The Substance of the Draft EPA “Waters of the US” rule; Clean Water Act

In prior blog posts I’ve explained different aspects of this new draft rule that proposes to re-define the term “navigable waters” in the Clean Water Act.  In this post I will (finally) address the substance of the draft rule, including the challenges presented by the general theory of the rule and the text of the rule. And I am going to try to do this all in layman’s terms, with the occasional wit and sarcasm.

First, a bit of context to help understand the draft rule.  The purpose of the Clean Water Act is to attain or maintain a certain water quality of those waters to which the Act applies, i.e. clean water.  The Clean Water Act establishes several different processes that must be followed when humans do something that affects, or may affect, the clean-ness of water.  For one of these processes, the Clean Water Act makes it illegal for anyone to affect navigable waters without first obtaining a permit from the US Army Corps of Engineers.  These are often referred to as “dredge and fill permits” but don’t let that tag fool you.  Thou shalt not disturb navigable waters without a permit.

A brief word on disturbing water. It’s not limited to what would make water less clean in the common sense.  It includes anything that affects the water-dirt, rock, heat, etc.  And the disturbance can come from practically any activity, from turning a shovel of dirt, or landscaping, or operating a dairy farm or other agricultural business, or oil and gas exploration and drilling activities, fracing, etc.  The Clean Water Act only excludes two things from its coverage even though they may disturb water: agricultural stormwater discharges and return flows from irrigated agriculture.

One of the most vexing questions created by this legislation has always been, and still is, to what waters does it apply?  We’ve always understood that it applies to only surface water (groundwater is not navigable).  And we’ve always understood that it applies to large rivers like the Mighty Mississippi, which is clearly navigable.  But at what point does a water become not navigable waters?  And where, exactly, does a navigable water end and land begin?  These are the questions this new draft rule is intended to answer.

Not surprisingly, the EPA wants to expand the definition of “navigable waters” to the greatest extent possible, by including as “navigable waters” everything the federal government could lawfully regulate under the Commerce Clause of the US Constitution.  And that certainly seems to be the EPA’s intent with this new draft rule.

The Commerce Clause.  Congress has the power to make all laws necessary and proper to regulate commerce among the States and with the Indian Tribes.  The powers not delegated to Congress by this provision are reserved to the States.  Back in the old days the federal power to regulate commerce was limited to interstate commerce-stuff that crossed state lines, like that trailer full of Coors Beer in Smokey and the Bandit.  Regulation of commercial activity that stayed inside one state, intrastate commerce, was reserved to that state.

But over time our federal government successfully argued, over and over, that more commercial activity was actually interstate, or affected interstate commerce, and so today basically all commercial activity is considered interstate commerce which Congress can regulate.  So let’s see how this draft rule proposes to bring all that power to real estate around you and me, because ultimately this new rule is about real estate more than water.

First, suspend your common sense as you interpret this.  The rule is not intended to make common sense, it’s to grab land.  Land, not just water.

The Clean Water Act applies to waters used in interstate or foreign commerce, territorial seas, waters that flow from one state to another (interstate waters), and the wetlands adjacent to all these waters.  Wetlands still means areas inundated or saturated by surface or groundwater at a frequency and duration sufficient to support, and that under normal circumstances do support, a prevalence of vegetation typically adapted for life in saturated soil conditions.  Examples include swamps, marshes, bogs, and such.  So far, so good.  If you see water on land, a red flag appears and you at least know to ask the question.

Now to begin the illogical.  The EPA wants to add all tributaries of all these waters, which practically writes the word “navigable” right out of the statute.  Some tributaries have a bed and banks and an ordinary high water mark which practically directs the flow of water into a navigable water.  But EPA proposes to include as tributaries wetlands, lakes, and ponds even if they lack a bed, a bank, or an ordinary high water mark, if they contribute flow to a navigable water, whether directly or indirectly.  How do lakes and ponds contribute flow to a navigable water?  Seems to me it’s called the hydrological cycle which could, in theory, pull into this definition every lake and pond except those specifically excluded in the Clean Water Act.  Notice there is no requirement that the water actually be capable of moving goods in interstate commerce.

But wait, there’s more.  If something could be a tributary as described above, it does not lose its “qualification” as a tributary if, for any length, there are one or more man-made breaks (such as bridges, culverts, pipes or dams), or one or more natural breaks (wetlands, debris piles, boulder fields, or a stream that flows underground) so long as a bed and banks and an ordinary high water mark can be identified upstream of the break.  The way I read this, altering one of these bridges, culverts, pipes, dams, debris piles, boulder fields, or underground streams in a natural break would affect a “navigable water” and require a permit.  So parts of tributaries don’t actually have to connect to navigable water to be subject to the Clean Water Act.

