Chapter 6: Water Pollution Control

THE AFTERMATH OF RAPANOS (pp. 608-616)

As discussed in the casebook on pp. 608-616, in Rapanos v. U.S., 547 U.S. 715 (2006), the Supreme Court considered the breadth of Clean Water Act jurisdiction over wetlands.  Because the Court split 4-1-4, the decision has created enormous confusion because Justice Kennedy’s decisive vote was premised on a new jurisdictional test that none of the other Justices adopted.  Justice Scalia, writing for the plurality, concluded that “only those wetlands with a continuous surface connection to bodies that are ‘waters of the United States’ in their own right . . . are ‘adjacent to’ such waters and covered by the [CWA].” Rapanos, at 742.  Scalia's standard would exclude “[w]etlands with only an intermittent, physically remote hydrologic connection to ‘waters of the United States’.”  Id.  According to Justice Scalia’s view, establishing federal CWA jurisdiction over wetlands requires consideration of (1) whether the wetland is adjacent to a “‘water of the United States’ (i.e., a relatively permanent body of water connected to traditional interstate navigable waters),” and (2) whether “the wetland has a continuous surface connection with that water, making it difficult to determine where the ‘water’ ends and the ‘wetland’ begins.”  Id. at 742.  However, this view was rejected by the other five Justices.

Justice Kennedy, concurring in the result, concluded that for wetlands adjacent to non-navigable waters, the government must establish a “significant nexus” between the wetlands and navigable waters. Rapanos, at 782.  Kennedy stated that a significant nexus exists “if the wetlands, either alone or in combination with similarly situated lands in the region, significantly affect the chemical, physical, and biological integrity of other covered waters more readily understood as ‘navigable’.”  Id. at 780.

Justice Stevens, in his dissent, stated that all four dissenting justice would have upheld the Corps' standard for establishing jurisdiction.  Rapanos, at 810.  Moreover, Stevens suggested that since the four dissenters would uphold jurisdiction under either the plurality or Kennedy's test (both of which are narrower than the Corps' standard) lower courts should find that jurisdiction exists whenever either test is satisfied.  Id.

There have been two main approaches followed by the lower courts in applying the Rapanos decision.

• The Seventh and Ninth Circuits have followed Marks v. United States, 430 U.S. 188, 193  (1977), which demands that in applying an ambiguous Supreme Court opinion, the controlling standard is “narrowest ground to which a majority of the Justices would have assented if forced to choose.”  U.S. v. Gerke Excavating, Inc., 464 F.3d 723 (7th Cir. 2006) (citing Marks, 430 U.S. at 193).  These Circuits concluded that Kennedy's “significant nexus” standard is the narrowest, because it places the fewest constraints on federal Clean Water Act jurisdiction.
• The First and Eighth Circuits have followed Justice Stevens' suggestion in his Rapanos dissent, finding that CWA jurisdiction exists over wetlands whenever either the plurality standard or the Kennedy standard is satisfied.  These courts criticize the Marks based approach because (1) it is unworkable given the incompatible standards promoted in Rapanos, (2) there is no support for finding that the "narrowest" standard is that which least restricts federal jurisdiction, and (3) the Supreme Court has moved away from the Marks test.

The Seventh Circuit, in U.S. v. Gerke Excavating, Inc., 464 F.3d 723 (7th Cir. 2006), stated that “[w]hen a majority of the Supreme Court agrees only on the outcome of a case . . . lower-court judges are to follow the narrowest ground to which a majority of the Justices would have assented . . . . Id. at 724 (citing Marks v. United States, 430 U.S. 188 (1977)).”  The Gerke court concluded that Justice Kennedy's “significant nexus” standard is narrower than the plurality standard because it places fewer limitations on federal CWA power, referring to the plurality's requirements of a continuous flow and a surface connection between the wetland and the “water of the United States.”  Id. at 724–25.  However, the Gerke court admitted that there will be some cases where the plurality's test confers jurisdiction but Kennedy's will not.  Id.  Critics of the Gerke approach have seized on this observation to show that Kennedy's test is not a narrower version of the plurality test, but is instead a completely different standard.

