SCOTUS won’t hear 9th Cir. NPDES permit case

Resurrection Bay, Seward, Alaska

SCOTUS won’t hear 9th Cir. NPDES permit case

In June, 2015, the United States Supreme Court declined to review the Ninth Circuit Court of Appeals holding in Alaska Comm. Action on Toxics, et al. v. Aurora Energy Services.  The Supreme Court’s denial came after Aurora and the Alaska Railroad Corp. petitioned the Court for review, asking the Court to reverse the Ninth Circuit’s holding that they said improperly narrowed the Clean Water Act’s (“CWA”) permit shield to allow citizen suits over discharges of pollutants not specified in a NPDES permit.

NPDES Permits Under the CWA

By way of background, Section 301(a) of the CWA prohibits the “discharge of any pollutant” from “any point source” into “navigable waters” unless the discharge complies with certain other sections of the CWA.  One of those applicable sections is section 402, which provides for the issuance of National Pollutant Discharge Elimination System (“NPDES”) permits.  In nearly every case, an NPDES permit is required before anyone may lawfully discharge a pollutant from a point source into navigable waters.

If a pollutant discharger has obtained and complied with a NPDES permit, then they are protected by what is known as the permit shield.  The permit shield protects pollutant dischargers from liability under the CWA, even if the Environmental Protection Agency (“EPA”) promulgates more stringent limitations over the life of the NPDES permit.  However, any violation of the permit’s terms constitutes a violation of the CWA.

Pursuant to section 402, there are two types of NPDES permits: individual and general.  An individual NPDES permit authorizes a specific entity to discharge a pollutant in a specific place and is issued after an informal agency adjudication process.  By contrast, a general NPDES permit is issued for an entire class of hypothetical dischargers in a given geographical region and is issued pursuant to administrative rulemaking procedures.

Once a general NPDES permit has been issued, an entity seeking coverage must submit a “notice of intent” to discharge pursuant to the permit.  The date on which coverage commences depends on the terms of the particular general NPDES permit, and, in some cases, the permit issuer may require a potential discharger to apply for an individual permit.

Multi-Sector General Permit for Stormwater Discharges Associated with Industrial Activity

As it relates to the Alaska Comm. Action case, a NPDES permit is required for stormwater discharges associated with industrial activity.  Under current EPA regulations, “stormwater” is defined as “storm water runoff, snow melt runoff, and surface runoff and drainage.”  “Storm water discharge associated with industrial activity” is defined as “the discharge from any conveyance that is used for collecting and conveying storm water and that is directly related to manufacturing, processing or raw materials storage areas at an industrial plant.”

At issue in the Alaska Comm. Action case was the Multi-Sector General Permit for Stormwater Discharges Associated with Industrial Activity, first issued in 1995 and since reissued in 2000 and 2008.  Specifically, the Ninth Circuit was asked to decide whether defendants’ alleged non-stormwater discharge of coal from the Steward Facility’s conveyor system and ship loading area into Resurrection Bay is covered by a general permit.

The Seward Coal Loading Facility is located on the northwest shore of Resurrection Bay in Seward, Alaska.  Defendant Alaska Railroad Corp. purchased the Seward Facility in 2003.  The facility has been operated by Defendant Aurora Energy Services since 2007.  The facility’s purpose is to receive coal by railcar from the Usibelli Coal mine located in close proximity to Healy, Alaska, and to then transfer that coal onto ships for delivery to out-of-state markets.

Plaintiffs’ Three Claims

The plaintiffs in this case claimed that defendants’ improperly discharged coal into the bay in three different ways: (1) coal falls into the Bay, either directly or as coal dust, during the over-water transfer of coal from the stockpiles to the ship holds; (2) coal dust generated at the stockpiles, and other land-based areas of the Facility, migrate to the Bay as airborne dust; and (3) coal-contaminated snow is intentionally plowed into the Bay and into a pond and wetlands north of the facility.

History of the Seward Facility General Permit

In 1984, the EPA issued the facility its original NPDES permit. In 1999, when it came time to renew their NPDES permit, the EPA advised the facility that its discharges could be regulated under either an individual permit or under the NPDES Multi-Sector General Permit for Stormwater Discharges Associated with Industrial Activities.  In 2001, the facility switched from its individual NPDES permit to the general permit.

In 2009, the facility renewed its general permit.  As a precondition to coverage under the general permit, the facility was required to have developed and implemented a Storm Water Pollution Prevention Plan.

In early February 2010, the EPA and the Alaska Department of Environmental Conservation (“DEC”) conducted a site inspection of the Seward Facility.  The purpose of the inspection was to “ensure that water quality standards and permit requirements [were] being met.”  A significant portion of the inspection report focuses on the coal that enters the Bay from the ship loader area and conveyer belt, and the coal dust the Facility generates.  No violations of the General Permit, the Prevention Plan, or water quality standards generally, were reported.  In August 2011, the Facility was inspected again. Again, no violations were reported.

