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STATE OF MINNESOTA MINNESOTA POLLUTION CONTROL AGENCY IN THE MATTER OF THE DECISION ON THE NEED FOR AN ENVIRONMENTAL IMPACT STATEMENT FOR THE PROPOSED HOWARD LAKE WASTEWATER TREATMENT IMPROVEMENTS PROJECT VICTOR TOWNSHIP/WRIGHT COUNTY HOWARD LAKE, MINNESOTA FINDINGS OF FACT CONCLUSIONS OF LAW AND ORDER FINDINGS OF FACT Pursuant to Minn. R. 4410.1000-4410.1600 (2006), the Minnesota Pollution Control Agency (MPCA) staff has prepared an Environmental Assessment Worksheet (EAW) for the proposed Howard Lake Wastewater Treatment Improvements Project (Project). Based on the MPCA staff environmental review, comments, and information received during the comment period, and other information in the record of the MPCA, the MPCA hereby makes the following Findings of Fact, Conclusions of Law, and Order. FACILITY HISTORY Overview The city of Howard Lake proposes to upgrade its wastewater treatment facility (WWTF) and increase its capacity from 369,000 gallons per day (gpd) to 850,000 gpd. The existing WWTF has reached the maximum hydraulic treatment capacity during peak wet weather flow conditions and is nearing the treatment capacity for reduction of Carbonaceous Biochemical Oxygen Demand load to the WWTF. The treated effluent will continue to be discharged to Mallard Pass Lake from the existing outfall. Permitting History The WWTF was originally constructed in the 1950s. A permit for reconstruction was issued in 1980 and a number of re-issuance or modification permits have been issued since then. Previous Environmental Review None identified. Compliance/Enforcement History No recent compliance issues were identified. PROPOSED PROJECT DESCRIPTION Proposed Modification Proposed construction includes a preliminary treatment building, control structures, oxidation ditch, clarifier, chlorine contact basin, and biosolids storage facility. The preliminary treatment building is a 1,600-square foot masonry building to enclose the mechanical screening and grit removal equipment. The remaining facilities are all partially below grade, cast-in-place, concrete facilities. TDD (for hearing and speech impaired only): 651-282-5332 Printed on recycled paper containing at least 30% fibers from paper recycled by consumers

Howard Lake Wastewater Treatment Improvements Project On the Need for an Environmental Impact Statement Howard Lake, Minnesota Findings of Fact Conclusions of Law And Order Environmental Concerns Typical environmental concerns from WWTFs include the potential for noise and dust during the construction phase, odors, erosion and sedimentation, and water-quality impacts to surface water. The WWTF discharges into Mallard Pass Lake. Phosphorus has been identified as a pollutant of concern as the discharge is directly to a lake. Mallard Pass Lake is directly upstream of Dutch Lake, which is hypereutrophic. Additional Concerns Described in Comment Letters The Minnesota Department of Natural Resources (DNR) expressed a concern regarding future expansions in the area and potential effects on the Woodland Wildlife Management Area. Community Involvement in Process Community involvement by the MPCA regarding the EAW included the standard activities required by the Environmental Quality Board (EQB). In addition, the Project proposer held a public meeting on the Facility Plan. PROCEDURAL HISTORY 1. Pursuant to Minn. R. 4410.4300, subp. 18.B, an EAW was prepared by the MPCA staff on the proposed Project. Pursuant to Minn. R. 4410.1500 (2006), the EAW was distributed to the EQB mailing list and other interested parties on May 4, 2007. 2. The MPCA notified the public of the availability of the EAW for public comment. A news release was provided to interested parties, on May 8, 2007. In addition, the EAW was published in the EQB Monitor on May 7, 2007, and available for review on the MPCA Web site at http://www.pca.state.mn.us/news/eaw/index.html on May 7, 2007 3. The public comment period for the EAW began on May 7, 2007, and ended on June 6, 2007. During the 30-day comment period, the MPCA received one comment letter from a government agency and received one comment letter from a citizen. 4. The MPCA prepared responses to all comments received during the 30-day public comment period. Comment letters received and the MPCA s responses to comments received have been hereby incorporated by reference as Appendix A to these findings. CRITERIA FOR DETERMINING THE POTENTIAL FOR SIGNIFICANT ENVIRONMENTAL EFFECTS 5. Under Minn. R. 4410.1700 (2006), the MPCA must order an Environmental Impact Statement (EIS) for projects that have the potential for significant environmental effects that are reasonably expected to occur. In deciding whether a project has the potential for significant environmental effects, the MPCA must compare the impacts that may be reasonably expected to occur from the project with the criteria set forth in Minn. R. 4410.1700, subp. 7 (2006). These criteria are: A. the type, extent, and reversibility of environmental effects; B. potential cumulative effects of related or anticipated future projects; 2

