Federal Agencies Repeal Obama-Era Rule Defining Waters Regulated Under the Clean Water Act, Recodify the Pre-Existing Rule — and Signal How They May Redefine Such Waters

In the latest twist in a decades-long struggle to determine the reach of the Clean Water Act, the Environmental Protection Agency (EPA) and Corps of Engineers, now run by appointees of President Trump, announced they are repealing controversial regulations, adopted in 2015 under the Obama administration, that defined—and expanded—“waters of the United States” regulated under the Act. The agencies are simultaneously recodifying the regulatory definition that had long prevailed before then. Having thus taken the first of two planned steps, the agencies contemplate advancing yet this winter to the next step—deciding on their proposal announced in December 2018 to, as they put it, “clearly define where federal jurisdiction begins and ends in accordance with the Clean Water Act and Supreme Court precedent” and thus clarify “the difference between federally regulated waterways and those that rightfully remain solely under state authority.” That proposal, also swirling in controversy, would narrow the scope of waters regulated by the federal government. In explaining their reasons for repealing the 2015 regulations, the agencies revealed at least a bit of the thinking that will guide their decision on their proposed new definition.

Background

Congress enacted the Clean Water Act (CWA) in 1972 authorizing the Corps and EPA to regulate discharges of pollutants, including dredged and fill material, into “navigable waters,” which Congress not-so-helpfully defined as “the waters of the United States.” And so began the struggle of agencies, courts, and landowners to determine what waters Congress meant to cover by this cryptic clause.

In the mid-1970s, the agencies administratively defined such waters to include not only rivers, lakes, and other readily recognizable waterbodies, but also “wetlands.” As the agencies’ revisions, interpretations, and practices during the past four decades have gradually expanded their regulatory reach over the landscape, the program has been dogged by questions of its legitimacy. One such question 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 they could regulate any waters that are used by migratory birds or endangered species.

In 1985, the justices of the Supreme Court joined in laughter upon hearing of the then-new migratory bird rule 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 Solid Waste Agency of Northern Cook County v. U.S. Army Corps of Engineers, 531 U.S. 159 (2001) (SWANCC), the Supreme Court took up the question of “isolated” waters and the migratory bird rule, and held that Congress never intended the CWA to regulate non-navigable, isolated, intrastate waters.

In 2006, in Rapanos v. United States and Carabell v. U.S. Army Corps of Engineers, 547 U.S. 715 (2006) (Rapanos), the Court confronted the Corps’ claims of CWA jurisdiction over wetlands lying near ditches and man-made drains that eventually empty into tributaries and then traditional navigable waters many miles away. The Court divided into three camps. Four justices, in an opinion by Justice Scalia, 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, Justice Kennedy, 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, led by Justice Stevens, dissented, characterizing the Corps’ more expansive view as a reasonable interpretation of the CWA.

2015 Regulations

It was against this backdrop of ongoing uncertainty that the agencies in 2015 adopted regulations to “increase CWA program predictability and consistency by clarifying the scope of ‘waters of the United States’ protected under the Act.” The agencies predicated their new regulations largely on Kennedy’s malleable “significant nexus” idea. By all accounts, the new regulations extended CWA regulation to more waters than ever before.

Thirty-one states and 53 other parties, including environmental groups and groups representing farming, recreational, forestry, and other interests, promptly challenged the new regulations in various federal courts. Some argued the regulations were too expansive, while others argued they excluded too many waters from federal jurisdiction. Several courts issued preliminary injunctions staying implementation of the regulations pending decisions on the merits of the claims. As a result, the new regulations took effect only in twenty-two states (including California), while in the rest the pre-existing regulations remained operative.

Repeal, Recodify, and Replace

Shortly after taking office, President Trump issued an Executive Order directing the Corps and EPA to review their 2015 regulations and propose rescinding or revising them as appropriate, and also to consider interpreting the CWA in keeping with Scalia’s opinion in Rapanos.

The agencies complied by proposing in July 2017 what they called the first step: repealing the 2015 regulations and recodifying the previous regulations. In December 2018, they proposed the second step: replace those regulations with a new regulatory definition of “waters of the United States” that would establish clear categories of jurisdictional waters generally in keeping with Scalia’s Rapanos opinion and eliminate case-by-case use of Kennedy’s “significant nexus” test to identify jurisdictional waters. Six categories of covered waters were proposed:

• Traditional navigable waters. This includes not only the territorial seas and waters subject to the ebb and flow of the tides, but also rivers and lakes that have been, are, or could be used in interstate or foreign commerce.

