USACE jurisdictional determination reviewable

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USACE Jurisdictional Determination Immediately Reviewable

USACE jurisdictional determination reviewable

In an 8-0 decision, the U.S. Supreme Court has ruled that landowners can challenge U.S. Army Corps of Engineers’ (“USACE”) jurisdictional determinations under the Clean Water Act (“CWA”).  In United States Army Corps of Engineers v. Hawkes, the eight-Justice Supreme Court concluded that a jurisdictional determination issued by the USACE under the CWA constitute “final agency action” under the Administrative Procedure Act (“APA”), which means those decisions can be immediately reviewed in court.

USACE Jurisdictional Determination Under the CWA

Hawkes involved a provision of the CWA that requires property owners to obtain a permit from the USACE before discharging dredged or fill material into waters covered by the CWA.  In some instances it is difficult to tell if a certain body of water falls within the CWA’s definition of “waters of the United States.”  As a result, the USACE offers landowners the opportunity to seek “jurisdictional determinations” under the CWA prior to undertaking the arduous permitting process.  According to the USACE, each jurisdictional determination is valid for five years, unless new information surfaces during that timeframe.

Lower District Court Dismisses Landowners’ Case

The plaintiffs/respondents in Hawkes were landowners who mine peat, a substance used to make putting greens flat.  These landowners sought a permit from the USACE to discharge material onto wetlands located on property that the landowners owned and hoped to mine.  In connection with the permitting process, the landowners obtained an approved jurisdictional determination from the USACE, which stated that the property contained “waters of the United States” because its wetlands had a “significant nexus” to the Red River of the North, located approximately 120 miles away.  After exhausting their administrative remedies, the landowners sought review of the approved jurisdictional determination in federal court under the APA.  However, the federal district court dismissed the landowners’ case for want of jurisdiction, holding that the revised jurisdictional determination was not a “final agency action for which there is no other adequate remedy in a court.”

Eighth Circuit Reverses Lower District Court

On appeal at the Eighth Circuit Court of Appeals, the Eighth Circuit reversed the lower court’s decision, holding that the lower court had misapplied the U.S. Supreme Court’s decision in Sackett v. EPA.  In Sackett, the Supreme Court unanimously held that a “compliance order” issued under the act – an order reflecting a determination that a party is violating the act and requiring them to come into compliance – constituted final agency action, even though such orders are only enforced through a subsequent judicial proceeding.

While similar, the case in Hawkes differed from that in Sackett because it involved a different step in the administrative process.  Even still, the two cases centered on the same legal issue: whether the agency determination at issue constituted “final agency action” for purposes of the APA.

U.S. Supreme Court Holds that USACE Jurisdictional Determination is “Final Agency Action” for Purposes of APA

Against the above legal backdrop, the Supreme Court determined that USACE jurisdictional determinations constitute “final agency actions” for purposes of the APA, which means landowners are free to challenge such determinations immediately in court.  The Supreme Court followed a two-prong test for determining APA finality.  Both parties admitted that the first prong was met because a jurisdictional determination marks the consummation of the USACE’s decision-making process.  Thus, the remaining issue before the court was whether the USACE’s jurisdictional determination is an action “by which rights or obligations have been determined, or from which legal consequences will flow.”

In its briefing, the USACE characterized the jurisdictional determination as a form of non-binding advice that carries no legal consequences of its own.  Instead, the USACE argued that a jurisdictional determination only helps the parties understand the existing law.  Conversely, the landowners focused on the practical burdens imposed by the jurisdictional determination, which require that a party receiving an affirmative jurisdictional determination to stop using the property, seek a costly permit, or risk an enforcement action, in their opposition.  Additionally, both parties invited a broader consideration of the holding in Bennett v. Spear, arguing about whether the test described above really requires a two-prong analysis, and about the relevance of pragmatism to the Bennett analysis.

