On January 9, 2001, the United States Supreme Court issued a watershed decision limiting the jurisdiction of the United States Environmental Protection Agency (EPA) and the United States Army Corps of Engineers (Corps) under the Clean Water Act (CWA), 33 U.S.C. §1251, et seq. In a 5-4 ruling written by Chief Justice William Rehnquist, the
Court held the Corps exceeded its authority granted under §404(a) of the CWA. The Court’s decision in Solid Waste Agency of Northern Cook County v. United States Army Corps of Engineers, et al., 531 U.S. ____, (2001) (SWANCC), is sure to raise many new issues. It is already being hailed as a return to reasonableness by those whose business involves developing land that has open water and wetlands, and condemned as a major setback by protectionists.
A brief history of the underlying facts in this case will be helpful in understanding the importance of the Court’s decision. In the mid-1980s, a consortium of 23 suburban Chicago communities purchased a 533-acre parcel for the purpose of locating and developing a disposal site for baled non-hazardous solid waste. The long abandoned sand-and-gravel-pit mining site, with its remnant excavation pits and trenches, eventually succeeded into woods and a number of permanent and seasonal ponds ranging in size from one-tenth acre to several acres, and in depth from several inches to several feet. The Corps, after having been contacted by SWANCC to determine whether a §404(a) permit was required to fill in the ponds, originally declined jurisdiction because the site lacked "wet-lands." However, after the Illinois Nature Preserves Commission notified the Corps that a number of migratory bird species had been observed at the site, the Corps reconsidered its decision and, pursuant to Subpart (b) of the Migratory Bird Rule (MBR), asserted §404(a) jurisdiction to "intrastate waters … (w)hich are or would be used as habitat by other migratory birds which cross state lines…" (51 Fed. Reg. 41217).
In 1987, the Corps denied SWANCC’s permit application, based upon the MBR and the Corps’ position that the gravel-mining depressions, "while not wetlands," qualified as "waters of the United States" since the proposed site had been abandoned as a gravel mining site and the water areas and spoil piles had developed a "natural character." The Corps rejected SWANCC’s proposal to mitigate for lost wetlands and preserve a great blue heron rookery. The site also received the necessary local and state approvals, including the Illinois Environmental Protection Agency’s water quality certification pursuant to §401 of the CWA. The petitioner filed suit and after the Seventh Circuit Court of Appeals upheld the lower court’s decision in favor of the Corps, appealed to the Supreme Court.
The Supreme Court reversed the Seventh Circuit and held specifically that 33 CFR §328.3(a)(3), as clarified and applied to the petitioner’s site pursuant to the MBR, exceeds the authority granted to the Corps under §404(a) of the CWA. It appears the Corps’ jurisdiction is now limited to navigable waters, and tributaries and wetlands adjacent thereto.
In a strongly worded dissent authored by Justice Stevens, it is clear the minority believes the decision undoes much of the Court’s earlier decision in United States v. Riverside Bayview Homes, Inc., 474 U.S. 121 (1985). Riverside Bayview held that the Corps had §404(a) jurisdiction over wetlands that actually abutted on a navigable waterway. At first glance, the Court’s decision in SWANCC appears at odds with its earlier decision in Riverside Bayview. In Riverside Bayview the Court found that Congress intended to regulate at least some waters that would not be deemed navigable under the classical definition of that term. But the Court relied on what it called Congress’ unequivocal acquiescence to, and approval of, the Corps’ regulations interpreting the CWA to include wetlands adjacent to navigable waters. In the instant case, however, the Court held that the Corps failed to make the necessary showing that Congress’ failure to pass legislation demonstrated acquiescence to the 1977 regulations or the 1986 MBR. The determining factor in Riverside Bayview was the significant nexus between the wetlands and "navigable waters." As the Court noted in SWANCC, however, it specifically expressed "no opinion" in Riverside Bayview "on the question of the authority of the Corps to regulate discharges of fill material into wetlands that are not adjacent to bodies of open water…" (emphasis supplied).
Whatever the reasoning of the Court, several long-term legal ramifications are still to be determined. The spectrum of what is navigable is still not certain, although the majority opinion and the dissent both offer some guidance. The impact of this case not only affects wetlands, but it extends to include open waters, such as ponds.
The traditional definition of "navigable" includes those waters used, or which by reasonable improvement could be used, as a means to transport interstate or foreign commerce. In the Riverside Bayview case, the wetland, though not hydrologically connected, was near enough to impact navigable waters by occasional surface runoff. In SWANCC the ponds were isolated and to include them within the §404(a) definition of "navigable waters" only because they serve as habitat for migratory birds would require that the term "navigable" has no independent significance.
33 CFR §330.2(e) defines "isolated waters" as those waters not part of a surface tributary system to interstate or navigable waters of the United States or are not adjacent to such tributary water bodies. The term "adjacent" means bordering, contiguous, or neighboring. At least with respect to wetlands, the term includes those which are separated from other waters of the United States by manmade dikes or barriers, natural river berms, beach dunes, and the like. 33 CFR §328.3(c). It would stand to reason that the same definition would apply to open bodies of water. Similarly, the Corps has set out its definition of "navigable waters of the United States" in 33 CFR §329.The Corps claims jurisdiction if it can establish the waters are presently used, or have been used in the past, or may be susceptible for use, to transport interstate or foreign commerce. Accordingly, an artificial channel may constitute a navigable water. Likewise, canals which connect two navigable waters of the United States or are open to navigable waters on only one end are considered navigable themselves.
