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EPA Seeks To Overturn Supreme Court Decisions Limiting Water Act Jurisdiction

Legal Backgrounder
05/20/11

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On May 2, 2011, the Environmental Protection Agency ("EPA") and the Corps of Engineers ("the Corps") published in the Federal Register a draft guidance document ("Guidance") explaining how EPA and the Corps will implement the U.S. Supreme Court's decisions Solid Waste Agency of Northern Cook County v. Corps of Engineers, 531 U.S. 159 (2001), and Rapanos v. United States, 547 U.S. 715 (2006).  The Guidance will dictate which waters are subject to the Clean Water Act ("CWA") permitting and regulatory processes.  There is a 60-day public comment period on the Guidance ending July 1, 2011 after which EPA and the Corps will issue a proposed rule, and later a final rule, pursuant to the Administrative Procedure Act.  

Although the SWANCC and Rapanos decisions involved only the CWA §404 dredge and fill permit program, the Guidance will apply to the jurisdictional reach of the §402 National Pollution Discharge Elimination System permit program, the §311 oil spill program, the §303 water quality standards and total maximum daily load programs, and the §401 state water quality certification process.  EPA and the Corps admit the Guidance will "increase significantly" the number of waters subject to CWA jurisdiction. 

A careful reading of the Guidance suggests that its practical effect will likely be to accomplish something Congress lacked the votes to do - effectively circumvent the Supreme Court' intention to place limits on how far the Corps and EPA can go in asserting jurisdiction under the CWA.  To understand the effect and practical reach of the Guidance, it is helpful to briefly review the SWANCC and Rapanos decisions.

The SWANCC Decision. 

Thirteen years after Congress passed the CWA, the Corps determined the law applied to waters that "are or could be used" by migratory birds.  A 1994 General Accounting Office report concluded the effect of this Migratory Bird Rule ("MBR") was "that nearly all waters and wetlands" in the U.S. were then jurisdictional.

When 23 Illinois municipalities banded together as the Solid Waste Agency of Northern Cook County ("SWANCC") to build a municipal landfill in an abandoned strip-mined gravel pit, the Corps applied the MBR to assert CWA jurisdiction.  The Corps found that when rainwater accumulated in the strip-mined trenches and ruts that these trenches and ruts became navigable waters of the U.S. subject to CWA jurisdiction because migratory birds could use the water.  The Corps assumed the birds could be using the waters because migratory birds had been seen on the site.  However, aside from seeing birds on the site, the Corps did no analysis to determine if the birds were using the waters at issue.  The Corps' jurisdictional claim meant SWANCC had to get a §404 CWA permit to fill the trenches and ruts at the proposed project site.

SWANCC applied for the permit and was denied, spending several million dollars along the way. After the Corps denied the §404 permit request, SWANCC challenged whether the government had jurisdiction over the site under the CWA.  Ultimately, the Supreme Court ruled that the Migratory Bird Rule exceeded the authority the Clean Water Act granted the Corps and EPA, and SWANCC thus did not need a CWA permit to build its landfill. 

In considering the effects of the Guidance, it is important to bear in mind that the SWANCC Court felt constitutional issues were implicated by the Corps' and EPA's efforts to expand the CWA's jurisdictional reach.  In dicta the Court stated there were "significant constitutional questions" raised by the MBR.  The Court went on to state that "[p]ermitting [the Corps] to claim federal jurisdiction ... would result in a significant impingement on the state's traditional and primary power over land and water use."  As discussed below, the Guidance appears to suffer from the same lack of limits, permitting the Corps and EPA to claim CWA jurisdiction over virtually all wet areas in the United States. 

The Rapanos Decision.

Five years after the SWANCC decision, the Supreme Court returned to the issue of which waters are subject to CWA jurisdiction.  Leaving the SWANCC decision intact, the Court fractured, four justices voting for a narrow interpretation of CWA jurisdiction, four for an expansive view, with Justice Kennedy in the middle casting the deciding vote.  Since Justice Kennedy cast the deciding fifth vote, it is principally his concurring opinion the Guidance seeks to interpret.  However, the Guidance also states that if a water or wetland is jurisdictional under the narrower jurisdictional interpretation adopted in the plurality opinion, it will also be jurisdictional under the Guidance.  

In Rapanos, every justice agreed that traditional navigable waters are jurisdictional, i.e., waters that are navigable in fact and waters that could be made navigable.  As to tributaries that cannot be made navigable, and intermittent streams, the dissenting Justices would have upheld the Corps' assertion of jurisdiction.  Justice Kennedy said this went too far because it allowed CWA jurisdiction over "every drain or ditch, however remote and insubstantial, that may eventually flow into traditional navigable waters."  This echoed the Court's opinion in SWANCC that the Corps' view of its CWA jurisdiction had no limits.  However, as discussed below, the Guidance is likely to remove virtually all limits to CWA jurisdiction.

Justice Kennedy said jurisdictional decisions should be based on whether the tributary, or intermittent stream, has a "significant nexus" with traditional navigable waters and, therefore, should be subject to the CWA to achieve that statute's goal of restoring and maintaining the quality of this nation's waters.  Justice Kennedy condemned the practice by which the Corps simply "deems water a [regulated] tributary if it feeds into a traditional navigable water (or a tributary thereof) and possesses an ordinary high water mark...."  Justice Kennedy believed the Corps had gone too far.  The fact that a mere hydrologic connection existed between a waterway and a traditional navigable waterway was insufficient for CWA jurisdiction.  However, the Guidance appears to approve the exact result that Justice Kennedy said went too far.  Indeed, the Guidance appears to create a jurisdictional basis similar to the mere hydrologic connection that Justice Kennedy condemned.