In Northern California River Watch v. City of Healdsburg, 496 F.3d 993 (9th Cir. 2007), the Ninth Circuit adopted the Gerke reasoning and its conclusion that Kennedy's is the controlling standard.  Id. at 999–1000.  The court concluded that a “significant nexus” existed between the river and the pond, which supported federal jurisdiction.  Id. at 994.  However, the court found that the trial court improperly applied Kennedy's test to the facts of the case, in which CWA jurisdiction was asserted over a pond adjacent to a navigable-in-fact river.  U.S. v. Fabian, 522 F.Supp.2d 1078, 1091 (N.D.Ind. 2007).  The court noted Justice Kennedy’s statement that “[w]hen the Corps seeks to regulate wetlands adjacent to navigable-in-fact waters, it may rely on adjacency to establish its jurisdiction.”  Therefore it concluded that it was not necessary to find a "significant nexus" in such cases.  Id.

Further decisions within the Ninth Circuit have followed this approach.  See San Francisco Baykeeper v. Cargill Salt Div., 481 F.3d 700 (9th Cir. 2007) (ruling that insufficient evidence had been presented to show a “significant nexus” between a pond and a nearby slough);  Coldani v. Hamm, 2007 WL 2345016 (E.D.Cal. Aug 16, 2007) (ruling that showing a hydrologic connection between a pollution source and contaminated groundwater is sufficient to defeat a motion of summary judgment);  U.S. v. Moses, 496 F.3d 984 (9th Cir. 2007) (ruling that Justice Kennedy's standard does not preclude CWA jurisdiction from extending over “impermanent streams”);  see also Environmental Protection Information Center v. Pacific Lumber Co., 469 F.Supp.2d 803 (N.D.Cal. 2007).

In U.S. v. Johnson, 467 F.3d 56 (1st Cir. 2006), the First Circuit concluded that either the plurality standard or Justice Kennedy's “significant nexus” standard could be used to establish CWA jurisdiction.  Id. at 64–66.  The First Circuit Court of Appeals cited U.S. v. Evans, 2006 WL 2221629 (M.D.Fla. 2006), in which the Middle District of Florida adopted the dissent's position that either the plurality or Kennedy's test could provide jurisdiction.  Johnson, 467 F.3d at 60.  The Johnson court favored this method because “[f]ollowing Justice Stevens's instruction ensures that lower courts will find jurisdiction in all cases where a majority of the Court would support such a finding.”  Id. at 64.   

The Johnson court considered the Seventh Circuit's decision in Gerke to adopt Kennedy's “significant nexus” standard, but found it curious that Gerke equates the “narrowest opinion” with “the one least restrictive of federal authority to regulate.” It highlighted the possibility that Kennedy's standard could extend jurisdiction in instances where both the plurality and the four dissenters would withhold it.  Id. at 61–62.  The court noted that given the Commerce Clause concerns inherent to extending CWA jurisdiction, “it seems just as plausible to conclude that the narrowest ground of decision in Rapanos is the ground most restrictive of government authority (the position of the plurality).”  Id. at 63.  The court concluded that Marks is incompatible with the Rapanos decision, given the incompatible standards.  Id. at 64.  Furthermore, the Johnson court asserted that the Supreme Court has moved away from the Marks line of cases.  Id. at 65 (citing Nichols v. U.S., 511 U.S. 738, 745-46 (1994)).    

