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ABA Environmental Enforcement and Crimes Committee Newsletter Jan. 2010 - Vol. 11, No. 1
E-newsletter
01.28.2010
NPDES ENFORCEMENT POST-RAPANOS
The Supreme Court's decision in Rapanos v. United States and Carabell v. United States, 126 S. Ct. 2208 (2006) (collectively Rapanos) has not only created uncertainty in the enforcement of Section 404 cases under the Clean Water Act, 33 U.S.C. §§ 1251 et. seq. (CWA) involving dredged and fill material, but also in the federal enforcement of state-delegated National Pollutant Discharge Elimination System (NPDES) permits. Under the CWA, federal authority to regulate a particular discharge generally depends upon whether the water at issue is a water of the United States. Post-Rapanos, most states have a definition of state waters that is much broader than what would now be considered a water of the United States. The practical implication is that many stateissued NPDES permits may not be fully enforceable by the federal government because they regulate outfalls that do not discharge into waters of the United States.
This problem is especially acute in certain areas of the country where intermittent and ephemeral streams are more prevalent such as dry areas of the West or wet areas of the East such as Appalachia. In NPDES enforcement cases involving waters over which the federal government's jurisdiction is questionable, an issue that is likely to arise is whether courts can simply enforce the terms and conditions of a NPDES permit or whether courts must require proof that the permit conditions are in fact federally enforceable. Such proof may require a showing by the federal government that pollutants at issue discharge into a water of the United States.
This article examines: (A) the arguments in favor of the position that the federal government can simply enforce a violation of the terms and conditions of an NPDES permit, (B) the arguments supporting the position that the federal government must prove that a violation resulted in a discharge into a water of the United States, and (C) the implications of requiring a showing that the underlying permit conditions or limits are in fact federally enforceable, and (D) the possible regulatory and legislative resolutions to address this uncertainty.
I. Arguments in Favor of the Federal Government's Ability to Enforce the Terms and Conditions of an NPDES Permit
The United States has taken the position that the federal government can enforce a violation of the terms and conditions of an NPDES permit, without further evidence. See, e.g., United States v. Massey Energy Company, et. al., No. 2:07-0299 (S.D. W. Va. 2007). There are several good reasons to support this conclusion.
First, the plain language of the CWA and the Environmental Protection Agency's (EPA's) regulations provides for the enforcement of violations of any limitation or condition in an NPDES permit. Sections 309(a)(3) and (b) of the CWA provide that the administrator of EPA is authorized to bring an action if a person is in "violation of Section 1311. . . or is in violation of any permit condition or limitation implementing any of such sections in a permit issued under Section 1342 [NPDES] of this title by him or by a state." See also 33 U.S.C. § 1319(d). EPA's implementing regulations specifically state that "[a]ny permit noncompliance constitutes a violation of the Clean Water Act and is grounds for enforcement action." 40 C.F.R. § 122.41(a).
Second, even though the language of Section 309 arguably limits the enforceability of an NPDES permit's terms to those which are implementing an underlying requirement of the CWA, which in the NPDES context would implicate Section 301 (prohibiting "the discharge of any pollutant by any person"), one could argue that conditions or limitations that do not themselves result in a discharge into a water of the United States, but are necessary to prevent such discharges in the future, are in fact enforceable as they indirectly implement Section 301. For example, there are a number of specific NPDES permit conditions or limitations that do not themselves result in any discharges to waters of the United States but are still federally enforceable, such as operation and maintenance requirements and limitations on internal waste streams. See, e.g., United States v. Gulf States Steel, Inc., 54 F. Supp. 2d 1233, 1243-46 (N.D. Ala. 1999). If an NPDES permit is required in order to discharge into a water of the United States it can be argued that the permittee must comply with all of the terms and conditions of the permit that have some relationship to regulating such discharges. Id.