• Tributaries that contribute perennial or intermittent flow to traditional navigable waters in a typical year. This does not include ephemeral streams, which flow only briefly in direct response to rain or snowfall.

• Ditches that are navigable or that are constructed in a tributary or adjacent wetland or that relocate or alter a tributary as long as they contribute perennial or intermittent flow to traditional navigable waters in a typical year. Most ditches do not meet these criteria and thus would not be encompassed within jurisdictional waters.

• Lakes and ponds that qualify as traditional navigable waters, contribute perennial or intermittent flow to a traditional navigable water, or are flooded by other jurisdictional waters in a typical year. Non-navigable, isolated lakes and ponds that are not part of a tributary network would not be included.

• Impoundments of other jurisdictional waters.

• Adjacent wetlands of other jurisdictional waters, meaning wetlands that abut or have a direct hydrologic surface connection to a jurisdictional water in a typical year. This definition does not encompass various types of wetlands the agencies have previously regarded as waters of the United States, e.g., those that are connected to jurisdictional waters via shallow subsurface flow or are separated from jurisdictional waters by berms or other barriers.

The EPA and Corps announced on September 12, 2019, that they are completing the first step. Their repeal of the 2015 regulations and recodification of the previous regulations will be effective sixty days after publication in the Federal Register, which is expected shortly. In a preamble the agencies presented and largely agreed with many arguments advanced against them in litigation by opponents of the 2015 regulations. They offered four main reasons for their action:

• The 2015 regulations exceeded the agencies’ authority under the CWA as intended by Congress and reflected in Supreme Court decisions. The regulations also adopted an interpretation of the “significant nexus” standard at odds with Kennedy’s opinion in Rapanos.

• In adopting the 2015 regulations the agencies failed to accord due weight to the policy Congress established in the CWA to “recognize, preserve, and protect the primary responsibilities and rights of States to prevent, reduce, and eliminate pollution” and “to plan the development and use . . . of land and water resources.”

• Repeal of the 2015 regulations avoids interpretations of the CWA that “push the envelope of [the agencies’] constitutional and statutory authority absent a clear statement from Congress authorizing encroachment of federal jurisdiction over traditional State land-use planning authority.”

• Provisions in the 2015 regulations basing jurisdiction on distance between waters suffered from procedural errors and lack of adequate support in the administrative record.

In explaining their decision, the agencies revealed some of their thinking that may bear on their adoption of new regulations defining jurisdictional waters. They noted, for instance, that the power conferred on them in the CWA “is grounded in Congress’ commerce power over navigation” and not some more general power to regulate interstate commerce. Recognition of that basis of the CWA may serve to justify the agencies’ development of a definition focused on traditional navigable waters. The agencies emphasized too that they “recognize and respect the primary responsibilities and rights of States to regulate their land and water resources” and echoed Scalia’s observation that “clean water is not the only purpose of the [CWA]. So is the preservation of primary state responsibility for ordinary land-use decisions.” That fundamental understanding of the CWA naturally would guide the agencies to limit the overall extent of waters subject to federal regulation. Also, while the agencies faulted the 2015 regulations for misinterpreting Kennedy’s “significant nexus” idea, they took care to say they were not taking a position on whether his opinion should be the controlling authority on the scope of the CWA. Rather they merely reasoned that since the 2015 regulations were largely grounded on Kennedy’s opinion, the failure of those regulations to adhere to principles described by Kennedy provided reason enough to repeal them. The agencies thus retained the flexibility to largely disregard Kennedy’s “significant nexus” standard when developing their new definition of “waters of the United States.” They anticipate taking that step by December 2019.

In states with robust regulatory programs, the federal agencies’ return to their pre-2015 regulatory regime generally will have little practical effect on the regulated community. To the extent that some waters no longer fall within federal jurisdiction, they would remain subject to regulation by the state. In California, the State Water Resources Control Board and nine regional boards claim the authority to regulate discharges of fill material into all surface waters, so landowners generally will not experience any lessening of regulatory constraints.

The change in federal jurisdiction could make a difference, though, in situations where federal endangered species are present. If there is no need for a Corps permit to fill waters of the United States, there would be no opportunity to authorize incidental take of federally listed species through formal consultation between the Corps and the U.S. Fish and Wildlife Service or National Marine Fisheries Service under the Endangered Species Act. The only remaining option then would be a considerably more onerous and time consuming application to the pertinent Service for an incidental take permit.

David Ivester
Briscoe Ivester & Bazel LLP
155 Sansome Street, 7th Floor
San Francisco, CA 94104
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