Several district courts have followed the lead of the First Circuit in adopting the dissent's suggestion.  The District of Minnesota followed Johnson in U.S. v. Bailey, 516 F.Supp.2d 998 D. Minn 2007), because that approach allows “a legal standard that, when applied, will produce results with which a majority of the Court would agree.”  Id. at 1006 (quoting Johnson, 467 F.3d at 64–66).  The District of Connecticut also followed Johnson's “common sense” approach in Simsbury-Avon Preservation Soc., LLC v. Metacon Gun Club, Inc., 472 F.Supp.2d 219 (D.Conn. 2007), while noting that the Marks­ approach favored by the Seventh and Ninth Circuits would usually reach the same result.  Id. at 226.  The Western District of Kentucky also adopted the Johnson approach in U.S. v. Cundiff, 480 F.Supp.2d 940, 941 (W.D.Ky. 2007).  In U.S. v. Sea Bay Development Corp., 2007 WL 1169188, the Eastern District of Virginia avoided deciding which Rapanos test controls, but hinted that it favored the dissent's approach. 

Judges in the Eleventh Circuit have criticized that Circuit's adoption of the Kennedy's standard as controlling.  In U.S. v. Robison, 505 F.3d 1208 (11th Cir. 2007) the court joined the Seventh and Ninth Circuits, while shunning the Johnson approach, because “Marks does not direct lower courts interpreting fractured Supreme Court decisions to consider the positions of those who dissented.”  Id. at 1221. 

On remand to the Northern District Court of Alabama, Southern Division, Judge Probst reassigned the case, because he was “so perplexed by the way the law applicable to this case has developed . . . .” U.S. v. Robison, 521 F.Supp.2d 1247, 1248 (N.D. Ala. 2007).  Judged Probst opined that holding the standards which broadens federal jurisdiction to be the narrowest standard conflicts with Supreme Court precedent relied on by Marks.  Id.  Additionally, Probst wrote that a standard only agreed on by one Justice should not be held as controlling precedent.  Id. at 1253. 

Subsequently a motion for rehearing en banc was denied by the Eleventh Circuit Court of Appeals in U.S. v. Robison, 521 F.3d 1319 (2008).   Circuit Judge Wilson, joined by Circuit Judge Barkett, dissented from the denial of re-hearing, arguing against adoption of Kennedy's “significant nexus” standard and promoting the Johnson approach.  Id.  Judge Wilson stated that the Supreme Court has recognized that the Marks test has “baffled and divided the lower courts that have considered it.”  Id. at 1322 (quoting Nichols v. United States, 511 U.S. 738, 745-46 (1994)).  Furthermore, Wilson asserted that application of the Marks test is only possible where “one Supreme Court opinion truly is narrower.”  Id. at 1323.  However, “[n]either the Rapanos plurality nor Kennedy's test a subset of the other.”  Id. at 1324.  

In U.S. v. Chevron Pipe Line Co., 437 F.Supp.2d 605, the Northern District of Texas ignored the recent Rapanos decision “[b]ecause Justice Kennedy failed to elaborate on the ‘significant nexus’ required.”  The court applied earlier circuit precedent, purportedly acting on the advice of Chief Justice Roberts, who in his concurring opinion instructed lower courts to interpret the decision “on a case-by-case basis.”  Id. at 613 (quoting Rapanos, 547 U.S. at 753).  The Fifth Circuit Court of Appeals failed to clarify its interpretation of Rapanos in U.S. v. Lucas, 516 F.3d 316 (5th Cir. 2008) in which it examined the wetlands at issue under the standards of the plurality, Justice Kennedy, and the broader Army Corps of Engineers standard supported by the dissent.  The Lucas court found that the wetlands came under federal jurisdiction, under each of these three standards, and thereby the court avoided determining which standard is controlling.  Id. at 325–27.