In light of SWANCC, the Corps will likely look for distinctions that allow it to continue to regulate as many wetlands and bodies of water as possible. The definitions of "isolated" and "navigable" will become the new battleground. It is also fairly certain there will be calls for Congress to expand the authority granted under the CWA. Congress may think twice, however, given the Court’s statement that federal jurisdiction over ponds and mudflats falling within the MBR would "result in a significant impingement of the States’ traditional and primary power over land and water use." Some states may rush in to fill the void, although this will take time. Other states already have regulations in place, or proposed, to address isolated intrastate waters and will be under greater pressure from environmental groups to enforce or adopt such regulations.
As in the past, it is likely the Corps will issue a memorandum providing its own interpretation of the limits set by the Court. The Buffalo District has stated it is consulting with the United States Department of Justice and the EPA in an effort to reach an agreement on how the Executive Branch will implement the decision. Interestingly, one Corps District regulator has notified an applicant that its project no longer requires authorization from the Corps. The letter cites SWANCC and notes that it results in a "major change in the Corps Regulatory program." The letter further offers its interpretation that "The Court determined that isolated wetlands, that is, wetlands with no direct surface connection to a navigable waterway, are not Waters of the United States, nor are secondary tributaries, isolated ponds or lakes" (emphasis supplied). Nonetheless, the prudent developer will in each case carefully analyze and document his or her own particular fact circumstances.
On January 19, 2001, the Corps and the EPA withdrew the "Wilson Guidance." The Guidance was issued May 28, 1998, in response to United States v. Wilson, 133 F. 3d 251 (4th Cir. 1997), and provided specific guidance applicable within the Fourth Circuit states regarding §404 jurisdiction over isolated water bodies based on use by migratory birds. The Wilson Guidance was withdrawn "in light of the recent Supreme Court Ruling" in SWANCC. Under the Guidance, the EPA and the Corps continued to assert jurisdiction over any and all isolated water bodies where (1) either agency could establish an actual link between that water body and interstate or foreign commerce and (2) individually and/or in the aggregate, the use, degradation or destruction of isolated waters with such a link would have a substantial effect on interstate or foreign commerce. With SWANCC it appears their rationale for continuing to assert jurisdiction over isolated waters within or outside of the Fourth Circuit states has been eliminated.
There are clearly situations where the decision of the Court will have an immediate impact, e.g., a small isolated manmade pond that is the result of a former mining operation. Even in these cases, however, it will be important to document the location of any nearby navigable water, the history of the site and similar facts. Some practitioners may feel it prudent to advise clients to at least notify the Corps to seek a "no jurisdiction" prior to discharging fill into isolated waters. Again, this decision will be dependent somewhat on both the fact circumstances and the particular client’s level of risk acceptance or avoidance. In addition, the impact this decision will have on farmers remains to be determined. Agricultural programs that promote the preservation of wetlands in return for subsidies are likely not affected, although further analysis into specific programs will have to be made before a final determination can be rendered. Finally there will be questions regarding previously issued §404 permits authorizing discharges into isolated waters. The Wilson Guidance set forth the EPA and Corps position that they were not required to modify previously issued permits or to delete permit conditions requiring compensatory mitigation for activities in isolated water bodies, or to delete other permit conditions relating to such water bodies. However, there is a strong argument that previously issued permit conditions are no longer applicable.
On January 22, 2001, the EPA’ s General Counsel and the Corps’ Chief Counsel issued a joint legal interpretation of the SWANCC decision. In a 10-page memorandum, the EPA and Corps lawyers relied principally on the Riverside Bayview case for the authority to assert CWA jurisdiction over "inter alia, all of the traditional navigable waters, all interstate waters, and all tributaries… upstream to the highest reaches of the tributary systems .…" While admitting that SWANCC provides an "important new limitation on how and in what circumstances the EPA and the Corps can assert regulatory authority under the CWA," the memorandum takes great pain to limit the decision to the MBR, arguing the Court did not specifically address "what other connections with interstate commerce might support the assertion of CWA jurisdiction "over isolated waters under §328.3(a)(3)." Whether the Court specifically struck down §328.3(a)(3) or not, the EPA and the Corps will have a difficult time escaping the reality that non-navigable, isolated [and] intrastate waters are outside their jurisdiction. As of this writing, the Corps has yet to issue any formal guidance. That task may be left to each individual District Office.
Peter Racher spoke on "Complying with Environmental and Special Use Regulations" at a National Business Institute seminar on "Land Use Law Update in Indiana" on February 13 in Indianapolis. Attending the seminar were business, real estate and environmental law practitioners, developers, engineers, industry managers, and local zoning/land use officials.
Donna Marron and Peter Racher participated in a mock trial presented to the Indiana Arborists Association in Indianapolis on January 21. The case, Whitford v. Chuck’s Vegetation Control Services, was about herbicide overspray. Peter served as the judge and Donna was the defendant’s counsel.
The content of this article does not constitute legal advice and should not be relied on in that way. Specific advice should be sought about your specific circumstances.