The Supreme Court ultimately concluded that the jurisdictional determination meets both of the Bennett analysis requirement.  In concluding that the jurisdictional requirement had legal consequence, the Supreme Court relied primarily on a Memorandum of Agreement (“MOA”) between the USACE and the Environmental Protection Agency (“EPA”).  While the MOA did not feature prominently in the parties opposing briefs, the Supreme Court took full aim at the MOA during oral argument.  The MOA states that “[f]inal determinations” made pursuant to the MOA “will be binding on the Government and represent the Government’s position in any subsequent Federal action or litigation concerning that final determination.”  By its language, the MOA seems to  establish a liability limit, or safe harbor, for the five-year validity period of a negative JD.  As a result, the MOA likely provides a concrete legal consequence that the case otherwise appears to lack.

However, the USACE argued that the MOA only applies to certain “special cases” defined in the MOA, and not to ordinary cases like the instant case.  During oral argument, Chief Justice Roberts resisted the USACE’s interpretation of the MOA under the MOA’s plain text.  The government’s position was further rejected in the Court’s final opinion.  The concurring opinions also discussed the MOA at length, given the fact that it is quite unusual to hinge a decision on a contested memorandum with little briefing.

Significance of Supreme Court’s Reliance on MOA

The Supreme Court’s reliance on the contested MOA is significant for two reasons.  First, the Court never addressed the possibility of deferring to the USACE’s interpretation of its own MOA.  Some might take the Court’s lack of discussion regarding deference to the USACE as another example of what has been perceived as anti-deference mood in recent Roberts Court opinions.

Second, if the Court’s determination turned solely on the MOA, then the landowners’ victory may be potentially short-lived.  During oral argument, the USACE stated that if it in fact had to lose the case, it preferred that it be via the MOA.  As the USACE’s lawyer explained, ““if the agencies wanted to fix it, they easily could, simply by issuing a new MOA clarifying their view of the – the [jurisdictional determination’s] effect.”

Questions Remain

The question left hanging by the Court’s decision is whether the opinion identifies any legal consequences of the jurisdictional determination beyond the MOA.  The best example that the opinion identifies legal consequences independent of the MOA is the Court’s discussion of the jurisdictional determination’s practical consequences.  There, the Court stated that the jurisdictional determination effectively “warns that if [property owners] discharge pollutants…without obtaining a permit…, they do so at the risk of significant criminal and civil penalties.”  However, does this sort of warning, alone, satisfy Burnett?  The Court’s opinion is unclear on this point.  Furthermore, to the extent the jurisdictional determination’s practical consequences constitute an independently cognizable legal effect, it has made the waters of the finality doctrine much murkier.

Hawkes Decision Already Impacting Other Cases

While the ink was still drying on the Supreme Court’s decision in Hawkes, the U.S. Supreme Court dealt another blow to the CWA.  Less than seven days after the Hawkes decision, the Court granted a Kent Recycling’s petition for rehearing in light of the Court’s ruling in Hawkes. A lower federal court will now have to review Kent Recycling’s case against the backdrop of Hawkes.

In Kent Recycling’s case, Kent Recycling planned on buying wetlands that were exempt from federal control since they were converted into croplands before 1985.  The company planned on turning the land into a waste disposal site, but the Army Corps of Engineers said it couldn’t, citing a recent policy getting rid of the old croplands exemption.  Kent Recycling sued the Corps, but lost in two lower courts, which held the Clean Water Act did not allow people to challenge a federal takeover of privately-owned wetlands until after a lengthy permitting process had been completed.

Hawkes May Open Litigation Floodgate, but USACE Might Have Something to Say About It

The Court’s decision in Hawkes represents a significant victory for landowners and other project proponents, who will now be able to immediately challenge an USACE jurisdictional determination.  Before both the Supreme Court’s and Eighth Circuit’s decisions in Hawkes, the prevailing precedent, Belle Co. v. U.S. Army Corps of Engineers, a Fifth Circuit opinion, reinforced the Army Corps’ view that jurisdictional determinations are not reviewable.

While challenging a USACE jurisdictional determination in court will not be without cost, it is likely that landowners will prefer the cost of litigation to the prohibitive costs associated with obtaining a USACE permit.  As the Supreme Court noted, the average applicant for an individual permit in 2002 spent 788 days and $271,596 to complete the application process.  That cost has likely increased in the intervening years and does not account for the cost of mitigation projects or design changes required as part of the permit.  Discharging without a permit may be an even less attractive option, as the CWA authorizes civil penalties of $37,500 per day and potential additional criminal penalties.