And yes, there’s still more.  These tributaries can be natural, man-altered, or man-made.  They include waters such as rivers, streams, lakes, ponds, impoundments, canals, and certain ditches.  So now, someone could take dry land not otherwise subject to the Clean Water Act, and cause it to become navigable waters by constructing a stream, lake, pond, canal or ditch.  Can you imagine ever being able to remove a water from Clean Water Act jurisdiction?  Jurisdictional creep.  Addition easy, subtraction not so much.

Tributaries don’t even have to contain water all the time, either.  Many features, like dry arroyos and mountain channels, have beds and banks even though they only flow when it rains or the snow melts.  If you see any dry bed and bank on a piece of land you might want to buy, beware.

Now, for every “water” identified by any of the above criteria, add bordering or contiguous waters.  Next, Fonzi jumps the shark.  You didn’t think he’d already jumped, did you?

The EPA wants to add “neighboring” waters.  Neighboring waters include areas (note that “areas” could be land) bordering waters where surface or subsurface hydrology directly influence the ecological processes and plant and animal community structure (these are termed “riparian areas”).  These riparian areas are transitional areas (i.e. land) between aquatic and terrestrial ecosystems that influence the exchange of energy and materials between those ecosystems.  They don’t have to be connected to surface water-they can be connected to groundwater and thus not be visually adjacent to any surface water whatsoever.  Any chance a normal non-expert human being could visually identify a riparian area?

There’s still more.  Neighboring waters also include areas (again, possibly dry land) bordering inland or coastal waters formed by sediment deposition from such water under present climactic conditions which are inundated during periods of moderate to high water flows.  This is termed “floodplain.”  But in times of drought, which describes most of Texas much of the time, these areas will not be obvious.

All of the waters and land identified so far would be automatically covered by the Clean Water Act and any activity on those waters or land would require a permit.  It is the EPA’s position that they are doing us a favor by clarifying that all these waters and non-water areas (land) are subject to Clean Water Act jurisdiction, which is why I said in a prior post that, in relative terms, they propose to solve a concern over a hangnail by amputating an arm.

So now we come to the case-by-case determinations to further expand the lands and waters covered by this new draft rule.  Waters and wetlands, either alone or in combination with other similarly situated waters in a watershed that drains to the nearest sea, or water used or capable of being used in commerce, or water that flows from one state to another, that significantly affects the chemical, physical, or biological integrity of one of these waters or wetlands, may be covered by the Clean Water Act also.  These areas are not adjacent to a water or wetland but they have a “significant nexus” to already-covered waters, wetlands and areas.  The connection must be more than speculative or insubstantial.  They include waters and wetlands that perform similar functions and are located sufficiently close together or sufficiently close to a navigable water that they can be evaluated as a single landscape unit with regard to their effect on the chemical, physical, or biological integrity of a navigable water.

Put this in the context of enforcement.  You disturb your land (or you hire someone else to).  EPA shows up and claims the land is regulated under the Clean Water Act because some feature of the land has a “significant nexus” to a navigable water located somewhere in the same watershed as your land.  You basically now have to stop working on the land, and file a court action where the EPA has to prove that your land has a significant nexus to a navigable water.  This practically means you have to invest some time and money to disprove the significant nexus.  Experts.  Lawyers.  Time.  Time.  Time.  Appeals perhaps.  EPA does not necessarily have to win, they just have to outlast you.

And in all likelihood you will be fighting this battle with the risk of being fined up to $75,000 per day for every day the land was disturbed without a permit, until you restore the land, until you win the case, making the fine retroactively disappear.  No pressure.

Over a decade in the making, in my opinion the rule, once finalized, will literally redefine the landscape of federal water pollution regulation, impacting laws governing wetlands fill, water discharge permits, oil spill liability, spill contingency planning, hazardous substance spill response, and more.  It will impact municipalities, states, and industry of every type, from natural resource extraction like energy and mining, to construction and development and beyond.

What to do?  Try to change the form of the final rule by filing comments to the draft rule.  Some of the best comments will be your story-how will this rule affect you and your business?  Be as specific as possible.

Work with an association that will file comments to this draft rule.  For example, I work with the Dallas Builders Association.  Share your story with those at the association who are working on this.  It could help them write their comments.

Contact your federal congressmen and senators.  Share with them your story about how this draft rule will affect you.  Ask them to sponsor legislation to rein in the EPA on this rule.  There are already legislative efforts underway.

Contact me with any questions, or if I may be of service, and stay tuned for future developments.

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