On June 29, 2015, the Environmental Protection Agency (“EPA”) and U.S. Army Corps of Engineers (“Corps”) published a final rule defining “waters of the United States.” The rule becomes effective on August 28, 2015.  Because the Clean Water Act (“CWA”) grants regulatory authority only to areas under federal jurisdiction, the new rule will play a central role in determining when and to what extent the Corps and EPA will be involved in land use decisions.  It will affect many industries, including agriculture, energy development and transmission, transportation, and housing.

The agencies promulgated the rule in response to Supreme Court decisions that held certain isolated waters and waters that lack a significant nexus to traditional navigable waters were not jurisdictional under the CWA.  The Corps and EPA had previously tried to clarify the scope of CWA jurisdiction through guidance, but in April of 2014, the agencies proposed new regulations defining the waters of the U.S.  Over a million comments were submitted in the rulemaking process. The final rule, which includes a 75-page preamble, is generally consistent with the proposed rule, but it includes several significant changes intended to provide greater clarity and certainty on the extent of the CWA jurisdiction and to reduce the need for case-specific analysis of waters.  Among the highlights, the final rule:

  • Makes all “tributaries” (as defined) jurisdictional by rule, without the need for a case-specific “significant nexus” analysis;
  • Defines “adjacent” waters, which are jurisdictional by rule, as including all waters within the floodplain of, or within specified distances from the ordinary high water mark (“OHWM”) of, traditional navigable waters, their tributaries, and impoundments;
  • Requires that certain types of waters, including vernal pools in California, be evaluated in combination with other waters of the same type within the watershed when making a significant nexus determination, which will have the practical effect of making all such waters jurisdictional by rule;
  • For waters not jurisdictional by rule, requires the water to be within the floodplain of, or within a certain distance from, a traditional navigable water, impoundment or tributary in order to be potentially subject to jurisdiction under a case-specific significant nexus analysis. Waters outside these limits cannot be jurisdictional—although such waters are likely be rare, at least in the arid West; and
  • Contains “grandfathering” language, in the preamble, that clearly provides the new definition will not apply to approved jurisdictional determinations, or permits, issued before the new rule’s effective date—unless the applicant requests otherwise.

The final rule retains exclusions found in the current regulations and adds several exclusions, according to the agencies, that are intended to codify longstanding practice.  A water falling within an exclusion is not jurisidctional even if it otherwise meets the definition of a waters of the U.S.  The exclusions include:

  • Waste treatment systems, including ponds or lagoons designed to meet the requirements of the CWA (no change);
  • Prior converted cropland (no change);
  • Certain ditches that are not tributaries (new), including:
    • ditches with ephemeral flows that were not excavated in and did not relocate a tributary,
    • ditches with intermittent flow that were not excavated in and did not relocate a tributary or drain a wetland; and
    • ditches that do not flow into a traditional navigable waters, interstate waters, or territorial seas;
  • Certain other features not considered jurisdictional under current practice, including:
    • artificially irrigated areas that would revert to dry land absent irrigation;
    • artificial, constructed lakes and ponds created in dry land, such as cooling ponds, settling ponds, and irrigation ponds and fields flooded for rice growing;
    • water-filled depressions created in dry land incidental to mining or construction activity, including pits excavated for obtaining fill, sand, or gravel and that fill with water;
    • erosional features, including gullies, rills, and ephemeral streams that do not meet the definition of a tributary; and
    • puddles (new);
  • Groundwater, including groundwater drained through subsurface drainage systems (new);
  • Stormwater control features created in dry land and constructed to convey, treat or store stormwater; and
  • Wastewater recycling structures created in dry land and certain related structures.

Most of the exclusions require that the feature have been created in and would revert to “dry land,” with the the burden on the applicant to demonstrate that an exclusion is applicable.

The agencies describe the rule as narrowing the scope of CWA jurisdiction compared to existing regulations, but final rule also expands federal regulatory authority by including many categories of waters as jurisdictional by rule.  The practical implications may be limited, particularly in California where the state already regulates waters falling outside the reach of the CWA.

As indicated by the number of comments on the proposed rule, the agencies’ rulemaking generated considerable interest and opposition from a variety of industry and environmental groups.  Some of those groups are expected to file legal challenges before the rule becomes effective.  Seventeen states filed three separate suits (Case No. 3:15-cv-00162 in the U.S. District Court for the Southern District of Texas; Case No. 3:15-cv-00059 in the U.S. District Court for the District of North Dakota Southeastern Division; and Case No. 2:15-cv-02467 in the U.S. District Court for the Southern District of Ohio Eastern Division) challenging the rule on June 29, 2015, the same day it was published in the Federal Register.  The controversy surrounding the rulemaking is also evident in Congress, where both the House and Senate have taken steps to prevent the agencies from implementing the rule.  Hence the full effect of the rule may be unknown for some time.