In light of the confusion spawned by Rapanos, Congressman James Oberstar, chair of the House Committee on Transportation and Infrastructure, has introduced a bill called “The Clean Water Restoration Act” that essentially would reverse the Rapanos decision and codify the Corps’ previous standard for asserting federal jurisdiction over wetlands.  Hearings on this proposed legislation were held in 2007 and 2008.  Robert Percival, one of the authors of this casebook, testified in support of this proposed legislation in July 2007.  See http://transportation.house.gov/Media/File/water/20070717/Percival%20Testimony.pdf

In an editorial supporting the proposed Clean Water Restoration Act, the New York Times noted that Rapanos has crippled enforcement of the Clean Water Act.  “A devastating internal document, obtained by Representatives James Oberstar and Henry Waxman, revealed that the Environmental Protection Agency has dropped or delayed more than 400 cases involving suspected violations of the law – illegal industrial discharges and the like[,] . . . nearly half the agency’s entire docket.”  In almost every case the reason “was that regulators did not know whether the streams and wetlands in question were still covered under the act.” “Clearer Rules, Cleaner Waters,” N.Y. Times, Aug. 18, 2008, p. A20.  Emory University Law School has put together a very useful website with links to materials on Rapanos.  It can be accessed online at: http://www.law.emory.edu/index.php?id=3302

TULLOCH II OVERTURNED (p. 623)

In National Ass'n of Home Builders v. U.S. Army Corps of Engineers, 2007 WL 259944 (D.D.C. 2007), the D.C. District Court overturned an Army Corps of Engineers/EPA rule (“Tulloch II”) presuming that “the use of mechanized earth-moving equipment to conduct landclearing, ditching, channelization, in-stream mining or other earth-moving activity in the waters of the United States” results “in a discharge of dredged material unless project-specific evidence shows that the activity results in only incidental fallback.”  Although the D.C. Circuit in National Mining Ass'n v. Army Crops of Engineers, 145 F.3d 1399 (D.C. Cir. 1998) (casebook p.617-622) stated that a bright-line rule defining incidental fallback would be entitled to deference, the District Court held that no deference is warranted, because the agencies failed to create a bright-line.  Because “not all uses of mechanized earth-moving equipment may be regulated, . . . the agencies cannot require ‘project-specific evidence’ from projects over which they have no regulatory authority.”  The district court enjoined EPA and the Corps from applying the “Tulloch II” rule.  While this removes the presumption that these activities require §404 permits, if they do in fact cause more than incidental fallback they remain subject to §404.

WATER TRANSFERS AND “DISCHARGE OF A POLLUTANT” (PP. 628-29)

As noted on page 245 of the Teacher’s Manual for the Fifth Edition, on June 7, 2006, EPA proposed to exempt all “water transfers” from NPDES permit requirements, despite judicial rejection in Catskills Mountain Chapter of Trout Unlimited v. City of New York, 451 F.3d 77 (2d Cir. 2006) of the Klee memorandum (Note 6, p. 629 of casebook) espousing this interpretation.  EPA, NPDES Water Transfers Proposed Rule, 71 Fed. Reg. 32887.  EPA adopted this rule in final form on June 9, 2008. 73 Fed. Reg. 33697 (June 13, 2008). See http://cfpub.epa.gov/npdes/home.cfm?program_id=41#water_transfer.  On June 27, 2008, Earthjustice filed a lawsuit challenging the rule in the U.S. Court of Appeals for the Eleventh Circuit. Florida Wildlife Federation, Inc. v. United States Environmental Protection Agency.  For further information see: http://www.earthjustice.org/news/press/2008/earthjustice-files-suit-to-stop-last-minute-bush-administration-assault-on-public-waters.html.  A copy of Earth-Justice’s petition for review is available at: http://www.earthjustice.org/library/legal_docs/fwf-petition-to-vacate-11th-circuit-court-of-appeals.pdf

CAN AN NPDES PERMIT BE AVOIDED BY CHARACTERIZING MINING WASTE AS “FILL” SUBJECT TO §404?: THE COEUR ALASKA CASE

The Supreme Court has agreed to review a decision by the Ninth Circuit invalidating a mining company’s effort to avoid getting a NPDES permit by characterizing disposal of mining waste into a lake as “fill” subject to §404.  Southeast Alaska Conservation Council v. U.S. Army Corps of Engineers, 486 F.3d 638 (9^th Cir. 2007).  The Corps had approved a §404 permit allowing Coeur Alaska, a Canadian mining company, to dispose of acidic and metal-laden liquid waste from a gold mine into Lower Slate Lake in Alaska.  The company planned to build a 90-foot high, 500-foot long dike around the part of the lake where the disposal would occur.  Because the daily discharge of 210,000 gallons of wastewater would contain 1,440 tons of tailings, the bottom elevation of this portion of the lake eventually would rise by 50 feet due to the deposit of 4.5 million tons of tailings.  The company claimed that this made the waste “fill” rather than “pollutants,” subjecting it to permitting under §404 rather than §402.

