California Adopts Complex Rules Governing Filling Waters and Wetlands

The State Water Resources Control Board has adopted regulations imposing stringent new requirements for permits to discharge dredged or fill material into waters and wetlands, which it newly defines.  In the face of opposition grounded on the lack of demonstrated need for such new rules (see Newsletter of February 21, 2019), the costs and delays the new rules would impose, and questions whether the new requirements would yield any better results than the already complex existing ones, the proposal of new rules had largely stalled for over a decade. Fears from some that the Trump administration will roll back federal regulation of wetlands, long the mainstay of wetland protection, refreshed efforts to develop new state rules and culminated in the Board’s adoption of the new regulations on April 2, 2019. 

As it became apparent that the Board would adopt new rules, the regulated community negotiated for months with environmental organizations and the Board staff to refine aspects of the proposed rules.  Compromises were struck, clarifications were made, and exclusions were added.  In the end, a complex Kafkaesque new regulatory program emerged.

The new program—entitled State Wetland Definition and Procedures for Discharges of Dredged or Fill Material to Waters of the State—establishes complex requirements for authorizations to fill waters and wetlands.  The new requirements will be implemented through existing state permitting authority—generally “certifications” under section 401 of the federal Clean Water Act (“CWA”) and “waste discharge requirements” under the state Porter-Cologne Act. 

First, the Board has adopted a new definition of “wetland” differing from the one long used by the State Board and regional water quality control boards and the U.S. Army Corps of Engineers and Environmental Protection Agency under the CWA.  The Corps and EPA define wetlands as areas having specified characteristics in three factors—hydrology, soils, and vegetation.  The Board definition refers to the same three factors, but allows an area devoid of vegetation to be classified as a wetland if wetland hydrology and soils are present.  The Board staff notes thus that “[t]idal flats, playas, some river bars, and shallow non-vegetated ponds” could meet the state definition.  Since, as the Board staff acknowledges, the federal regulatory program covers these non-vegetated areas as well, just without calling them wetlands, the point of relabeling them as “wetlands” under the new state program remains elusive. 

Second, the Board establishes what it calls a “Jurisdictional Framework” that is designed to distinguish some areas that meet the technical definition of wetland, but nonetheless are not regarded as wetlands or waters of the state.  As the staff explains, “[t]he jurisdictional framework is intended to exclude artificially-created, temporary features, such as tire ruts or other transient depressions caused by human activity from regulations, while still capturing smaller, naturally-occurring features, such as seasonal wetlands and small vernal pools that may be outside federal jurisdiction.”  The new rules emphasize that “[i]f an aquatic feature meets the [new] wetland definition, the burden is on the applicant to demonstrate that the wetland is not a water of the state.”

Third, the new rules provide “wetland delineation procedures” that adopt the Corps’ wetland delineation manual and regional supplements used to identify wetlands and delineate their boundaries under the federal program and call for the State and Regional Boards generally to rely on delineations verified by the Corps.  The delineation method may be modified only to allow areas that lack vegetation, but meet the state definition to be included.  Where federal jurisdiction does not extend to certain features, applicants are directed to use the Corps wetland delineation manual and supplements to identify and delineate such features.

Fourth, the State Board prescribes detailed “procedures” for submittal and review of applications for authorization to discharge dredged or fill material into waters of the state. 

The items required for a “complete” application are specified at length.  Determining the completeness of an application is important because the CWA prescribes a reasonable period of time, not to exceed one year from receipt of a request for certification, for a Regional Board to act on such a request, and the State and Regional Boards have presumed that that statutory time limit does not begin until they determine applications to be “complete.”  (They may need to reconsider.  In New York State Department of Environmental Conservation v. Federal Energy Regulatory Commission, 884 F.3d 450 (2d Cir. 2018), the Court of Appeals held that the plain language of the CWA establishes that the one-year period for a state to act on a request for water quality certification begins when the state receives an application for certification, regardless of whether the state deems the application “complete.”)  This completeness determination can be troublesome.  Applicants have often been dogged by the refusal of Regional Board staffs to accept their applications as complete until they provide not only all required items, but also include in those items text, analysis, further analyses—whatever the staffs may wish to require the applicant to provide.

Central to the Board’s new procedures is an “alternative analysis” requirement that obligates applicants to demonstrate that their proposed projects are the least environmentally damaging practicable alternatives (“LEDPA”) to accomplish the overall project purposes.  The Corps, applying Guidelines issued by the EPA, has long called for alternatives analyses as part of its review of many projects seeking individual permits to fill waters and wetlands under section 404 of the CWA.  Alternatives analyses frequently have the heft and girth of a doctoral dissertation.  The State Board, it says, models its alternatives-analysis requirement on the EPA’s Guidelines.  But it makes changes and extends the requirement to many more activities than are covered by the EPA Guidelines, some quite small.  The sundry differences between the federal and state alternatives-analysis requirements are sure to bedevil applicants and their consultants.  Too, this broader application, an uncertainly broader application, of the requirement will add tens or hundreds of thousands of dollars of cost and months of delay to many projects. 

The Board proclaims an objective to “[a]dvance statewide efforts to ensure no overall net loss and a long-term net gain in the quantity, quality and sustainability of wetlands in California in a manner that fosters creativity, stewardship, and respect for private property.”   To that end, the Board prescribes requirements for mitigation of impacts to wetlands and specifications for mitigation plans prepared by applicants.  It requires that a “minimum of one-to-one mitigation ratio, measured as area or length, is required to compensate for wetland or stream losses whenever compensatory mitigation is required.”  Notable are requirements that a mitigation plan analyze various aspects of the entire watershed within which the project and mitigation are located.  So too is a requirement that the plan discuss whether and how climate change might affect the mitigation.

Because the Board’s new rules constitute “regulations” within the meaning of the Administrative Procedure Act, they must be reviewed and approved by the Office of Administrative Law (“OAL”) before they become effective.  That review typically takes several months.  Because the rules also will be part of the state’s water quality standards under the CWA, they must also be reviewed and approved by the EPA.  With the aim of affording the regulated community time to learn the new rules and plan for their application, the State Board has set a future effective date of the rules—nine months after approval by OAL.  The rules thus will likely become operative sometime in 2020.

Owing to uncertainty over how many aspects of the new rules will be interpreted and implemented and concerns that unintended or undesirable consequences may result, representatives of both the regulated community and environmental organizations urged the State Board to assess the implementation of the new program and consider adjustments as warranted.  The Board agreed to have its staff monitor implementation of the new rules and provide annual reports to the Board.

While the full impacts of the new rules will not be felt for some time, they will impose substantial new burdens on projects that entail filling waters or wetlands.  As is typical of the rollout of any new regulatory program, questions will abound and disagreements will arise.  The considerable complexity of the State Board’s new rules will only add to that prospect. 

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