Ninth Circuit Disagrees that Seward Facility Was Not in Violation of NPDES Permitting Requirements

However, in its opinion, the Ninth Circuit disagreed that the facility had not violated the parameters of the general permit, determining that: 1) the plain terms of the general permit prohibited defendants’ non-stormwater discharge of coal; 2) the court’s analysis was controlled by Part of the general permit, which prohibited the discharges; 3) the court would have reached the same conclusion had it employed the permit shield analysis that has been applied to individual permits; and 4) the district court erred in concluding that the general permit shielded defendants from liability for their non-stormwater coal discharges.

According to the Ninth Circuit:

The plain terms of the General Permit prohibit defendants’ non-stormwater discharge of coal. In Part, the General Permit states: “You must eliminate non-stormwater discharges not authorized by an NPDES permit. See Part 1.2.3 for a list of non-stormwater discharges authorized by this permit.” The referenced section (which is actually Part 1.1.3) lists eleven categories of non-stormwater discharge which are “the non-stormwater discharges authorized under this permit.” None of these categories cover defendants’ coal discharge.

The Ninth Circuit rejected the defendants’ arguments that the list contained in Part 1.1.3 was not meant “to circumscribe the universe of authorized non-stormwater discharges.”  There, the court said:

The section cited by defendants, for instance, governs Sector A, pertaining to timber products facilities. The Seward Facility is classified under Sector AD. This sector does not pertain to any particular industry, but rather is a catchall category for “facilities designated by the Director as needing a stormwater permit, and any discharges of stormwater associated with industrial activity that do not meet the description of an industrial activity covered by Sectors A-AC.” Unlike sections governing other sectors, the section governing Sector AD does not specify additional categories of non-stormwater discharge that are authorized or prohibited. With the possible exception of additional monitoring or reporting requirements that may be imposed, Sector AD facilities are governed only by the permit’s general provisions.

In sum, the court concluded, “Defendants’ non-stormwater coal discharges are not on this list, thus they are plainly prohibited.”

Ninth Circuit Would Have Reached Same Conclusion Under “Permit Shield” Analysis

Having determined that the general NPDES permit did not allow defendants’ coal discharges, the court stated that it would have reached the same result as if the court had employed the permit shield analysis used in the context of individual permits.  In the court’s view:

Under that analysis, a permittee is shielded from liability under the CWA if it (1) complies with the permit’s express terms, and (2) discharges pollutants that were disclosed to and within the reasonable contemplation of the permitting authority during the permitting process. Here, the express terms of the General Permit prohibit defendants’ non-stormwater coal discharges, thus defendants would not be shielded from liability. As our outcome would be the same regardless of whether Piney Run’s analysis applies to general permits, we need not decide whether it does.

Following the Ninth Circuit’s decision, the defendants appealed the decision to the United States Supreme Court.  However, as noted at the outset, the Supreme Court declined to hear their case.  The case will now proceed back to the lower district court for further proceedings.

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National WQS updated under EPA final rule

In august 2015, the administrator of the Environmental Protection Agency (“EPA”) signed a final rule updating six significant areas of the federal water quality standards, or WQS for short, regulation, which assists the EPA in implementing the Clean Water Act (“CWA”).  According to the EPA:

The final revisions provide a better-defined pathway for state and authorized tribes to improve water quality, protect high quality waters, increase transparency and enhance opportunities for meaningful public engagement at the state, tribal and local levels.

EPA Final Rule Requires that Every State Adopt WQS

Under the CWA, every state must adopt WQS in order to protect, maintain and improve the quality of the nation’s surface waters.  WQS set forth the parameters for any body of water deemed to be “Waters of the United States” by designating the body of water’s uses, setting water quality criteria to protect those uses, and establishing antidegradation policies to protect high quality waters from degrading pollutants.  Additionally, WQS utilize a process of back calculation procedures known as total maximum daily loads, or wasteload allocations, to form the basis of water quality-based permit limitations that regulate the discharge of pollutants into US waters under the National Pollutant Discharge Elimination System (“NPDES”) permit program.

Prior to the new final rule, the previous WQS regulation had been in place since 1983.  The EPA added tribal provisions to the WQS regulation in 1991, the “Alaska rule” provisions in 2000, and the BEACH Act rule provisions in 2004.