Finally, and perhaps most importantly, the Court’s decision in Hawkes will not doubt result in increased litigation over USACE jurisdictional determinations, whether those challenges come from landowners or the government.  Such challenges could, in turn, lead to further judicial definition of the CWA’s reach. The Supreme Court’s opinion in Hawkes suggests that at least several justices would be willing to revisit the Court’s previous opinions on CWA jurisdiction.

How the USACE will react to the decision is anybody’s guess, but as the USACE argued to the Supreme Court, the CWA does not require the USACE to issue standalone jurisdictional determinations. Thus, the Army Corps could potentially modify the timing of its jurisdictional determinations or even choose to not make them independent of permitting decisions. The Government also noted that it could modify or revoke the memorandum of understanding between the Army Corps and EPA that makes jurisdictional determinations binding on both agencies. If litigation of jurisdictional determinations proves burdensome for the agencies, they may choose to change how the jurisdictional determination process works in some way.

* Photo Cred. scotusblog.com

Copyright 2016


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U.S. Sixth Circuit Court of Appeals

Clean Water Rule Challenges to be heard by Sixth Circuit

Recently we reported on the stay issued by the Sixth Circuit Court of Appeals to the Clean Water Rule.  The Clean Water Rule was challenged by a number of plaintiffs in various federal district courts and circuit courts around the country.  The plaintiffs filed petitions in both the district and circuit courts based upon what they allege is uncertainty about whether the adoption of the Clean Water Rule is within those actions that must be challenged in a U.S. Circuit Court of Appeals.  After issuing a stay of the Clean Water Rule, the Sixth Circuit Court of Appeals ruled in late February that it would hear challenges to the Rule.

The Clean Water Rule and its Challengers

In June 2015, the Environmental Protection Agency (“EPA”) and Army Corps of Engineers (“USACE”) proposed the Clean Water Rule, which redefined what bodies of water qualify as “waters of the United States” under the Clean Water Act (“CWA”).  The Clean Water Rule’s detractors say the Rule improperly gives the EPA and USACE broad new authority under the CWA, and that federal district courts should first hear the case, not the Sixth Circuit.

A central question before the Sixth Circuit has been whether the federal government was correct in asserting that the Clean Water Rule is an “other limitation,” meaning a limitation on the way the EPA regulates certain pollutant discharges, under section 509(b)(1)(E) of the CWA.

Sixth Circuit Holds it has Jurisdiction Over Challenges to Clean Water Rule

In a close 2-1 panel decision, the Sixth Circuit stated that it had jurisdiction to hear the case.  This is true despite the fact that Sixth Circuit Judges Richard Griffin and Damon J. Keith actually found the Clean Water Rule does not fit into that provision’s parameters, saying they would not review the case on that basis.  Even still, Judge Griffin agreed with Judge David W. McKeague that Section 509(b)(1)(F) of the act, which addresses the issuance or denial of permits, grants the Sixth Circuit jurisdiction.

The groups opposing the Sixth Circuit’s review said that section (F) did not justify jurisdiction in the Sixth Circuit because the Clean Water Rule is not an “action” of the EPA administrator “in issuing a permit.”  Judge McKeague disagreed, siding instead with the EPA’s argument that the effect of the Clean Water Rule is to impact permitting requirements, thereby affecting the granting and denying of permits, which the judge said is enough to bring the Clean Water Rule under subsection (F).

Sixth Circuit Relied on National Cotton Decision in Concluding it has Jurisdiction

Judge McKeague and Judge Griffin relied on the Sixth Circuit’s 2009 ruling in National Cotton Council v. EPA in coming to their conclusion.  In National Cotton, numerous groups challenged a rule that exempted from the CWA’s permitting requirements pesticides applied in accordance with federal law.  The environmental groups that challenged the rule argued that jurisdiction lied in federal court, where the groups had filed an action in the Northern District of California.  The Sixth Circuit disagreed, denying the groups’ motion to dismiss.