Howard Lake Wastewater Treatment Improvements Project On the Need for an Environmental Impact Statement Howard Lake, Minnesota Findings of Fact Conclusions of Law And Order C. the extent to which the environmental effects are subject to mitigation by ongoing public regulatory authority; and D. the extent to which environmental effects can be anticipated and controlled as a result of other available environmental studies undertaken by public agencies or the project proposer, including other EISs. THE MPCA FINDINGS WITH RESPECT TO EACH OF THESE CRITERIA ARE SET FORTH BELOW Type, Extent, and Reversibility of Environmental Effects 6. The first criterion that the MPCA must consider when determining if a project has the potential for significant environmental effects that are reasonably expected to occur, is the "type, extent, and reversibility of environmental effects," Minn. R. 4410.1700, subp. 7.A (2006). The MPCA findings with respect to each of these factors are set forth below. 7. Reasonably expected environmental effects of this Project to water quality: A. Stormwater runoff B. Surface water 8. The extent of any potential water-quality effects that are reasonably expected to occur: A. Stormwater runoff Approximately 2,000 cubic yards would be graded during construction. Best management practices (BMPs) would be employed during construction to prevent sediments from leaving the site. The addition of the proposed structures increases the impervious area by 0.2 acres and is not anticipated to change the water quality of runoff at the site. Precipitation that falls into the open-topped basins will be captured there. Runoff on the remaining WWTF site will be overland flow until it is captured by the municipal stormwater collection system. Once completed, the Project will have little additional impact to the current runoff situation. The proposed Project will serve expanded development that is projected in the area. Other potential development projects are dependent on local economics, and the timing of future development is uncertain. Future residential developments will be subject to National Pollutant Discharge Elimination System/State Disposal System (NPDES/SDS) Permit requirements and may also be subject to local stormwater management rules. The permit requires BMPs, which may include silt fences, stormwater retention ponds, or other control measures prior to any discharge of stormwater to the municipal stormwater collection system. B. Surface water The WWTF discharges into Mallard Pass Lake in the North Fork Crow River watershed of the Upper Mississippi River basin. 3

Howard Lake Wastewater Treatment Improvements Project On the Need for an Environmental Impact Statement Howard Lake, Minnesota Findings of Fact Conclusions of Law And Order Phosphorus has been identified as a pollutant of concern as the discharge is directly to a lake. Mallard Pass Lake is directly upstream of Dutch Lake, which is hypereutrophic. Additionally, downstream portions of the Mississippi River (Lake Pepin) are impaired for excess nutrients. The MPCA will set effluent limits that prevent the degradation of the receiving water. The standard limit setting and non-degradation review processes considers background water quality within the receiving water. To assure that the effluent of the new discharge does not further degrade water quality, or cause or contribute to a water-quality standards violation for pollutants of concern, permit limits will apply. The proposed discharge would be subject to permit limits that will freeze the mass loading of phosphorus. The proposed mass limit of 1.4 kg/day is approximately 1,124 pounds per year of phosphorus. It should be noted that once a total maximum daily load is established for Lake Pepin, additional phosphorus controls or limits may be required. 9. The reversibility of any potential water-quality effects that are reasonably expected to occur: The MPCA finds that any potential effect that is reasonably likely to occur from this Project would be reversible. As discussed above, the expected effects on water quality are minimal. Proposed permit limits are expected to prevent degradation of the water quality. Potential environmental effects are expected to be minimal based on current conditions. Though not expected to occur, impacts from a release of effluent not meeting the limits stipulated in the NPDES/SDS Permit for the proposed Project would be of finite duration and the environment would be expected to ultimately return to current conditions. There is no reason to believe that this Project is reasonably expected to cause a significant negative effect on water quality. 10. Comments received that expressed concerns regarding potential effects to water quality: The DNR comment letter expressed concern about Dutch Lake being hypereutrophic. As discussed above in Findings 8 and 9, the analysis indicates that the effects on water quality that are reasonably expected to occur are not significant. 11. The MPCA finds that the environmental review is adequate to address the concerns because: All potential impacts to water quality that are reasonably expected to occur from the proposed Project have been considered during the review process and a method to prevent these impacts has been developed. 12. The MPCA finds that the Project, as it is proposed, does not have the potential for significant environmental effects on water quality based on the type, extent, and reversibility of environmental effects reasonably expected to occur. 4

