The 2001 Tulloch Rule: New and Revised?

January 9, 2001, was a significant date for property containing wetlands. On the same day the U.S. Supreme Court issued its ruling in SWANCC, (see PSRB Newsletter, February 2001), the U.S. Environmental Protection Agency ("EPA") promulgated a final rule which revised the regulatory definition of "discharge of dredged fill material." The new rule, which refines a prior rule originally issued in 1993 and is commonly referred to as the "Tulloch Rule," is intended to close a "loophole" in the Clean Water Act ("CWA") created in part by earlier court decisions interpreting the rule. The new rule was originally scheduled to take effect February 16, 2001; however, on the day President George W. Bush was sworn into office, his Chief of Staff issued a Memorandum regarding new and pending regulations. The "Memorandum for the Heads and Acting Heads of Executive Departments and Agencies" required regulations that had been published in the Federal Register, but which had not yet taken effect, to be temporarily postponed for 60 days until the new department or agency head appointed by the President reviewed and approved the regulatory action. Consequently, implementation of the new Tulloch Rule was put on hold. On April 16, 2001, EPA Administrator Christie Whitman announced that the administration was endorsing the rule and making it effective April 17, 2001.

In 1993, the EPA and the U.S. Army Corps of Engineers (Corps) defined "discharge of dredged material" to include "any addition, including any redeposit, of dredged material, including excavated material, into waters of the U.S. which is incidental to any activity, including mechanized land-clearing, ditching, channelization, or other excavation that destroys or degrades waters of the U.S." 58 F.R. 45008 (August 25, 1993). This definition greatly expanded the activities that required a permit under §404 of the CWA for the discharge of dredged material into waters of the United States. The U.S. District Court for the District of Columbia invalidated the rule for exceeding the authority of the EPA and the Corps under the CWA. American Mining Congress v. United States Army Corps of Engineers, 951 F.Supp. 267 (D.D.C. 1997) (AMC); aff’d sub nom, National Mining Association v. United States Army Corps of Engineers, 145 F.3d 1399 (D.C.Cir. 1998) ("NMA"). The court found that EPA and the Corps lacked authority under the CWA to regulate such activities if conducted so as to result in only "incidental fallback." The court de-fined this phrase to mean excavated material that falls back to substantially the same place as the initial removal. In an effort to respond to the NMA court’s decision and to clarify what activities are regulated by §404 of the CWA, the EPA and the Corps promulgated the new definition of "discharge of dredged material" in addition to defining activities that merely result in "incidental fallback."

The EPA acknowledged in the preamble to the new rule that developers and landowners have been unsure as to whether their activities have required permits. In revising the definition of "discharge of dredged material," the EPA and the Corps state that their intention is to further wetland protection while providing more certainty in this respect.

The EPA and Corps have now adopted the following definition for the "discharge of dredged material": (2)(i) The Corps and EPA regard the use of mechanized earth-moving equipment to conduct land-clearing, ditching, channelization, in-stream mining or other earth-moving activity in waters of the United States as resulting in a discharge of dredged material unless project-specific evidence shows that the activity results in only incidental fallback. This paragraph (i) does not and is not intended to shift any burden in any administrative or judicial proceeding under the CWA. 33 CFR §323.2(d)(2)(i) (Corps Regulation) and 40 CFR §232.2(2)(i) (EPA Regulation).

Moreover, after numerous comments to the proposed rule requesting a definition of what constitutes non-regulable incidental fallback, the EPA and Corps have adopted language consistent with the NMA opinion to develop the following definition: (ii) Incidental fallback is the redeposit of small volumes of dredged material that is incidental to excavation activity in waters of the United States when such material falls back to substantially the same place as the initial removal. Examples of incidental fall-back include soil that is disturbed when dirt is shoveled and the back-spill that comes off a bucket when such small volume of soil or dirt falls into substantially the same place from which it was initially removed. 33 CFR §323.2(d) (2)(ii) (Corps Regulation) and 40 CFR §232.2(2)(ii) (EPA Regulation)

The new rule reflects the agencies’ opinion that the inherent purpose of using mechanized earth-moving equipment is to move large portions of earth that is likely to result in more than just incidental fallback. From a practical perspective, the rule puts the burden on the owner to provide site-specific evidence that its activities are in fact resulting in only incidental fallback. The EPA and the Corps will rely, however, not only on evidence provided by the project proponent but on other evidence as well. For instance, evidence may also come from sources such as agency files or site-visits. The agencies believe that this approach should give more guidance to developers while still offering the flexibility of case-by-case evaluations. In reality, the burden of providing site specific evidence that the redeposit of dredged material is only incidental fallback will be all the more difficult since evidence provided by the project proponent will now be weighed with that of the agency making the determination.

