Supreme Court ruling offers clues on fate of Obama rule

By Tiffany Stecker | 06/01/2016 01:17 PM EDT

Enforcement of the Clean Water Act could undergo a wave of changes in the wake of yesterday’s Supreme Court ruling on a key wetlands case, legal scholars say. The opinion is also offering clues to the possible fate of the administration’s new water rule.

Enforcement of the Clean Water Act could undergo a wave of changes in the wake of yesterday’s Supreme Court ruling on a key wetlands case, legal scholars say. The opinion is also offering clues to the possible fate of the administration’s new water rule.

The Supreme Court ruled 8-0 yesterday in the case Army Corps of Engineers v. Hawkes Co. Inc. to allow landowners to challenge corps decisions on what is a federally protected wetland (Greenwire, May 31).

Traditionally, landowners had to wait until they began the application process for permits to dredge and fill in wetlands before challenging the Army Corps in court.


Justice Anthony Kennedy wrote in his opinion that "the reach and systemic consequences of the Clean Water Act remain a cause for concern," adding that the law raised "troubling questions" on the government’s influence on private property rights.

Kennedy’s words may set the stage for a possible Supreme Court review of the Obama administration’s contentious Clean Water Act jurisdiction rule, said Larry Liebesman, a senior adviser with the water resources policy firm Dawson and Associates.

"He didn’t have to go down that road, but he decided to do that," said Liebesman, also a former environmental attorney with the Justice Department.

U.S. EPA and the corps promulgated the new rule to define which waterways and wetlands receive automatic Clean Water Act protection after a pivotal 2006 ruling in Rapanos v. United States, in which the high court ended up split 4-1-4.

In a stand-alone opinion in Rapanos, Kennedy wrote that streams and wetlands must have a "significant nexus" to navigable waters to be protected under law.

He also argued that regulators could consider isolated waters in combination with nearby water bodies for federal protection if they affect waters downstream.

Kennedy’s Hawkes opinion could hint at his views on the new EPA-corps water rule, Liebesman said. "He could say ‘it misinterprets what I said about significant nexus, I intended it to be more site-specific,’" he said.

Yesterday’s Supreme Court decision is the culmination of a Minnesota peat mining company’s efforts to obtain a permit to expand operations into a wetland.

The Army Corps oversees permits to develop near wetlands under Section 404 of the Clean Water Act. The program requires the agency to make "jurisdictional determinations" to assess whether a parcel of land is a water of the U.S.

Observers interpreted Kennedy’s opinion as a win for developers and farmers who have struggled with the corps to build or expand on their own land.

Wetlands serve an important role in controlling flooding, filtering pollution out of aquifers and providing habitat for wildlife.

But unlike a river or stream, small and seasonally flooded wetlands on private property require a complicated assessment for determining eligibility for federal protection.

‘Huge amount of pressure’

The Hawkes decision could lead to thousands of dollars and many years saved for developers, said Timothy Bishop, an attorney with Mayer Brown LLP.

Bishop represented a Chicago-area municipality that wanted to build a landfill in 2001’s Solid Waste Agency of Northern Cook County v. Army Corps of Engineers Supreme Court arguments.

The agency was tied up in litigation for nearly a decade, fighting a permit on land that, ultimately, was not found to have jurisdictional waters, Bishop said. The Hawkes case could avoid similar drawn-out legal sagas, he said.

What the Hawkes decision will do is place an additional burden on the corps, said Jan Goldman-Carter, who heads the National Wildlife Federation’s wetlands and waterways program.

The practical effect "is that every one of these case-by-case agency actions is now open to litigation," she said. "This puts a huge amount of pressure on the Corps of Engineers, just in terms of resource constraints."

Central to the court’s ruling is the "memorandum of agreement" between the corps and EPA. The memorandum established that jurisdictional determinations are legally binding, but also shielded landowners from potential Clean Water Act violations for five years if regulators failed to find federally protected waters.

The creation of the memorandum allowed for jurisdictional determinations to be "final agency actions" that could be challenged, the justices said.

This could open the door for review of the many similar agreements between agencies that are set up across the federal government, said Vermont Law School professor Pat Parenteau.

"There’s tons of them," said Parenteau, on topics ranging from enforcement to the application of the Endangered Species Act across agencies. "That’s how our multifaceted federal bureaucracy does business because there’s all of these overlapping authorities."

Kennedy’s new comments on the Clean Water Act could resonate with water debates outside wetlands. The Total Maximum Daily Load program — a "pollution diet" for bodies of water that don’t meet water quality standards — may also come under scrutiny.

The Supreme Court recently turned down the opportunity to hear challenges to the Chesapeake Bay TMDL, the most expansive application of the program in the country, but the issue may eventually come back to the court.

"It’s an issue that is raised front and center by the Chesapeake Bay case," said Richard Schwartz, an environmental attorney with Crowell and Moring LLP. The Hawkes decision "certainly indicates that the court might be friendly to that."

But others say the decision will have little connection with the rest of the law.

"It’s like apples and oranges," said Liebesman of Dawson and Associates. "I don’t see that there’s any real connection to other aspects of the Clean Water Act."