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No. 174. An act relating to potable water supply and wastewater system
connections.
                                      (S.212)
It is hereby enacted by the General Assembly of the State of Vermont:
Sec. 1. 10 V.S.A. § 1971 is amended to read:
§ 1971. PURPOSE
  It is the purpose of this chapter to:
     (1) establish a comprehensive program to regulate the construction,
replacement, modification, and operation of potable water supplies and
wastewater systems in the State in order to protect human health and the
environment, including potable water supplies, surface water, and
groundwater;
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     (6) allow delegation of the permitting program created by this chapter to
municipalities demonstrating the capacity to administer the chapter review of
potable water supply and wastewater system connections pursuant to general
permits adopted under this chapter.
Sec. 2. 10 V.S.A. § 1972 is amended to read:
§ 1972. DEFINITIONS
  For the purposes of As used in this chapter:
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     (6) “Potable water supply” means the source, treatment, and conveyance
equipment used to provide water used or intended to be used for human
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consumption, including drinking, washing, bathing, the preparation of food, or
laundering. This definition includes a service connection to a public water
system of any size. This definition does not include any internal piping or
plumbing, except for mechanical systems, such as pump stations and storage
tanks or lavatories, that are located inside a building or structure and that are
integral to the operation of a potable water system. This definition also does
not include a potable water supply that is subject to regulation under chapter 56
of this title.
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       (10) “Wastewater system” means any piping, pumping, treatment, or
disposal system used for the conveyance and treatment of sanitary waste or
used water, including carriage water, shower and wash water, and process
wastewater. This definition does not include any internal piping or plumbing,
except for mechanical systems, such as pump stations and storage tanks or
toilets, that are located inside a building or structure and that are integral to the
operation of a wastewater system. This definition also does not include
wastewater systems that are used exclusively for the treatment and disposal of
animal manure. In this chapter, “wastewater system” refers to a soil-based
disposal system of less than 6,500 gallons per day, or a sewerage sanitary
sewer collection system connection of any size.
Sec. 3. 10 V.S.A. § 1973 is amended to read:
§ 1973. PERMITS
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   (a) Except as provided in this section and sections 1974 and 1978 of this
title, a person shall obtain a permit from the Secretary before:
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      (7) making a new or modified connection to a new or existing potable
water supply or wastewater system; or
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   (f)(1) The Secretary shall give deference to a certification by a licensed
designer with respect to the engineering design or judgment exercised by the
designer in order to minimize Agency review of certified designs. Nothing in
this section shall limit the responsibility of the licensed designer to comply
with all standards and rules, or the authority of the Secretary to review and
comment on design aspects of an application or to enforce Agency rules with
respect to the design or the design certification.
      (2) The Secretary shall issue a permit for a new or modified connection
to a water main and a sewer main or indirect discharge system from a building
or structure in a designated downtown development district upon submission
of an application under subsection (b) of this section that consists solely of the
certification of a licensed designer, in accordance with subsection (d) of this
section, and a letter from the owner of the water main and sewer main or
indirect discharge system allocating the capacity needed to accommodate the
new or modified connection. However, this subdivision (2) shall not apply if
the Secretary finds one of the following:
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          (A) The Secretary has prohibited the system that submitted the
allocation letter from issuing new allocation letters due to a lack of capacity.
          (B) As a result of an audit of the application performed on a random
basis or in response to a complaint, the system is not designed in accordance
with the rules adopted under this chapter.
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   (k)(1) The Secretary shall adopt a general permit for both potable water
supply and wastewater system connections that require a permit under this
chapter. Under the general permit, the Secretary may give deference to
applications for connections certified by a licensed designer. The Secretary
shall publish a manual providing guidance to licensed designers implementing
the general permit for potable water supply or wastewater system connections.
The manual shall include guidance for determining or defining the capacity of
a public water system or pollution abatement facility for purposes of approving
a potable water supply or wastewater system connection.
      (2) The Secretary may adopt a general permit under this chapter for the
subdivision of land when no building, structure, or campground exists on or is
proposed for the property at the time of subdivision.
      (3) The Secretary may adopt a general permit under this chapter for
boundary line adjustments for improved or unimproved lots.
      (4) The Secretary may adopt a general permit for the permitting under
this chapter of potable water supply systems with a design flow of less than
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1,000 gallons per day when there is no requirement for any variance,
hydrogeologic analysis, or yield testing of a potable water source.
