By: Erik S. Mroz, Drewry Simmons Vornehm, LLP
In previous blog posts, I tried to explain the government’s rulemaking efforts to define (or redefine) “Waters of the United States” (or “WOTUS”) under the federal Clean Water Act. The WOTUS Rule came out last year and was, almost instantly, the subject of lawsuits brought by the states and the regulated community. Those lawsuits are still pending. Recently, the President and the EPA have issued new orders to rescind the WOTUS Rule. I think it is safe to say that the WOTUS Rule is effectively dead.
Federal jurisdiction (i.e., the power of EPA and the Army Corps of Engineers to regulate impacts to surface water) under the Clean Water Act is limited to the vaguely defined concept of “Waters of the United States.” The lack of a clear statutory definition has led to a series of court decisions trying to figure out the limits of federal power under the statute. The U.S. Supreme Court’s most recent attempt was in a case called Rapanos v. United States, 547 U.S. 715 (2006). In a rare 4-1-4 decision, the Court split without a majority opinion. The plurality opinion, written by the late Justice Antonin Scalia, adopted a narrow test that defines “Waters of the United States” to include: “only those relatively permanent, standing or continuously flowing bodies of water ‘forming geographic features’ that are described in ordinary parlance as ‘streams, oceans, rivers and lakes.’” In a concurring opinion, Justice Kennedy adopted a different and broader test that defined “Waters of the United States” as waters that possess “a significant nexus to waters that are navigable-in-fact or that could reasonably be so made.” Chief Justice Roberts, in his concurrence, noted that the issue remained unresolved and all but begged the EPA and the Army Corps of Engineers to come up with a workable definition.
Following Rapanos, lower courts have adopted two approaches in applying a rule defining “Waters of the United States.” The first approach, adopted by Seventh, Ninth and Eleventh Circuits (Indiana is part of the Seventh Circuit) have adopted Justice Kennedy’s test. The First and Eighth Circuits have ruled that jurisdiction can be established under either Justice Kennedy’s test or Justice Scalia’s test. No circuit court has adopted only Justice Scalia’s test.
Without clear guidance from the courts, EPA and the Army Corps of Engineers were left often making decisions on a case-by-case basis. In 2015, EPA and the Army Corps of Engineers published the WOTUS Rule, which was set to go into effect in 2016. According to the agencies, the WOTUS Rule defined “Waters of the United States” consistent with Justice Kenney’s opinion in Rapanos. States as well as members of the regulated community disagreed and argued that the WOTUS Rule impermissibly redefined and expanded federal jurisdiction. As discussed, the WOTUS Rule became the subject of numerous lawsuits in various federal courts. Those cases were consolidated in the Sixth Circuit Court of Appeals. Those lawsuits are still pending but are stayed.
More recently, on February 28, 2017, the President issued an executive order (Presidential Executive Order on Restoring the Rule of Law, Federalism, and Economic Growth by Reviewing the “Waters of the United States” Rule) directing EPA and the Army Corps of Engineers to rescind the WOTUS Rule. The Executive Order also directs the agencies to consider rewriting the WOTUS Rule consistent with Justice Scalia’s opinion in Rapanos, which, as indicated above, has not been adopted by any federal court of appeals. Also, on February 28, 2017, EPA issued a notice of intent to rescind or revise the WOTUS Rule. This begins a long process of rescission, which must go through formal rule-making, and will include a notice-and-comment period. Commenters expect that this process will take at least 18 months. Meanwhile, the test set forth in Justice Kennedy’s opinion in Rapanos will continue to be the standard for federal jurisdiction over projects in the Seventh Circuit, including in Indiana.