In denying the motion, the Sixth Circuit concluded that the rule at issue satisfied subsection 509(b)(1)(F).  In relying on two decisions from the Ninth Circuit, the Sixth Circuit found that a rule falls within the purview of subsection (F) if it regulates the underlying permitting procedures, even if it does not amount to the actual denial of the permit.

In his opinion Judge McKeague said, “The National Cotton court noted that this more expansive reading of subsection (F) encompassed even regulations that exempted certain discharges from permitting requirements.”  Judge Griffin said he disagreed with the National Cotton decision, but was nonetheless bound by it.  Judge Keith disagreed that the National Cotton case gave the Sixth Circuit jurisdiction to hear challenges to the Clean Water Rule.

Sixth Circuit’s Jurisdictional Ruling Comes on Heels of Previous Stay of the Clean Water Rule

As noted the Sixth Circuit’s decision regarding its jurisdiction to hear challenges to the Clean Water Rule was preceded by a stay of the Rule.  There, the Sixth Circuit said the petitioners who opposed the Rule had demonstrated “a substantial possibility of success” on the merits of their claims.  The stay order says the rule is stayed “pending further order of the court,” so it appears the stay will remain in effect even after the court’s jurisdictional ruling, which didn’t make any statement that it would be lifted.

The Sixth Circuit’s jurisdictional decision keeps the EPA from having to litigate approximately 20 different cases in federal district court, no doubt a big relief for the EPA.  This is true because the U.S. Panel on Multidistrict Litigation denied the EPA’s request to have the cases centralized in one court on the grounds that the disputes are based on administrative record and require very little discovery.

Similar Case in the Eleventh Circuit Waited to Hear What Sixth Circuit had to Say

While the Sixth Circuit has determined that it has jurisdiction over challenges to the Clean Water Rule, there is another similar case pending in the Eleventh Circuit in which Florida and 10 other states, including Utah, are seeking to overturn a Georgia district judge’s finding that an appeals court is the proper venue for their challenge to the Clean Water Rule.  In Georgia v. McCarthy, the states argued that federal district courts are the proper place to challenge the Clean Water Rule.  The Eleventh Circuit postponed oral arguments in the case pending a ruling from the Sixth Circuit.

Since the Sixth Circuit has ruled that they had jurisdiction, it is likely the Eleventh Circuit will rule it has jurisdiction as well.  However, this does not mean the end for the battle over the Clean Water Rule.  In fact, it would appear that the fight is just beginning.  Yet, if the Sixth Circuit’s hint in issuing its stay is correct, namely that the petitioners had shown a possibility of success on the merits, then the Clean Water Rule may be in jeopardy.

Contact C/J’s Water Law Team Today

We will continue to follow this case, and will provide any updates as they become available.  If you or someone you know may be impacted by the Clean Water Rule, its stay, any future litigation, or if you have other water law related issues, please contact our water law team for a consultation.

* Photo Cred.: the newcivilrightsmovement.com


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USACE Section 404 Permit

Section 404 violation undisclosed in Favero

Section 404 of the Clean Water Act (“CWA”) sets forth a program to regulate the discharge of dredged or fill material into the waters of the United States (“WOTUS”), including wetlands.  Section 404 regulates a number of activities in the WOTUS, including fill development, water resource projects (such as dams and levees), infrastructure development (such as highways and airports) and mining projects.  Before dredged or fill material may be discharged into the WOTUS a permit must be obtained, unless the activity is exempt from Section 404 regulation.

Premise of the Section 404 Program

The Environmental Protection Agency (“EPA”) has said, “The basic premise of the program is that no discharge of dredged or fill material may be permitted if: (1) a practicable alternative exists that is less damaging to the aquatic environment or (2) the nation’s waters would be significantly degraded.”  This means that when a permit is applied for, the applicant “must first show that steps have been taken to avoid impact to wetlands, streams and other aquatic resources; that potential impacts have been minimized; and that compensation will be provided for all remaining unavoidable impacts,” the EPA has said.

Any proposed activities are regulated through a permit review process.  The EPA sets forth that “[a]n individual permit is required for significant impacts,” and that “[i]ndividual permits are reviewed by the U.S. Army Corps of Engineers [“USACE”], which evaluates applications under a public interest review, as well as the environmental criteria set forth in the CWA Section 404(b)(1) Guidelines.”

