Is EPA’s Limiting of Wastewater Decision Akin to New Rule?

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By Amena H. Saiyid

Oct. 21 — Should a federal agency’s refusal to apply an appeals court order on a regulation or policy nationwide be viewed as “re-promulgating” a rule and thus have legal consequences, an appellate judge asked at the start of oral arguments Oct. 21 on the Environmental Protection Agency’s wet weather policies ( Ctr. for Regulatory Reasonableness v. EPA, D.C. Cir., No. 14-01150, oral arguments 10/21/16 ).

Judge Stephen Williams, one of three jurists on the U.S. Court of Appeals for the District of Columbia Circuit, wasted no time in posing these questions in a lawsuit challenging the EPA’s effort to preserve its policies on how wastewater treatment plants manage excess flows during heavy rains. When the Eighth Circuit struck down the wet weather policies in 2013, the EPA said it would continue to enforce them in the parts of the country outside the court’s jurisdiction.

The question before the D.C. Circuit was whether the EPA could limit the Eighth Circuit’s ruling to the states—Arkansas, Iowa, Minnesota, Missouri, Nebraska, North Dakota and South Dakota—that fall under the appellate’s legal jurisdiction.

Judge Brett Kavanaugh followed up this line of questioning by asking whether any legal consequences would flow from what Williams termed EPA’s “non-acquiescence” with the Eighth Circuit’s decision.

Cites Consequences of Action

“The consequences are there,” said John Hall before listing the costs cities will incur if the wastewater management practices are banned. Hall, of the Washington D.C.-based Hall & Associates that represented the plaintiffs in the case, the Center for Regulatory Reasonableness, also represented the Iowa League of Cities when it challenged the EPA’s policies on mixing zones and blending before the Eight Circuit in 2013. The center supports the right of wastewater utilities to use a technique known as blending when excess flows—that could overwhelm the plant—are routed around a portion of the treatment process during storms and recombined with the treated effluent before being discharged. The EPA issued a policy banning the practice as illegal under the Clean Water Act and restricting mixing zones—the immediate discharge area in a waterbody that may in certain situations exceed water quality standards.

At Kavanaugh’s urging, Hall then proceeded to give the court legal examples of the costs incurred by cities outside of the Eighth Circuit that are having to spend money complying with the EPA policy that has been deemed illegal.

Legal Consequences

Allentown, Pa., a member of the Center for Regulatory Reasonableness, could spend an estimated $37 million to reduce combined sewer overflows of wastewater and stormwater as part of a federal consent decree, Hall said.

The city isn’t allowed to use blending, he said. As a result, it could face enforcement proceedings if it chooses not to comply, and its costs would increase beyond the $37 million because it would have to redesign the plant to boost its capacity to treat higher volumes of wastewater during heavy rains.

Kavanaugh took note when Hall reminded the panel of judges about the U.S. Supreme Court’s unanimous rulings in which EPA decisions were made subject to judicial review based on the legal consequences that flowed from those actions.

For instance, in Sackett v. EPA (132 S.Ct. 1367, 73 ERC 2121, 2012 BL 67234(2012)), the Supreme Court made administrative compliance orders subject to reviews, while findings of Clean Water Act jurisdictional waters were made reviewable in U.S. Army Corps of Eng’rs v. Hawkes Co. (136 S. Ct. 1807, 82 ERC 1465, 2016 BL 171974 (2016)).

Kavanaugh explored the question of consequences further with Justice Department attorney Andrew Doyle, who argued that the only time cities face consequences is when effluent limits are written into discharge permits that can be challenged in courts.

Veering off Question

The oral arguments veered from the central question of whether the EPA is allowed to limit the Eighth Circuit’s decision to whether cities and towns have recourse through judicial review when the EPA fails to comply with the court’s ruling.

Kavanaugh asked Doyle whether cities and towns would have to spend a lot of money before they even got to the point of seeking judicial review. He also raised the issue of delays that cities and towns would face as they challenged the EPA’s approval or veto of certain permits or permit conditions.

Doyle insisted that cities and towns don’t have to make any changes and aren’t “forced” to change treatment practices under the EPA letters, unlike guidance documents that the D.C. Circuit struck down in Appalachian Power Co. v. EPA, 208 F.3d 1015, 1028, 50 ERC 1449 (D.C. Cir. 2000).

Kavanaugh wasn’t persuaded by Doyle’s response. In other words, Kavanaugh said, “your response is ‘just tough.’ ”

Briefs Not Followed

After the arguments, Hall told Bloomberg BNA that the D.C. Circuit’s line of questioning didn’t follow the briefs that were filed. He said the question about “non-acquiesence” was one that neither the EPA nor the center had tackled in their briefs.

An EPA official, who was present, refused to comment, other than to term the exchange as “very interesting arguments.”

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

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