EHS Administration, Regulatory Developments

SCOTUS Restores Trump-Era Water Rule, For Now

In a close 5–4 decision, on April 6, 2022, the U.S. Supreme Court (SCOTUS) reinstated a Trump-era Clean Water Act (CWA) regulation that limited state and tribal authority in the permitting process for projects in their territory.

History

The CWA made it unlawful to discharge any pollutant from a point source into navigable waters unless a permit was obtained.

“Under Section 401 of the Clean Water Act (CWA), a federal agency may not issue a permit or license to conduct any activity that may result in any discharge into waters of the United States unless a Section 401 water quality certification is issued, or certification is waived,” states the EPA CWA 401 website. “States and authorized tribes where the discharge would originate are generally responsible for issuing water quality certifications.”

The 401 certification process impacts thousands of industry projects, both in initial certification and in relicensing, including construction near wetlands, natural gas pipeline projects, wastewater treatment facilities, and hydroelectric plants.

However, many states and tribal authorities were accused of misusing the 401 certification process to delay and block certain development projects. Trump’s pro-industry administration issued a final rule in June 2020 narrowing state and tribal authority “to formally object to federally permitted projects based on state water quality standards,” a JD Supra article notes.

The new rule said a state or tribal authority “is deemed to have waived its delegated authority under section 401 if it ‘fails or refuses to act on a request for certification, within a reasonable period of time (which shall not exceed one year) after receipt of such request,’” law firm Davis Wright Tremaine LLP says. “The rules adopt the D.C. Circuit’s view in Hoopa Valley Tribe v. FERC that one year means one year, and they narrow the scope of conditions that states can impose on a project as part of the certification.”

“Under the rule, which took effect in September 2020, states could no longer consider a project’s impact on air emissions and road traffic congestion,” says Courthouse News Service. “The scope of review [was] limited to water quality alone. It also forbids states and tribes from imposing recreation-related conditions on projects and required they provide more details on why specific permit conditions are necessary.”

In re Clean Water Act Rulemaking

States, tribes, and environmental groups objected to these 401 certification limitations, and several took the matter to court. Three of the cases were consolidated in a California federal court.

In October 2021, U.S. District Judge William Alsup of the Northern District of Columbia in In re Clean Water Act Rulemaking vacated the Trump rule limiting state and tribal authority in the 401 certification process.

The EPA had requested that the judge remand the rule back to the Agency for revision but did not request that it be vacated.

“In sum, in light of the lack of reasoned decisionmaking and apparent errors in the rule’s scope of certification, the indications that the rule contravenes the structure and purpose of the [CWA], and that EPA itself has signaled it could not or will not adopt the same rule upon remand, significant doubt exists that EPA correctly promulgated the rule,” Alsup wrote in the ruling.

“Alsup also found that plaintiffs challenging the Trump EPA changes showed that ‘significant environmental harms will likely transpire’ with the rule left in place,” Natural Gas Intelligence says. “The potential harms to the environment outweigh the ‘disruptive economic consequences’ of vacating the rule, and the economic harms further ‘do not outweigh the significant doubts that EPA correctly promulgated’ the rule, the judge wrote.”

Alsup’s ruling also indicated in his opinion that “the Trump-era rule likely violated the law because it abruptly adopted an understanding of the [CWA] that contradicted decades of EPA interpretation and Supreme Court precedent established in the 1994 ruling PUD No. 1 of Jefferson County v. Washington Department of Ecology,” courthousenews.com adds.

SCOTUS throws shade from shadow docket

The district court’s vacatur was appealed in the 9th Circuit Court of appeals by Louisiana, Arkansas, Mississippi, Missouri, Montana, West Virginia, Wyoming, Texas, and various trade associations. The 9th Circuit consolidated the appeals into Louisiana et al. Applicants v. American Rivers et al. and denied the appeal in February 2022, leaving Alsup’s vacatur in place.

Appellants then sought a stay via SCOTUS’s emergency docket—a process sometimes referred to as the court’s “shadow docket” because decisions are quickly provided without the benefit of hearing a full briefing and arguments.

The conservative justices in the majority who reinstated the Trump-era regulation did not explain their reasoning for granting the stay, as is typical in shadow docket rulings.

The dissenting opinion was written by Justice Elena Kagan. She was joined in the dissent by Chief Justice John Roberts and Justices Stephen Breyer and Sonia Sotomayor.

“Writing for the dissenters, Justice Elena Kagan said the group of states and industry associations that had asked for the lower court’s ruling to be put on hold had not shown the extraordinary circumstances necessary to grant that request,” says U.S. News. “Kagan said the group had failed to demonstrate their harm if the judge’s decision were left in place. She said the group had not identified a ‘single project that a State has obstructed’ in the months since the judge’s decision and had twice delayed making a request, indicating it was not urgent. Kagan said the court’s majority had gone ‘astray’ in granting the emergency petition and was misusing the process for dealing with such requests. … Kagan wrote that her colleagues’ decision ‘renders the Court’s emergency docket not for emergencies at all.’”

Consequences and next steps

The EPA’s Notice of Intent to Reconsider and Revise the CWA Section 401 Certification Rule was published in the Federal Register on June 2, 2021. The Notice of Intent states the Agency will not reinstate the original 401 certification regulation but will “revise the rule in a manner that promotes efficiency and certainty in the certification process, that is well-informed by stakeholder input on the 401 Certification Rule’s substantive and procedural components, and that is consistent with the cooperative federalism principles central to CWA Section 401.”

In court filings related to the appeal for a stay, the Biden administration “urged the court not to reinstate the rule, saying that in the months since the Alsup’s ruling, officials have adapted to the change, reverting to regulations in place for decades,” notes PBS. “Another change would ‘cause substantial disruption and disserve the public interest,’ the administration said.”

The EPA has indicated it is committed to restoring state and tribal authority to regulate water pollution.

“‘EPA’s own review of the 2020 Rule identified substantial concerns with a number of provisions that relate to cooperative federalism principles and CWA section 401’s goal of ensuring that states and Tribes are empowered to protect water resources that are essential to public health, ecosystems, and economic opportunity,’ [an EPA] spokesperson said,” Courthouse News Service continues.

The EPA’s revised proposed regulation is expected in Spring 2023.

“The exact procedural requirements that states will face when a future application for FERC (Federal Energy Regulatory Commission) approvals of interstate pipelines or other sorts of federal applications for other sorts of projects … is … unknown at present,” The National Law Review says.