General Permit Process

The EPA has iterated that for most discharges of dredged or fill material that will only have “minimal adverse effects,” a “general permit” may suffice.  Those general permits are “issued on a nationwide, regional, or state basis for particular categories of activities.”  By way of the general permit process, individual review is limited while at the same time certain activities are allowed to proceed with little to no delay, so long as “the general or specific conditions for the general permit are met.”  For example, minor road activities, utility line backfill, and bedding are activities that can be considered for a general permit. States also have a role in Section 404 decisions, through State program general permitswater quality certification, or program assumption.”

Favero Farms, LC v. Baugh

A recent case from the Utah Court of Appeals underscores the importance of the Section 404 permit process and what can happen to a seller or land that fails to obtain such a permit and/or fails to disclose a Section 404 violation to a buyer.  In Favero Farms, LC v. Baugh, the Utah Court of Appeals affirmed the lower district’s determination that the sellers had breached their contract with the buyer, as well as breached the covenant against encumbrances and the implied covenant of good faith and fair dealing.

The property at issue in Favero was approximately 20 acres of land in Weber County, Utah.  The sellers met with a wetlands consultant in 2004 who told the sellers that their property contained wetlands, and, as a result, the sellers needed to obtain a permit from the USACE before they could use fill dirt on their property.  However, even though the sellers had already placed some fill dirt on the property prior to that time, and placed additional fill dirt on the property after they met with the wetlands consultant, they never obtained a Section 404 permit for any of the fill dirt.

In 2005, a representative from the USACE inspected the sellers’ property and advised them that the fill dirt on their property constituted a Section 404 violation.  The USACE representative instructed the sellers to remove the fill dirt from their property and to install a silt fence up against the wetlands.  Again, the sellers failed to comply.

In August 2009, the sellers sold the property.  The real estate purchase contract (“REPC”) between the parties required the sellers to disclose “conditions known to [the sellers] relating to environmental problems and building or zoning code violations.”  Pursuant to the REPC, the buyer had a right to object to the disclosures or cancel the contract if it did not acquiesce to what was revealed by the disclosures.  Even still, the sellers never delivered any disclosures to the buyer and never informed the buyer of the existence of the wetlands or the wetlands violation.

After the sale of the property closed, the buyer became aware of the Section 404 violation and learned that it could not use the property for agricultural purposes “without extensive work and repairs” and that it would need to restore or relocate the wetlands in order to comply with federal requirements.  Accordingly, the buyer sued the sellers alleging  breach of contract, breach of the covenants in the warranty deed, breach of the covenant of good faith and fair dealing, negligence, and fraudulent misrepresentation.  Following a bench trial, the trial court dismissed the buyer’s negligence and fraudulent misrepresentation claims but granted judgment in favor of the buyer on its other three claims.  The lower district court awarded the buyer  awarded damages in the amount of $200,000 based on testimony that it would “cost between $197,850 and $287,850 to restore or mitigate the damages to the wetland property.”  The court also ordered that the sellers pay the buyer’s attorney fees in the amount of $32,853.63, based on the provisions of the REPC.  The sellers subsequently appealed.

Warranties Made by Sellers in REPC Survived Closing

On appeal, the sellers made several arguments, which the Utah Court of Appeals roundly rejected.  First, the sellers argued that the buyer’s representation in the Escrow Instructions that it accepted the property “in its present condition” amounted to an as-is acceptance that the property would be delivered in “generally accepted agricultural condition.”  The Court of Appeals disagreed.

There, the Court of Appeals concluded:

Because the Escrow Instructions indicated that warrants made in the REPC would survive closing if not specifically deleted, the “generally accepted agricultural condition” promised by the [the sellers] was part of the “present condition” in which [the buyer] believed it was accepting the property.  Thus, the trial court did not err in concluding that the [sellers] breached the REPC and the Escrow Instructions by failing to deliver the property in generally accepted agricultural condition.