      (5) The Secretary may adopt a general permit for the permitting under
this chapter of wastewater systems that:
          (A) have a design flow of less than 1,000 gallons per day; and
          (B) do not require a variance, a hydrogeologic analysis, or innovative
or alternative technologies unless such technologies are allowed by the
Secretary.
Sec. 4. 10 V.S.A. § 1976 is amended to read:
§ 1976. DELEGATION OF CONNECTION PERMITTING AUTHORITY
          TO MUNICIPALITIES
   (a)(1) The Secretary may delegate to a municipality authority to:
          (A) implement all sections of this chapter, except for sections 1975
and 1978 of this title; or
          (B) implement permitting under this chapter for the subdivision of
land, a building or structure, or a campground when the subdivision, building
or structure, or campground is served by sewerage connections and water
service lines, provided that:
             (i) the lot, building or structure, or campground utilizes both a
sanitary sewer service line and a water service line; and
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             (ii) the water main and sanitary sewer collection line that the water
service line and sanitary sewer service line are connected to are owned and
controlled by the delegated municipality.
      (2) If a municipality submits a written request for delegation of this
chapter, the Secretary shall delegate authority to the municipality to implement
and administer provisions of this chapter, the rules adopted under this chapter,
and the enforcement provisions of chapter 201 of this title relating to this
chapter, provided that the Secretary is satisfied that the municipality:
          (A) has established a process for accepting, reviewing, and processing
applications and issuing permits, that shall adhere to the rules established by
the Secretary for potable water supplies and wastewater systems, including
permits, by rule, for sewerage connections;
          (B) has hired, appointed, or retained on contract, or will hire, appoint,
or retain on contract, a licensed designer to perform technical work that must
be done by a municipality under this section to grant permits;
          (C) will take timely and appropriate enforcement actions pursuant to
the authority of chapter 201 of this title;
          (D) commits to reporting annually to the Secretary on a form and date
determined by the Secretary;
          (E) will only issue permits for water service lines and sanitary sewer
service lines when there is adequate capacity in the public water supply system
source, wastewater treatment facility, or indirect discharge system; and
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          (F) will comply with all other requirements of the rules adopted under
section 1978 of this title The Secretary may delegate to a municipality
authority to conduct technical review of proposed projects that include both
municipal potable water supply and municipal wastewater system connections
that require a permit under this chapter, provided that the water main and
sanitary sewer collection line that the water service line and sanitary sewer
service line are connected to are owned and controlled by the delegated
municipality. A municipality that is delegated authority under this section
shall incorporate the requirements of the Secretary’s general permit for potable
water supply and wastewater system connections into a municipal connection
approval, including deference to applications for connections certified by a
licensed designer.
      (2) If a municipality submits a request for delegation of authority under
this subsection, the Secretary shall delegate authority to the municipality to
implement and administer the provisions of this chapter governing municipal
potable water supply and wastewater system connections, provided that the
municipality:
          (A) is qualified to perform the technical review as determined by the
Secretary;
          (B) receives authorization from the municipal legislative body to
administer a program for review of potable water supply and wastewater
system connections;
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          (C) meets any other requirement for the delegation program as
adopted by the Secretary in writing;
          (D) shall only issue permits for water service lines and sanitary sewer
service lines when there is adequate capacity in the public water system,
wastewater treatment facility, or indirect discharge system;
          (E) submits required documentation of the permitted project as
determined by the Secretary; and
          (F) complies with the requirements for connection and all
requirements of the Agency’s rules adopted under section 1978 of this title.
                                       ***
   (f) The Secretary may review municipal implementation of this section on
a random basis, or in response to a complaint, or on his or her the Secretary’s
own motion. This review may include consideration of the municipal
implementation itself, as well as consideration of the practices, testing
procedures employed, systems designed, system designs approved, installation
procedures used, and any work associated with the performance of these tasks.
Sec. 4a. TECHNICAL ADVISORY COMMITTEE REPORT ON
          OVERSHADOWING OF PROPERTY BY POTABLE WATER
          SUPPLIES AND WASTEWATER SYSTEMS
   (a) On or before January 15, 2027, the Secretary of Natural Resources’
Technical Advisory Committee (TAC) shall report to the House Committees
on Environment and on Judiciary and the Senate Committees on Natural
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Resources and Energy and on Judiciary regarding authority under State statute
and rules that allows the isolation distances for potable water supplies and
wastewater systems to extend onto neighboring property, a practice commonly
referred to as overshadowing. In preparing the report, the TAC shall:
      (1) summarize the scientific and technical basis and benefit to the
environment and public health from overshadowing;
      (2) evaluate alternatives to overshadowing that could prevent or
significantly limit overshadowing of property and recommend preferred
alternatives;
      (3) present data on the frequency of overshadowing and on the different
alternatives or types of outcomes that occur when overshadowing exists;
      (4) recommend additional steps the Agency of Natural Resources can
take to support the resolution of issues that may occur between neighbors when
overshadowing occurs; and
      (5) provide any additional information that the TAC deems relevant to
address the issue of overshadowing from potable water supplies and
wastewater systems.
