The U.S. Army Corps of Engineers and Environmental Protection Agency propose to expand their regulatory jurisdiction by reinterpreting two U.S. Supreme Court decisions. Five years ago, a fractured Supreme Court offered three different views of the scope of the Clean Water Act (“CWA”), none of which commanded a majority, in Rapanos v. United States and Carabell v. U.S. Army Corps of Engineers, 547 U.S. 715 (2006) (“Rapanos”). Five years earlier, the Court ruled in Solid Waste Agency of Northern Cook County v. U.S. Army Corps of Engineers, 531 U.S. 159 (2001) (“SWANCC”), that the CWA does not reach non-navigable, isolated, intrastate waters and wetlands. Now the Corps and EPA have issued “draft guidance” explaining how they plan to “implement” those decisions and identify jurisdictional waters. By this guidance, the agencies “expect” that the extent of waters over which they assert jurisdiction “will increase” beyond what they claim today. Responding to the Court’s suggestions that much confusion may be resolved by regulation, the agencies said they also plan to propose rules in the future. They have invited public comment on the draft guidance by July 1, 2011.
 

Background

Under the CWA, the Corps and EPA regulate “discharges” of “pollutants” into “navigable waters,” which the Act defines as “the waters of the United States.” In the mid-1970s, the agencies administratively defined “navigable waters” to include waters that are or could be used for navigation, tidal waters, interstate waters, “tributaries” of jurisdictional waters, wetlands “adjacent” to jurisdictional waters, and “all other waters such as intrastate lakes, rivers, streams (including intermittent streams), mudflats, sandflats, wetlands, sloughs, prairie potholes, wet meadows, playa lakes, or natural ponds, the use, degradation or destruction of which could affect interstate commerce . . . .”

As the agencies’ regulatory program has gradually expanded over the landscape during the past four decades, it has been dogged by questions of its legitimacy. One of those questions concerns whether the U.S. Constitution empowers the federal government to regulate isolated waters and wetlands. The Constitution, after all, confers only limited powers on the government, among which is the power to regulate foreign and interstate commerce. The agencies answered this question in the mid-1980s with what became known as the “migratory bird rule,” asserting that it could regulate any waters that are used by migratory birds or endangered species.

In 1985, the justices of the Supreme Court joined in laughter over the then-new migratory bird rule upon hearing of it during oral argument of the Court’s first CWA wetland case, United States v. Riverside Bayview Homes, Inc., 474 U.S. 121 (1985), but refrained from discussing the issue then, holding in that case that the CWA could reasonably be interpreted to authorize the Corps to regulate “adjacent” wetlands actually abutting a navigable waterway.

Sixteen years later, in SWANCC, the Supreme Court took up the question of “isolated” waters and held, 5-4, that Congress never intended the CWA to regulate non-navigable, isolated, intrastate waters. Pointing to the statutory term “navigable waters,” the Court noted that it held in Riverside that “the term ‘navigable’ is of ‘limited import’ and that Congress evidenced its intent to ‘regulate at least some waters that would not be deemed “navigable” under the classical understanding of that term.’” “But it is one thing to give a word limited effect,” said the Court, “and quite another to give it no effect whatever. The term ‘navigable’ has at least the import of showing us what Congress had in mind as its authority for enacting the CWA: its traditional jurisdiction over waters that were or had been navigable in fact or which could reasonably be made so.” Accordingly, the Court held that the Corps’ regulation defining “waters of the United States” to include non-navigable, isolated, intrastate waters and wetlands, as applied to the SWANCC site under the migratory bird rule, exceeds the Corps’ authority under the CWA.

In Rapanos, the Court confronted the Corps’ claims of CWA jurisdiction over four wetlands lying near ditches or man-made drains that eventually empty into traditional navigable waters. The Court divided into three camps. Four rejected the Corps’ claims, reasoning that the CWA extends only to relatively permanent, standing or continuously flowing bodies of water and wetlands directly connected to them. A fifth concurred that the Corps’ claims were excessive, but opined that the CWA extends to waters and wetlands with a “significant nexus” to truly navigable waters. Four other justices dissented, characterizing the Corps’ view as a “reasonable interpretation” of the CWA.

