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A federal appellate court ruled March 25 that the Environmental Protection Agency cannot regulate wastewater treatment processes at publicly owned utilities through guidance letters in lieu of rulemaking (Iowa League of Cities v. EPA, 8th Cir., No. 11-3412, 3/25/13).
A three-judge panel for the U.S. Court of Appeals for the Eighth Circuit “invalidated” two letters that EPA sent in June 2011 and September 2011 to Sen. Charles Grassley (R-Iowa) regarding wastewater treatment processes.
The June 2011 letter reinforced EPA's position on “mixing zones” of high pollutant concentrations created in receiving waters immediately below points of wastewater discharges, while the September 2011 letter spelled out the agency's policy on blending of partially treated and treated wastewater within a utility prior to discharge into the receiving waters.
“We vacate both the mixing zone rule in the June 2011 letter and the blending rule in the September 2011 letter as procedurally invalid,” the court said. “Further, we vacate the blending rule as in excess of statutory authority insofar as it would impose the effluent limitations of the secondary treatment regulations internally, rather than at the point of discharge into navigable waters.”
In November 2011, the Iowa League of Cities petitioned the Eighth Circuit, contending that the “letters effectively set forth new regulatory requirements with respect to water treatment processes at municipally owned sewer systems.” The EPA actions violated the Administrative Procedure Act, the League of Cities said.
The appellate court agreed, holding that “the letters can be considered 'promulgations' for the purposes of establishing our jurisdiction under section 509(b)(1)(E) because they have the binding effect on regulated entities.”
Section 509(b)(1)(E) of the Clean Water Act allows for judicial review of an EPA effluent limitation.
EPA deferred to the Department of Justice response on the court ruling. Charles Miller, a DOJ spokesman, told BNA March 25 that “the department is reviewing the court's decision at this time.”
Bruce Bergman, the Iowa League of Cities general counsel, said that the group is pleased that the court saw the merits in its argument. He said the group is still reviewing the decision.
EPA had sought to have the league's petition dismissed, contending that the letters should have been considered “general policy statements or, at most, interpretive rules.”
The court dismissed EPA's argument, saying “we decline to accept such Orwellian Newspeak.”
Mixing zones are areas in the receiving waters immediately around the point of wastewater discharge.
Pointing to the June 2011 letter on mixing zones, the court said EPA reinforced as a rule the position of a 2008 memorandum penned by EPA Science and Technology Director Ephraim King by stating that mixing zones in waters designated for primary contact recreation “should not be permitted.”
In the memorandum, King wrote, “mixing zones that allow for elevated levels of bacteria in rivers and streams designated for primary contact recreation are inconsistent with the designated use and should not be permitted because these could result in a significant health risk.”
The court said this statement was at odds with the discretion given to states to establish policies on mixing zones under 40 C.F.R. Part 131.13.
Moving onto the September 2011 letter on blending, the court said EPA relied on a 2005 draft policy on wet weather flows to disallow a treatment process used in lieu of secondary biological treatment of rerouted wastewater. The court termed the letter “a legislative rule because it is irreconcilable with both the secondary treatment and the bypass rule.”
Moreover, the court said, EPA was applying effluent limitations to a facility's internal secondary treatment processes, rather than at the end of the pipe.
Blending refers to the process of rerouting excess stormwater generated during heavy rains around a utility's secondary biological treatment and then mixing that partially treated wastewater with the treated wastewater prior to discharge into the receiving waters. The partially treated wastewater does undergo primary treatment before being rerouted around the secondary treatment process, which involves biological processes.
EPA's bypass rule at 40 C.F.R. 122.41(m) prohibits bypasses of wastewater treatment around secondary biological treatment within utilities except where necessary for essential maintenance to assure efficient operation.
The court cited a 1996 Am. Iron & Steel v. EPA decision in holding that the agency can regulate waste streams that are discharged into navigable waters but is not authorized to regulate pollutant levels in a facility's internal waste stream ( 115 F. 3d 979, 996 (D.C. Cir. 1997).
The National Association of Clean Water Agencies termed the ruling an “important legal victory” for publicly owned wastewater utilities that it represents.
In a March 25 email, Nathan Gardner-Andrews, NACWA general counsel, told BNA that the ruling “confirms NACWA's belief that EPA has been improperly regulating blending and peak flow treatment facilities at the plant, which play an integral role in helping utilities provide maximum treatment to wet weather flows and protect water quality.”
The U.S. Court of Appeals for the Eighth Circuit ruling in Iowa League of Cities v. EPA is available at http://www.bloomberglaw.com/public/document/Iowa_League_of_Cities_v_EPA_Docket_No_1103412_8th_Cir_Nov_04_2011/1.
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