Third, the legislative history of the CWA supports a reading of the statute that allows an NPDES permit to be enforced when a term or condition has been violated, without further evidence. In enacting the CWA, Congress explained that "[o]ne purpose of these new requirements is to avoid the necessity of lengthy fact finding, investigations, and negotiations at the time of enforcement." S. Rep. No. 414, 92d Cong., 1st Sess. 7 (1972), reprinted in 1972 U.S.C.C.A.N. 3668, 3730. Congress concluded that, "if the timetables established throughout the Act are to be met, the threat of sanction must be real, and enforcement provisions must be swift and direct." See id. at 3731 (emphasis added). Furthermore, Congress intended that the NPDES permitting program and requirements for self-reporting violations, pursuant to Discharge Monitoring Reports (DMRs), would avoid lengthy fact finding, investigations, and negotiations at the time of enforcement. S. Rep. No. 414, 92d Cong., 1st Sess. 64, reprinted in 1972 U.S.C.C.A.N. 3668, 3746 ("[t]he factual basis for enforcement of requirements would be available at the time enforcement is sought, and the issue before the court would be a factual one of whether there had been compliance"). Requiring the United States to prove in an enforcement action that the permit conditions are in fact federally enforceable because they directly result in a discharge to a water of the United States would run counter to Congressional intent.
II. Arguments Supporting the Position That the Government Must Prove That an NPDES Permit Violation Resulted in a Discharge into a Water of the United States
On the other hand, there are several good reasons to conclude that where a state delegated NPDES program has broader coverage than the federal requirements, the United States must prove that the permit violations are enforceable by the federal government.
First, the CWA reserves the authority of states to implement broader and more stringent requirements than federal law requires (33 U.S.C. § 1370) and EPA regulations state that, "[i]f an approved State program has greater scope of coverage than required by Federal law the additional coverage is not part of the Federally approved program." 40 C.F.R. § 123.1(i)(2). EPA confirmed this position in the context of the Concentrated Animal Feeding Operation (CAFO) program. See Apr. 20, 2006, letter from Benjamin Grumbles, Assistant Administrator, EPA Office of Water to Congress ("additional [state] coverage is not part of the federally approved program, and the requirements imposed pursuant to that greater scope of coverage are not federally enforceable and are only imposed under State law."); see also 71 Fed. Reg. 37,744, 37,759 (June 30, 2006).
Second, since Section 309 arguably limits the enforcement of any permit condition or limitation to one that is implementing a specific section of the CWA mentioned in Section 309, it could be argued that EPA may only bring an action for a violation of a permit condition or limit that is implementing an obligation the federal government could require in the first place. See CWA §§ 309(a) and (b). Under this reading, to enforce an NPDES permit violation involving a stateissued permit, the federal government would have to prove that the permit violations would result in a "discharge of any pollutant by any person" under Section 301 of the CWA, the underlying CWA section that the NPDES permit is implementing. See 33 U.S.C. § 1311(a). Since the CWA defines "discharges of a pollutant" as "any addition of any pollutant to navigable waters from any point source" id. at § 1362(12)(A) and "navigable waters" is defined as "waters of the United States," id. at § 1362(7), the United States would have to show that a discharge of a pollutant from a permitted outfall discharged into a water of the United States.
Third, some states currently specify in their state codes that the scope of coverage that is greater than what is required by federal law is not part of the federally approved NPDES program and therefore not subject to EPA oversight. See, e.g., ALA. ADMIN. CODE 335-6-7-.06(5); LA. ADMIN. CODE 33:IX.2301.B. This presumably shows that states and EPA (which approves state-delegated programs) are aware that the portions of a state program and a state-issued NPDES permit that are broader than federal law are not enforceable by the federal government. It should be noted that neither Alabama nor Louisiana specify in their codes or state-issued NPDES permits which portions are only enforceable by the state. Therefore, a court would still have to determine in an enforcement action by the United States which sections of the NPDES permit are enforceable by the federal government and which are not.
III. Implications Post-Rapanos if the Government has to Prove That an NPDES Permit Violation Resulted in a Discharge into a Water of the United States
If a court determines that the United States cannot simply enforce the terms and conditions of an NPDES permit without proving that the violation resulted in a discharge to a water of the United States, there are numerous issues that the court will have to determine, including what test to apply in deciding whether a particular body of water is a water of the United States.
That determination could be difficult post-Rapanos. There are at least three tests that a court could apply: (1) the Scalia plurality test in which waters of the United States are "relatively permanent, standing or continuously flowing bodies of water" connected to traditional navigable waters (Rapanos at 2225-27); (2) the Kennedy significant nexus test in which waters are considered waters of the United States if they "significantly affect the chemical, physical, and biological integrity of other covered waters more readily understood as ‘navigable'" (Rapanos at 2248); or (3) a combination of the two pursuant to Marks v. United States, 430 U.S. 188, 193-94 (1977) in which a water would be considered a water of the United States if it meets either test.
