Obama Says Water Jurisdiction Rule Provides Clarity, Certainty; Critics Claim Overreach

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By Amena H. Saiyid

May 27 — Claiming that it will provide clarity and certainty to businesses, the Obama administration announced its final rule May 27 that seeks to spell out which wetlands and waterways are subject to Clean Water Act protections.

The joint rule (RIN No. 2040–AF30), by the Environmental Protection Agency and the U.S. Army Corps of Engineers, would cover all ephemeral, intermittent and perennial streams and potentially certain other isolated waters to be determined on a case-by-case basis and whose protections previously were uncertain.

Activities, such as mining operations, development and energy production, in waters and wetlands not previously covered would be subject to Clean Water Act permitting requirements. These permits would regulate how dredging and filling occurs with accompanying mitigation practices.

Critics, including industry groups and certain members of Congress, say the rule is a significant regulatory overreach.

(Click image to enlarge.)

WLPM graphic 5/28/2015

Ephemeral and intermittent streams are sources of drinking water for one in three Americans, EPA Administrator Gina McCarthy said on a conference call with reporters.

Impoundments and dams also will be covered, as well as natural, artificial, and altered waters such as rivers, streams, canals and certain types of ditches.

The rule maintains exemptions for agriculture and ranching activities. It adds to regulatory exclusions features like artificial lakes and ponds, water-filled depressions from construction and grassy swales, McCarthy said.

The agencies' economic analysis estimates the rule will result in a decrease in Clean Water Act jurisdiction because the scope of regulatory jurisdiction is narrower than that under the existing regulations and historic practices. However, this rule is estimated to result in a 2.84 percent to 4.65 percent increase in waters found jurisdictional when compared with a baseline of recent practices.

The agencies estimated annual costs ranging from $158.6 million to $306.6 million, while benefits range from $338.9 million to $349.5 million in a change from the proposed rule. A year ago, the agencies estimated indirect annual costs to range between $133.7 million and $200 million and benefits to range from $300.7 million to $397.6 million annually.

Used 2013, 2014 Permit Data 

The agencies said they responded to criticism leveled by an industry coalition representing miners, roadbuilders, farmers, and others by reviewing permit data from fiscal years 2013 and 2014 instead of fiscal years 2009 and 2010. The industry group said the previous analysis relied on data that represented a period of economic inactivity with less mining, home building, and construction occurring in the country.

The analysis said the rule will lead to potential increases in permitting activity and compliance with Clean Water Act programs. These include oil spill prevention, state water quality certification of federal projects and discharge permits for concentrated animal feeding operations, stormwater and pesticides as well as dredge-and-fill permits.

As promised earlier by McCarthy, the joint rule streamlines the definition of tributaries by excluding wetlands and open waters that lack a bed, bank and ordinary high water mark. Tributaries are defined as having a bed, bank and indicators of ordinary high mark that include signs of scouring, loss of vegetation and debris.

The final rule will allow the EPA and the corps to determine on a case-by-case basis whether the cumulative effect of activities in five types of wetlands and waters will significantly affect the physical, biological and chemical integrity of downstream traditional navigable waters, interstate waters and territorial seas.

“Our health and economy need clean water,” McCarthy said, as she emphasized the need to protect the lakes, the rivers, and the streams and wetlands that feed them.

Change From Proposed Rule 

In a change from the proposed rule, the agencies also will claim jurisdiction over wetlands adjacent to tributaries of navigable waters on the basis of their proximity to a navigable water or its tributary.

The agencies said the final rule increases Clean Water Act program predictability and consistency by clarifying the scope of waters of the U.S. consistent with rulings by the U.S. Supreme Court and certain appeals courts and with the latest peer-reviewed science.

A broad range of industrial sectors, from mining to energy producers to agriculture, will be affected by the rule, particularly if their operations take place in waterbodies and wetlands not previously covered by the Clean Water Act.

The joint rule modifies corps regulations at 33 CFR Part 328 and EPA regulations at 40 CFR Parts 110, 112, 116, 117, 122, 230, 232, 300, 302, and 401 and takes effect 60 days after publication in the Federal Register.