Writing for a plurality of four, Justice Scalia interpreted the CWA to regulate “only those relatively permanent, standing or continuously flowing bodies of water ‘forming geographic features’ that are described in ordinary parlance as ‘streams[,] . . . oceans, rivers, [and] lakes’ [as well as] wetlands with a continuous surface connection to [such] bodies . . . so there is no clear demarcation between ‘waters’ and wetlands . . . .”

Justice Kennedy agreed that the Corps’ treatment of any channel that “feeds into a traditional navigable water (or a tributary thereof) and possesses an ordinary high-water mark” as a “tributary” subject to regulation under the CWA is overly broad—so broad, he noted, that it “seems to leave wide room for regulation of drains, ditches, and streams remote from any navigable-in-fact water and carrying only minor water-volumes towards it.” He agreed, too, that “mere hydrological connection [to navigable waters] should not suffice in all cases” to render a wetland or channel a “water of the United States” since “the connection may be too insubstantial for the hydrological linkage to establish the required nexus with [traditional] navigable waters.”

In other respects, though, Kennedy charted his own course. Pointing to the Court’s observation in SWANCC that “[i]t was the significant nexus between wetlands and ‘navigable waters’ that informed our reading of the CWA in Riverside Bayview Homes,” Kennedy deemed “significant nexus” a test for CWA jurisdiction and infused the term with meaning unimagined by the other justices. “[T]he Corps’ jurisdiction over wetlands,” he declared, “depends upon the existence of a significant nexus between the wetlands in question and navigable waters . . . .” Reasoning that “[t]he required nexus must be assessed in terms of the statute’s goals and purposes,” he declared that “wetlands possess the requisite nexus, and thus come within the statutory phrase ‘navigable waters,’ if the wetlands, either alone or in combination with similarly situated lands in the region, significantly affect the chemical, physical, and biological integrity of other covered waters more readily understood as ‘navigable.’” “[I]n contrast,” he explained, when “wetlands’ effects on water quality are speculative or insubstantial, they fall outside the zone fairly encompassed by the statutory term ‘navigable waters.’” When the Corps seeks to regulate wetlands adjacent to nonnavigable tributaries, Kennedy added, it “must establish a significant nexus on a case-by-case basis” at least until “more specific regulations” are adopted.

All eight other justices told Kennedy he was wrong and panned his “significant nexus” test as a judicial innovation derived from a misreading of SWANCC. Nonetheless, because Kennedy is seen as necessary to form a majority of five (with either the four in the dissent or the four in the plurality) favoring or opposing any particular assertion of jurisdiction, his solitary opinion has been treated by the Corps and EPA and most courts and commentators as the operative basis for determining the extent of CWA jurisdiction. An opinion held by one justice and rejected by the other eight thus ironically has become the “law of the land.”
 

Guidance

On April 27, 2011, the Corps and EPA released draft guidance that, if adopted, would replace guidance they issued in 2003 and 2008. The agencies said that “after careful review of [SWANCC and Rapanos, they] concluded that previous guidance did not make full use of the authority provided by the CWA to include waters within the scope of the Act, as interpreted by the Court.” They have relied heavily on Kennedy’s “significant nexus” idea and have endeavored to exploit its full potential to increase the scope of their regulatory jurisdiction.

The agencies identified several types of waters they said meet the standards of both Kennedy and the plurality and thus are regulated under the CWA:

  • Traditional navigable waters. The agencies declined to define such waters as co-extensive with the “navigable waters” regulated under the Rivers and Harbors Act and, instead, embraced waters currently used, historically used, or susceptible of being used in the future for commercial navigation, including commercial waterborne recreation, e.g., canoeing.
  • Interstate waters. The agencies explained that such waters need not be traditionally navigable or connected to traditionally navigable waters.
  • Any lakes or ponds “crossing state boundaries” are jurisdictional “in their entirety. Any river or stream crossing a state boundary is jurisdictional as an interstate water “for the entire length that the water is of the same stream order.”

