In a significant ruling issued on January 3, 2013, a federal court held for the first time that the Environmental Protection Agency (EPA) cannot regulate stormwater as a "pollutant" under the Clean Water Act.
Judge Liam O'Grady of the U.S. District Court for the Eastern District of Virginia ruled in Virginia Dep't of Transp. v. U.S. Envtl. Protection Agency that the EPA exceeded its statutory authority under the Act by establishing a total maximum daily load (TMDL) using stormwater flow into the Accotink Creek. The court applied the first step of the two-step analysis set forth in Chevron, U.S.A., Inc. v. NRDC, Inc.1 in finding that "pollutant" is a statutorily defined term that does not include stormwater, and therefore that EPA did not have the statutory authority to use stormwater flow as a surrogate for sediment (which is a "pollutant") in establishing TMDLs for Accotink Creek.2
The Accotink Creek is a 25-mile-long tributary of the Potomac River in Fairfax County, Virginia. The creek had been identified as having "benthic impairments," believed to be caused by the accumulation of sediment. On April 18, 2011, the EPA established a TMDL for stormwater in an effort to regulate the flow of sediment into the creek.3
Under the Clean Water Act, states are required to establish a set of TMDLs for each "impaired" water body that fails to meet specified water quality criteria.4 If a state fails to issue appropriate TMDLs, then the EPA may establish them in its place. Any pollutant, as defined in the Clean Water Act, can be subject to a TMDL for a given water body.5
The Court's Decision
In this case, all parties agreed that the Act's definition of "pollutant" includes sediment, but not stormwater.6 Nevertheless, the EPA argued that stormwater flow could be regulated under the TMDL as a "surrogate" for the accumulation of sediment into the creek. Therefore, the issue before the court was whether the Clean Water Act authorizes the EPA to regulate the level of a pollutant in a water body by establishing a TMDL for the flow of a non-pollutant into that water body. The district court ruled that the EPA does not have such authority.7
First, the court held that the language of the Act unambiguously allows states to establish TMDLs only for substances defined in the Act as a "pollutant." The court found that, because stormwater is not identified in the Act as a pollutant, the EPA lacks the authority to establish a TMDL for stormwater, regardless of how well it can serve as a surrogate for measuring the flow of an actual pollutant into an impaired water body.8 Because the intent of the statute was clear, the court held that it did not need to move to the second part of the Chevron test, which would have required it to defer to any reasonable statutory construction by the agency.9
Second, the court noted that the EPA's previous attempts to expand its authority to issue TMDLs have been struck down in the past on similar grounds. In particular, in Friends of the Earth, Inc. v. Envtl. Protection Agency, the U.S. Court of Appeals for the District of Columbia Circuit rejected a TMDL issued by the EPA that expressed the maximum load of certain pollutants in the Anacostia River in terms of annual and seasonal quantities because the Clean Water Act clearly permits the EPA to express TMDLs only in terms of daily loads.10 Just as EPA exceeded its statutory authority in issuing a seasonal TMDL for the Anacostia River, the court found in this case that EPA exceeded its statutory authority in establishing a TMDL for non-pollutants, such as stormwater. As the court stated, "in this case, as in Friends of the Earth, the statute simply does not grant EPA the authority it claims."11
Finally, although it acknowledged that "EPA is not explicitly forbidden . . . from establishing TMDLs for nonpollutants,"12 the court concluded that EPA's TMDL for non-pollutants going into the Accotink "goes beyond 'permissible gap-filling' and is instead an impermissible construction of the statute."13 Thus, the court made clear that the unambiguous text of the Clean Water Act sets forth the outer limits of the EPA's authority to establish TMDLs. "Whatever reason EPA has for thinking that a stormwater flow rate TMDL is a better way of limiting sediment load than a sediment load TMDL, EPA cannot be allowed to exceed its clearly limited statutory authority."14
Significantly, the court ventured beyond the narrow legal issues in the case and directly critiqued EPA's novel TMDL policies. The court noted that EPA has approved 3,700 TMDLs for sediment nationwide and that Virginia has addressed 111 benthic impairments with TMDLs. None of these TMDLs regulated the flow rate of stormwater. The court observed that EPA had tried the novel approach of regulating sediment via flow in only four instances nationwide and that all four attempts had been challenged in court. Three of those challenges were still pending, and one had settled out of court.15 The court signaled that taking "shortcuts" to achieve Clean Water Act standards is not the best policy when EPA has historically been able to establish pollutant limits consistent with the law.
Implications of the Decision
This decision could have far-reaching consequences for EPA's TMDL and stormwater programs under the Clean Water Act. Local jurisdictions that are being required to comply with ever more stringent stormwater and TMDL requirements are concerned about the cost of these requirements for local ratepayers. Virginia Attorney General Ken Cuccinelli, who argued the case on behalf of the Virginia Department of Transportation, stated shortly after the opinion was issued that the court's ruling could save Fairfax County at least $300 million in compliance costs.16
Nationally, the ruling could significantly affect EPA's planned Post-Construction Stormwater Rule, which is currently under development and scheduled to be formally proposed in June 2013. EPA has considered for some time using flow as a "surrogate" for specific pollutants in situations where it may be difficult to identify a specific pollutant causing impairment of a water body.17
Even though the VDOT v. EPA decision is binding only in the Eastern District of Virginia, it is likely to cause EPA to re-evaluate whether it can regulate stormwater flow in developing its national post-construction stormwater rule, and whether it can include stringent restrictions on stormwater flow in municipal separate sewer system (MS4) permits, given the litigation risk of embracing such a policy. The results of EPA's internal deliberations over the next few months could have a direct and long-term impact on many jurisdictions that are otherwise being required to impose ever more costly TMDL and stormwater controls.
1 467 U.S. 837 (1984).
2 No. 1:12-CV-775 (E.D. Va. Jan. 3, 2013) (hereinafter, VDOT v. EPA).
3 See id. at 2-3.
4 See 33 U.S.C. §1313(d)(1)(C).
5 See Total Maximum Daily Loads Under the Clean Water Act, 43 Fed. Reg. 60,662 (Dec. 28, 1978).
6 See VDOT v. EPA, at 3. For the complete definition of "pollutant" under the Clean Water Act, see 33 U.S.C. §1362(6).
7 See id.
8 See id. at 4-5.
10 446 F.3d 140, 143 (D.C. Cir. 2006).
11 VDOT v. EPA, at 6.
13 Id. at 9.
15 Id at 8.
16 See Corinne Reilly, "In Victory for Va., Judge Rules EPA Can't Regulate Storm Water as Pollutant," Washington Post (Jan. 3, 2013).
17 See "Revisions to the November 22, 2002 Memorandum 'Establishing Total Maximum Daily Load (TMDL) Wasteload Allocations (WLAs) for Storm Water Sources and NPDES Permit Requirements Based on Those WLAs" from James A. Hanlon, Director, Office of Wastewater Management and Denise Keehner, Director of Office of Wetlands, Oceans and Watersheds, to Water Management Division Directors, Regions 1-10 (Nov. 12, 2010).