Headwater Streams Cover Most Tributaries 

The majority of tributaries as defined by the rule are headwater streams that play an important function in transporting water, sediments, organic matter, nutrients and organisms to downstream waters.

The rule streamlines the definition of adjacency by establishing distance limits. It includes open waters and wetlands adjacent to jurisdictional waters that are within a minimum of 100 feet and within the 100-year floodplain to a maximum of 1,500 feet of the ordinary high water mark of traditional navigable waters.

It clarifies that ditches that carry ephemeral and intermittent flow won't be covered as long as they weren't built to channelize tributaries.

The EPA and the corps can determine jurisdiction on a case-by-case basis over five types of wetlands: prairie potholes, Carolina and Delmarva bays, pocosins, western vernal pools in California and Texas coastal prairie wetlands. Scientific analysis will be used to demonstrate that these five waters should be looked at not individually but rather as a group in a given watershed to determine their impact on downstream navigable waters.

Significant Nexus Test 

The significant nexus test isn't a scientific term but rather a concept articulated by Justice Anthony Kennedy as “not being speculative and not insubstantial” in the 2006 U.S. Supreme Court ruling in Rapanos v. EPA (547 U.S. 715, 62 ERC 1481 (2006) Rapanos v. United States (547 U.S. 715, 62 ERC 1481 (2006)).

According to the agencies, a water or wetland has significant nexus when any single function or a combination of functions performed by this water alone or together in similarly situated waters in a region, contributes to the physical, biological and chemical integrity of waters. Such functions include trapping pollutants or sediments, retaining flood waters, contributing flow, exporting organic matter and recycling nutrients, among others.

Consistent with the Rapanos decision, the agencies determined that wetlands that are physically distant from navigable waters should be analyzed as a group, rather than individually in the watershed that drains to the nearest traditional navigable water, interstate water or the territorial seas when making a case-specific analysis.

Rule Incorporates Suggestions 

William Sapp, senior attorney with the Southern Environmental Law Center, told Bloomberg BNA that the agencies adopted the recommendations to consider the combined effect of isolated wetlands that the SELC, the National Wildlife Federation, and the Natural Resources Defense Council sought in the final rule.

“I think this is a clear step forward by grouping the waters in this manner and by calling them similarly situated up front,” Sapp said. “The approach they've taken here will reduce resources in the permitting process when dealing with these types of waters, whether it be a prairie pothole, a vernal pool or a Carolina bay.”

Sapp acknowledged that if one these waters is found jurisdictional using a case-by-case basis, then all similarly situated waters in a given watershed that serve similar functions could be covered, too.

Final Rule Called ‘Fairly Expansive.'

In contrast, Lowell Rothschild, senior counsel for the Washington, D.C. office of Bracewell & Giuliani LLP, told Bloomberg BNA that “the final rule is fairly expansive in defining similarly situated waters in the region that will result in a fair amount of otherwise isolated waters deemed jurisdictional.”

Rothschild said the rule is much clearer than its proposed version in that it defines adjacency with concrete identifiable distances.

The final rule's release was welcomed by environmental groups and Democratic leaders, while Republican leaders and industry decried the “power grab.

President Obama Welcomes Rule 

In a May 27 statement, President Barack Obama reiterated that “this rule will provide the clarity and certainty that businesses and industry need about which waters are protected under the Clean Water Act, and it will ensure that polluters who knowingly threaten our waters can be held accountable.”

Principal Deputy Press Secretary Eric Schultz told reporters en route to Miami that the rule has “no direct cost to a community, business or individual.”

He called it a win-win for the economy and for public health.

The rule, he said, “only applies if someone is going to pollute or destroy a body of water and needs a permit. So money and time will actually be saved by all involved because we will not have to deal with long, drawn out case-by-case bases for those determinations.”

House Minority Leader Nancy Pelosi (D-Calif.) said the final rule represents “vital protections against the pollution of the water that our children drink, that grows the food we eat, and that sustains our environment.”

In contrast, House Speaker John Boehner (R-Ohio) characterized the final rule as “a raw and tyrannical power grab that will crush jobs.”

