For the 2024-25 state fiscal year and for each state fiscal year thereafter, if the total number of issued authorizations exceeds or is projected to exceed 110 authorizations, the department must seek a supplemental appropriation from the general assembly to pay the costs of processing the authorizations and to ensure that authorizations are processed in a timely manner.

The act requires the commission to establish by rule on or before December 31, 2025, authorization fees for the program. Collected fees are credited to the existing clean water cash fund.

In current law, with certain exceptions, an applicant for any water diversion, delivery, or storage facility that requires an application for a permit, license, or other approval from the United States must inform the Colorado water conservation board, the parks and wildlife commission, and the division of parks and wildlife of its application and submit a mitigation proposal. The act extends the same requirement to applicants for certain activities that require an individual authorization from the division.

Current law requires the division to report annually to the general assembly concerning water quality control matters. The act requires the division to include in this annual report certain specific information concerning the implementation of the program. On a quarterly basis, the division must also report to the joint budget committee the number of individual dredge and fill authorizations and notices of authorization that the division projects to issue for the fiscal year.

For the 2026-27 state fiscal year and for each state fiscal year thereafter, the state treasurer must transfer $248,304 from the general fund to the clean water cash fund. On July 1, 2024, the state treasurer must transfer $748,000 from the severance tax operational fund to the clean water cash fund for use by the department in administering the program.

For the 2024-25 state fiscal year, the act appropriates $747,639 to the department from the clean water cash fund. Any money not expended prior to July 1, 2025, is further appropriated to the department for the 2025-26 state fiscal year.

APPROVED by Governor May 29, 2024

EFFECTIVE May 29, 2024
(Note: This summary applies to this bill as enacted.)