Big Changes to Wetland Regulations Expected
In a ruling that is expected to have major repercussions nationwide, on May 25th, the Supreme Court ruled unanimously in favor of Michael and Chantell Sackett, owners of a property near Priest Lake, Idaho. At issue was the question of whether wetlands on their property were considered Waters of the U.S. (WOTUS) and would thus require federal permits under Clean Water Act (CWA) Section 404 prior to construction.
Court Ruling and Regulatory Implications
The majority opinion was delivered by Justice Alito, and concurring opinions were issued by Thomas, Kagan, and Kavanaugh. The majority opinion found that the definition of “waters” in the CWA is limited to features “described in ordinary parlance as ‘streams, oceans, rivers, and lakes’” and to wetlands that are adjacent and “indistinguishable” from those bodies of water due to a continuous surface connection. Therefore, although wetlands on the Sackett’s property were located just 300 feet from Priest Lake and had a hydrological connection, the Court ruled that these wetlands are not WOTUS. The concurring opinions included an argument that no adjacent wetlands be considered WOTUS (Thomas), as well as arguments for including “wetlands separated from a covered water only by a man-made dike or barrier, natural river berm, beach dune, or the like” in the definition of “adjacent wetlands” as per statutory text and Court precedents (Kagan and Kavanaugh). However, all justices concurred that the “significant nexus test” should not be used to determine the jurisdiction of certain adjacent wetlands. The significant nexus test was proposed by Justice Kennedy during the Rapanos vs. EPA split decision in 2006 and determines the jurisdiction of certain “adjacent wetlands” on a case-by-case basis.
The Sackett ruling is a stark departure from the USACE and EPA’s current interpretation of “adjacent wetlands” under the CWA which has, by and large, remained consistent since the Rapanos decision (excluding brief periods during which the Obama and Trump era WOTUS definitions were in place). The decision also calls into question the Biden-era redefinition of WOTUS, which was published in the Federal Register in January and was based on guidance issued after the Rapanos decision, and lessons learned from the past 17 years of implementation since Rapanos.
At this time, no guidance has been issued from the USACE Headquarters to regional offices on how to proceed after the decision. However, the EPA has stated that they are now interpreting the phrase “waters of the United States” consistent with the Supreme Court’s decision in Sackett and are developing a new rule to amend the Biden WOTUS rule with the intent to issue a final rule by September 1, 2023.
Anticipated Effects on Projects
Although the USACE and EPA’s implementation of the Sackett decision remains unknown, several repercussions with potential to affect construction timelines are possible. In California, all wetlands are protected by State law regardless of federal jurisdiction, and where federal jurisdiction is lacking, project proponents must currently go through a lengthier and more arduous process with the State Water Resources Control Board which includes public review. In addition, many wetlands in California (including vernal pools) are hosts to federally listed endangered and threatened species. Because many vernal pools and other wetlands may no longer be subject to federal jurisdiction under the CWA, project proponents may need to obtain coverage under the Endangered Species Act through separate, more complex regulatory processes such as preparation of Habitat Conservation Plans. As a result, although wetlands throughout much of the U.S. are losing protection, wetlands in California will remain heavily regulated, potentially requiring more complicated processes.