The United States' position is that a particular water is a water of the United States if either the Scalia plurality or the Kennedy significant nexus test is met. See EPA Rapanos Guidance (Dec. 2, 2008)http://www.epa.gov/owow/wetlands/guidance/CWAwaters.html#definition. Several circuits, however, have disagreed with this position and there is currently a split between the circuits that have addressed this issue. Thus far, the First Circuit has adopted the federal government's position, while the Seventh, Ninth, and Eleventh Circuits have instead found that only the Kennedy significant nexus test applies. Numerous circuits have yet to address this issue. The Supreme Court has recently decided not to grant certiorari to clarify the appropriate test and resolve the split among the circuits. See United States Writ for Certiori in United States v. Charles Barry Robinson, 505 F. 3d 1208 (11th Cir. Oct. 24, 2007), pet'n for reh'g en banc denied, 2008 WL 794982 (Mar. 27, 2008), cert denied (Dec. 1, 2008). Therefore, the law that a federal district court would apply depends upon the circuit it is in and some courts currently have little or no guidance regarding what test should be applied.
As a result of the legal uncertainty surrounding the appropriate legal test under Rapanos, the level of evidence required to satisfy each test, and the uncertainty of federal permit obligations as a result, there are likely to be fewer enforcement cases brought by the federal government, as it must be careful not to bring anything but the strongest cases or risk producing bad law that could adversely impact future cases. At the very least, federal NPDES enforcement cases will take longer to develop, causing enforcement delays, as additional levels of scientific evidence must be developed in the event a court requires proof that a water at issue meets the significant nexus test. Once enforcement cases are initiated they will likely take longer to litigate as it will be more difficult to resolve liability on summary judgment as many NPDES enforcement cases have traditionally been resolved. See, e.g., United States v. Smithfield Foods, Inc., 965 F. Supp. 769, 783 (E.D. Va. 1997) (granting summary judgment on the basis of the defendants' DMRs as admissions and stating that "the Act's approach of regulating effluent levels was intended to achieve swift and direct enforcement based on simple numerical standards").
This Rapanos-generated legal uncertainty also hurts permit holders that will have to spend more on discovery costs, especially in light of the fact that in many cases discovery could proceed without a clear understanding of what legal test will ultimately be applied and what level of proof will be required to meet the applicable test. Despite the increased costs and time to litigate, the legal uncertainty surrounding these issues will likely result in fewer early settlements and more litigation, as parties will likely litigate long enough to determine what test will be applied and what their true burden of proof is before they are able to accurately assess their chances of ultimate success on the merits. Another strong possibility is that there will be more joint federal and state enforcement cases to avoid having to address some of these issues on the merits, as the terms of the permit will either be enforceable by the federal government, the state government, or both, and the ramifications of this issue can be resolved in the damages stage of the case.
IV. Conclusion
In sum, there are strong legal and policy reasons for concluding that the federal government can simply enforce the terms and conditions in an NPDES permit without proving the underlying factual claims that a pollutant was discharged into a water of the United States. On the other hand, there is a strong argument that because states are allowed to adopt requirements that are more stringent than the federal government could require and EPA has stated that in such situations the portions of the permitting program are unenforceable by the federal government, that the United States cannot simply enforce the terms and conditions of the permit, without more, as Congress had envisioned. Therefore, steps should be taken to resolve these legal ambiguities in the federal NPDES program.
Some possible steps include: (1) EPA or the states could specify the portions of state-delegated programs and state-issued NPDES permits that are beyond federal law, (2) NPDES permit holders could challenge their permits or request amendments to clarify their permit requirements before a federal enforcement action, see 33 U.S.C. § 1369(b)(1) and (b)(2) (barring challenges to an NPDES permit for the first time in an enforcement action), or (3) Congress could amend the CWA and/or EPA could enact regulations to clarify the federal definition of waters of the United States, which would likely make it clear which portions of a state-issued NPDES permit are enforceable by the federal government.
Jeff Talbert is a counsel at the law firm of Preti Flaherty Beliveau & Pachios LLP and a former trial attorney at the Department of Justice in the Environmental Enforcement Section of the Environment and Natural Resources Division. He was lead counsel for the federal government in United States v. Massey Energy Company et. al., No. 2:07-0299 (S.D. W. Va. 2007).