EPA’s Recent Clean Water Act Guidance to Implement the Supreme Court’s Maui Decision

Wiley Rein LLP

On April 23, 2020, the Supreme Court of the United States issued a groundbreaking ruling in County of Maui v. Hawaii Wildlife Fund, 140 S. Ct. 1462 (2020), holding that a National Pollutant Discharge Elimination System (NPDES) permit under the Clean Water Act (CWA) may be required not only for a direct discharge from a point source into navigable waters but also for a “functional equivalent” of a direct discharge. Following this decision, on December 4, 2020, the U.S. Environmental Protection Agency (EPA) issued a Draft Guidance Memorandum, “Applying the Supreme Court’s County of Maui v. Hawaii Wildlife Fund Decision in the Clean Water Act Section 402 National Pollutant Discharge Elimination System Permit Program.”

This Draft Guidance provides insight into how EPA currently interprets and intends to apply the Supreme Court’s Maui decision. As discussed below, in addition to the seven factors that the Court listed, EPA also proposes one new factor to consider in analyzing whether an indirect discharge constitutes a “functional equivalent” of a direct discharge: the design and performance of the system or facility from which the pollutant is released. EPA has invited the public to submit comments on the Draft Guidance until January 4, 2021.

Even though the Draft Guidance attempts to reassure regulated entities that the number of NPDES permits issued for groundwater discharges after Maui would continue to be “a small percentage,” an EPA under a Biden Administration may take a different position and broadly implement the Supreme Court’s Maui decision. With Wiley’s significant CWA experience, we can help companies provide comments on the Draft Guidance and comply with the NPDES permitting regime after the Supreme Court’s Maui decision.


The CWA establishes a permitting scheme that regulates the discharge of pollutants from point sources (defined as discernible, confined, and discrete conveyances, including but not limited to any pipe, ditch, channel, tunnel, conduit, well, discrete fissure, container, rolling stock, concentrated animal feeding operation, or vessel or other floating craft, from which pollutants are or may be discharged) into navigable waters (defined as the waters of the United States, including territorial seas and streams that are navigable in fact). The CWA does not directly regulate discharge of pollutants into groundwater; instead, Congress left the primary responsibility for regulating and protecting groundwater to the states. Regulated entities are prohibited from discharging pollutants from a point source to navigable waters without an NPDES permit. 

In April 2020, the Supreme Court issued its decision in Maui, holding that an NPDES permit may be required for an indirect discharge of pollutants that constitute a “functional equivalent” of a direct discharge into navigable waters. This means that discharges of pollutants into groundwater that ultimately reach navigable waters could, under certain circumstances, require regulated entities to obtain an NDPES permit prior to the discharge. The Court gave a non-exhaustive list of seven factors to analyze whether an indirect discharge could constitute a "functional equivalent" of the direct discharge:

  1. Transit time from deposit until pollutants reach navigable waters;
  2. Distance traveled;
  3. The nature of the material through which the pollutant travels;
  4. The extent to which the pollutant is diluted or chemically changed as it travels;
  5. The amount of pollutant entering the navigable waters relative to the amount of the pollutant that leaves the point source;
  6. The manner by or area in which the pollutant enters the navigable waters; and
  7. The degree to which the pollution (at that point) has maintained its specific identity.

Although the Court provided these factors, it also largely left it to lower federal courts and EPA to provide further direction to regulated entities.

EPA’s Draft Guidance

In response to the Court’s April 2020 decision, EPA issued its Draft Guidance on December 4, 2020. EPA “intend[ed] . . . to provide clarity to the public regarding existing requirements under the law or Agency policies” because “the Maui decision likely will increase the instances where potentially regulated entities may have questions regarding whether and when to obtain permit coverage, particularly given the uncertainties associated with the Court’s fact-specific, multi-factor functional equivalent analysis.” In the Draft Guidance, EPA explained what the Maui decision left unchanged and what it clarified.

First, EPA confirmed that there must be “an actual discharge of a pollutant to a water of the United States” for regulated entities to be required to obtain an NPDES permit. According to EPA, nothing in the Maui decision changed this basic element, and simply a potential for an actual discharge is not enough to warrant an NPDES permit.

Second, EPA similarly confirmed that the discharge must come from a point source. EPA noted that the Supreme Court did not change this requirement.

Third, EPA explained that, under the Maui decision, “[o]nly a subset of discharges of pollutants to groundwater that ultimately reach a water of the United States are the ‘functional equivalent’ of a direct discharge to a water of the United States.” EPA found it significant that the Supreme Court expressly rejected the Ninth Circuit’s “fairly traceable” test, under which regulated entities would have needed to obtain an NPDES permit so long as a pollutant was traceable to any point source. Thus, according to EPA, the “functional equivalent” test cannot be applied to subject all indirect groundwater discharges to the NPDES permitting scheme.

Critically, EPA listed one more factor to the Court’s list of seven factors to help determine whether an indirect discharge constitutes a functional equivalent of a direct discharge: the design and performance of the system or facility from which the pollutant is released.

EPA observed that “[t]he design and performance of a system or facility can affect or inform all seven factors identified in Maui.” In EPA’s view, “[i]f a facility or system is designed and performs to discharge pollutants consistently and predictably from a point source through groundwater into a water of the United States, the owner or operator should contact its permitting authority to determine whether an NPDES permit is required.”

On the other hand, EPA acknowledged that “it may be less likely that an NPDES permit would be required” for the following scenarios “either because those pollutants do not reach a water of the United States or because the discharge is not a functional equivalent of a direct discharge to a water of the United States”:

  • A storage or treatment system such as a septic system, cesspool, or settling pond;
  • A runoff management system, such as with stormwater controls, infiltration or evaporation systems, or other green infrastructure; and
  • Water reuse, recycling, or groundwater recharge facilities that prevent or abate discharges of pollutants to waters of the United States.

To make an NPDES permit less likely, these system components must, in fact, prevent or abate discharges of pollutants to waters of the United States.


EPA’s Draft Guidance provides a helpful reminder that not all groundwater discharges will constitute a "functional equivalent" of a direct discharge. Even so, consistent with its statutory authority to implement the Clean Water Act and the Supreme Court’s invitation in Maui, EPA sought to further clarify what may constitute a “functional equivalent” of a direct discharge by adding another factor (i.e., system and facility design) to consider.

To be sure, regulated entities should continue to monitor how a Biden Administration may modify this approach. In the meantime, regulated entities should also take full advantage of the EPA’s invitation to submit comments on the Draft Guidance.

Written by:

Wiley Rein LLP

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