Environment
Issue Brief

Waters of the United States

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Summary

On May 27, 2015, the Environmental Protection Agency (EPA) and U.S. Army Corps of Engineers (Corps) released a final rule to redefine the definition of waters of the U.S. (WOTUS) under the Clean Water Act (CWA). The rule became effective on August 28, 2015. The American Public Power Association (Association or APPA) believes that the 2015 WOTUS rule is problematic because it dramatically expanded the definition of WOTUS, thereby subjecting more utility projects and activities to CWA jurisdiction. Litigation on the merits of the 2015 WOTUS rule were put on hold pending review by the U.S. Supreme Court on which federal court(s)—circuit or district—have original jurisdiction to hear challenges. On January 22, 2018, the U.S. Supreme Court ruled that challenges to the WOTUS rule must be filed in district courts and, thus the stay of the rule issued by the U.S. Court of Appeals for the Sixth Circuit (Sixth Circuit) was lifted and the pending litigation was dismissed. Although the nationwide stay of the 2015 WOTUS rule is now lifted, the agencies’ recent promulgation of the applicability rule prevents the 2015 WOTUS rule from going into effect for two years. In the meantime, the agencies will apply the prior regulatory definition of WOTUS, consistent with the approach they have taken since the Sixth Circuit stayed the 2015 WOTUS rule.

Background

The Clean Water Act of 1972 gave the federal government the authority to regulate pollution of “navigable waters” (also known as “Waters of the U.S.”). This seemed straight forward on its face, but given the interconnectedness of surface water—clearly navigable large rivers and lakes are fed by streams and other smaller bodies of water that are clearly not navigable—the line of the federal government’s jurisdiction is a fuzzy and moving one. Years of legal battles came to a head in a messy 4-1-4 ruling by the U.S. Supreme Court in 2006. Justice Anthony Kennedy joined the conservative wing of the court in ruling that the government could no longer broadly interpret its jurisdiction. In other words, the government needed to write a new set of rules for determining where it had jurisdiction. Justice Kennedy wrote a standalone opinion suggesting that the government limit its jurisdiction to waters that have a “significant nexus” with navigable waters. Instead of providing clarity, what constituted a “significant nexus” kicked off another round of confusion between the federal government and industry.

EPA and the Corps released a proposed rule attempting to define what constitutes a “significant nexus” in April 2014. APPA felt the proposed rule dramatically expanded the agencies’ federal authority and would therefore trigger additional, costly CWA permit requirements for utility projects. EPA and the Corps released a final rule in May 2015. While it did address some of the issues that the Association outlined in its comments on the proposed rule, the changes did not go far enough to allay APPA’s concerns, specifically with regards to the expansive interpretation of adjacent waters, ditches, and waste treatment system exclusions. Such expansive interpretations, resulting in an increase in federal jurisdiction, would have a substantial effect on public power utilities’ ability to finance and develop new projects or perform maintenance on existing infrastructure and facilities. APPA’s members’ construction and operations activities often require various permits under the CWA. The agencies’ expansion of jurisdiction under the revised WOTUS rule would result in additional permit obligations for all CWA programs.

Legal Challenges

On October 9, 2015, the Sixth Circuit issued an order staying the WOTUS rule nationwide, pending further order of the court. Subsequently, the National Association of Manufacturers (NAM) filed a writ of certiorari seeking U.S. Supreme Court review of the Sixth Circuit’s decision holding that it has exclusive jurisdiction to decide the challenges to the WOTUS rule under CWA § 509(b)(1). NAM argued that jurisdiction should remain at the district court level. The high court granted petitioners’ request to reconsider the Sixth Circuit decision and held oral argument in January 2017. The Sixth Circuit briefing on the merits of the WOTUS rule remained in abeyance while the U.S. Supreme Court decided on the question of jurisdiction. On January 22, 2018, the U.S. Supreme Court unanimously ruled that challenges to the WOTUS rule must be filed in federal district courts. As such, the nationwide stay put in place by the Sixth Circuit was lifted on February 28, 2018, and all pending cases dismissed. Although the nationwide stay of the 2015 WOTUS rule is now lifted, the recent promulgation of the applicability rule by EPA and the Corps prevents the 2015 WOTUS rule from going into effect for two years. Multiple district court challenges were filed immediately following the promulgation of the applicability rule. The lawsuits request the courts to declare the applicability rule unlawful and vacate the rule.