  • Wetlands adjacent to either traditional navigable waters or interstate waters.
  • Non-navigable tributaries to traditional navigable waters that are relatively permanent, meaning they contain water at least seasonally.
  • Wetlands that directly abut relatively permanent waters.

Additional waters are regulated, the agencies said, “if a fact-specific analysis determines they have a ‘significant nexus’ to a traditional navigable water or interstate water,” including:

  • Tributaries to traditional navigable waters or interstate waters.
  • Wetlands adjacent to jurisdictional tributaries to traditional navigable waters or interstate waters.
  • Waters that fall under the “other waters” category of the regulations. The guidance divides these waters into two categories, those that are physically proximate to other jurisdictional waters and those that are not, and discusses how each category should be evaluated.

The Corps and EPA also identified aquatic areas generally not covered by the Clean Water Act:

  • Wet areas that are not tributaries or open waters and do not meet the agencies’ regulatory definition of “wetlands.”
  • Waters excluded from coverage under the CWA by existing regulations.
  • Waters that lack a “significant nexus” where one is required for a water to be protected by the CWA.
  • Artificially irrigated areas that would revert to upland should irrigation cease.
  • Artificial lakes or ponds created by excavating and/or diking dry land and used exclusively for such purposes as stock watering, irrigation, settling basins, or rice growing.
  • Artificial reflecting pools or swimming pools created by excavating and/or diking dry land.
  • Small ornamental waters created by excavating and/or diking dry land for primarily aesthetic reasons.
  • Water-filled depressions created incidental to construction activity.
  • Groundwater drained through subsurface drainage systems.
  • Erosional features (gullies and rills), and swales and ditches that are not tributaries or wetlands.
  • The agencies have cleverly torqued critical points in the fine print to ease the task of finding a significant nexus and thus maximizing their jurisdictional reach. For instance, “significant nexus” has been minimized to any effect “more than ‘speculative or insubstantial.’” Two waters need not be hydrologically connected to have such a nexus and, indeed, the lack of such a connection may establish a negative nexus (so to speak) in that one water may retain floodwaters or pollutants that would otherwise flow downstream to the other water. Once the agencies have made a case-specific determination for one water, they “would generally expect” that similarly situated waters in the same watershed also have a significant nexus, so they may forego further study.

The agencies have interpreted SWANNC narrowly, reducing it to a decision only about predicating CWA jurisdiction on use of waters by migratory birds, and largely circumvented it by predicating jurisdictional determinations on various other grounds logically falling within the sweep of SWANCC’s reasoning. While ostensibly accepting that SWANCC precludes assertions of jurisdiction over “isolated” wetlands based on their use by migratory birds, the agencies have interpreted “adjacent” to encompass any wetland with an “ecological connection” to a jurisdictional water, including, for example, if resident aquatic species (“e.g., . . . ducks”) “rely on” both the wetland and the jurisdictional water for all or part of their life cycles (“e.g., nesting, rearing, or feeding”).

The Supreme Court has repeatedly urged the EPA and Corps to issue regulations to clarify the scope of CWA jurisdiction, and the agencies now appear ready to do just that. In doing so, their aim, it seems, will be to simplify the task of maximizing their jurisdiction. They said that “[t]hrough rule-making, [they] will further consider whether the existence of an ordinary high-water mark alone is sufficient to establish a significant nexus to downstream traditional navigable or interstate waters, without requiring a site-specific analysis . . . .” Since all waters, such as rivers, lakes, and the like, (apart from wetlands) must, by definition, have an ordinary high-water mark to be recognized as such, any such rule would, with elegant simplicity, render all such waters subject to the agencies’ CWA jurisdiction.

 
David Ivester
Briscoe Ivester & Bazel LLP
155 Sansome Street, 7th Floor
San Francisco, CA 94104
Telephone: (415) 402-2700
Fax: (415) 398-5630

Disclaimer: In our Newsletters and Bulletins, Briscoe Ivester & Bazel LLP intends to present general information to the public and does not intend to provide legal advice pertaining to a particular situation.

 

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