The American Farm Bureau Federation, which has been a vocal opponent of the rule, said in a May 27 statement that it was reviewing the rule and would decide on a course of action in the following days.

“We are looking in particular at how the rule treats so-called ephemeral streams, ditches, small ponds and isolated wetlands,” Farm Bureau President Bob Stallman said.

Seeking Congressional Fixes 

Tom Wood, chairman of the National Association of Home Builders, warned that the rule would “regrettably” end up in courts as a result of the broad definitions that include coverage of streams that flow only when it rains.

“EPA's final water rule will needlessly raise housing costs and add more regulatory burdens to landowners and industries that rely on a functioning permitting process to spur job and economic growth,” Woods said, adding that the rule underscores the role that Congress must play in defining the limits of the Clean Water Act.

The House already has passed the Regulatory Integrity Protection Act (H.R. 1732) that would force withdrawal of the rule within 30 days of the bill's enactment. H.R. 1732 was authored by Reps. Bill Shuster (R-Pa.), chairman of the House Transportation and Infrastructure Committee, and Rep. Bob Gibbs (R-Ohio), chairman of the House Transportation Subcommittee on Water Resources and Environment.

Rule Called Flawed, Power Grab 

“Today, the Administration is capping off this power grab, plowing ahead with its flawed rule despite the bipartisan, bicameral concerns of Congress, despite the long-standing federal-state partnership to regulate waters under the Clean Water Act, and despite the objections and concerns from at least 32 states and representatives of the Nation’s large cities, smaller cities, counties, towns, townships, farmers, businesses, homebuilders, contractors, manufacturers, and more.,” Shuster and Gibbs said in a joint statement.

Of the rule, Sen. John Barrasso (R-Wyo.), who coauthored the Federal Water Quality Protection Act (S. 1140) with Sen. Joe Donnelly (D-Ind.), agreed with other critics who said the rule goes too far.

“There is bipartisan agreement that Washington bureaucrats have gone beyond their authority and have no business regulating irrigation ditches, isolated ponds and other ‘non-navigable’ waters as waters of the United States,” he said.

Barrasso urged support for S. 1140 that would require the agencies to write a new clean water rule no later than Dec. 31, 2016, and include only streams that have enough flow to transport pollutants at levels that would impair traditional navigable waters.

Schultz declined to say whether Obama would veto legislation blocking the rules.

“I’m not going to speculate on legislation that it’s not entirely clear that it will pass,” he said.

States Give Mixed Reaction

Among state officials, the reaction was mixed. Julia Anastasio, executive director for the Association of Clean Water Administrators, said “publication of the final rule provides the group with the opportunity to understand the changes to Clean Water Act jurisdiction, review the extent to which state comments were incorporated into the final rule, and to turn our attention to implementation of these changes.”

ACWA, the Environmental Council of the States, and Association of State Wetland Managers said the groups “look forward to full engagement between EPA, the Corps, and the states as co-regulators in implementing the Clean Water Rule.”

Meanwhile, Wyoming Gov. Matt Mead (R) said he was disappointed at the “lack of consideration for the law and procedure” and refusal to consult with states.

To contact the reporter on this story: Amena H. Saiyid in Washington at asaiyid@bna.com

To contact the editor responsible for this story: Larry Pearl at lpearl@bna.com

The joint final clean water rule by the Environmental Protection Agency and the U.S. Army Corps of Engineers is available at http://www2.epa.gov/sites/production/files/2015-05/documents/rule_preamble_web_version.pdf.

The summary of the final rule and associated fact sheets are available at http://www2.epa.gov/cleanwaterrule/clean-water-rule-factsheets.

The economic analysis of the joint final rule is available at http://www2.epa.gov/sites/production/files/2015-05/documents/final_clean_water_rule_economic_analysis_5-15_2.pdf

For more information about the rule, contact Donna Downing, in the EPA Office of Water at (202) 566–2428 or at CWAwaters@epa.gov, or Stacey Jensen, in the U.S. Army Corps of Engineers Regulatory Community of Practice, at (202) 761–5856 or at USACE_CWA_Rule@usace.army.mil