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Moving goalposts: U.S. Supreme Court narrows scope of federal protection for wetlands
2023 PRINDBRF 0415
• Practitioner Insights Commentaries
• August 10, 2023
(August 10, 2023) - Pierce Werner, Mary K. Stukes and Peter McGrath of Moore & Van Allen's environmental practice break down the significance of the high court's May 25 Sackett opinion limiting the Clean Water Act's regulatory reach.
For years federal environmental regulation of waterways and wetlands has been in a state of flux, changing with political tides via agency rulemakings, but the Supreme Court of the United States may have just ended the cycle.
By now, most readers of environmental law updates will be familiar with the latest, and likely most consequential, decision on federal water jurisdiction issued by the Supreme Court in recent memory — Sackett v. United States Environmental Protection Agency ("EPA"). The Supreme Court issued its decision on the case heard during its October 2022 term of court, on May 25, 2023, wherein all nine justices found for the Petitioners, Michael and Chantell Sackett, and in doing so, the Court reinterpreted and narrowed the scope of "waters of the United States," under the federal Clean Water Act ("CWA").
Justice Alito delivered the opinion of the court, and was joined by Justices Barrett, Gorsuch, Thomas, and Chief Justice Roberts; and Justices Kagan and Kavanaugh each filed opinions concurring in the judgment only, rejecting the majority's narrower interpretation for various reasons, and Justices Sotomayor and Jackson each joined in both opinions.
The Court's decision defines "waters of the United States" under the CWA to include (1) traditionally navigable waterways such as streams, oceans, rivers and lakes, and (2) only wetlands that are 'practically indistinguishable' from such waters, requiring a jurisdictional determination over adjacent wetlands to establish (a) that the adjacent water is a relatively permanent body of water connected to traditional interstate navigable waters and (b) "that the wetland has a continuous surface connection with that water, making it difficult to determine where the 'water' ends and the 'wetland' begins."1
The Court's decision is largely a readoption of Justice Scalia's plurality opinion in Rapanos,2 thereby expressly rejecting Justice Kennedy's "significant nexus" test from the same case — upon which many of the most recent waters of the United States rulemakings ("WOTUS" rules) have been based — and removing many waters and wetlands from the jurisdiction of the EPA and Army Corps of Engineers ("USACE") as a consequence.
With this decision, the Court has apparently sought to deliver a more easily understood and definite rule intended to provide landowners with a clear and simple means by which to evaluate whether a federal permit is necessary to conduct activities on their property that may alter or impact a water or wetland.
Before understanding the significance and implications of this decision, it's necessary to take a brief foray into the recent history of Supreme Court decisions and federal rulemakings on the scope of "waters of the United States" within the CWA before finally describing what is to come as a result of the decision.
What's been going on?
As alluded to above and discussed thoroughly by the Court in Sackett, the Supreme Court has (rather uncommonly) issued multiple decisions construing the CWA's statutory phrase "waters of the United States," with two of which occurring since the turn of the millennium. The Court's decisions on the issue take a fairly logical progression.
United States v. Riverside Bayview Homes, Inc., came in 1985, where the Court first recognized the term "waters of the United States" could include not only traditionally navigable waters, but also certain abutting wetlands to a navigable waterway.3
Crossing into the 21st century, Solid Waste Agency of Northern Cook Cty. v. Army Corps of Engineers ("SWANCC") was decided by the Court in 2001 and held that "nonnavigable, isolated, intrastate waters" were not within the jurisdiction of the EPA or USACE under the CWA, rejecting the 'Migratory Bird Rule,' which had been used by the agencies to massively expand the jurisdiction of the CWA over even excavation trench ponds many miles from the closest traditionally navigable waterway on the basis of being connected through the migratory patterns of birds.4
Finally, and most relevant to Sackett, the Court decided the case of Rapanos v. United States, in 2006; however, with a split of 4-1-4, there was no prevailing majority opinion defining the test for "waters of the United States."5
Instead, readers were left with Justice Scalia's plurality opinion, defining the phrase to include relatively permanent (i.e., not occasional, intermittent, or ephemeral) waters connected to traditional interstate navigable waters and wetlands with such a close physical connection to those waters that they were "[practically] indistinguishable from waters of the United States," evidenced by a continuous surface water connection6; and Justice Kennedy's concurring opinion, taking the broader approach in recognizing that wetlands need not have a continuous surface water connection to be jurisdictional but must have a "significant nexus" with a traditionally navigable water, where "the wetlands, either alone or in combination with similarly situated lands in the region, significantly affect the chemical, physical, and biological integrity" of such waters.7
With the ultimate question of what the test should be in defining a "water of the United States" remaining unanswered, EPA and USACE were essentially left with the option of choosing which interpretation to use in promulgating rules under the CWA, setting the stage for the slew of rules that changed depending on the political leanings of the administration with power of the executive branch. Predictably then, there have been no less than five WOTUS rules in the past eight years: the Pre-2015 rules, the 2015 Rule, the 2019 Rule, the Trump Rule (2020), and the Biden Rule (2023).8
Vastly oversimplified: The 2015 Rule strengthened and expanded jurisdiction by broadly construing "adjacent" using the "significant nexus" framework such that a majority of water features in the United States would require a jurisdictional analysis; The 2019 Rule repealed the 2015 Rule to pave the way for the Trump Rule in 2020, which narrowed jurisdiction by shifting to reliance on Scalia's rationale in Rapanos rather than Kennedy's test, but with a somewhat broader interpretation of adjacent wetlands to include not only those which share a surface water connection (at least once in a typical year) or abut a traditionally navigable waterway but also those which are nevertheless separated from such waterway by certain natural or artificial barriers; and The Biden Rule reversed-course back to a basis in the "significant nexus" test and functioned similarly to the 2015 Rule by re-expanding jurisdiction over much more waters and wetlands than the preceding Trump Rule.
