Supreme Court Ruling Sets New Test for Clean Water Act Permitting
On April 23, 2020, the Supreme Court ruled that pollution traveling indirectly to rivers and streams through groundwater can be covered by the Clean Water Act’s (CWA) permitting requirements. The case, County of Maui, Hawaii v. Hawaii Wildlife Fund, et al, 590 U.S. (2020), concerned whether pollutants discharged from a point source into groundwater, a non-point source, and then conveyed into navigable waters fall within permitting requirements of the CWA. In a 6-3 Opinion delivered by Justice Breyer, the Court held that the CWA “requires a 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.” Slip op. at 15.
Under the CWA, a point source is a discernable conveyance such as a pipeline and other conduit, including wells (the Court notes that wells ordinarily result in discharge of pollutants through groundwater). Slip op. at 13. The case at issue concerned the County of Maui’s (Maui) operation of a wastewater reclamation facility that collected and partially treated sewage before pumping the treated water into four underground injection wells. From the wells, the treated water traveled half a mile through groundwater into the Pacific Ocean, a navigable water. Maui had not obtained a permit for the discharge, and in 2012, several environmental groups brought a citizens’ CWA lawsuit against the county.
The legal question of whether the CWA’s permitting program covers pollution that travels from a point source, like a factory discharge pipe or a containment pond, through groundwater before reaching a downstream water has major implications for industries ranging from agriculture to oil and gas. The Court’s “functional equivalent” standard for the reach of federal regulation is an interpretation that is narrower than the one sought by environmentalists and endorsed by the Ninth U.S. Circuit Court of Appeals, but the Court declined to defer to the U.S. Environmental Protection Agency’s (EPA) 2019 Interpretative Statement. 84 Fed. Reg. 16810, 16824 (April 2019).
EPA’s Interpretive Statement supported the argument of Maui and the U.S. Solicitor General that if any non-point source lies between the point source and the navigable water, a permit is not required for the release. Groundwater and non-point pollution that is generated, for instance, by rainwater runoff is not covered by the CWA and is regulated by the states. The Court rejected this interpretation, posing the question: “If that is the correct interpretation of the statute, then why could not the pipe’s owner, seeking to avoid the permit requirement, simply move the pipe back, perhaps only a few yards, so that the pollution must travel through at least some groundwater before reaching the sea?” Slip op. at 10. The Court held that “to follow EPA’s reading would open a loophole allowing easy evasion of the statutory provision’s basic purposes. Such an interpretation is neither persuasive nor reasonable.” Slip op. at 12.
The Court did not adopt the “fairly traceable” standard supported by the environmental groups and the Ninth Circuit either, as its scope would be too broad, and would interfere too seriously with states’ traditional and intended regulatory authority over groundwater and non-source pollution. Slip op. at 7-8.
The “functional equivalent of a direct discharge” standard will require a permit for discharge from any point source directly into navigable waters, and from point sources when the discharge “reaches the same result through roughly similar means.” The Court identified seven factors that may be relevant in determining whether the discharge comes “from” a point source:
(1) transit time, (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, (7) the degree to which the pollution (at that point) has maintained its specific identity. Slip op. at 16.
The Court notes that time and distance will be important factors in many (though potentially not all) cases. For example, a distance of a few feet is concretely within the scope of the permitting requirement; a distance of 50 miles that may take a year for the water and perhaps mixing with other materials before reaching the navigable water is indeterminate.
The Court stated that the “functional equivalent” standard will essentially maintain EPA’s longstanding interpretation of the 1972 water law’s requirements prior to the 2019 Interpretive Statement that sought to narrow its reach. The Court further acknowledges that the new standard may expand the scope of the CWA as it applies to wells and septic systems, but does not expect an “unmanageable expansion” of the permitting program, and expects that EPA and the states will mitigate harms and initiate a best practices permitting policy, and that judges will exercise discretion mindful of the complexities of indirect discharges. Slip op. at 18.