   (b) Any recommendation by the TAC under subsection (a) of this section
for legislative action or rulemaking may be presented as draft legislation or
draft amendment to rules. The TAC may submit the report required under
subsection (a) of this section as part of the Committee’s annual report to the
General Assembly.
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Sec. 5. 3 V.S.A. § 2822 is amended to read:
§ 2822. BUDGET AND REPORT; POWERS
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   (i) The Secretary shall not process an application for which the applicable
fee has not been paid unless the Secretary specifies that the fee may be paid at
a different time or unless the person applying for the permit is exempt from the
permit fee requirements pursuant to 32 V.S.A. § 710. Municipalities shall be
exempt from the payment of fees under this section except for those fees
prescribed in subdivisions (j)(1), (7), (8), (14), and (15) of this section for
which a municipality may recover its costs by charging a user fee to those who
use the permitted services. Municipalities shall pay fees prescribed in
subdivisions (j)(2), (10), (11), (12), and (26) of this section, except that a
municipality shall also be exempt from those fees for stormwater systems
prescribed in subdivisions (j)(2)(A)(iii)(I), (II), or (IV) and (j)(2)(B)(iv)(I), (II),
or (V) of this section for which a municipality has assumed full legal
responsibility under 10 V.S.A. § 1264. Municipalities that conduct a technical
review or approval of a potable water supply or wastewater system connection
permitted under 10 V.S.A. § 1976 within the municipality may charge a fee for
the cost of municipal services, provided that the municipality shall pay an
administrative processing fee of $100.00 for submission to the Secretary of
Natural Resources of documentation of the municipally permitted project.
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   (j) In accordance with subsection (i) of this section, the following fees are
established for permits, licenses, certifications, approvals, registrations, orders,
and other actions taken by the Agency of Natural Resources.
                                        ***
      (4) For potable water supply and wastewater permits issued under
10 V.S.A. chapter 64. Projects under this subdivision include: a wastewater
system, including a sewerage connection; and a potable water supply,
including a connection to a public water supply:
          (A) Original applications, or major amendments for a project that is
not a potable water supply or wastewater system connection with the following
proposed design flows. In calculating the fee, the highest proposed design
flow whether wastewater or water shall be used:
               (i) design flows 560 gpd or less: $306.25 per application;
               (ii) design flows greater than 560 and less than or equal to 2,000
gpd: $870.00 per application;
               (iii) design flows greater than 2,000 and less than or equal to
6,500 gpd: $3,000.00 per application;
               (iv) design flows greater than 6,500 and less than or equal to
10,000 gpd: $7,500.00 per application; or
               (v) design flows greater than 10,000 gpd: $13,500.00 per
application.
          (B) Minor amendments: $150.00.
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          (C) Minor projects: $270.00.
          As used in this subdivision (j)(4)(C), “minor project” means a project
that meets the following: there is an increase in design flow but no
construction is required; there is no increase in design flow but construction is
required, excluding replacement potable water supplies and wastewater
systems; or there is no increase in design flow and no construction is required,
excluding applications that contain designs that require technical review.
          (D) Notwithstanding the other provisions of this subdivision, when a
project is located in a Vermont neighborhood, as designated under 24 V.S.A.
chapter 76A, the fee shall be no more than $50.00 in situations in which the
application has received an allocation for sewer capacity from an approved
municipal system. This limitation shall not apply in the case of fees charged as
part of a duly delegated municipal program. [Repealed.]
          (E) Original applications or major amendments for coverage under a
potable water supply and wastewater system connection general permit issued
under 10 V.S.A. § 1973(k)(1), the following fee according to the highest
proposed design flow of wastewater or water for the connection:
               (i) design flows below 2,000 gpd: $250.00 per application;
               (ii) design flows of between 2,000 gpd and 6,500 gpd: $2,500.00
per application; or
               (iii) design flows greater than 6,500 gpd: $5,000.00 per
application.
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                                      ***
Sec. 6. IMPLEMENTATION; REPEAL OF EXEMPTIONS IN RULE
   (a) On or before December 1, 2027, the Secretary of Natural Resources
shall publish the general permit and manual required under 10 V.S.A.
