presented to the JOINT COMMITTEE ON APPROPRIATIONS South Dakota - - PDF document

SLIDE 1

Agency Presentation FY13 - DENR

Tuesday, January 17, 2012 2:46 PM

DENR FY 2013 BUDGET REQUEST

presented to the

JOINT COMMITTEE ON APPROPRIATIONS South Dakota Department of Environment and Natural Resources

Protecting South Dakota's Tomorrow ... Today

DE.NR Mi ion Statement: To protect public flea/Ill and the enviro11111e11t by providi11g em• iro11me11tal mo11ilori11g and natural resource assessment, tech11ical a11d fi11a11cial assista11ce for e11viro11111e11tal projects, a11d envirom11e11lal regulatory sen• ices; all done i11 a ma1111er to protect South Dakota's e11l'iro11111e11t aud 11atural resources/or today and tomorrow while treating everyo11e as our customer a11d e_-..:ceedi11g their expectations.

January 19, 2012

SLIDE 2

Review of FY 2011 End of Year Status

• 1. DENR Operating Budget
• DENR utilized 90% of

ir total budget authori ty ( ex luding authority for the Regulated ub tance Response and Environmental Livestock Cleanup Ftmd )

• DENR utilized 100% of

it general fimds

• transfe between personal service and operating were needed
• DENR utilized 100% ofit FTE allocation
• DENR" t1.m1over rate wa 5.8%
• 2. Informational Budgets
• Regulated ub tanre Re pon e Fund
• a. Created by the 1988 Legi larnre to deal with environmental cleanup
• b. Life ofFtmd expendit1.1re - $3.54 •

.489

• c. Utilized $198.9 5 last year to re pond to 6 cleanup
• d. FY _011 end-of-year cash balance - $2.96 million
• e. Fut1.1re liabilitie to the Fund
• EnYironmental cleanup - we have about 200 to 2 0 spill per year
• EPABrohm Mine Superfund ite - state mu t provide JO% match for

the projected 80 million EP uperfund cleanup: the tate is then 100% liable for long-tenn water treatment o t after EPA leave

• Environmental Livestock Cleanup Fund
• a. Created by the 1998 Legi lat1.1re to act a. a ·afety net
• b. Life of

Fund expenditures - $230.281

• c. Utilized -

B .393 la t year to re pond to one Ji, esto k Jeanup

• d. FY _011 end-of-year balance -

1.13 million

• e. Future liabilitie to the Ftmd
• Several live tock operations are going tlu-ough bankruptcy and tl1e

fimd may be needed to en ure the manure holding ponds have adequate capacity for tunoffand nowmelt

• Petroleum Relea e ompen ation Fund
• a. Created by the 1988 Legi lature to financially as ist tank owner with

cleanup and to meet the federal environmental financial re ponsibility requirements

• b. A live ca e - 133
• c. Utilized $425,627 last year to respond to 97 cleanups
• d. FY 2011 end-of-year balance - 3.28 million
• e. Fut1.1re liabilities to the Fm1d
• Ongoing abandoned tu1derground tank removal.
• Ongoing reimbur ement for regulated petroleum tank relea e
• Ongoing federal financial a sman e for tank owner

Page2

SLIDE 3

DENR FY 2013 Budget Request

• '.\ifajor Items Reque ted
• a. Govemor'

alruy Poli y and Health Insurance

• General Ftmds - $292.3 8
• Federal Fun
• $329.446
• Other Funds - $18 .302
• b. BFM Spa e Billing and Computer enrice
• General Ftmds - 6.434
• Federal Fund - $9.9 2
• Other Ftmds - $4,651

Redu tion of ARRA federal funds

• Per ·onal Senrice = ($2

.000)

• Operating = ($12,540.000)
• Total Federal Reduction= ($12.81 .000)
• d. Total In rea es/Decrea es
• General Ftmds - $298.SL
• Federal Fund - $12.-1 5.602)
• Other Ftmds - $191.9 -3
• Exrept for the Governor'

alary Poliry and BFM iorrease , ~o Growth Budoet Reque t (Cut from FY 2012 will remain in place)

• a. DENR is reque ting no expansion in FTEs
• b. DENR i requesting no expansion in pe1 onal e1vice
• c. DENR is requesting no expansion in operating
• DENR will use existing re ·ourres to continue to take on new priotitie even as

workloads grow

Page )