Sellers Violated Covenant Against Encumbrances by Failing to Disclose Section 404 Violation

Second, the sellers argued that the trial court erred in determining that their failure to disclose the wetlands violation constituted a breach of the warranty deed’s covenant against encumbrances.  Again, the Court of Appeals rejected the sellers’ arguments, concluding:

The [sellers] were aware of the wetlands violation and, in fact, committed it themselves. Furthermore, the Army Corps of Engineers had informed the [sellers] that their improvements violated the wetlands restrictions and had ordered them to remove the fill dirt and construct a silt fence.  Because the [sellers] were aware of the wetlands violation and the Army Corps of Engineers had taken action to compel compliance with the wetlands regulations prior to the time the warranty deed was conveyed, the violation is an “interest in a third person” that “constitutes a burden or limitation upon the rights of the fee title holder.”  Accordingly, the trial court did not err in concluding that the [sellers] had breached the covenant against encumbrances by conveying the property without disclosing the existence of the wetlands violation.

Sellers Violated Implied Covenant of Good Faith and Fair Dealing by Failing to Disclose Section 404 Violation

Finally, the sellers challenged the trial court’s determination that they breached the implied covenant of good faith and fair dealing by failing to disclose the wetlands violation.  The Court of Appeals determined:

The trial court’s findings support its determination that the [sellers] breached the covenant of good faith and fair dealing.  By failing to make the disclosures, the [sellers] misled [the buyer] concerning the existence of environmental problems on the property and thereby deprived it of the opportunity to object or cancel the contract in accordance with its rights under the REPC.  Thus, the trial court did not clearly err in concluding that the [sellers] breached the covenant of good faith and fair dealing by failing to disclose the existence of the wetlands violation.

Buyers Entitled to Attorney Fees Under REPC

Having determined the substantive issues on appeal, the Court of Appeals turned to the issue of attorney fees.  There, the Court of Appeals upheld the district court’s attorney fee award, which was made pursuant to the explicit language of the REPC that provided that  “[i]n the event of litigation . . . to enforce [the REPC], the prevailing party shall be entitled to costs and reasonable attorney fees.”

* Photo Cred.: ebay.com


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2016 EPA Water Law

EPA issues final Clean Water Rule, but Sixth Circuit stays rule pending further determination

EPA Water Rule 2016In the spring of 2015, the Environmental Protection Agency (“EPA”) and the U.S. Army Corps of Engineers (“USACE”) released the final Clean Water Rule in order “to clearly protect from pollution and degredation the streams and wetlands that form the foundation of the nation’s water resources.”  According to the EPA’s news release:

The rule ensures that waters protected under the Clean Water Act are more precisely defined and predictably determined, making permitting less costly, easier, and faster for businesses and industry. The rule is grounded in law and the latest science, and is shaped by public input. The rule does not create any new permitting requirements for agriculture and maintains all previous exemptions and exclusions.

Up and until the EPA and the USACE acted to pass the final Clean Water Rule, “[p]rotection for many of the nation’s streams and wetlands [had] been confusing, complex, and time consuming as the result of Supreme Court decisions in 2001 and 2006.”  Accordingly, the EPA and USACE took action to release the final Clean Water Rule “to provide clarity on protections under the Clean Water Act after receiving requests for over a decade from members of Congress, state and local officials, industry, agriculture, environmental groups, scientists, and the public for a rulemaking.”

At the outset, it is very important to understand what the new Clean Water Rule does and does not do.  First, the rule clearly defines and protects tributaries that impact the health of downstream waters.  “The rule says that a tributary must show physical features of flowing water – a bed, bank, and ordinary high water mark – to warrant protection,” and “[t]he rule provides protection for headwaters that have these features and science shows can have a significant connection to downstream waters.”

Second, the rule provides certainty in how far safeguards extend to nearby waters.  “The rule protects waters that are next to rivers and lakes and their tributaries because science shows that they impact downstream waters,” and “[t]he rule sets boundaries on covering nearby waters for the first time that are physical and measurable.”

Third, the rule provides protection for the nation’s regional water treasures.  Specifically, “[t]he rule protects prairie potholes, Carolian and Delmarva bays, pocosins, western vernal pools in California, and Texas coastal prairie wetlands when they impact downstream waters.”

