Testimony on August 3rd Before The Assembly Committee on Jobs and the Economy In Support of August 2017 Special Session Assembly Bill 1

Chairman Neylon and Committee Members:

Thank you for the opportunity to testify today. My name is Lucas Vebber and I am the General Counsel and Director of Environmental and Energy Policy at Wisconsin Manufacturers and Commerce (WMC). WMC is the state’s chamber of commerce and manufacturers’ association. With approximately 3,800 members, we are the largest business trade association in Wisconsin. WMC represents members from all over Wisconsin of all sizes and in every sector of the state’s economy. I am here today to testify in support of Special Session Assembly Bill 1.

Manufacturing drives our state’s economy. It is Wisconsin’s top employment sector, and makes up about 20% of GDP. Nearly half a million Wisconsinites work in manufacturing, producing more than $22 billion in exports each year. Manufacturing is what we do. We make things in Wisconsin, and we make them better than anywhere else in the world. Our strength in manufacturing has led to a tremendous new transformational opportunity to grow our state’s economy – Foxconn.

The opportunity before our state is a validation of the pro-growth reforms that have been enacted in recent years. The improvements to Wisconsin’s business climate through tax, regulatory and litigation reforms over the past six years have literally changed the way the world looks at Wisconsin. Whether it was Act 10, the Manufacturing and Agriculture Credit, or Right to Work, Wisconsin has shown that we are open for business and are here to compete and win against anywhere in the world.

These reforms, combined with Wisconsin’s high quality of life, low cost of living, great communities, world-class schools and diverse recreational activities have set our state up for success for a generation and beyond. The legislation before you today keeps our state moving in the right direction, and we ask that you support it.

Since this legislation was made public last week there has been a significant amount of misinformation spread by those who simply wish to stymie economic development in our state. These are the same individuals who refuse to recognize the reality that these reforms are working.

Environmental activist groups have been misleading the public for the past several days about the extent of the permitting reforms in this legislation. The reality is this legislation maintains our state’s strong environmental protections while providing a regulatory atmosphere necessary to draw this once-in-a-lifetime opportunity to our state.

It’s important to note that the regulatory changes proposed in this legislation are not permanent, and they do not apply statewide. These are temporary changes that apply only within a designated “Electronics and Information Technology Manufacturing Zone.” Only one such zone may be designated, and only for a period of 15 years.

Environmental Impact Statements

For “major actions,” state law requires the preparation of an Environmental Impact Statement (EIS). A “major action” is defined in regulations as anything that’s not a minor action, and minor actions are very limited. The EIS is essentially a book report, summarizing what types of permits may be required in the future, it does not issue permits or any approvals. These documents can be incredibly time consuming even though they have absolutely no regulatory consequence.

This legislation provides that projects within the specifically designated zone are not “major actions.” Such projects would thus, not be required to prepare an EIS. This change in no way exempts such projects from permitting, it merely absolves such a project from taking part in a burdensome, time consuming and costly paper chase that benefits no one.

Wetlands

There are two types of wetlands in Wisconsin: federal and nonfederal. Federal wetlands are those wetlands subject to the Clean Water Act and require federal permitting. This legislation does not (and the State of Wisconsin cannot) change those federal permitting requirements. Wisconsin also regulates nonfederal, isolated, intrastate wetlands. Wisconsin was the first state in the nation to regulate such non-federal wetlands. Few states have followed our lead in adopting this onerous, unnecessary, and unique regulatory framework.

This legislation would exempt a project in the specifically designated zone from the additional state-specific permitting requirements. It’s important to note that federal permitting requirements and state-based mitigation requirements still apply. In fact, those mitigation requirements are increased. Under this legislation, any adverse impacts to wetland functional values, federal or nonfederal, will have to be mitigated at a 2:1 ratio, which is 66% more stringent than what is required under current law.

Other Permitting Changes

This legislation also expands certain current-law exemptions to include the construction, access or operation of a new manufacturing facility within an Electronics and Information Technology Manufacturing Zone. For example, under current law any agricultural use of the land or any activities in Milwaukee County are exempt from permitting requirements to construct or enlarge an artificial water body that connects to navigable water. This legislation would have state law treat the newly specifically designated zone just as it treats agricultural uses statewide and activities in Milwaukee County.

Public Trust Doctrine

Opponents to this development have also brought up the public trust doctrine and are claiming our state’s constitution prohibits these reforms. This could not be further from the truth. As our Supreme Court has made clear time and time again, most recently in the 2013 Rock- Koshkonong v. DNR decision (350 Wis.2d 45), the public trust doctrine only applies to navigable waters, and only up to the ordinary high water mark (“There is no constitutional foundation for public trust jurisdiction over land, including non-navigable wetlands, that is not below the OHWM of a navigable lake or stream.”). Additionally, as noted above, other changes in this legislation merely expand current law exemptions. Claiming that these changes violate the public trust doctrine would be claiming that current law violates the public trust doctrine. It does not. Any attempt to claim this legislation would violate the public trust doctrine is nonsense and runs contrary to long standing legal precedent.

These reforms do not, in any way, reduce or modify any air or water quality standard in our state. This legislation does not exempt any business from air or water quality standards. Foxconn, like anyone else in Wisconsin, will have to obtain air and water permits as necessary to operate, and will need to abide by Wisconsin’s stringent environmental standards in order to do so.

This is a landmark moment. The world is literally watching. Wisconsin has made far too much progress to turn back now. Let’s make these common sense and necessary reforms and make this transformational project a reality.

Thank you for your time, I would be happy to answer any questions you may have today.

 

Lucas Vebber is the General Counsel & Director of Environmental and Energy Policy with Wisconsin Manufacturers & Commerce