As to wetlands adjacent to waters that are navigable in fact, Justice Kennedy's opinion formed a majority view that these wetlands are subject to the CWA based on "a reasonable inference of biological interconnection...."  For wetlands adjacent to non-navigable tributaries, Justice Kennedy said "the Corps must establish a significant nexus on a case-by-case basis...." Despite protests to the contrary in the Guidance, the Guidance could, in fact, be used to eliminate the case-by-case analysis Justice Kennedy sought. 

The Guidance. 

As noted above, EPA and the Corps expect The Guidance will "increase significantly" the number of waters found to be subject to CWA jurisdiction.  However, the Guidance states it is not the agencies' intent that previously issued jurisdiction determinations be reopened as a result of the Guidance.

Consistent with the Supreme Court's rulings, the Guidance says that the government has CWA jurisdiction over waters that are navigable in fact or that can be made so.  However, as to wetlands, isolated waters, and tributaries, including drains or ditches that could flow into traditional navigable waters, the Guidance sets forth a standard effectively allowing a significant nexus to be found in virtually every case.

For example, the Guidance states that if pollution enters any drain, ditch, wet area, etc. and it can somehow find its way to a traditional navigable water, then the water, drain, ditch, etc. is jurisdictional.  Given that a hydrologic connection of some type can almost always be found, this jurisdictional standard, sometimes called the meandering molecule theory of jurisdiction, has few, if any, limits. 

Regarding jurisdictional limits, Justice Kennedy condemned the Corps/EPA practice of deeming a water jurisdictional "if it feeds into a traditional navigable water (or a tributary thereof) and possesses an ordinary high water mark [("OHWM")]...."  Nevertheless, the Guidance provides that if the water "has a bed or bank, and an OHWM" and there is a reasonable basis to believe it can transport pollutants downstream, then it is jurisdictional. 

Moreover, although the Guidance says EPA and the Corps will make a case-by-case finding that the individual water has a significant nexus, included within the Guidance is language planting the seeds by which the Corps and EPA can avoid a case-by-case finding.  Thus, the Guidance allows EPA and the Corps to assert jurisdiction if the water "in combination with similarly situated waters in the region" significantly affects "the chemical, physical, or biological integrity" of regulated waters.  In short, by folding the insignificant effect of the water at issue into the significant effects of other waters, the water at issue becomes jurisdictional because it is now deemed to have a significant nexus. 

Equally important regarding the case-by-case analysis that Justice Kennedy sought, the Guidance states that "in conducting a significant nexus analysis, [EPA and the Corps] are not required to identify or evaluate every similarly situated water" as long as the agencies have evaluated a sufficient number to establish that this "type of water" has a significant nexus.  In other words, once EPA and the Corps establish a class of waters, anything falling within that class can be jurisdictional without the case-by-case analysis for an individual water. 

Although Justice Kennedy said there had to be a case-by-case analysis for each jurisdictional assertion, the Guidance provides a basis for replacing this individual determination with a determination that the water is part of a class and that other members of the class have a significant nexus to traditional navigable waters.  Indeed, the Guidance indicates that although it may be difficult to demonstrate that a particular individual water or area has a significant nexus to a traditional navigable water, if the effects of similar waters "in a region" could have a significant effect on a traditional navigable water, then each similar individual water or area is jurisdictional.  It is also very important to recognize how the Guidance defines the waters "in the region" that can be considered similar waters for determining the significant nexus of the class.  The Guidance establishes a broad standard stating that similar waters in the region include all such waters within the same watershed.

In considering what types of "pollution" should be examined to determine if there is a significant nexus of impact justifying CWA jurisdiction, the Guidance is not limited to the meandering petroleum, chemical, toxic, or other waste molecule.  The Guidance also states that a significant nexus can be found in sediment trapping, nutrient recycling, pollutant trapping and filtering, retention, or attenuation of flood waters, runoff storage, and the provision of fish and wildlife aquatic habitat.  If any of these functions occurring upstream of a traditional navigable waterway might affect the downstream waterway, the Guidance provides a basis for asserting CWA jurisdiction. 

The provision of habitat category is an interesting one given the SWANCC decision.  The Guidance states that the usage of an area by migratory birds is not a basis for CWA jurisdiction.  However, under the provision of habitat standard in the Guidance, if resident aquatic species, including ducks and other waterfowl, "rely on" the navigable water and the water at issue, then the latter is jurisdictional.  One can imagine a circumstance where the words "rely on" come to mean "use," similar to the circumstance for migratory birds that the Court rejected in SWANCC.

Finally, the Guidance defines the word "significant" as it is to be applied in determining the evidentiary threshold that has to be crossed to find there is a "significant nexus" justifying a claim of CWA jurisdiction.  The Guidance states the word "significant" means "more than speculative or insubstantial."  If the effect is "predictable" or "observable," the Guidance says it also qualifies as "significant."

Conclusion. 

The Guidance states it only seeks to explain how EPA and the Corps will implement the SWANCC and Rapanos Supreme Court decisions.  However, the thrust of these Supreme Court decisions was that there are limits to CWA jurisdiction.  The standards set forth in the Guidance by which the Corps and EPA can claim CWA jurisdiction are so broad that they may well effectively eliminate any limit to that jurisdiction.  Indeed, the jurisdictional assertions that were challenged in SWANCC and Rapanos would likely be upheld on other grounds using the standards in the Guidance.  This is not the result for which the Supreme Court decisions stand.

George J. Mannina, Jr. is a partner in the law firm of Nossaman LLP and a member of the Land Use and Environment Practice Group.

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