SLIDE 4

Top Five Priority Areas from OENR

• 1. DENR's Oil and Gas Initiative
• DENR Oil and Ga Reol'aanizatlon
• a. Reorganized DENR's oil and g:a acti,·ities by cutting reg:ulat01y taffby half

to dernte more FIE to a elerate work on the Oil and Ga Initiative de igned to promote more development

• Oil and Ga · luitiatiYe
• a. Interacti,·e Map for One top hop for Oil and Ga I11fo1mation completed in

months instead of years ( ee 1111,1csdde111:11et/sdoi{) b. treamlined oil and ga regulations by eliminating 11 pages ofntles to expedite pennitting

• c. Oil & Gas Legi lation
• DENR has introduced HB l O

12 to make hearing ma11dat01y only if cases are conte ·ted

• Will expedite oil and ga pennitting process even more

Page,

SLIDE 5

• 1. Interactive Maps

Available at sddenr.net/sdoil/oilgas_app.html lnterac ve pomt-and-<:lick maps for oll and gas permits, geophysical logs, and records of drilling & weft completion C

lick on a well to Instantly get a complete oil and gas

permit file, In bookmarked PDF format Clldc on a well to instantly ge a drilling record dock on a well to instantly get geophys,cal logs Various base maps show,ng stree, aerial, terrain, and topography are provided by ESRl's online mappmg service and are read,ty changeable.

• There are several data layers that can be rumed on

and off.

Deprutment of En irolllllent and Natw·al Re ource (DENR) Oil and Gas Initiative

Prom ring l!'Cplorruion and Dcvdopmcnt of . outh Dal.Ola's Oil and Gas Resources

DE'.'IR's One Stop Shop for

Oil and Ga, Information

A\'ailable at sddenr.neLsdotl

Three way to get i11formatio11!

1. Browse, ,;ew, and downJoad data usioa: ioteracth-e maps. 2. Cse online databases to search for and

download data. 3. Download publications.

Plus

Rr~ulation\ Strramliurd in 2011

t:nnecessary rules were eliminated and others were cha need to expedite industry acth;ty.

• 2. Online Databases for nearly

100,000 drill holes

Records of oil and gas drilling from ~1,900 locations at sddenr.net/oil_gas/ Records of water well completion from

• 62,24S locations at

denr.sd.gov/des/wr/dblogsearch.aspx

• Other records of test hole and well drilling

from •34,350 locations at sddenr.net/lithdb/

• Records of DENR's observation well

measurements from 1,555 wells at denr sd.gov/des/wr/dbobsearch.aspx

• 3. Examples of Publications

Order hard copy or get free downloads at www.sdgs.usd.edu Statewide cross sections Bedrock geologic map Names and dlstrlbubon

• f geologic units

SUbdlvls,ons of the Precambrian surface

SLIDE 6

Barrels of Oil Produced

~ 1954-2010

0 2,000,000

~

~

~

1,000,000

..

m 1940 1960 1980 2000 2020 Calendar year

Number of Producing Oil Wells

1954-2010 .!!!

1300

~ 200

..

°E 100

i

1940 1960 1980 Calendar year 2000 2020

Areas of Oil and Gas Production

South Dakota Oil and Gas Facts

Oil production began in 1954. The discovery well was drtlled In 1953 In Harding County by Shell Oil Company. The well was drilled to a depth of 9,332 feet. The producing geologic unit is the Red River Formation. The Red River Formation remains South Dakota's most productive geologic unit for oil . Nonh Dakota's Bakken Formation does not exist in South Dakota. The Tyler Formation and Three Forks Shale being developed In North Dakota QQ exist In South Dakota but remain effectively unexplored.

State Oil and Gas Revenues

&IMiiMM/l1M•

2011 S281,4"1> $5,276,994 S2,SOO 2010 S2•0.282 S4 505,530 53,100 2009 $297,771 $5,596,540 57,100 2008 S294,773 $5.526,990 S3,600 2007 S166.178 53.152,690 S5,000 2006 $173,710 $3,255,856 52,900

1 soa 10.398 0.24"of thevalut orou and cas prooJc:ttt,

d~icated 10 OEhR to carry out O!I 11\d 1as1ctiv t!i

i SDCl 10-39A

.

.a s" of tM walue of oil and cas productd,

hair 1oes to me natt aentral fund and ha• 1oes to the

county in 'Nhich the production occurred

1 Apptic• on ftt o' S100"of • pen,iit to dr I an o or 1n

wel dfliicated to O~Q to c1rrv out oil and 1u Ktivi ·u

Marketable Gas Production

1979-2010

i~[~

i

1970 1980 1990 2000 2010 2020 Calendar year

Number of Producing Gas Wells

1979-2010

.!!!