Howard Lake Wastewater Treatment Improvements Project On the Need for an Environmental Impact Statement Howard Lake, Minnesota Findings of Fact Conclusions of Law And Order Potential Cumulative Effects of Related or Anticipated Future Projects 13. The second criterion that the MPCA must consider, when determining if a project has the potential for significant environmental effects that are reasonably expected to occur, is the "potential cumulative effects of related or anticipated future projects," Minn. R. 4410.1700, subp. 7.B (2006). The MPCA findings with respect to this criterion are set forth below. 14. The EAW, public comments, and the MPCA follow-up evaluation did not disclose any related or anticipated future projects that may interact with this Project in such a way as to identify any potential cumulative environmental effects that are reasonably expected to occur. 15. Public comments concerning cumulative effects: The DNR expressed concerns about the effect of future expansions of several WWTFs in the area on the Woodland Wildlife Management Area. However, the timing of future expansions of WWTFs in other cities is unknown. Based on MPCA staff experience, available information on the Project, and information presented by the commenters, the MPCA does not reasonably expect significant cumulative effects from this Project. Future projects will be subject to applicable regulatory requirements. 16. In considering the potential cumulative effects of related or anticipated future projects, the MPCA finds that the reasonably expected effects from this Project will not be significant. The Extent to Which the Environmental Effects Are Subject to Mitigation by Ongoing Public Regulatory Authority 17. The third criterion that the MPCA must consider, when determining if a project has the potential for significant environmental effects that are reasonably expected to occur, is "the extent to which the environmental effects are subject to mitigation by ongoing public regulatory authority," Minn. R. 4410.1700, subp. 7.C (2006). The MPCA findings with respect to this criterion are set forth below. 18. The following permits or approvals will be required for the Project: Unit of Permit or Approval Required Status Government MPCA NPDES/SDS Permit Re-issuance Submitted MPCA Plan and Specification Approval Submitted MPCA General Storm Water Permit for Construction Activity To be submitted Wright County Conditional Use Permit To be submitted City of Howard Lake Building Permit To be submitted 19. The above-listed permits include general and specific requirements for mitigation of environmental effects of the Project. The MPCA finds that ongoing public regulatory authority will address any significant potential environmental effects that were identified as reasonably expected to occur. 5

Howard Lake Wastewater Treatment Improvements Project On the Need for an Environmental Impact Statement Howard Lake, Minnesota Findings of Fact Conclusions of Law And Order The Extent to Which Environmental Effects can be Anticipated and Controlled as a Result of Other Available Environmental Studies Undertaken by Public Agencies or the Project Proposer, Including Other EISs 20. The fourth criterion that the MPCA must consider is the extent to which environmental effects can be anticipated and controlled as a result of other available environmental studies undertaken by public agencies or the project proposer, including other EISs, Minn. R. 4410.1700, subp. 7.D (2006). The MPCA findings with respect to this criterion are set forth below. 21. The following documents were reviewed by the MPCA staff as part of the potential environmental impact analysis for the Project. This list is not intended to be exhaustive. The MPCA also relies on information provided by the Project proposer, commenters, staff experience, and other available information. EAW information; Proposed effluent limitations summary sheet and non-degradation review; and The NPDES/SDS Permit files, Permit Application, and related materials. 22. There are no elements of the Project that pose the potential for significant environmental effects that cannot be addressed in the Project design and permit development processes, or by regional and local plans. 23. Based on the environmental review, previous environmental studies, and MPCA staff expertise on similar projects, the MPCA finds that the environmental effects of the Project that are reasonably expected to occur can be anticipated and controlled. CONCLUSIONS OF LAW 24. The MPCA has jurisdiction in determining the need for an EIS for this Project. The EAW, the permit development process, the facility planning process, responses prepared by the MPCA staff in response to comments on the Howard Lake Wastewater Improvements project EAW, and the evidence in the record are adequate to support a reasoned decision regarding the potential significant environmental effects that are reasonably expected to occur from this Project. 25. Areas where the potential for significant environmental effects may have existed have been identified and appropriate mitigation measures have been incorporated into the Project design and permits. The Project is expected to comply with all MPCA standards. 26. Based on the criteria established in Minn. R. 4410.1700 (2006), there are no potential significant environmental effects reasonably expected to occur from the Project. 27. An EIS is not required. 28. Any findings that might properly be termed conclusions and any conclusions that might properly be termed findings are hereby adopted as such. 6

