WEST VIRGINIA ENVIRONMENTAL QUALITY BOARD CHARLESTON, WEST VIRGINIA E©EHWE_ INDEPENDENT OIL AND GAS ASSOCIATION OF WEST VIRGINIA, INC., C. I. MCKO\nrN & SON, INC., POCONO ENERGY CORP. and TEMPEST ENERGY CORP. Appellants) D OCT -1 2015 OMRONMENIALoral,m/come AIR QuA lTYCQco Appeal No. lS-lG-E&B V. SCOTT G. MANDIROLA, Director) Division ofWater and Waste Management, West Virginia Department ofEnvironmental Protection, Appellee. NOTICE OF APPEAL Appellants C. I. McKown & Son, Inc. (66McKown"), Pocono Energy Corp. (ccPocono"), Tempest Energy Coap. (6Tempesr) and Independent Oil and Gas Association of West Virginia, Inc. (CCIOGA"), (sometimes collectively referred to as 6Appellants") respectfully represent that each is aggrieved by certain decisions by Scott G. Mandirola, Director, Division of Water and Waste Management (CDWWM"), West Virginia Department of Environmental Protection (WVDEP"), issued on September 4, 2015 and September 8, 2015 and other dates by e-mails directed to o\uners and operators of aboveground storage tanks (c6ASTs") which designate which ASTs are Level 1 Regulated ASTs or Level 2 Regulated ASTs based in whole or in part on whether the ASTs are located in a 66zone of critical concem" or CCzone of peripheral concem" as deflned in the Aboveground Storage Tank Act, W. Va. Code § 22-30-3 (20) and (21) (CAST Act"). More particularly attached as Exhibit A hereto is a list of the McKo\un, Pocono and Tempest ASTs that have been designated as Level 1 or Level 2 regulated ASTs by communication from WVDEP dated September 4, 2015 and September 8, 2015. Additional designations of Level 1 and Level 2 regulated ASTs were made to many members of IOGA. These designations contain common errors which are raised by McKolun, Pocono, Tempest and IOGA on behalfofits members in the interest ofadministrative andjudicial economy. McKolun, Pocono, Tempest and IOGA are challenging the delineation and mapping ofthe zones ofcritical concem cczccs") and zones ofperipheral concem (zpcs,,) which lwDEP uses, in whole or in part, in detemlining and designating Which ASTs are Level 1 or Level 2 regulated ASTs on the basis that the ZCC and ZPC delineations are unlarwhll and the criteria used for delineating the ZCCs and ZPCs are arbitrary and capricious and without basis in law or fact: (1) The ZCC and ZPC delineations are unenforceable because the conclusions and mapping was not subject to notice and opportunity to comment by the regulated comlnunity and the public. (2) The ZCC and ZPC delineations exceed the scope ofthe deflnitiOnS Set forth in the AST Act by continuing upstream beyond the 66tributaries draining into the principal stream." (3) The ZCC and ZPC delineations exceed the scope ofthe definitions by failing to adequately account for stream flows, gradient and area topography and other existing conditions in streams, rivers, lakes, reservoirs, impoundments and other fieatures in the delineation. (4) Upon information and belief one or more of the assumptions utilized in delineating the area ofthe ZCCs and ZPCs are arbitrary and capricious without a basis in fact. In addition, Pocono has incurred costs and expenses in moving ASTs and rearranging its operating equipment to areas outside of ZCCs as designated by lhIVDEP in October 2014. Pocono relied upon information from WVDEP to rearrange its operating equipment outside the 2 designated ZCCs. lWDEP confi-ed that the ASTs were located outside the ZCCs following the rearrangement ofPocono?s ASTs and operating equipment. McKown, Pocono, Tempest and IOGA therefore pray that the Environmental Quality Board (the 6CBoard?)) review this matter pursuant to W. Va. Code § 22-30-18 and grant it the following relief: (1) Such relief as the Board may deem appropriate, including but not limited to the following: a- Prohibit the WVDEP9s utilization and enforcement of deterlninations