A federal appeals court ruled yesterday that the Army Corps of Engineers must take another look at whether it has jurisdiction over wetlands slated for development in southeastern Virginia.

The 4.8 -acre site is part of a 657-acre parcel that Precon Development Corp. is developing in Chesapeake.

A three-judge panel of the Richmond, Va.-based 4th U.S. Circuit Court of Appeals concluded that, in light of the Supreme Court's 2006 ruling in Rapanos v. United States, which limited government jurisdiction over wetlands, the Army Corps needs to conduct a more thorough analysis before determining whether it has jurisdiction over the land.

The ruling in Precon Development v. United States is the latest example of how regulators and courts have struggled to interpret the Supreme Court's ruling (Greenwire, March 1, 2010).

The Clean Water Act states that the government can regulate any discharge into "navigable waters." Traditionally, the Army Corps considered wetlands to be under its jurisdiction, but in Rapanos, the Supreme Court tinkered with the law. However, it struggled to reach a coherent conclusion, with the justices split 4-1-4.

Since then, some members of Congress have sought to revise the Clean Water Act to make the law clearer (E&ENews PM, Nov. 16, 2010).

In 2007, the Army Corps, in conjunction with U.S. EPA, issued new guidance on jurisdiction in light of the Supreme Court ruling. The guidance stated that wetlands "adjacent to, but not directly abutting, a relatively permanent tributary" are not automatically under the government's jurisdiction.

In such cases, the corps is required to evaluate the site to determine if there is a "significant nexus" with nearby navigable waters. If there is such a relationship, then the government has jurisdiction.

The corps, following the new guidance, concluded that it had jurisdiction over the Virginia site because there is a drainage ditch that runs alongside it. The agency denied Precon's request for a permit.

That was good enough for U.S. District Judge Rebecca Beach Smith of the Eastern District of Virginia, who ruled in favor of the government, but the 4th Circuit disagreed.

Judge Allyson Kay Duncan wrote in the opinion that the government had failed to show that there was a significant nexus between the wetlands and the Northwest River.

What evidence that was provided by the Army Corps -- including documents about the flow of nearby tributaries -- was not sufficient, Duncan said.

"Accordingly, we must conclude that this record does not support the Army Corps' determination that the nexus that exists ... is 'significant,'" Duncan wrote.

In the future, the government must "pay particular attention to documenting why such wetlands significantly, rather than insubstantially, affect the integrity of navigable waters," she added.

Click here to read the opinion.