It’s been 25 years since four Virginia agencies coalesced to form the department charged with protecting the environment and public health. Now, one of the new governor’s first orders of business suggests it might be time for a makeover.The DEQ issued two notices of violation and fines to Virginia True Corp., whose contested golf resort project began with an illegal clearing of trees that contributed to erosion near a portion of Fones Cliffs on the Rappahannock River. (Xing Lin / VA DEQ)

In April, Gov. Ralph Northam issued an executive order calling for an overhaul of the state’s beleaguered Department of Environmental Quality, which has seen its staff cut by 30 percent and its budget trimmed by nearly $60 million over the past decade. 

The agency and its director, David Paylor, have been the subject of increased public scrutiny, particularly over the recent approval of two major natural gas pipelines that will cross dozens of streams as they are erected across the state. A majority of the 20,000 comments the DEQ received about the pipeline projects opposed their construction, and hundreds of people attended the State Water Control Board meetings in December when they were approved.

Northam said the yearlong review of the DEQ, which is already under way, is a first step toward rebuilding “a critically important state agency.” His executive order requires that Paylor inform the governor’s office within 90 days if “critical updates” are needed to ensure the agency’s permitting process is protective of the environment. 

Paylor is also to monitor changes to federal regulations that could impact the state and submit quarterly reports to the governor for the duration of his term, the order states. Another aspect of the review calls for reports in six months to the secretary of natural resources, who will complete his recommendations to the governor by the end of April 2019. 

Northam said in a speech at the Environment Virginia Symposium on April 4 that he would work with the General Assembly to nearly quadruple the state’s natural resources budget, which includes the environmental agency, to at least 2 percent of the general fund. That would be about $400 million, based on current budget projections. 

DEQ spokeswoman Ann Regn said that the agency’s deputy director, by the end of May, would present a plan to the governor’s office on how the overhaul should proceed. Stakeholder groups and a website to collect feedback from the public will be part of the process, and the agency is already collecting feedback from staff at every level on how their work could be improved.

“You have people who worry about, ‘Are we being criticized?’ and others who think, ‘Oh, this is a great opportunity,’ ” Regn said. “The people who work here love the environment, and that’s why they’re in the field of public service.”
Virginia Secretary of Natural Resources Matthew Strickler — who has received high marks from virtually every environmental organization in the state — will be overseeing the review of the DEQ. He served as senior policy adviser to

Democratic members of the U.S. House of Representatives Committee on Natural Resources before joining Northam’s administration, and he holds master’s degrees in public policy and marine science from the College of William and Mary and the Virginia Institute of Marine Science.

Paylor, who was reappointed by Northam, will be involved in the effort, too — to the chagrin of some environmental organizations who have cast Paylor as too friendly to the industries he regulates. But Strickler said Paylor remains an asset to the organization whose relationships with legislators could prove helpful in drumming up additional funds for the agency.

Broadly, the review of the DEQ hinges on determining if the agency is using its full regulatory authority to protect clean water, air and public health. Changes could include updating regulations or increasing the enforcement of environmental standards while ensuring the permitting process is not an impediment to “responsible” economic development, Strickler said. 

Improving communication with the public is also likely to be part of the revamp. During the pipeline permitting process last year, for example, a DEQ spokesman who is no longer with the agency gave reporters information that was contradicted by technical staff weeks later. 

The agencywide analysis could lead to a request that legislators expand DEQ’s authority.

Peggy Sanner, the Chesapeake Bay Foundation’s Virginia assistant director and senior attorney, said she has “significant optimism” for solutions that could benefit the Bay, given Northam’s early focus on environmental issues.

Based on her reading of the executive order, Sanner said the directive boils down to this: “We need to look really hard at what we’re doing in these important areas — permitting, monitoring, enforcement — and see if we are maximizing the opportunities we have, under our legal authority, to protect the environment.” 

That, she said, “could be a game changer” for a state agency whose approach has historically been more focused on getting violators back into compliance than on levying fines.

The DEQ already has acted on a few significant violations this year, which has heartened some environmentalists. In Richmond County on Virginia’s Northern Neck, the agency issued two notices of violation and fines to Virginia True Corp., whose contested luxury golf resort project began with an illegal clearing of trees. The clearing has contributed to erosion near a portion of Fones Cliffs on the Rappahannock River.

DEQ spokeswoman Regn said the agency was working out a consent order with the company and that “details regarding penalties and corrective action are confidential during this stage.” Virginia law allows for penalties of up to $32,500 for each day of each specified violation and additional civil penalties of up to $100,000.

Across the river in Essex County, the DEQ issued fines to another project that did not have the proper stormwater controls in place before it began construction. In February, heavy rains left muddy water gushing off the 200-acre site, where solar panels are being installed to feed Dominion Energy’s grid, and into aptly named Muddy Gut Creek, a tributary of the Rappahannock River.