EPA Final Rules Addresses Six Areas Regarding WQS

As initially proposed in 2013, the final rule addresses the following key program areas:

  • the EPA Administrator’s determinations that new or revised water quality standards are necessary
  • designated use for water bodies
  • triennial reviews of state and tribal WQS
  • antidegradation requirements
  • WQS variances
  • Provisions authorizing the use of schedules of compliance for water quality-based effluent limits (“WQBELS”) in NPDES permits

EPA Administrator’s Determinations

As it relates to the first program area, the EPA’s final rule amends the former regulation to add a requirement that an Administrator’s Determination must be signed by the Administrator (or duly authorized delegate) and include a statement that the document is an Administrator’s determination for purposes of section 303(c)(4)(B) of the CWA.  The EPA’s goal in addressing an Administrator’s determination is to allow the EPA and states/tribes to communicate directly and specifically on areas where WQS improvements should be considered and establish a more transparent process for the Administrator to announce determinations under section 303(c)(4)(B) of the CWA.

Desginated Use

The second program area addressed by the final rule relates to designated use for water bodies.  There, the EPA amended the former regulation to provide that where a state/tribe removes or revises a use specified in CWA section 102(a)(2) or a subcategory of such a use that is not attainable, the highest attainable use (“HAU”) shall be adopted in its place.  The final rule also amended the former regulation to clarify when a use attainability analysis (“UAA”) is and is not needed.  The final rules defines the term “non-101(a)(2) use” and amends the former regulation to clarify that for such uses while a UAA is not required, the state/tribe must submit documentation justifying how its consideration of the use and value of water for those uses listed appropriately supports the state/tribal action.  The EPA’s goal in including this amended language in the final rule is to provide clear requirements and ensure appropriate WQS are in place to help restore and maintain robust aquatic ecosystems and promote resilience to emerging water quality stressors.

Triennial Reviews

The third program area addressed by the final rule relates to triennial reviews.  Under that portion of the rule, the EPA amended the former regulation to clarify the “applicable water quality standards” that must be reviewed triennially.  The final rule also requires that if a state/tribe chooses not to adopt new or revised criteria for any parameters for which EPA has published new or updated criteria recommendations under the CWA, then they must explain their decision when reporting the results of their triennial review to the EPA.  The EPA’s goal in requiring states/tribes to explain their decision not to adopt new or revised criteria is to ensure public transparency and clarify existing requirements, so that states/tribes update WQS when necessary and consider the latest science as reflected in the CWA recommendations.


The fourth program area addressed in the EPA’s final rule relates to antidegradation.  The amended regulation now states that states/tribes:

  • may identify high quality waters on either a parameter-by-parameter approach, or on a waterbody-by-waterbody approach that does not exclude water bodies from Tier 2 protection solely because water quality does not exceed levels necessary to support all of the CWA section 101(a)(2) uses. When using the water body approach, states/tribes must involve the public in any decision pertaining to when to provide Tier 2 protection, and the factors considered in such decisions.
  • must evaluate a range of practicable alternatives that would prevent or lessen the degradation associated with the proposed activity. When the analysis of alternative identifies one or more practicable alternatives, the state/tribe must only find that the lowering is necessary if one of those alternatives is selected for implementation.
  • must provide an opportunity for public involvement during the development and any subsequent revisions of antidegradation implementation methods (whether or not those methods are adopted into rule), and to make the methods available to the public.

The EPA’s goal as it relates to the antidegradation amendments is to promote public transparency and enhance antidegradation implementation through clearer requirements and expectations.

WQS Variances

The second to last amendment made to the WQS regulations centers around WQS variances.  The EPA amended the former regulation to add a section that provides a comprehensive regulatory structure for and explicitly authorize the use of WQS variances.  The final rule clarifies:

  • that a WQS variance is a water quality standard subject to EPA review and approval or disapproval.
  • how WQS variances relate to other CWA programs and specifies the information that the state/tribe must adopt in any WQS variance, and/or the water body or waterbody segments to which the WQS variance applies, and a quantifiable expression of the highest attainable condition.
  • that states/tribes must submit to EPA supporting documentation that demonstrates why the WQS variance is needed and justifies the term and interim requirements.
  • that states/tribes must reevaluate WQS variances longer than five years on an established schedule with public involvement.

The goal of the WQS variance amendments is to promote the appropriate use of WQS variances when applicable WQS are not attainable in the near-term but may be attainable in the future, and provide regulatory certainty to states, tribes, the regulated community, stakeholders, and the public in making progress toward attaining designated uses and criteria that protect such uses.

Schedules of Compliance

Finally, the new rule includes provisions authorizing the use of permit-based compliance schedules.  There, the EPA’s final rule adds a section to the former regulation to clarify that a permitting authority may only issue compliance schedules for water quality-based effluent limitations in NPDES permits if the state/tribe has authorized the use of such compliance schedules in their WQS or implementing regulations.  The EPA’s goal in adding this language is to clearly articulate in regulation what must be done for states/tribes to be able to utilize permit compliance schedules, and ensure public transparency on state/tribal decisions to allow permit compliance schedules.

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