.; 150

~

0 100

~ ..

50

.D

E :,

z

1970 1980 1990 2000 2010 2020 Calendar year

Oil & Gas Drilling Permits Issued

al

.~ 80 J2 60

~ ~

40

~

20

..

.D

E o

:,

z

a G!iSWt. Ptrff'I u a OIi Well Permits (lnciudts Associated lnJ ection Wells)

SLIDE 7

Top Five Priority Areas from DENR

f-

·--

• 2. Building Public Infrastructure to Grow Our Economy
• Strong Year for Upgrading Drinking Wate1; Wastewater ancl Solid Wa te Facilities
• a. DENR awarded I

09 million in grant and EPA low interest loans for water.

• wastewater. and olid waste project statewide
• b. DENR provided financial a i tance to 6 different project and awarded another

36 mall Olllllltmity plaiming grant

• c. DENR awarded a I million grant to the Ell wo1th DeYelopment Authority for the

de ign of a regional wastewater treatment system to enhance stat federal part:nedlip

PageS

SLIDE 8

Top Five Priority Areas from DENR

• .., 3. Growing Our Agricultural Economy - controversial cases
• Long View Farm · - 4.900-head confined hog unit near Wagner
• a. Yanlion 'ioux Tribe won court ca e that concluded water used by the hog 1U1it i

not dome tic l e of water and need a water right permit instead

• b. DENR

·s Water Management Board approved the water 1ig.ht permit over

• bjections from the Yanlion Sioux Tribe
• c. EPA dismi ed an enviromnental justice complaint filed against DENR by tl1e

Yankton Sioux Tribe

• d. DENR has introduced HB l O

11 to clarify le s than 18 gallons per minute of water use by on.fined li,·esto k operations is dome ti use and does not need a water right

SLIDE 9

Top Five Priority Areas from DENR

• .., 3. Growing Our Agricultural Economy - controversial cases
• VeblPn Dairies - two dairies in eblen totaling 13.6 6-head that went bankrupt
• a. DENR helped bankrupt y trn tee keep overfall manure laooon euvirouIUentaJly

afe

• b. DTh1R naIUed the fonuer IUanager as au envirouIUeutal "bad a tor"·
• c. DENR ucce sfully transfened the two water pollution control penuits to new
• wner
• l!NI O.k-/

Page7

SLIDE 10

Top Five Priority Areas from DENR

• .., 3. Growing Our Agricultural Economy - controversial cases
• Hanson County Dairy - proposed .000-head daity
• a. DENR

· Water Management Board approved water right permit over local

• bjections
• b. Judge ean

'Brien of the Fir t Judicial ircuit omt i ued a mling denying a filing by the opponents for a stay of the Water anagement Board decision to approve the water right

• c. Water 1

ight permit has been appealed to circuit court by the opponents on the ba i

• f

improper notice

PageB

SLIDE 11

0 Wllarl M,ne Perm! Boondary 0 Wlla1 Expans,on Fermi Boundary

Wharf Expansion Permtted Pllected Alea

Top Five Priority Areas from OENR

• 4. Growing Our M neral and Energy Economy
• controversial cases
• Ex1nmsion of

Wharf Re ourre Gold Mine

• a. After a tightly come ted a e hearing that la ·ted more than two days. DENR

· Board of Minerals and Envirorunent unanimou ly approYed the pennit to expand the Whruf mine by 530 acre a recommended by DENR

• b. ApprO\"ing thi expansion aves 150 high-paying mining job for

to 10 years. depending on the gold market

Page9

SLIDE 12

Top Five Priority Areas from OENR

• 4. Growing Our M neral and Energy Economy
• controversial cases
• Spearfish Hydroelectric Plaut Saved
• a. The Federal Energy Reg1.1lato1

y

• nuui . ion upheld DENR' 401 Water Quality

Certification

• b. The Federal Energy Regulato1

y

• nuui ion i ued the city of pearfi ha federal
• perating license a reconuuended by DENR
• c. The Federal Energy Regulato1y onuni ion di mi ed a rehearing petition from

ACTion for the Environment

SLIDE 13

Top Five Priority Areas from OENR

• 4. Growing Our M neral and Energy Economy
• controversial cases
• Xakota Energy near Bear Butte
• a. DENR. Board of