that certain ASTs are Level 1 or Level 2 regulated ASTs based on the location ofthe AST being within a ZCC or ZPC until the delineation ofthe areas of the ZCCs and ZPCs are finalized following public notice and opportunity to corrment. Order W\DEP to disclose the methodology, assumptions and criteriaused to delineate the ZCCs and ZPCs to afford AST ovIlerS and OPeratOrS the opportunity to evaluate the validity and accuracy of the determinations made by WVDEP conceming the regulated status ofASTs. C. Find and determine that the distance an AST is from a principal stream or tributary to the principal stream must be measured from the ordinary high water mark ''of the stream on a perpendicular line nmning horizontally along the surface of the ground for a distance of one thousand (1,000) or five hundred (500) feet, respectively, to anAST. Order WVDEP to delineate the ZCCs and ZPCs using validated stream I flow rates based upon the individual characteristics of the stream and 3 water flow within the specific watershed, including residence time in lakes, reservoirs and impoundments. e. prohibit WVDEP from designating as Level 1 regulated ASTs those pocono ASTs which were relocated and rearranged to be outside ZCC based information supplied by WVDEP and conflrmed by WVDEP, or, in the altemative, award Pocono the cost of relocating and rearranging its ASTs to be outside the designated ZCCs. (2) Any other relief or revisions deemed appropriate by the Board following consideration ofall ofthe information and evidence presented. specific objections: Appellants, specific objections including questions offact and law to be determined by the Board are set forth in detail and attached hereto as Exhibit B. Amendment of this Notice of Appeal may be had.only by leave of the Board, and for good cause shorn. [Signatures on next page] 4 Respectfully submitted this lSt day ofoctober, 2015. INDEPENDENT OIL AND GAS ASSOCIATION OF WEST VIRGINIA, INC. //A/us David L. Yaussy (WV Bar #4156) Mark D. Clark (WV Bar #731) Spilman Thomas & Battle, PLLC 300 Kanawha Boulevard, East Charleston, West Virginia 25301 Telephone: (304) 340-3800 Facsimile: (304) 340-3801 C. I. MCKOVIIN a SON, INC. POCONO ENERGY CORP. By: Its: By: Its: "i=__/ +-i C.I.McKo\un,II President Address: P. O. Box 711 C.I.McKo\un,II President Address: P. O.Box 711 9958 Clay Road Newton, WV 25266 9958 Clay Road Newton, WV 25266 Phone.. (304) 565-73 18 Phone: (304) 565-7318 TEMPEST ENERGY CORP. Its: President Address: P. O. Box 711 9958 Clay Road Newton, WV 25266 Phone: (304) 565-7318 5 EXHIBIT A NOTICE OF APPEAL - October 1, 2015 E-mail Designations from WVDEP dated September 4 and 8, 2015 g±. MCKO rmr & SON, IN± Akyyeground Storage Tanks Located in Zone of Critical Concern (lWDEP registration nLQ± 008-00000501 020-00002288 020-00002137 Aboveground Storage Tanks Located in Zone ofPeripheral Concern (WVDEP registration -= 020-00002134 020-00002276 020-00002277 020-00002138 020-00002283 020-00002284 020-00002286 020-00002290 020-00002278 020-00002133 P_OCONO ENERGY CORPAboveground Storage Tanks Located in Zone ofCritical Concern (WVDEP registration no: 007-00000986 007-00000987 007-00000316 007-000003 17 007-00000321 007-00000322 007-00000323 007-00000324 007-00000327 007-00000356 007-00000357 007-00000359 007-00000361 007-00000362 007-00000363 007-00000366 007-00000367 007-00000368 007-00000369 007-00000372 007-00000374 007-00000375 HJMPEST ENERGY CORPAiboveground Storage Tanks IJOCated in Zone ofPeripheral CQ±Cem m7veEP regLstrationiEQ= 020-0000231 1 020-00002312 020-00002313 EXHIBIT B ELACTS RELEVANT TO APPEAL The facts relevant to this appeal and the Particular grounds on which this appeal is based, including questions oflaw and fact to be determinedby the Board, are as follows: 1. The West Virginia Legislature enacted Senate Bill 423 amending the Aboveground Storage Tank Act during its 2015 Regular Session which included defining cLeve1 1 regulated tanks,, and ccLeve1 2 regulated tanks" based, in Significant Part, upon location in zones ofcritical concem (cZCCs") and zones ofperipheral concem (¬ZPCs"). 