Although the new rule proposes not to regulate activities that only generate "incidental fallback," many activities that might seem to constitute only a limited discharge will be regulated. When deciding whether an activity involves a regulated discharge or just incidental fallback, the agencies will look at whether material is displaced vertically or horizon-tally, in addition to the volume or amount of displaced material. Thus, even if material is not removed from a wetland or stream, but it is disturbed so that currents may move the material and redeposit it elsewhere within the wetland or stream, the activity may be considered a regulated discharge. 66 F.R. 4550, 4553. Part of the rationale for this position is that the agencies argue pollutants such as heavy metals and PCBs are often sequestered in sediments and may be released by disturbing the sediments. 66 F.R. 4550, 4565.

The new rule is not an "effects based" test. That is, the agencies will look at the actual mechanics of activities, not the results of such activities in deciding whether a permit is required under §404 of the CWA. Therefore, some activities that cause only incidental fallback, but have significant adverse environmental effects, will not be regulated, while other activities having very little environmental impact may be regulated discharges. Even desirable activities like flood control or wetland restoration may require a permit under §404.

The preamble to the new rule provides some specific guidance as to what types of excavation activities would result in only incidental fallback. For instance, suction dredging operations, where the excavated material is pumped to an up-land location or other container outside waters of the U.S. and does not cause re-suspending and relocation sediment downstream, would meet the incidental fallback criteria. So does discing, harrowing, and harvesting where soil is stirred, cut, or turned over to prepare for planting of crops, since these practices involve only minor redistribution of soil, rock, sand, or other surface materials. In addition, the use of K-G blades and other forms of vegetation cutting such as bush hogging or mowing that cut vegetation above the soil line do not involve a discharge of dredged material. 66 F.R. 4550. 4554.

So what, in the opinion of the EPA and the Corps, is the difference between the 1993 Tulloch Rule and the 2001 Tulloch Rule? The 2001 rule explicitly and repeatedly excludes incidental fall-back from the definition of "discharge of dredged material." The new rule also provides a descriptive definition of incidental fallback and explicitly indicates that project-specific evidence may be used to show that only incidental fallback will result from the activity. These provisions are a direct response to the NMA decision according to the agencies and the fact that the 1993 rule included any redeposit, including incidental fallback.

Legal challenges to the new Tulloch Rule have been brought by several organizations, including the National Stone, Sand and Gravel Association and the National Association of Homebuilders. In response to concerns that the Bush Administration may enter into a settlement of the suit, two environmental groups have sought to intervene. The federal government has been given an extension of time to file its response until May 25, 2001.

It would appear that the EPA and Corps have issued the new Tulloch Rule in as narrow a manner as possible, with-out giving much heed to the rationale of the court in NMA. It remains to be seen whether the courts will again rein in the agencies or will accept the new rule. Perhaps the present administration can forge a compromise with industry groups that more accurately reflects the NMA decision, while still placating the environmentalists. If not, the EPA and the Corps will continue to litigate over this issue for some time.

NOTE: On a related matter, the U.S. Court of Appeals for the Fifth Circuit issued an opinion on April 25, 2001, holding that the EPA does not have authority under the Clean Water Act and the Oil Pollution Act to regulate discharges into subsurface waters or to intermittent creeks that are not sufficiently linked to an open body of navigable water. Rice v. Harken Exploration Company, (5^th Cir. 2001, No. 99-11229). The court, relying on the recent decision of the U.S. Supreme Court in SWANCC, held there was nothing in the record to convince a reasonable trier of fact that a discharge into a "small seasonal creek" upgradient to a navigable water was sufficiently linked to that open body of navigable water as to qualify for protection.