§ 1973(k)(1) for potable water supply or wastewater system connections.
   (b) Beginning on January 1, 2028, the Secretary of Natural Resources shall
begin to accept certifications of the connections of potable water supplies and
wastewater systems under the general permit required by 10 V.S.A.
§ 1973(k)(1).
   (c)(1) The following provisions of the Department of Environmental
Conservation’s Wastewater System and Potable Water Supply Rules shall be
repealed on January 1, 2028:
          (A) subdivisions 1-304(15) and (16) (modification of design flows of
a wastewater system or potable water supply serving an existing building or
structure);
          (B) subdivision 1-603(2) (related to full delegation of permitting to
municipalities); and
          (C) subdivisions 1-603(8), (9), and (10) (related to recordkeeping by
fully delegated municipalities).
      (2) References in chapter 6 of the Department of Environmental
Conservation’s Wastewater System and Potable Water Supply Rules related to
full delegation to municipalities of permitting potable water and wastewater
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system connections are no longer applicable or enforceable due to the repeal of
statutory authority for full delegation.
Sec. 7. 10 V.S.A. § 1263 is amended to read:
§ 1263. DISCHARGE PERMITS
   (a) Any person who intends to discharge waste into the waters of the State
or who intends to discharge into an injection well or who intends to discharge
into any publicly owned treatment works any waste that interferes with, passes
through without treatment, or is otherwise incompatible with that works or
would have a substantial adverse effect on that works or on water quality, or is
required to apply for a CAFO permit, shall make application to the Secretary
for a discharge permit. Application shall be made on a form prescribed by the
Secretary. An applicant shall pay an application fee in accordance with
3 V.S.A. § 2822.
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   (k)(1) The Secretary may enter into an agreement with the owner of a
POTW to delegate to the owner of the POTW authority under this title to
regulate pretreatment discharges to the POTW. An agreement entered into by
the Secretary under this subsection shall authorize the owner of the POTW to
regulate and enforce pretreatment discharges to the POTW consistent with the
authority set forth in 40 C.F.R. Part 40, including the establishment of
applicable civil, criminal, or administrative penalties for the violation of
pretreatment standards or requirements. The owner of a POTW that the
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Secretary enters into an agreement with under this subsection may, as part of
the agreement, set application fees and other fees necessary for the regulation
of a pretreatment discharge to the POTW. The Environmental Division shall
have the same jurisdiction to review the actions of the owner of the POTW
delegated pretreatment authority by an agreement under this subsection and to
hear appeals as the Environmental Division’s jurisdiction over the Secretary’s
actions. The jurisdiction of the Environmental Division shall be construed
broadly with respect to review of the actions of an owner of a POTW delegated
pretreatment authority under this subsection.
      (2) As used in this subsection:
          (A) “Pretreatment” means the reduction of the amount of pollutants,
the elimination of pollutants, or the alteration of the nature of pollutant
properties in wastewater prior to or in lieu of discharging or otherwise
introducing pollutants into a POTW. Pretreatment includes those processes or
technologies authorized under 40 C.F.R. § 403.3(s).
          (B) “Pretreatment discharge” means the introduction of pollutants
into a POTW from any nondomestic source regulated under 33 U.S.C.
§ 1317(b), (c), or (d).
          (C) “Publicly owned treatment works” or “POTW” has the same
meaning as in 40 C.F.R. § 403.3(q).
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Sec. 8. CONTINGENT EFFECTIVE DATE
   Sec. 7 (municipal pretreatment authority) shall take effect upon the U.S.
Environmental Protection Agency notifying the Secretary of Natural Resources
that the Agency of Natural Resources is authorized to enter into an agreement
with a municipality to administer a pretreatment program under the
Modification to National Pollutant Discharge Elimination System
Memorandum of Agreement Between the State of Vermont and the U.S.
Environmental Protection Agency, Region 1, March 16, 1982, or other
agreement between the U.S. Environmental Protection Agency and the Agency
of Natural Resources. The Secretary of Natural Resources shall notify the
Clerk of the House of Representatives and the Secretary of the Senate when the
U.S. Environmental Protection Agency authorizes municipal administration of
a pretreatment program.
Sec. 9. EFFECTIVE DATES
   This act shall take effect on passage, except that 3 V.S.A. § 2822(j)(4)(D) in
Sec. 5 (repeal of fee cap for potable water supply and wastewater system
permits located in designated areas) shall take effect July 1, 2026.
Date Governor signed bill: June 18, 2026
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