Federal appeals court upholds EPA rule exempting water transfers from Clean Water Act regulation

The Eleventh Circuit Court of Appeals, based in Atlanta, has upheld the Bush EPA’s controversial water transfer rule, which would allow polluted water from a dirty waterbody to be pumped and dumped into a pristine waterbody without a Clean Water Act permit.  This is a critically important issue for water quality and invasive species in the Great Lakes and nationally.  For background on the issue, and the stakes for our lakes, rivers, and streams, see my prior post, “US EPA issues final rule exempting water transfers from Clean Water Act regulation.” 

Several states and numerous environmental organizations (including the Great Lakes Environmental Law Center representing the Michigan Council of Trout Unlimited) have filed petitions challenging the rule in federal court.  However, the petitions were stayed because a prior case, Friends of the Everglades v. South Florida Water Management District, which had been going on since before the final rule was issued, raised the same substantive issues.

The core of the issue is the legality of the “unitary waters” theory that the Bush EPA used to exempt the transfer of pollutants between waterbodies from Clean Water Act regulation.  The Clean Water Act bans the “discharge of any pollutant” without a permit.  “Discharge” is defined as “any addition of any pollutant to navigable waters from any point source.”  (See 33 U.S.C. §§ 1311, 1342(a)(1), 1362(12)).  Under the EPA’s “unitary waters” theory, the waters of the United States are not distinct lakes, rivers, and streams, but one big bucket of water.  So, under this theory, taking polluted water from a dirty river and dumping that water into a pristine trout stream is not “adding” pollutants to navigable waters (which would otherwise be illegal from point sources without a permit).

As the court’s decision noted, “[t]he unitary waters theory has a low batting average.  In fact, it has struck out in every court of appeals where it has come up to the plate.”  The other courts considering this issue “take the view that the transfer of pollutants from one meaningfully distinct navigable body of water to another is an ‘addition … to navigable waters’ for Clean Water Act permitting purposes.”

However, these prior cases were all decided before the Bush EPA issued a final rule adopting the unitary waters theory.  Agency rules are entitled to deference as long as the rule is a reasonable interpretation of an ambiguous statute.  (This is usually called Chevron deference, named after the Supreme Court’s decisions in Chevron v. Natural Resources Defense Council, 467 U.S. 837 (1984)).  Chevron deference is a simple concept – if the statute is not clear, then the agency gets deference in its interpretation, unless its interpretation is arbitrary and capricious.  As the court in this case stated, for the EPA’s regulation to be upheld, “there must be two or more reasonable ways to interpret the statute, and the regulation must adopt one of those ways.”

The court ultimately concluded that the relevant Clean Water Act language could be interpreted in at least two different ways, and that the EPA’s rule is consistent with one of those interpretations:

There are two reasonable ways to read the § 1361(12) language “any addition of any pollutant to navigable waters from any point source.”  One is that it means “any addition . . . to [any] navigable waters;” the other is that it means “any addition . . . to navigable waters [as a whole].” 

The court further acknowledged that the EPA’s interpretation undermines the Clean Water Act’s goals, but recognized the political realities that led to an imperfect Clean Water Act:

[I]t may seem inconsistent with the lofty goals of the Clean Water Act to leave out of the permitting process the transfer of pollutants from one navigable body of water to another, but it is no more so than to leave out all non-point sources, allowing agricultural run-offs to create a huge “dead zone” in the Gulf of Mexico.  Yet we know the Act does that.  What this illustrates is that even when the preamble to legislation speaks single-mindedly and espouses lofty goals, the legislative process serves as a melting pot of competing interests and a face-off of battling factions.  What emerges from the conflict to become the enactment is often less pure than the preamble promises.  The provisions of legislation reflect compromises cobbled together by competing political forces and compromise is the enemy of single-mindedness.  It is not difficult to believe that the legislative process resulted in a Clean Water Act that leaves more than one gap in the permitting requirements it enacts.

Having concluded that the statutory language is ambiguous, the court ruled that the EPA’s regulation, which accepts the unitary waters theory that transferring pollutants between navigable waters is not an “addition . . . to navigable waters,” is a permissible construction of that language. 

However, this issue is far from over.  Earthjustice, which represents the plaintiff environmental groups, plans to file for a rehearing before a full circuit appellate panel.  With a circuit split, the issue could eventually go to the U.S. Supreme Court.  Further, the Obama EPA could make additional litigation unnecessary by simple rescinding the rule or revising it to protect our freshwater from pollution and invasive species transferred from other waterbodies.  For now, I expect a few more rounds of appellate litigation before environmental groups start pressuring the Obama EPA on this issue.