What does the Court's decision mean?
First and foremost, the Court's unanimous decision in Sackett means that Michael and Chantell Sackett can continue to backfill their lot in a subdivision near Priest Lake in Idaho, which they began back in 2007 before EPA issued an administrative compliance order to cease the operation and restore the property or face civil penalties; but it also means the Sacketts can boast back-to-back wins before the Supreme Court, thanking the late Justice Antonin Scalia for both.9
Justice Alito's majority decision in Sackett effectively makes Scalia's plurality opinion in Rapanos the Court's only answer to the question of defining "waters of the United States" by expressly rejecting Kennedy's "significant nexus" test to consider jurisdictional "only those relatively permanent, standing or continuously flowing bodies of water 'forming geographic[al] features' that are described in ordinary parlance as 'streams, oceans, rivers, and lakes,'"10 and wetlands which are 'practically indistinguishable from a water of the United States by having "'a continuous surface connection with that water, making it difficult to determine where the 'water' ends and the 'wetland' begins.'"11
Ultimately, the Court's decision in Sackett has halted the regulatory ebb and flow of EPA and USACE oscillating WOTUS rules under various presidential administrations between the available, non-controlling interpretations of Scalia and Kennedy in Rapanos. As the Court acknowledged in its opinion, with only the narrow interpretation of the Sackett majority available, EPA and USACE will have to promulgate a new WOTUS rule consistent with the decision, and any further expansion of federal protection for waters and wetlands will require action on the CWA by Congress or regulation by the various States.
Where do we go from here?
As mentioned, though it was not procedurally the impetus of the Court's decision, because the Biden Rule was based on Kennedy's framework from Rapanos, the Court's decision has effectively vacated the most-recent WOTUS rule, leaving EPA and USACE in an uncertain state until a new rule is published. In fact, because of its relatively broad interpretation that included wetlands physically separated from jurisdictional waters to be covered by the CWA, even the narrow Trump Rule may not be consistent with the Court's decision in Sackett — a fact acknowledged by Justice Kavanaugh in his concurrence.12
In light of the Court's decision, EPA announced via a dedicated page13 on its website that it will publish a new final rule consistent with the Court's decision in Sackett on Sept. 1, 2023. Interestingly though, EPA's announcement states the new final rule will be published as an amendment to the Biden Rule promulgated on January 18, 2023. Given the apparent pause on permitting from USACE until the amended WOTUS rule is issued, the new rule will presumably be effective immediately, though this is unclear.
Of note, the Administrative Procedure Act ("APA") does allow an agency to issue a final rule that's immediately effective without going through the complete rulemaking process; however, typically this is done only for "good cause."14 Of course, this article does not purport to evaluate the availability or viability of any such procedural challenge to the upcoming new rule, only illustrating the point that adversaries to the Court's decision may try to bring challenges to the agencies' rulemaking attempts via common procedural arguments.
Finally, the Court's decision leaves the door open for Congress to enact revision to the CWA to expand the definition of "waters of the United States," and for States, as the sovereign with "primary" responsibility and rights to regulate and protect water resources within their borders, to regulate all waters and wetlands which now fall out of the CWA's definition and coming WOTUS rule, though few States currently do so.15
Notes
1 Sackett v. EPA, 598 U.S. __, at *22 (2023) (citing Rapanos v. United States, 547 U.S. 715 ,742 (2006)).
2 Rapanos v. United States, 547 U. S. 715 (2006).
3 474 U.S. 121, 135 (1985).
4 531 U.S. 159 (2001).
5 547 U.S. at 722.
6 Id., at 742, 755.
7 Id., at 779–780.
8 See 80 Fed. Reg. 37054 (June 29, 2015); 84 Fed. Reg. 56626 (October 22, 2019); 85 Fed. Reg. 22250 (April 21, 2020) (hereinafter, the "Trump Rule"); 88 Fed. Reg. 3004 (January 18, 2023) (hereinafter, the "Biden Rule").
9 See Sackett v. EPA, 566 U.S. 120 (2012). The Sacketts were before the Supreme Court in 2012 on the issue of whether the EPA's administrative compliance order amounted to a final agency action which could be challenged by civil action under the Administrative Procedures Act ("APA"). Delivering the opinion of the Court, Justice Scalia held that the Sackett's civil challenge to EPA's order was proper, overturning the 9th Circuit Court of Appeals and remanding for proceedings — which returned to the Court on the substantive issue 10 years later.
10 Sackett, 598 U.S. at *14 (citing Rapanos, 547 U.S. at 739).
11 Id. at *22 (citing Rapanos, 547 U.S. at 742).
12 See Sackett, 598 U.S. at *7 (Kavanaugh, J., concurring in judgment).
13 https://bit.ly/3ONySUw
14 See 5 U.S.C. § 553.
15 See Sackett, 598 U.S. at *17-18.
Pierce Werner is an associate with Moore & Van Allen. He represents entities, businesses and industries across the full spectrum of environmental legal issues. He has experience with complex environmental litigation, regulatory enforcement and compliance actions at the local, state and federal level, as well as transactional environmental due diligence, brownfields redevelopment and environmental permitting. He can be reached at [email protected]. As head of the firm's environmental practice, Mary K. Stukes advises clients on environmental issues in all types of business transactions, as well as regulatory compliance issues and environmental litigation. She can be reached at [email protected]. Peter McGrath, a member of the firm, helps businesses navigate the complex maze of environmental law and regulation. For more than 30 years, he has provided advice and advocacy in litigation and on brownfields, permitting and transactional issues in diverse industries and businesses. He can be reached at [email protected]. All three authors are based in Charlotte, North Carolina.
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