Administrative Action

In February 2017, President Trump signed Executive Order (EO) 13778 entitled, “Restoring the Rule of Law, Federalism, and Economic Growth by Reviewing the ‘Waters of the United States’ Rule.” The EO directed EPA and the Corps to review the WOTUS rule for consistency with the Administration’s policy directive that seeks to ensure the “Nation’s navigable waters are kept free from pollution, while at the same time promoting economic growth, minimizing regulatory uncertainty, and showing due regard for the roles of the Congress and the States under the Constitution.” The EO directed EPA and the Corps to engage in a notice and comment rulemaking to propose a rule to rescind or revise the WOTUS rule consistent with the CWA. In addition, EPA, the Corps, and the heads of all executive departments and agencies were to review “all orders, rules, regulations, guidelines, or policies implementing or enforcing” the WOTUS rule for consistency with the EO’s policy statement. The EO further directed EPA and the Corps to interpret the term “navigable waters,” as defined in the CWA, in a manner consistent with an opinion authored by Justice Antonin Scalia in the 2006 U.S. Supreme Court case, Rapanos v. United States. Justice Scalia’s opinion interpreted federal jurisdiction as applicable where “navigable waters” connected by a surface flow at least part of the year, a significant departure from previous policy positions.

On June 27, 2017, the agencies issued a proposed rule to initiate the first step in a comprehensive, two-step process to review and revise the definition of “waters of the United States” consistent with the President’s executive order. The proposed rule seeks to repeal the 2015 WOTUS rule and re-codify the definition of WOTUS that was in place prior to the 2015 rule. Subsequently, on June 29, 2018, the agencies issued a supplemental notice to the proposed repeal. The supplemental notice clarifies, supplements, and seeks additional comments on the earlier repeal proposal. The repeal is intended to provide certainty and maintain the status quo until the agencies complete a second rulemaking to revise the definition of WOTUS consistent with a new policy directive. EPA and the Corps have been working to finalize the repeal by the fall of 2018 and are expected to propose a new WOTUS rule in 2018 and finalize the proposal by 2019.

The Supreme Court lifted the nationwide stay before the WOTUS rule was repealed and replaced. To minimize confusion of which version of the WOTUS rule applied where, EPA and the Corps finalized a rule to push back the applicability date of the 2015 WOTUS rule until February 6, 2020. The additional time allows the agencies to complete repeal of the 2015 rule and promulgate a new WOTUS rule.

Congressional Action

There have been numerous unsuccessful attempts in Congress to nullify or force EPA and the Corps to withdraw and re-propose the rule since it was finalized in 2015.

Though the Trump Administration is in the process of repealing and replacing it, some opponents of the rule think legislative action will strengthen the new rule when it is inevitably challenged in court. Both the House-passed farm bill and fiscal year (FY) 2019 Energy & Water Development (EWD) Appropriations bill included amendments to repeal the rule. However, an amendment offered by Senator Mike Lee (R-UT) to repeal the rule was defeated during the Senate’s consideration of its FY 2019 EWD bill.

American Public Power Association Position

Overall, the Association believes that the final rule is problematic because it would drastically expand the WOTUS jurisdiction of EPA and the Corps, which would subject more utility projects and activities to CWA jurisdiction. This would mean that some projects’ permitting processes would be required to undergo lengthier and costlier individual section 404 permit procedures. It also would affect the applicability of, and compliance with, other CWA programs, including National Pollutant Discharge Elimination System (NPDES) requirements for industrial wastewater and storm water, section 311 requirements, and section 401 certification, to name a few. As such, APPA supports the repeal of the 2015 rule and recodification the pre-existing pre-2015 rules, and looks forward to commenting further. The Association believes the following key principles should guide the development of a new WOTUS rule:

  • A new WOTUS rule should be developed with consideration of the roles states play in water resource management;
  • A new WOTUS rule should recognize that clear boundaries are necessary to allow states to effectively regulate land and water use within their borders;
  • A new WOTUS rule should retain the waste treatment system exclusion and further clarify that features that are part of a NPDES permitted treatment system are not “waters of the United States” and the exclusion applies to the systems, including conveyances, ponds, and those used for cooling water treatment or supply; and
  • A new WOTUS rule should account for all U.S. Supreme Court precedent on the geographic reach of WOTUS—and avoid any Scalia-only approach that would not account for these decisions.