Richard Moncure, tidal river steward for Friends of the Rappahannock, said he was glad to see the state take action in both cases. But, he said, the instances also point to broader gaps in how the permitting process is managed between the DEQ and rural localities that have deferred to the department to manage stormwater permits.

Notably, the DEQ also issued its first violations to the larger of the two pipeline projects, the Atlantic Coast Pipeline that traverses the state and portions of the Chesapeake Bay watershed, in March. The notice states that the project removed trees that were part of protected stream buffer zones and wetland crossings on 15 separate sites. Dominion Energy, which leads the project, also is not permitted to begin disturbing land until its plans for preventing polluted runoff from erosion, sediment and stormwater are approved by the DEQ. 

“The agency’s review of the project has been the most thorough in the history of the commonwealth, and the enforcement will be as rigorous,” Paylor said in a press release. 

The agency had the authority to issue the stop work order and violation early in the pipeline process in part because of a bill that Northam championed in the legislature this year. Senate bill 698 authorized the DEQ to issue stop work orders on portions of the natural gas pipeline projects if they are found to have a “substantial adverse impact to water quality.” The governor also added to the bill an emergency clause that allowed the DEQ to enforce the provision as soon as it passed in March.

Lee Francis, spokesman for the Virginia League of Conservation Voters, said he was pleased with the governor’s leadership on that bill. But the organization is among others urging the governor to use his full authority to subject the pipelines to further scrutiny. 

The League was the second-highest donor to Northam’s campaign for governor, with a total of nearly $2.8 million in contributions, according to the Virginia Public Access Project. 

Other notable donors include Dominion Energy, which contributed about $73,000 to Northam’s campaign, and the Virginia chapter of the Sierra Club, which contributed slightly more at nearly $75,000. 

Mike Tidwell, founder and director of the Chesapeake Climate Action Network, one of the pipeline project’s most vocal opponents, said that, despite progress on other environmental measures, the pipelines could haunt Northam’s legacy if the DEQ doesn’t do enough to ensure environmental protection.

“We’ve said all along that these pipelines are going to shock the conscience of the average Virginian,” Tidwell said. 

His group and others are training citizen monitors on the use of drones and water testing kits to identify and report environmental violations during pipeline construction

Tidwell’s organization is among several that would like to see the pipeline projects subject to stream-by-stream water quality reviews. In addition to the “blanket” permit from the U.S. Army Corps of Engineers for utility lines that cross waterways, the State Water Control Board, a governor-appointed citizen board under the umbrella of the DEQ, could require additional certifications for each stream crossing under Section 401 of the Clean Water Act.

In April, the board opened a public comment period focused on whether the state-level permits should be required for the project’s stream crossings. That comment period closed May 30. 

Last year, hundreds of people attended public meetings largely to oppose to the pipeline projects,  but DEQ officials contended they did not have the regulatory authority to deny the permits.

Tidwell also was critical of Northam’s decision to leave Paylor in place as DEQ director, questioning whether the agency could be reformed without a change in leadership.

“I think the pretty uniform response from the environmental community — whether some made it public or expressed it privately — was, ‘Are you kidding?’ ” Tidwell said. 

Paylor’s work with the agency began in 1973 at the State Water Control Board, which later became part of the DEQ. Starting as a field biologist with a bachelor’s degree in zoology from Duke University and a master’s degree in fisheries science from Oregon State University, Paylor was originally appointed to the position of director by Democratic Gov. Tim Kaine in 2006. 

In 2016, while the agency was weighing whether to issue permits to Dominion Energy to permanently dispose of its coal ash, news reports began questioning Paylor’s ties to the industry. Public documents showed Dominion had paid Paylor’s way to a golf tournament in 2013 and paid for an expensive meal. This was two years before ethics legislation was passed that specifically restricts certain gifts to state employees, although that didn’t stop anti-pipeline protestors — dressed in golf gear and riding in “Dominion” golf carts — from mocking Paylor at demonstrations.

Strickler said he understands that individuals who’ve questioned Paylor’s leadership would like to see him replaced, but he also sees value in the director’s institutional knowledge. 

“David Paylor is embattled, and he would admit there are things the agency could have handled better, particularly with the pipelines,” Strickler said. “If the one thing we wanted to do at DEQ is put someone else in there to make some folks happy, we could do that. But the governor has bigger goals for DEQ.” 

Francis, of the League of Conservation Voters, said he doesn’t think Paylor departing would solve the DEQ’s problems, which he attributed partially to staff cuts over the years. 

“The worst thing that could have happened at DEQ was to have a leadership void with everything going on,” he said.