APPENDIX A Minnesota Pollution Control Agency (MPCA) Howard Lake Wastewater Treatment Improvements Project (Project) Environmental Assessment Worksheet (EAW) ERRATA Item 23 of the EAW should read: The project does include the addition of an additional emergency generator rather than does not. LIST OF COMMENT LETTERS RECEIVED 1. Janette Brimmer, Minnesota Center for Environmental Advocacy. Letter received May 31, 2007. 2. Ron Wieland, Minnesota Department of Natural Resources. Letter received June 7, 2007. RESPONSES TO COMMENTS ON THE EAW 1. Comments by Janette Brimmer, Minnesota Center for Environmental Advocacy. Letter received May 31, 2007. Comment 1-1: The MCEA objects to the MPCA s practice of dual noticing of environmental permits and environmental review documents and suggests that this practice violates the Minnesota Environmental Protection Act (MEPA). The MPCA practice of noticing EAWs along with an NPDES permit is a violation of the law that requires environmental review to precede governmental action. The intent and purpose of environmental review is to fully inform government decisions. MCEA has notified the MPCA of its concerns in previous letters. Response 1-1: The decision has been made to co-notice EAWs and permits whenever practicable. The MEPA does not preclude a responsible governmental unit (RGU) from developing a draft permit for a facility during the environmental review process. The permit information is necessary for the MPCA to make an informed decision. The relevant statute, Minn. Stat. 116.04, subd. 2b provides that, If an environmental assessment worksheet or an environmental impact statement is required for a governmental action under subdivision 2a, a project may not be started and a final governmental decision may not be made to grant a permit, approve a project, or begin a project, until [the environmental review process is complete]. Minn. R. 4410.3100 similarly precludes a governmental unit from making a final decision to grant a permit. The statute and rule only prohibit a governmental unit from making a final decision to grant a permit. Public noticing a draft permit is not making a final decision and is not prohibited by the statute or rule. Should the EAW review process indicate needed changes in the water permit, the MPCA still has the ability to make changes. By placing the draft permits on public notice in the same time frame as the EAW, the MPCA is not precluded from modifications.

Howard Lake Wastewater Treatment Improvements Project Howard Lake, Minnesota List of Comment Letters Received on the Environmental Assessment Worksheet 2. Comments by Ronald Wieland, Minnesota Department of Natural Resources. Letter received June 7, 2007. Comment 2-1: Aside from the water quality status of the current and proposed receiving waters, the facility design and EAW represent a good process for a small and growing community. Response 2-1: The comment is noted. Comment 2-2: It is our belief that the agencies and local communities are at a critical planning juncture for examining appropriate regional treatment. Future growth in the Melrose-Waverly-Howard Lake- Montrose regions will require additional treatment system expansions. The DNR is already concerned about current treated wastewater flows into the Woodland WMA and would not want to see additional flows into the WMA. By acting now, state and local agencies could address impaired aquatic resources and identify cost efficient future options that acknowledge inevitable growth pressures and regulatory requirements for resource protection/restoration. DNR suggests considering the consolidation of Howard Lake and Waverly municipal flows into a regional facility with effluent reuse and/or discharge to the Crow River. This would eliminate discharge to the lake flowage between Howard Lake and Waverly, and create reserve design capacity for Montrose. Response 2-2: The comment has been relayed to the MPCA s municipal discharge unit. We appreciate the Minnesota Department of Natural Resources concerns regarding potential impacts to wetlands in the Woodland Wildlife Management Area. We note that Melrose is a considerable distance from Howard Lake, in Stearns County, and discharges to the Sauk River. The outlet from Howard Lake flows into Dutch Lake. Dutch Lake flows into Twelve Mile Creek, a tributary of the North Fork of the Crow River. The expansions at Montrose, Waverly, the trailer park 12-Hi Estates, and Howard Lake were intended to address projected growth in the area over the next 20 years. It is not known at this time if future growth would be addressed via a regional facility that discharges elsewhere or by some other means. Comment 2-3: Going forward, DNR will be interested in effluent flow reductions for Woodland WMA and will be strongly opposed to future flow expansions here. Response 2-3: The comment has been relayed to the MPCA s municipal discharge unit. Comment 2-4: DNR provides a listing of the results of a 2006 fisheries survey of Dutch Lake illustrating concerns with dissolved oxygen, fish population, and other parameters. Response 2-4: The MPCA appreciates the additional information regarding the condition of Dutch Lake. As noted in the EAW, a phosphorus cap on the Howard Lake Wastewater Treatment Facility will apply and additional monitoring for Dutch Lake will be required. Comment 2-5: The DNR requests coordination with the MPCA staff for implementing the proposed monitoring at Dutch Lake at the earliest opportunity. Response 2-5: This comment has been relayed to the Project proposer and the MPCA s water monitoring unit. The proposed National Pollutant Discharge Elimination System/State Disposal System Permit will require the city of Howard Lake to monitor phosphorus, nitrogen, and other parameters in Dutch Lake for two years. In addition, the MPCA may conduct an additional year of monitoring. 2

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