Business Licenses and Renewals and SB 205. New SIC Code Requirements Causing Headaches for CA Businesses

​California businesses and municipalities need to be aware of Senate Bill 205 (Hertzberg). The bill was signed into law on October 2, 2019. The bill requires businesses applying for or renewing their businesses licenses to provide their Standard Industrial Classification Code (SIC), and if required, show proof of enrollment in California’s Industrial General Stormwater Permit (IGP)¹. The purpose of the bill is to capture many of the non-filer businesses who are currently operating without IGP coverage, which is a violation of the Clean Water Act, and is also an unfair business practice.

Businesses applying for or renewing their license need to be aware that they must select the most representative SIC code for their operations. Based on the SIC code selected, the need for IGP coverage may apply. There are roughly 882 SIC Codes that trigger the need for IGP coverage (e.g., manufacturing, transportation, warehousing, mining, etc.). If your business has one of these SIC Codes, the most common type of application for those businesses that operate indoors will be a No Exposure Certification (NEC). For those businesses that perform operations both indoors and outdoors, they will typically be required to file for a Notice of Intent for full permit coverage (NOI). Very rarely, a facility may apply for a Notice of Non Applicability (NONA) which means their site wont discharge offsite or to a receiving water. A NONA will require a certified report from a CA Professional Engineer. Again, this is very rare.

In the event IGP coverage is warranted and full permit coverage is required, specific SIC codes selected may require sampling for additional pollutants beyond the basic required monitoring parameters. Further, businesses who are located in specific watersheds may also have additional, more stringent requirements imposed upon them due to downstream waterbody impairments with Total Maximum Daily Loads (TMDLs) (see our November 2018 article entitled “Industrial General Stormwater Permit Amendments”). The majority of the TMDL waterbodies are located in the Los Angeles Region, but do exist statewide depending on the watershed. Add to that, if you are relying on your HR or Accounting department to complete your business license renewals, selecting the wrong SIC Code or something different than what is provided in your current IGP (if you already have IGP coverage), can result in violations or third-party lawsuits down the road. It will be important to consult with your environmental team/consultants and/or legal team to better understand the SIC code and requirements.

Municipalities also need to be aware of this potential change as it will require additional effort on their part to track and comply with these requirements. Cities should train their business license managers on these requirements and to be prepared to handle the questions expected. It is highly recommended that resources and educational materials be prepared to handle this new requirement.

The full text of the bill can be found at https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201920200SB205

​NV5’s experts and Qualified Industrial Stormwater Practitioners (QISPs) provide expertise on the Industrial Permit and SIC Codes. We can prepare full permit applications for NOIs, NECs, or NONAs if applicable. To learn if your facility is subject to the IGP, TMDLs, elevated ERA status, or just compliance concerns in general, give us a call at 562-495-5777 or email our Water Resources experts.

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¹Final National Pollutant Discharge Elimination System (NPDES) General Permit for Storm Water Discharges Associated with Industrial Activities (Industrial Permit) (SWRCB Order 2014-0057), adopted on April 1, 2014.