2. Upon information and belief, in late 2014, the West Virginia Department of Health and Human Resources, (CDHHR,,) Bureau for Public Health (¬BPFT) contracted withthe west virginia university Research Corporation (6lWURC, to determine the extent and Scope of the zccs related to public water supply intake locations. Upon info-ation and belief, no final report conceming the methods and assumptions used in determining the extent and scope of the zccs has been delivered to DHHR or BPH. 3. By agreement having an effective date OfApri1 1, 2015, the WDEP's DWWM entered into an Inter-Agency Agreement with the -URC (6CInter-Agency Agreement") providing for -URC to provide funding tO West Virginia University,s Division ofResource Management (CDRM") to cccontinue the methodologies required by BPH to develop ZCC's and apply it towards the development ofZPC9s." 4. The Inter-Agency Agreement provides that a final report and presentation tO WVDEP be delivered by December 31 a,resunably 2015). Upon information and belief, no final report conceming the methods and assumptions used in determining the extent and Scope Of the zpcs has been delivered by WVURC or DRM to WVDEP. 2 5. Notwithstanding the absence Of a final report COnCeming the ZCCs and ZPCs, WVDEP began notifying AST owners and operators Ofthe -DEP,s determination ofWhether each AST is a Level 1 Regulated AST because it is located in a ZCC or a Level 2 Regulated AST because it is located in a ZPC. 6. The determinations made by lWDEP cary significant regulatory requirements and associated costs and expenses that have a material impact on the profitability ofAST ouners and operators business operations, including, but not limited to, McKorm, Pocono and Tempest. 7. The Independent Oil and Gas Association of West Virginia, Inc. ('IOGA") is a statewide non-profit trade association representing COmPanieS engaged in the exploration, production and development of natural gas and oil resources in West Virginia, and the companies and individuals who support these activities. Many of IOGA,s members our or operated ASTs. On behalf of its membership, therefore, IOGA is adversely affected within the meaning ofw. va. code § 22-30-18 by certain actions, decisions Or Orders Ofthe WVDEP that are unreasonable, unduly burdensome, or othe]wiSe arbitrary and Capricious, aS Set forth in detail below. 8. This appeal has beentimely flled within 30 days ofreceipt ofthe action decision or order ofvwDEP in accordance with W. Va. Code § 22-30-18. 9. With regard to Item 1 ofthe Notice ofAppea1, the delineation ofboth the ZCCs and zpcs constitutes promulgation of a legislative rule that is subject to the requirements established in W. Va. Code § 29A-3+ eZ sea- which Provide for Public notice and opportunity tO comment by the regulated community and the Public. 10. With regard to Item 2 of the Notice ofAppea1, upon information and beliefthe tributaries to the stream on which a public water supply intake is located are not streams within the meaning or intent ofthe deflnitiOnS OfZCC and ZPC contained inthe AST Act. 3 ll. With regard to Item 3 of the Notice ofAppea1, the delineation of the ZCCs and zpcs ful to adequately account for stream flows, gradient and area topography and Other existing conditions in streams, rivers, lakes, reservoirs, impoundmentS and Other features affecting time oftravel as required in the statutory definition OfZCC and ZPC. 12. With regard to Item 4 of the Notice of Appeal, upon information and belief because the final report has not been completed or disclosed, the mathematical model, assumptions, generalizations and other criteria utilized in delineating the ZCC and ZPC are arbitrary and capricious resulting in larger ZCCs and ZPCs than appropriate. 