Samuel L. Lofland
On February 28, 2017, President Trump signed an Executive Order entitled “RESTORING THE RULE OF LAW, FEDERALISM, AND ECONOMIC GROWTH BY REVIEWING THE ‘WATERS OF THE UNITED STATES’ RULE.” The purpose of this briefing paper is to provide a summary of the background of the definition of “Waters of the United States” (“WOTUS”) and an analysis of the impact of the Executive Order.
The CWA can have significant impacts on industries, and thus expansions to its scope increase the burden felt by the regulated community. The Final Rule broadened the scope of the Clean Water Act (“CWA”) by expanding the definition of WOTUS. The Final Rule has been stayed in Federal Court and now has been targeted by the Executive Order. The current scope of the CWA (since the Final Rule is stayed) is ambiguous, as WOTUS are not well defined under Rapanos (as implemented by the Army Corps and EPA) particularly because the question of whether a water body is “jurisdictional” (other than a navigable or interstate water body, which is always jurisdictional), is subject to a case-by-case determination of the agencies and is not applied consistently across regions. The Final Rule was meant to provide certainty and clarification, and while it did that, it greatly increased the scope of the CWA and the burden on the regulated stakeholders. Consequently, a revised definition of WOTUS is needed, as is being directed by the Executive Order. But what remains to be seen is how the new Administration will replace the Final Rule with a WOTUS definition that provides clarity, certainty, and predictability to the regulated stakeholders.
I. Background leading up to the Final Rule
There have been several cases that have shaped the scope of the EPA and the Army Corps of Engineers jurisdiction over WOTUS under the CWA. Briefly, here are three seminal cases:
In 2008, to provide “clarification,” the EPA issued guidance stating its understanding of the significant nexus test to help “clarify” federal jurisdiction. The 2008 Guidance provided:
The Significant Nexus Test:
Thereafter, in 2011, the EPA proffered additional guidance regarding the agency’s interpretation and implementation of Rapanos, in which EPA applied the “significant nexus test” to “other waters,” and “similarly situated waters,” such that the CWA would apply to all waters of the same resource type with a hydrological connection which constituted a “significant nexus” to a traditional navigable or interstate water.
On May 27, 2015, the prepublication version of the Final Rule, “Clean Water Rule: Definition of ‘Waters of the United States,’” was released. The Final Rule has a 197-page preamble to explain the eight-page rule. The Final Rule increases the jurisdictional scope of the CWA by expanding the definition of “Waters of the United States” to make tributaries and adjacent waters, even those that are intermittent or ephemeral, “per se jurisdictional without the need for a significant nexus determination.” Preamble at p. 86.
II. Court Proceedings Related to the Final Rule
Before the Final Rule became effective, legal challenges to the rule were filed in multiple federal courts. These lawsuits were filed by industry groups, several environmental groups, and over half of the states; ultimately, totaling over 90 plaintiffs. On October 9, 2015, a three-judge panel of the Court of Appeals for the Sixth Circuit stayed the rule’s implementation nationwide. On February 22, 2016, the three-judge panel further concluded it had jurisdiction to hear the combined challenges to the Final Rule in the various federal courts. Various industry groups filed petitions for rehearing on this decision, all of which were denied on April 26, 2016. Following this decision, district courts across the country have dismissed individual challenges to the rule on jurisdictional grounds, stating that the Sixth Circuit is the appropriate venue. However, a district court in North Dakota declined to dismiss an action challenging the Final Rule, instead opting to put the action on hold pending the Sixth Circuit outcome. Similarly, the Eleventh Circuit put a hold on a similar challenge on August 16, 2016, stating it would wait until the Sixth Circuit action was resolved to proceed. On January 13, 2017, the Supreme Court granted a petition to hear an appeal to the Sixth Circuit’s ruling. On January 25, 2017, the Sixth Circuit granted a motion to hold its ongoing WOTUS litigation pending the Supreme Court’s decision.
Since the stay of the Final Rule litigation, the EPA and Army Corps of Engineers have continued to exercise their authority consistent with the “significant nexus test” as set forth in Rapanos and the definition of WOTUS effective prior to the Final Rule.
III. The Executive Order
On February 28, 2017, President Trump signed an Executive Order (“EO”) directing the Administrator of the EPA and the Assistant Secretary of the Army to review the Final Rule and publish for notice and comment a proposed rule rescinding or revising the same. The EO provides: “It is in the national interest to ensure that the Nation's navigable waters are kept free from pollution, while at the same time promoting economic growth, minimizing regulatory uncertainty, and showing due regard for the roles of the Congress and the States under the Constitution.”
The EO also directs all agencies involved with enforcing the Final Rule to rescind or revise enforcement related to the Final Rule; directs the heads of the EPA and Army Corps to notify the Attorney General in charge of the ongoing Final Rule litigation of the agencies’ pending review of the same; and orders that the EPA and Army Corp to consider interpreting the term “navigable waters” in a manner consistent with the opinion of Justice Antonin Scalia in Rapanos v. United States.
Effectively, this means the EO is requiring the EPA and Army Corps to consider interpreting the term “navigable waters” to mean those waters channels or bodies: (1) that were traditionally used for commerce or to transport people; (2) that are interstate; (3) that are “relatively permanent bodies of water” connected to traditional navigable waters; and (4) that are wetlands with a continuous surface connection to these waters, such that it is difficult to determine where the “water” ends and the “wetland” begins. Ultimately, the EO does not repeal the Final Rule, but instead directs the EPA and Army Corps to consider revising or repealing the same. Consequently, in the foreseeable future the Army Corps and EPA will continue to administer the CWA consistent with their interpretations of Rapanos prior to development of the Final Rule. In other words, the agencies will continue to have to make a case-by-case determination of applicability of the CWA to any waters other than navigable or interstate waters. Recall, the goal of the Final Rule was to reduce the need for a case-by-case determination for waters which, by rule, would be defined as jurisdictional under the CWA.
Any changes to the Final Rule will need to undergo proper administrative notice and comment periods, and it will take significant time before the Final Rule is ultimately revised or repealed. In the interim, the EO directs the EPA and Army Corps to notify the Attorney General of any pending review of the Final Rule “so that the Attorney General may, as he deems appropriate, inform any court of such review and take such measures as he deems appropriate concerning any such litigation pending the completion of further administrative proceedings related to the rule.” EO at Para. 2(c). Effectively, this will likely lead to the Attorney General requesting that the Supreme Court dismiss the ongoing WOTUS litigation as moot, or stay the action pending revision of the Final Rule.
From an industry perspective, the initial effect of the EO is as follows:
At some undefined point in the future, the EO will likely lead EPA and the Army Corps to adopt Justice Scalia’s narrower interpretation of WOTUS. However, it is important that any future rule provide clarity, as well as narrowing the scope of the definition of WOTUS. Ideally, to strike the balance of clarity and narrowing the definition of WOTUS a replacement rule will:
IV. Scope of the Final Rule
It is likely that environmental groups will fight to preserve the Final Rule, either in its current form or to ensure that its salient points are included in any replacement rule flowing from the EO. Consequently, it is important to understand the content of the Final Rule, as these concepts will no doubt resurface in the discussions and debates that follow the implementation of the EO.
Summarily, below are salient provisions of the Final Rule:
If you have any questions about the information in this article, please contact the authors.