Supreme Court Creates "Functional Equivalency" Test for Discharges to Groundwater



On April 23, 2020, the US Supreme Court issued an important opinion on the scope of EPA's authority under the Federal Clean Water Act to regulate indirect discharges of pollutants from point sources to navigable waters.

In a 6-3 decision, the Court held that the Clean Water Act's ("the Act") permitting program—the National Pollutant Discharge Elimination System ("NPDES")—requires a discharge permit when there is a direct discharge from a point source into navigable waters or when there is the "functional equivalent" of a direct discharge.1

The Act defines "discharge of pollutant" as "any addition of any pollutant to navigable waters from any point source."2 "Point source" is defined as "any discernible, confined and discrete conveyance, including…any container, pipe, ditch, channel, tunnel, conduit, well… from which pollutants are or may be discharged.3 The opinion turns on the definition of the word "from" ("from any point source").

The County of Maui operates a wastewater reclamation facility on the island of Maui, Hawaii. The facility collects sewage from the surrounding area, partially treats it, and pumps the treated wastewater to four groundwater wells. Pollutants from the treated wastewater then migrate approximately half a mile via groundwater to the Pacific Ocean. Environmental groups brought a citizens' suit under the Clean Water Act against the County, claiming that it was discharging pollutants from a point source to navigable waters without an NPDES permit. The Ninth Circuit held that an NPDES permit is required when pollutants are "fairly traceable from the point source to a navigable water." In accepting the case, the Supreme Court acknowledged that the circuits were employing different standards: the Sixth Circuit held in a different case that discharges to groundwater were categorically exempt from NPDES permitting, and the Fourth Circuit required a "direct hydrological connection" between the point source and the navigable water. In the Maui case, EPA took the position that discharges to groundwater were categorically exempt.

The Supreme Court rejected the positions advanced by the parties in the Maui case as too extreme. The Court held the Ninth Circuit's "fairly traceable" test was too broad, creating the possibility of "surprising, even bizarre" results such as a permit potentially being required for a discharge that travels many miles and takes years to reach navigable waters. On the other hand, the Court determined that exempting a discharge from the permit requirement if it travels through any amount of groundwater would create a "large and obvious loophole" not in keeping with the purpose of the Act.

In its decision, the Court reasoned that its new test—which requires a permit if there is a direct discharge into navigable waters or the "functional equivalent" of a direct discharge—appropriately reflected circumstances that required a permit under the Act. The Court then identified factors that would be important when applying that test. In most cases, the time and distance between the point source and the jurisdictional water would be the most important factors. Other potentially relevant factors include the nature of the medium through which the pollutant travels; dilution and chemical changes during travel; change in concentration or quantity during travel; manner by or area in which the pollutant enters the navigable waters; and the degree of change in the pollutant's specific identity.

The standard announced by the Court will require further interpretation by EPA and the lower courts, and some decisions made under it may turn on highly technical factual determinations requiring hydrogeological experts. This decision could create uncertainty in the regulated community as to when such "indirect discharge" permits are required and lead to the potential for lawsuits over indirect discharges, including discharges that travel some distance through groundwater or across land.

1 County of Maui v. Hawaii Wildlife Fund, No. 18-260 (U.S., April 23, 2020).
2 33 U.S.C. §1362(12).
3 33 U.S.C. §1362(14).

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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