Fourth, the rule focuses on streams, not ditches.  “The rule limits protection to ditches that are constructed out of streams or function like streams an can carry pollution downstream.”  Thus, ditches that are not constructed in streams and only flow after a rainstorm are not protected under the rule.

Fifth, the rule maintains the status of waters within Municipal Separate Storm Sewer Systems and encourages the use of green infrastructure.  Finally, the rule reduces the use of case specific analysis of waters.  Before the release of the new rule, “almost any water could be put through a lengthy case-specific, even if it would not be subject to the Clean Water Act.”  Now, “[t]he rule significantly limits the use of case-specific analysis by creating clarity and certainty on protected waters and limiting the number of similarly situated water features.”

In terms of what the Clean Water Rule does not do, the EPA and the U.S. Army corps of Engineers has said the rule does not: 1) protect any types of waters that have not historically been covered by the Clean Water Act; 2) add any new requirements for agriculture; 3) interfere with or change private property rights; 4) regulate most ditches; 5) change policy on irrigation or water transfers; 6) address land use; 7) cover erosional features such as gullies, rills and non-wetland swales; and 8) include groundwater, shallow subsurface flow and tile drains.

As it relates specifically to agriculture, “[t]he final rules recognizes the vital role that U.S. agriculture serves in providing food, fuel, and fiber at home and around the world.”  As a result, “[a]ctivites like planting, harvesting, and moving livestock have long been exempt from Clean Water Act regulation, and the Clean Water Rule doesn’t change that.”  Instead, “[t]he Clean Water Rules provides greater clarity and certainty to farmer and does not add economic burden on agriculture.”

Following the release of the Clean Water Rule, the EPA Administrator Gina McCArthy and the Army (Civil Works) issued a joint memorandum to their respective staffs instructing the agencies to work together to improve implementation of the national Clean Water Act section 404 program.  The joint memorandum was issued to help “improve transparency, strengthen the coordination processes between the agencies, increase public participation, promote the use of the best available science and technical data for making case-specific significant nexus determinations, and promote public health and environmental protection for all Americans who depend on reliable and abundant sources of clean water.”

However, in October 2015, the Sixth Circuit Court of Appeals issued a stay of the Clean Water Rule nationwide, until federal courts could review the rule.  Eighteen states have challenged the validity of the Clean Water Rule.  These states contend that the rule expands the agencies’ regulatory jurisdiction and alters the balance of federal/state collaboration.  Furthermore, the states argue that the rule, which seeks to define “significant nexus to navigable waters,” is inconsistent with the law as defined by the United States Supreme Court. In response, the EPA contends that the states did not make a requisite showing to justify a stay.

The Sixth Circuit ultimately concluded that the states had demonstrated a substantial possibility of success on the merits of their claims.  The states took issue with the way the rule was promulgated administratively.  Initially, the proposed Clean Water Rule did not include distance limitations in its treatment of “adjacent waters,” and waters having a “significant nexus,” as was provided in the final rule.  Therefore, the proposed Clean Water Rule was not a logical outgrowth of the final rule, as required by 5 U.S.C. §553.  Second, the Sixth Circuit concluded that the irreparable harm factor was not determinative for each side.  Neither the states would be harmed by the rules continued application, nor was there any indication that the nation’s waters would be harmed without it.  Finally, and more importantly, the Sixth Circuit noted the nationwide burden on private parties and government bodies—state and federal—implicated by the Clean Water Rule’s effective redrawing of jurisdictional lines.

Then, in January 2016, President Obama vetoed Joint Resolution 22, a congressional resolution that would have overturned the EPA’s Clean Water Rule.  Thus, for now, the Sixth Circuit’s stay remains in force pending a determination regarding the Sixth Circuit’s jurisdiction over challenges to the rule.   Currently, the U.S. Supreme Court in, United States Army Corps of Engineers v. Hawkes Co., Inc., is set to determine whether the United States Army Corps of Engineers’ determination that the property at issue contains “waters of the United States” protected by the Clean Water Act, constitutes “final agency action for which there is no other adequate remedy in a court,” and is therefore subject to judicial review under the Administrative Procedure Act.