Minerals and En\"ironment incorporated the Historical Society recornmendatio1

• b. Tue board approved a new spacing order for the new Gullickson Oil Field O\"er
• bjections of

five T1 ibe

Pa09 11

SLIDE 14

• Hyperion Inergy Center

Top Five Priority Areas from OENR

• 4. Growing Our M neral and Energy Economy
• controversial cases
• a. After Ii tening to fotu· days of
• testimony. DENR's Board of

Minerals and Em irolllllent tmanimou ly approved again in September 2011 the Pre,·ention of ignificant Deterioration precon trnction air quality pennit

• b. The new pemtit contain an exter ion of

the deadline for beginning con trnction: the new deadline i March _Q

13

• c. The revi ed air quality pemtit now goe back to Cir uit Court as both Hyperion

and the iem1 lub appealed the first air quality pennit

Paoe 12

SLIDE 15

Top Five Priority Areas from DENR

• Govemor Daugaard' Better onmment Initiative
• a. DENR has identified 130 sections. 109 pages. & 30.40_ words ofmle to

eliminate

• b. So far. DENR has completed repealing 9 sections. 5 pages. and 14.1 6 words of

mle

• c. DENR has introduced HB 1013 to repeal weather modification regulation

..

recycling and mining report to the legi lature. P B regulation. tatewide olid waste management plruL and requirement for recyclable or biodegradable beverage container · and garbage bags

Paoe 13

SLIDE 16

~000 4000 )000 2000 1000 2002 2002 200] 200, 200) 200,

Key Environmental Indicators

• 1. Workloads Continue to Increase

Air Quallty Permits Regulated

200!, 2006 2001 200I 200! 2010 2011 Sla&e Fiscal Ytar

Splll Sites Cleaned Up Since 1972

200!, 2006 2001 2008 2009 2010 2011 StMe nxal YHf

Paoe 1,

SLIDE 17

120 100 IO

,o

20 9000

Key Environmental Indicators

• 1. Workloads Continue to Increase

Funding Assistance for Projects

~--------------------------- 117 -

107.A

99.2 100 91.3 17

s..s ---------I

.. ,.

,

3U7 2002

2003 2004 2005 2006 2007 2008 2009 2010 20 11 Slate rltul Year

Water Right Permits Regulated

7,9'1 l.020 1.055 St te n.c.1 Ye.,

Paoe 1s

SLIDE 18

2.500 2000 1500 I 000

500 760 000 740 000

noooo

700 000 680 000 660000 6-40000 620 000 60 000 580 000

Key Environmental Indicators

• 1. Workloads Continue to Increase

Hazardous Waste Generators

2.tll

• ----1.917--

i.m

1,1'8 Sttte rltcol Yea, People Served by Regulatad Public Drinking Watar Syatama

750.050

1..i.,n

• -------------------111,

115 .... 711.17)

700.181

6l0.000 650.500 2002 200)

201),1

2005 20 10 201 1 Slate Fi.teal Y Mr Paoe 16

SLIDE 19

100 100 75 50 25

Key Environmental Indicators

• 2. Environmental Standards Maintained

Percent of Fecal Coliform samples that meet South Dakota Surface Water Quality Standards

• ------93

___

93

___ ~---,.---,,

,.............,i---,.---97

17 19

12

83 83 13 2002 20QJ 2004 2005 2006 2007 200I 2009 2010 2011 Sta .. FIK.al YHt Percent of Total Suspended Solids S.mplea !hot meet South D kola Surfaca Watar Quality Samples

,..,, __ .

99 99

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Paoe 11

SLIDE 20

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Key Environmental Indicators

• 2. Environmental Standards Maintained

PM10 Trend1 In South 01koc.

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Paoe ,a

SLIDE 21

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Key Environmental Indicators

• 2. Environmental Standards Maintained

Ozone Trends for South Dakota

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SUMMARY

• DENR FY 2013 Budg"t R"qu" t:
• a. Incr('aS(' G"uuaJ Fund by $298,812 and Oth('r Funds by 191,953, but cuts

F ('dN·al Fund by ( 12,815,000)

• b. Maintain FY 2012 budg('t cuts

c.

• ntain zuo growth in FTE and opN·ating
• d. Will allow DE.'.\"R to coutinu(' to h"IP grow ow· ('COnomy th1·ough b('tt('r

('ll\il'OllID('Otal pl'Of('Ction

Paoe 19