I haven't read the application forms, but my guess is that the applicant makes the initial determination of the type of permit being sought, perhaps in consultation with the DEC. Assuming this is the case, the DEC would of course retain oversight, so good luck to Mr. Applicant trying to pass off an application for a minor project when the pollution levels subject it to Title V (actually, in that case there would be two authorities to contend with).
You are absolutely right that many people (myself included) thought that the permit process would be further along by now. The fact is we are invested in what is largely a start-up company in a very young industry. Of course there will complications and setbacks to the business plan. Whether the particular setbacks and complications in JBI's case are warranted or justified is a decision left for our own individual determinations.