13. With regard to Pocono it has detrimentally relied upon information and guidance supplied by -DEP resulting in costs and expenses that Were lost by the designation ofLevel 1 and Level 2 regulated ASTs at issue inthis docket. QHIJSTIONS OF FACT 1. What mathematical model, assumptions, generalizations and other criteria Was utilized by DRM in the calculation ofthe area ofthe ZCCs and ZPCs? 2. What are the differen;eS betWeenthe area Ofthe ZCCs used by WVDEP in 2014 and the area ofthe zccs used in September 2015? 3. How is the bank ofa Stream Or tributary determined for Purposes OfmeaSuring the distance between an AST and a stream or tributary bank? 4. Is the topography and elevation change between a Stream Or tributary and the location ofan AST considered in measuring the distance tO an AST? 5. Are impediments or Obstructions tO Stream flow accounted for in determining the distance and area ofzccs and zpcs, including time oftrave1? 4 6. Is the location ofan AST in a different watershed from the Stream Or tributary in a zcc or zpc accountedfor? 7. Are the determinatiOnS made by -DEP conceming whether an AST is located in a zcc or zpc accurate andreliable? 8. How many ASTs designated as Level 1 or Level 2 regulated tanks would be outside appropriately delineated ZCCs and ZPCs? QquSTIONS OF LAB 1. Whether the determination Of the area designated aS Within ZCCs and ZPCs are subject to emergency or legislative rulemaking in accordance With W. Va. Code § 29A-3-1, ef seqf! 2. Whether the areas designated aS ZCCs and ZPCs comply with the definitions Of zcc and zpc in w. va. code § 22-30-3(20) and (21)? 3. Whether the areas designated aS ZCCs and ZPCs are unreasonable and constitute arbitrary and capricious action by VWDEP? 4. Whether the areas designated aS ZCCs and ZPCs should be revised and corrected to more accurately account for stream flows, gradient and area topography for use by WVDEP in J determining which ASTs are Level 1 Regulated ASTs and Level 2 Regulated ASTs? 5. Whether certain ASTs should be determined by lWDEP to be located outside zCCs and ZPCs? 6. Whether the e-mail communications from lWDEP constitute sufficient notice and service ofan action, decision or order to be an enforceable action, decision or Order? 7. Whether WVDEP is liable to Pocono for the costs and expenses incurred by each in reliance on determinatiOnS and guidance OfVWDEP? WEST VIRGINIA ENVIRONMENTAL QUALITY BOARD CHARLESTON, WEST VIRGINIA INDEPENDENT OIL AND GAS ASSOCIATION OF WEST VIRGINIA, INC. a. I. MCKOWN & SON, INC., pocoNO ENERGY CORP. and TEMPEST ENERGY CORP. Appellants, Appeal No. V® scoTT a. MANDIROLA, Director, Division ofwater and waste Management, West virginia Department ofEnvironmental Protection) Appellee. £;ELLRTIFICATE OF SERVIC:E I, Mark D. Clank, counsel for Independent Off and Gas Association ofWest Virginia, Inc. and on behalfofthe Appellauts, do hereby certify that I have flled an original and six (6) copies ofthe foregoing Notice ofAppeal with the Envirormental Quality Board and have served a true and exact copy ofthe same upon the Appellee, Patrick V. Canpbell, Director ofthe Division of water and waste Management, West Virginia Department ofEnviror-ental Protection, by hand delivery) on this lst day ofOctober, 2015, addressed as follows: scott G. Mandirola, Director Division ofWater and Waste Management west virginia Department ofEnvironmental Protection c/o office OfLegal Services 601 57th Street, S.E. charleston, WV 25304 INDEPENDENT OIL AND GAS ASSOCIATION oF WEST VIRGINIA, INC. c. I. MCKOlhrN & SON, INC. pocONO ENERGY CORP. TEMPEST ENERGY CORP. spilman Thomas & Battle, PLLC 300 Kanawha Boulevard, East charleston, West Virginia 25301 Telephone: (304) 340-3800 Facsimile: (304) 340-3801 2