Last week, the United States Supreme Court provided additional guidance regarding the application of the Clean Water Act. In short, the Clean Water Act requires the federal government to regulate certain groundwater pollutants that find their way into navigable waters such as oceans, rivers and streams.
The recent Supreme Court opinion has been considered by many to constitute a compromise of opposing positions, as it rejects the Trump Administration’s goals of lesser regulation, but also eliminates a Ninth Circuit court ruling that would have increased permitting requirements related to groundwater pollution. According to the Supreme Court opinion, the primary question presented was whether the Act “requires a permit when pollutants originate from a point source, but are conveyed to navigable waters by a nonpoint source.” In its analysis of the permitting requirements for plant owners seeking to emit pollutants, the Supreme Court ultimately concluded that “the statutory provisions at issue require a permit if the addition of the pollutants through groundwater is the functional equivalent of a direct discharge from the point source into navigable waters.”
Much of the recent issues surrounding the Clean Water Act have arisen as a result of the efforts of a wastewater reclamation facility on the island of Maui in Hawaii. According to the Supreme Court opinion, this facility collects sewage from the surrounding area, partially treats it, and pumps the treated water through four wells hundreds of feet underground. In 2012, several environmental groups claimed that Maui was discharging a pollutant into navigable waters without the permit required by the Clean Water Act.
In its review of the progeny of decisions about whether a permit was required, the Supreme Court focused on the meaning of the word “from.” Specifically, environmental groups and NGOs take the position that the permitting requirement applies so long as the pollutant is “fairly traceable” to a point source even if it traveled long and far (through groundwater) before it reached navigable waters. Maui’s position argued for a bright-line test, arguing that a point source or series of point sources must be “the means of delivering pollutants to navigable waters.” In its review of the arguments, the Supreme Court found a “middle ground,” holding that statutory context limits the reach of the statutory phrase “from any point source” to a range of circumstances narrower than that which the Ninth Circuit’s interpretation suggests, but also is significantly broader than the total exclusion of all discharges through groundwater described by Maui.
In its opinion, the Supreme Court Justices acknowledged that Congress did not intend the point source permitting requirement to provide the EPA with such broad authority as the Ninth Circuit’s narrow focus on traceability would allow. Moreover, the court held that Congress intended to leave substantial responsibility and autonomy to States regarding groundwater pollution and non-point source pollution. Accordingly, Congress’ failure to include groundwater in the general EPA permitting provision was deliberate, as Congress had confidence in state-specific controls regarding regulation of groundwater pollution.
However, the Supreme Court further addressed some deficiencies from the position of Maui and the Solicitor General, as their argument “would risk serious interference with EPA’s ability to regulate ordinary point source discharges.” The Solicitor General urged that the Clean Water Act specifically excluded from the NPDES program all releases of pollutants into groundwater. Due to this broad interpretation, the court found that both of these interpretations were inconsistent with the statute’s text and invited dischargers to evade the Clean Water Act’s permitting requirement simply by relocating their discharges.
After rejecting the positions from both EPA and the Solicitor General, the Supreme Court identified seven, nonexclusive factors “that may prove relevant” to assessing whether the functional equivalent of a direct discharge has occurred. Moreover, the court held that “an addition falls within the statutory requirement that it be ‘from any point source’ when a point source directly deposits pollutants into navigable waters, or when the discharge reaches the same result through roughly similar means.” The seven factors identified include: (1) transit time; (2) distance traveled; (3) the nature of the material through which the pollutant travels; (4) the extent to which the pollutant is diluted or chemically changed as it travels; (5) the amount of pollutant entering the navigable waters relative to the amount of the pollutant that leaves the point source; (6) the manner by or area in which the pollutant enter the navigable waters; and (7) the degree to which the pollution (at that point) has maintained its specific identity. According to the opinion, points (1) and (2) will be the most important factors in most cases, but not necessarily every case.
Given the incredibly open-ended nature of its functional equivalent test, the court provided the opportunity for both federal courts and EPA to provide further guidance on how the test will practically work. The majority opinion stated that courts may arrive at a more well-defined standard through “the traditional common-law method” of establishing principles in individual cases. The court also invited EPA to “provide administrative guidance” in a variety of ways, including through rulemaking.
Over the next several months and years, we can expect significant litigation over the practical definition and application of the “functional equivalent of a discharge” method proposed by the Supreme Court. As a result of the court’s “middle-ground” test, substantial uncertainty will continue to exist as to when certain companies will need to obtain NPDES permits.