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Environmental Law Update

Environmental Law Update Editor: Rafe Petersen, Holland & Knight LLP, 2099 Pennsylvania Ave., N.W., Suite 100, Washington, DC 20006-6801, rapeters@hklaw.com.

Environmental Law Update provides information on developments in environmental law as it applies to property, probate, and trust matters. The editors of Probate & Property welcome information and suggestions from readers.

Opinions on Scope of Federal Authority to Regulate Drainage Ditches and Isolated Wetlands

Coming to a Head

In the wake of the Supreme Court’s decision in Solid Waste Agency of Northern Cook County v. United States Army Corps of Engineers (SWANCC), 531 U.S. 159 (2001), there has been much confusion over the scope and reach of the U.S. Army Corps of Engineers’s regulatory authority over “navigable waters” under the Clean Water Act (CWA), 33 U.S.C. §§ 1251 et seq. A growing number of courts, notably the Fourth, Sixth, Seventh, and Ninth Circuits, have read SWANCC narrowly—upholding the Corps’s assertion of jurisdiction over drainage ditches, intermittent tributaries, and isolated wetlands that have any type of surface water connection to regulated “navigable waters,” no matter how attenuated. On the other side of the spectrum stands the Fifth Circuit, which ruled that SWANCC reigned in the historic expansion of the Corps jurisdiction. Finally, the Administration and Congress have thrown their hats into the ring, proposing regulatory and statutory clarifications that would end the controversy. Given the split in circuits and the wordsmithing fixes proposed by the executive and legislative branches, it is probable that this issue will be resolved one way or the other in the near future.

Numerous Narrow Interpretations of SWANCC Give Corps Authority over Wide Spectrum of Streams and Wetlands

The Fourth, Sixth, Seventh, and Ninth Circuits have read SWANCC narrowly, interpreting it as merely invalidating a controversial 1986 regulation allowing the Corps to assert jurisdiction over isolated wetlands based on their use by migratory birds (“Migratory Bird Rule”). These circuits have found that the Corps may find the necessary “nexus” to commerce (the jurisdictional prerequisite required under the Commerce Clause) by simply proving that the wetland or stream in question has an indirect hydrologic connection to a “navigable water” or some other Commerce Clause connection other than use by migratory birds.

For example, in Headwaters, Inc. v. Talent Irrigation District, 243 F.3d 526 (9th Cir. 2001), the Ninth Circuit held that an irrigation district’s use of aquatic herbicide in a system of irrigation canals that entered nearby Bear Creek through a malfunctioning waste gate was regulated under the CWA. The court concluded that the Corps’s assertion of jurisdiction was “not affected” by SWANCC’s decision on “isolated waters,” because the canal had released water into Bear Creek twice in 13 years. The court held that even a tenuous hydrological connection to a navigable water was a sufficient nexus and that “[e]ven tributaries that flow intermittently are ‘waters of the United States.’ ”

In what was a bit of a surprise to court watchers, the Fourth Circuit in United States v. Deaton, 332 F.3d 698 (4th Cir. 2003), narrowly interpreted SWANCC to allow jurisdiction over nonnavigable waters “with some connection to navigable ones.” Deaton sets forth the most extensive analysis of the issue to date by a federal court of appeals. At issue in that case was whether the CWA permitted federal jurisdiction over a roadside ditch (dug by Deaton), whose waters eventually connected with the navigable Wicomico River, eight miles away, after traversing through at least five culverts, three ponds, and five dams. In upholding the Corps’s assertion of jurisdiction, the Deaton court first held that the courts must defer to the agency’s interpretation of the CWA term, “waters of the United States,” because it is ambiguous. This would allow jurisdiction over any branch of a tributary system that eventually flows into a navigable body of water. Second, the court noted that Congress’s power over the “channels” of interstate commerce “reaches beyond the regulation of activities that are purely economic in nature.” The court noted that “there is no reason to believe Congress has less power over navigable waters than over other interstate channels such as highways. . . .”

The Sixth Circuit has followed Deaton. In United States v. Rapanos, 339 F.3d 447 (6th Cir. 2003), the defendant owned a tract of land 20 miles from both the Saginaw Bay and the navigable Kawkawlin River. Approximately one-third of the land consisted of wetlands, which defendant filled with sand. The government’s evidence showed that the wetlands were connected by a “surface hydrological connection”—an open drain sluice connected to a creek, connected to the Kawkawlin. The Sixth Circuit found CWA jurisdiction based upon Deaton‘s reasoning that in light of congressional concern for water quality and aquatic ecosystems, a nexus between navigable waterways and their nonnavigable tributaries is enough to grant CWA jurisdiction over the whole tributary system of any navigable waterway.

Finally, the Seventh Circuit held in United States v. Rueth Dev. Co., 335 F.3d 598 (7th Cir. 2003), that surface runoff that winds through tributaries into navigable waters may establish a jurisdictional nexus.

The Fifth Circuit Has Broadly Interpreted SWANCC

The only court of appeals case to date broadly interpreting SWANCC is the Fifth Circuit. In Rice v. Harken Exploration Co., 250 F.3d 264 (5th Cir. 2001), the owner of the surface rights to a tract of land used for oil exploration and drilling filed suit under the Oil Protection Act (OPA) against the drilling company for the accumulated damage to the soil and groundwater resulting from many small-scale discharges of oil and other pollutants onto the soil. Ultimately, the pollutants entered into Big Creek, “a small seasonal” or “intermittent” creek on the property. The court concluded that neither the groundwater nor the nonnavigable creek at issue were protected by the CWA (and, therefore, fell outside the OPA as well). Unlike other circuits, the court was not persuaded by the fact that, ultimately, Big Creek may have some sort of connection to a navigable water. The court also declined to extend the coverage of the CWA to a discharge on dry land that seeps into groundwater, which in turn seeps into a navigable water.

One Branch of Government Likely to Bring Clarification

The split in interpretation among the courts wrestling with the SWANCC decision was deep and instantaneous. In the two years since the high court ruled, two diametrically opposed, fully articulated interpretations have emerged among the lower federal courts. On the whole, the trend is toward a narrow reading of the decision. A growing majority of courts have read SWANCC narrowly and preserved the Corps’s jurisdiction over all but the most isolated waters. Of course, it is impossible to predict whether the Supreme Court will ultimately decide to further clarify SWANCC’s application to tributaries and their adjacent wetlands. The conflict in the circuits means, however, that the odds are in favor of the Supreme Court again addressing these issues in the future.

While the judicial branch wrestles with this issue, the other branches have not been silent. On January 15, 2003, the Corps and EPA issued a Joint Guidance Memorandum and Advanced Notice of Proposed Rule Making (ANPRM) that would eventually lead to a formal rule that would provide a clearer interpretation of SWANCC’s meaning. The ANPRM cites the great uncertainty engendered by SWANCC, noting that one of its purposes is to “solicit additional information, data, or studies addressing the extent of resource impacts to isolated intrastate, non-navigable waters.” The goal of the ANPRM is to determine which factors provide a basis of jurisdiction over isolated, intrastate nonnavigable waters, as well as whether the regulations should define “isolated waters” and, if so, what factors should be considered in determining whether a water is or is not isolated for jurisdictional purposes. The agencies are still early in the process of analyzing the comments received. It is presently unclear when the Corps and EPA will publish a proposed regulation for public comment. Meanwhile, several bills pending before Congress would address the definition of “waters of the United States.”

Thus, given all this attention, it is hoped that clearer guidance is imminent. Which branch of government it ultimately comes from, however, is anyone’s guess.