as published in IOGA of West Virginia newsletter, January 2015
“Waters of the United States” or “WOTUS” in the esoteric taxonomy of the Clean Water Act (“CWA”), is a term with which many are becoming increasingly familiar. This deceptively simple phrase is anything but simple in its application. The oil and gas industry is increasingly experiencing the U.S. Environmental Protection Agency’s (“EPA”) proclivity finding CWA jurisdiction through WOTUS interpretation. New proposed regulatory language issued by the EPA and the U.S. Army Corps of Engineers (“USACE”), makes WOTUS even broader.
Enacted in 1972 to "restore and maintain the chemical, physical, and biological integrity of the Nation's waters," the CWA prohibits unpermitted discharges of pollutants into "navigable waters." "Navigable waters" are "the waters of the United States, including the territorial seas."
The Supreme Court of the United State (“SCOTUS”) first addressed the proper scope of WOTUS in United States v. Riverside Bayview Homes, Inc. (1985). In Riverside Bayview, SCOTUS upheld agency interpretation that WOTUS covered wetlands which “actually abut” traditional navigable waterways. The court did not rule on whether WOTUS might also extend to more remote waters.
A year later, USACE rulemaking expanded the WOTUS definition. These regulations covered traditionally navigable waterbodies, and also "[a]ll other waters … (including intermittent streams)… wetlands sloughs,… or natural ponds… which could affect interstate or foreign commerce[.]" This definition remains, but SCOTUS has constrained its scope.
In 2001, SCOTUS decided Solid Waste Agency of Northern Cook County v. U.S. Army Corps of Engineers (“SWANCC”). USACE used migratory birds to assert jurisdiction over a defunct gravel pit. SCOTUS held the CWA's use of the term "navigable" could not be ignored, and that migratory fowl were "a far cry, indeed, from the 'navigable waters' and 'waters of the United States' to which the statute by its terms extends."
EPA and USACE soon sought to circumvent SWANCC’s limitations by claiming jurisdiction over any waters having "any hydrological connection" to navigable waters, asserting such were not "isolated" per SWANCC if connected, however remotely, to navigable waters. In the agencies’ view, this granted authority to regulate non-navigable waters as a "water of the United States." In 2006, SCOTUS addressed this new approach in Rapanos v. United States.
In Rapanos, EPA and USACE claimed jurisdiction based tenuous hydrologic connections to navigable waters. A plurality opinion and separate concurrence rejected the Corps's assertion. Unfortunately, the opinions gave different tests for identifying WOTUS. The plurality held WOTUS included "only relatively permanent, standing or flowing bodies of water... continuously present, fixed bodies of water, as opposed to ordinarily dry channels through which water occasionally or intermittently flows." The concurrence held WOTUS applied to wetlands with a “significant nexus” to navigable waters. This nexus existed "if… either alone or in combination with other similarly situated lands… significantly affect the chemical, physical, and biological integrity of other [navigable] waters."
Joint Proposed Rules on "Waters of the United States"
On April 21, 2014, the EPA and USACE jointly proposed rules revising the definition of WOTUS in seven categories:
All waters currently used, used in the past, or may be susceptible to use in interstate or foreign commerce, including tidal waters (i.e., traditional navigable waters (“TNWs”));
All interstate waters, including interstate wetlands;
The territorial seas;
All impoundments of waters identified in (1)-(3) above;
All tributaries of waters identified in (1)-(4) above;
All waters, including wetlands, adjacent to a water identified in (1)-(5) above; and
On a case-specific basis, other waters, including wetlands, that alone or in combination with other similarly situated waters in the region have a significant nexus to a water identified in (1)-(3) above.
A new definition of tributary is included as:
Water with a bed and banks and ordinary high water mark that contribute water flow directly, or through other water bodies, to waters in (1)-(4) above.
Wetlands, lakes, and ponds may be tributaries (even lacking bed, banks or ordinary high water mark) if they contribute flow.
Tributary status remains even with man-made interruptions, if bed, banks and ordinary high water mark are identifiable upstream. Unprecedented, ditches are now jurisdictional tributaries under the CWA, unless excluded.
The proposed rule also establishes a new category— adjacent waters—which include wetlands within WOTUS. Adjacent means bordering, contiguous, or “neighboring waters” separated from other WOTUS. “Neighboring” waters are within a “riparian area” or “floodplain,” having a shallow subsurface, or confined surface, hydrological connection. “Riparian areas” are where surface or subsurface hydrology influence ecosystem and vegetation between water and land. A “Floodplain” borders inland or coastal areas and is inundated during moderate to high flow.
A new definition of “significant nexus” has been made, and includes wetlands, either alone or in combination with other “similarly situated” waters in the region that significantly affect water identified in (1)-(3) above. “Similarly situated” waters are sufficiently close together to be evaluated as a single landscape unit and perform similar hydrologic functions.
Several exclusions apply, including: (i) CWA waste treatment systems; (ii) prior converted cropland; (iii) upland only ditches with less than perennial flow; (iv) ditches that do not directly contribute flow, or through another water, to a water identified in paragraphs (1)-(4) above; (v) artificially irrigated areas that would revert to upland without irrigation; (vi) artificial lakes or ponds used exclusively for stock watering, irrigation, etc.; (vii) artificial pools; (viii) small ornamental waters for primarily aesthetic reasons; (ix) water-filled construction depressions; (x) groundwater, including subsurface draining systems; and (xi) gullies, rills, and non-wetland swales. While these categories are not WOTUS, they may yet establish a connection to a TWN by adjacency or significant nexus.
The Significance and Impact of the Proposed Rule
The impact of the new rule is difficult to overstate. Several categories not previously considered WOTUS (e.g., ditches, waters in a floodplain, and isolated waters) will be jurisdictional. Many more activities will require section 404 (dredge and fill) permitting. Stormwater conveyances will likely be become subject to previously inapplicable water quality standards. Spill Prevention, Control, and Countermeasures (SPCC) Plans will likely expand dramatically due to inclusion of ditches and manmade impoundments as WOTUS. Industrial ponds and similar structures may also fall become adjacent waters. State regulators will have a tremendous increase in the number of waters requiring water quality standards. Increased enforcement is a given. And third party litigation, most likely from the environmental advocacy sector, is a virtual certainty. The proposed rule will have a significant adverse impact on small businesses. Rather than “clarify,” WOTUS, the proposal generates additional regulatory confusion and uncertainty. It will drive up project/operational costs and cause permitting delays by expanding the scope of various CWA regulatory programs.