The Scope Will Be Further Confused Under Recently Proposed EPA Guidance.
By Carolyn McIntosh
Identifying a jurisdictional wetland, subject to a dredge and fill permit under Section 404 of the Federal Clean Water Act (CWA),1 has always been challenging. First, only the United States Army Corps of Engineers (Corps) can make an enforceable “jurisdictional” determination. Second, the scope of jurisdictional “waters of the United States” keeps changing. The question of whether a 404 permit is required can be an extremely important one for any mining operation. Fines, penalties and even the ability to operate are at stake if mining activities proceed into jurisdictional water without the required approval.
Since adoption of the CWA in 1972, the scope of 404 jurisdiction continuously expanded through United States Environmental Protection Agency (EPA) enforcement action and Corps delineation, until the Supreme Court found that the Corps had gone too far in Solid Waste Agency of Northern Cook County v. U.S. Army Corps Engineers (SWANCC).2 The Supreme Court held that isolated intrastate wetlands are not jurisdictional and are not subject to 404 permit requirements, if the only connection to a waterway is the presence of migratory birds. Questions remained, resulting in a second Supreme Court decision on 404 jurisdiction, Rapanos v. United States (Rapanos),3 which requires a “significant nexus” with a navigable water for a water body to be jurisdictional. EPA and the Corps assert the need to “clarify” and have proposed “Guidance Regarding Identification of Waters Protected by the Clean Water Act”4 (Guidance).
The Guidance will apply to all CWA programs referring to “waters of the United States”.5 It will include as “jurisdictional” traditional navigable waters, interstate waters, wetlands adjacent to traditional navigable or interstate waters, non-navigable tributaries to traditional navigable waters, and wetlands that directly abut relatively permanent waters. It could also include tributaries to traditional navigable waters or interstate waters, wetlands adjacent to jurisdictional tributaries to traditional navigable waters or interstate waters, and “other waters.” EPA defines “other waters” as intrastate, non-navigable waters that lack a permanent surface connection to other waterways and that may or may not be physically proximate to jurisdictional waters. EPA could include any such “other waters” as “jurisdictional” though they have been non-jurisdictional since SWANCC. In sum, the Guidance greatly expands the definition of “waters of the United States,” and the regulatory authority of both the Corps and EPA.
Further, the Guidance reduces categorically excluded waters. It increases the likelihood that ephemeral streams will be covered. All wetlands in a watershed could be “aggregated” to determine whether any are jurisdictional. Some waters are “generally” not covered – artificial reflecting pools, swimming pools created by excavation or diking, water-filled depressions created by excavation, erosion features, and certain ditches. However, “generally” is not defined; thus none of the preceding list is definitely excluded. “Seasonal flow” is redefined from the current three-month limit to an “ecoregion” determination. In short, the Guidance creates “jurisdiction by default,” effectively shifting the burden to the regulated community to prove that particular waters are not jurisdictional. Of concern to many states, the proposed regulatory expansion also has significant implications for their CWA responsibilities and costs.
Not surprisingly, under its cost-benefit analysis EPA has determined there are greater benefits than costs, but acknowledges that the majority of costs are borne by the regulated community. EPA estimates that the total annual cost of obtaining 404 permits could increase by a range of $3.1 million to $11.3 million.6 Further, EPA projects the increase in mitigation costs will be about 4 percent and range from $2.1 to $3.9 billion.7
Praised by several environmental groups and cited by EPA Administrator Jackson as helping “restore protection” to the nation’s waters, others believe the Guidance violates the CWA. For example, under the Guidance more waterways will be protected, including 17 percent of the very type of isolated wetlands the Supreme Court found were not jurisdictional in SWANCC. Forty-one senators urged EPA and the Corps to abandon the Guidance in a June 30, 2011, letter. Their concerns include:
1) Elevation of “other waters” to the same level as “navigable waters” if situated on a state boundary.
2) Expansion of the “significant nexus” test from wetlands and certain tributaries to all tributaries, wetlands, and proximate other waters in the same watershed.
3) Aggregation of waters.
4) Determining “significant nexus” based upon a water’s functions.
5) Defining “significant nexus” as any relationship that is “more than speculative or insubstantial.”
6) New definitions of ditches that will sweep previously non-jurisdictional ditches into the program.8 With similar concerns, the House Appropriations Committee approved the Corps FY 2012 funding bill, but prohibited any expenditure to implement the Guidance.
Fundamentally, if clarification of this magnitude is necessary, it should be done by regulation. Guidance, as defined by the Administrative Procedures Act should clarify how an agency will interpret a law or convey administrative procedures to its offices. Conversely, a regulation is legally binding and subject to public notice and comment. The June 30 Senate letter stated: “Changes in legal status [of this magnitude] should only be done, if at all, through the regulatory process, specifically under the Administrative Procedure Act…”9 The tactic of using guidance to change law is not new, but the Obama Administration’s broader use of guidance and with a much more transparent intent that it have the force of law10 is subject to legal challenge.11
In conclusion, what “waters of the United States” are, subject to CWA 404 permitting, is a complex question. The Guidance proposed by EPA and the Corps on May 2, 2011, does nothing to simplify that determination. To the contrary, it will complicate the 404 program and greatly expand permit requirements. EPA’s own estimates show the Guidance could cost the regulated community $2.1 billion to $3.9 billion! The Guidance has not been issued in final, comments are still under consideration. If your company has not been closely following the Guidance, it should start now.
1 Clean Water Act, Section 404, 33 U.S.C. § 1344.
2 531 U.S. 159 (2001).
3 547 U.S. 715 (2006).
4 76 Fed. Reg. 24,479 (May 2, 2011).
5 The Guidance will apply to Section 303 water quality standards, Section 311 oil spill prevention and response, Section 401 water quality certification, Section 402 National Pollutant Discharge Elimination System permits, and Section 404 dredged or fill permits.
6 “Potential Indirect Economic Impacts and Benefits Associated with Guidance Clarifying the Scope of Clean Water Act Jurisdiction,” issued by the U.S. Environmental Protection Agency, April 27, 2011, page 10.
7 Id., page 9.
June 30, 2011 letter from 41 Republican Senators to EPA Administrator Jackson and Army Assistant Secretary (Civil Works) Darcy, http://tinyurl.com/44k8mcb.
9 Id., page 2.
10 Indeed, EPA has issued another guidance under the CWA to set a water pollution standard based upon conductivity, with directions to reject dredge and fill permits for mining operations that do not meet the standard, evidencing clear intent that the conductivity “guidance” have the force of law.
11 In Natural Resources Defense Council v. EPA, D.C. Cir., No. 10-1056 (7/1/11), the D.C. Circuit held that EPA violated the APA by using guidance to allow states to avoid collecting air quality non-attainment fees.