The Ninth Circuit agreed with environmental groups that this deposit of more than 6,000 tons of tailings-laden water into the lake each day would constitute a discharge of pollutants requiring a permit under §402, rather than “fill” subject to §404. The Court noted that although the discharge “facially meets the Corps’ current regulatory definition of ‘fill material’ because it would have the effect of raising the bottom elevation of the lake,” 33 C.F.R. §323.2(e), it also was the very kind of discharge from a froth-flotation mill that EPA regulations prohibit. 40 C.F.R. §440.104(b)(1).  The court concluded that “the plain language of the Clean Water Act resolves [the] conflict” between the two sets of regulations and requires that the discharge be subject to §402.  486 F.3d at 644. The case will be decided by the U.S. Supreme Court during its 2008-2009 Term.  Coeur Alaska, Inc. v. Southeast Alaska Conservation Council, No. 07-984.

WHAT CONSIDERATION MAY BE GIVEN TO COSTS WHEN TECHNOLOGY-BASED REGULATIONS ARE DETERMINED?: WATER INTAKE STRUCTURES & THE ENTERGY CASE (pp. 644-656)

In late 2008, the U.S. Supreme Court will hear oral argument in three consolidated cases that represent a challenge to the way technology-based regulations are determined under the Clean Water Act.  The cases are No. 07-588, Entergy Corp. v. EPA, No. 07-589, PSEG Fossil LLC v. Riverkeeper, Inc., and No. 07-597, Utility Water Act Group v. Riverkeeper, Inc.  The Court has agreed to decided whether §316(b) of the Clean Water Act authorizes the EPA to compare costs with benefits in determining the “best technology available for minimizing adverse environmental impact” at cooling water intake structures. 

Section 316(b) of the Clean Water Act requires that “the location, design, construction, and capacity of cooling water intake structures reflect the best technology available for minimizing adverse environmental impact.”  This is the only provision of the Clean Water Act that governs the intake, rather than the discharge of water.  It is designed to protect aquatic organisms from impingement against, and entrainment into a facility’s cooling system.  After decades of litigation-affected delay, in 2004 the EPA promulgated regulations determining the “best technology available” (BTA) for applying §316(b)’s mandate to existing, large power plants.  The regulations endorsed a range of measures for protecting aquatic life, including relocating intakes, using fine mesh passive screens or barrier nets, and measures to reduce intake velocity.  Without requiring the use of any specific technology, the regulations established national performance standards to reduce impingement mortality by 80-95% and entrainment by 60-90%.  40 C.F.R. 125.94(b).  While EPA requires new power plants to use closed-cycle, recirculating cooling systems, it refused to require them for existing plants, in part because of the high cost of retrofitting them. 

After the regulations were challenged in court, the U.S. Court of Appeals for the Second Circuit ruled that EPA may consider costs in determining what technology can be “reasonably borne” by the industry and “to engage in cost-effectiveness analysis.”  But the court said that EPA was not allowed to use cost-benefit analysis in determining BTA.  Because it was unclear whether the EPA had considered costs in an unpermissible way, the court remanded the regulations back to the agency.  Riverkeeper, Inc. v. U.S. EPA, 475 F.3d 83 (2^nd Cir. 2007).   Utility petitioners, supported by EPA, are asking the U.S. Supreme Court to rule that the agency can balance costs against benefits in determining BTA.  The case will be decided by the Supreme Court during its 2008-2009 Term.