2021 saw a flurry of activity surrounding the regulation of waters of the United States, starting with the last days of the Trump administration and then as the Biden administration sought to move policy in a different direction. Overall, the Nationwide Permit (NWP) scheme under Section 404 of the Clean Water Act (CWA) was overhauled, the 2020 Environmental Protection Agency (EPA) Water Quality Certification (WQC) Rule under CWA 401 was overturned in court, and the Biden administration proposed changes to the definition of “waters of the United States” (WOTUS). These developments will continue to impact the regulated community into 2022. Here is where things stand.
Nationwide Permits
In December, the Army Corps of Engineers (Army Corps) completed its overhaul of NWPs, which means there will be some different permits and standards in 2022 for activities that impact WOTUS. NWPs are frequently used by project developers instead of undergoing the more time-consuming process of applying for an individual permit under CWA Section 404. On December 27, 2021, the Army Corps reissued 40 of the existing 52 NWPs and a new NWP 59 for water reclamation and reuse facilities. Several existing NWPs and general conditions were also modified, including the following:
- NWP 14 (linear transportation projects): Added driveways as an included example of activities covered by NWP 14.
- NWP 41 (reshaping existing drainage and irrigation ditches): Added irrigation ditches to types of ditches covered by NWP 41.
- Mitigation general condition: Modified the threshold for stream compensatory mitigation from 1/10 acre to 3/100 acre.
This followed an earlier announcement on January 13, 2021, when the Army Corps reissued 12 NWPs and issued four new NWPs. The January 13, 2021, final rule split the previous NWP 12, which authorized utility line activities, into three new NWPs: a new NWP 12 for oil and natural gas pipeline activities, NWP 57 for electric utility line and telecommunications activities, and NWP 58 for utility lines that convey other substances, such as water and sewage. The Army Corps also issued two new NWPs not related to utility lines: NWP 55 (seaweed mariculture activities) and NWP 56 (finfish mariculture activities), and.
The 40 current NWPs will expire on February 24, 2022, and the new NWPs will take effect on February 25, 2022. Coverage under the existing NWPs may continue either by regulation or if the Army Corps issues a verification letter for the project. All 56 NWPs issued in 2021 will expire on March 14, 2026.
Army Corps Halts Requests for Certain NWPs Requiring Water Quality Certification Coverage or Waiver
At the same time it was preparing to issue the second set of NWPs, the Army Corps made a surprise announcement in November 2021 that it would not be processing requests for coverage under the NWPs issued in January 2021 that rely on 401 WQC waiver under the EPA’s 2020 CWA 401 Rule. The announcement came after a October 21, 2021, decision in the United States District Court for the Northern District of California that vacated the 2020 rule. The announcement does not implicate individual permits under Section 404.
Under CWA Section 401, before a federal agency can approve a project that may result in “discharge to the navigable waters,” the applicant must obtain a WQC from the affected state. A state is deemed to have waived its delegated authority if it “fails or refuses to act on a request for certification, within a reasonable period of time (which shall not exceed one year) after receipt of such request.” Historically, states have avoided the one-year limit by allowing multiple cycles of withdrawal and resubmittal of the 401 certification applications. In the 2020 rule, however, the EPA adopted the view that one year meant one year. The EPA also narrowed the scope of conditions a state could impose on a project as part of the certification.
The Northern District of California overturned the 2020 rule, finding that it limited a certifying state’s control over setting and enforcing water quality standards. As a result, the Army Corps announced that it is working to provide more refined guidance that allows it to finalize permit decisions. The decision has been appealed to the United States Court of Appeals for the Ninth Circuit by energy industry organizations and a coalition of Republican-led states, who have asked the Ninth Circuit to suspend the California lower court’s decision pending the outcome of the lawsuit. In response, the federal government and a group of Democrat-led states have asked the Ninth Circuit not to block the decision. While the appeal or issuance of a revised rule is pending, permitting approvals may be delayed.
Biden Administration Announces Proposed New WOTUS Rule
Amid all the changes to the NWPs, on December 7, 2021, the EPA and the Army Corps announced a proposed final rule to revise the definition of WOTUS. The proposed final rule seeks to re-expand the scope of WOTUS following the elimination of the “significant nexus” test in a rule issued during the Trump administration. Generally, the proposed final rule seeks to set aside categorical exclusions and incorporate past Supreme Court precedent, such as Rapanos v. United States, SWANCC v. US Army Corps of Engineers, and United States v. Riverside Bayview Homes, Inc., similar to the regulations in place prior to 2020. The public comment period for the proposed final rule will close on February 7, 2022.
Barclay Damon’s Environmental Practice Area and Energy Team attorneys will be monitoring these issues and developments closely.
If you have any questions regarding the content of this alert, please contact Yvonne Hennessey, Environmental Practice Area chair, at yhennessey@barclaydamon.com; Tom Paul, counsel, at tpaul@barclaydamon.com; Emma Marshall, associate, at emarshall@barclaydamon.com; Dan Krzykowski, law clerk, at dkrzykowski@barclaydamon.com; or another member of the firm’s Environmental Practice Area or Energy Team.