 |
“…O muddy waters, your mysteries
are deep and wide…”
by J. Craig Kiser.
It is often said that hard cases make bad law – particularly so when the applicable law is murky to start.
In 1972, Congress passed the Federal Water Pollution Control Act Amendments which, as amended in 1977, have become
commonly referred to as the Clean Water Act (the “Act”). The objective of the Act is “to restore and maintain the
chemical, physical, and biological integrity of the Nation’s waters.” 33 U.S.C. §1251(a).
Section 404 of the Act established a program to regulate the discharge of dredged and fill materials into
“navigable waters.” 33 U.S.C. § 1344(a). Under 33 U.S.C. §1311(a), “the discharge of any pollutant by any
person shall be unlawful.” Defined fairly broadly, the “discharge of a pollutant” includes “any addition of
any pollutant to navigable waters from any point source.” A “pollutant” includes not only traditional
contaminants but also solids such as “dredged soil, … rock, sand [and] cellar dirt,” 33 U.S.C. § 1362(6).
Finally, navigable waters are “the waters of the United States, including the territorial seas.” 33 U.S.C. §1362(7).
While the fluidity of, say, the 9th Amendment to the U.S. Constitution (“The enumeration in the Constitution, of
certain rights, shall not be construed to deny or disparage others retained by the people”) would understandably
need to be judicially filtered to produce some clarity, the succinct, albeit imprecise, definitions regarding
the scope of the Act do not necessarily suggest the need for several decades of Supreme Court jurisprudence to
dredge the Act and Congressional intent for a workable analytical framework. Alas, at least for those thirsting
for purification of the Act, it has become a situation of “water, water, everywhere, nor any drop to drink.”
Earlier this year, the Supreme Court handed down its decision in Rapanos v. United States, 126 S. Ct. 2208 (2006),
2006 WL 1667087.i Unfortunately for those left in Rapanos’s wake, the jurisdictional tides under the Act appear
to be changing, but it is not entirely clear whether they are coming or going. The opinion, consisting of a
four-justice plurality, with another justice concurring in judgment and the other four justices issuing two
dissenting opinions, leaves behind a legal quagmire for the rest of us to sieve through.
The Rapanos case consisted of two consolidated cases from the District Courts of Michigan regarding the
application, or lack thereof, for wetland fill permits. One of the petitioners in Rapanos, John A. Rapanos,
backfilled some wetlands on property he owned in April of 1989. The Rapanos property consisted of 54 acres
of “sometimes-saturated soil conditions,” though the nearest body of navigable water was located 11 to 20 miles
from the site. Rapanos did not seek or obtain a fill permit before backfilling his wetlands, and he was subsequently
told by the applicable authorities that the filled-in fields were “waters of the United States” and any fill activity
required a permit. Rapanos’ wetlands consisted of three separate sites, two of which connected to what the Court
referred to as “traditionally navigable waters” by surface connections, while the third connected to a man-made
drain, which then connected to a traditionally navigable water. The record from the lower courts did not reveal
whether “the connections between these wetlands and the nearby drains and ditches [were] continuous or intermittent,
or whether the nearby drains and ditches contain continuous or merely occasional flows of water.”
The District Court held that Rapanos’ wetlands were subject to federal regulation since they were “adjacent to
waters of the United States,” which finding was upheld on appeal to the Sixth Circuit as “there were hydrological
connections between all three sites and corresponding adjacent tributaries of navigable waters.”
The Carabells took a different path than Rapanos by trying to obtain a permit before filling in any wetlands,
but reached a similar result when their permit application was denied. Located about a mile from Lake St. Clair,
a traditionally navigable water, the Carabells’ land was connected to the lake by a series of ditches and drains.
More specifically:
“A man-made drainage ditch [ran] along one side of the wetland, separated from it by a 4-foot-wide man-made berm.
The berm [was] largely or entirely impermeable to water and block[ed] drainage from the wetland, though it may
[have] permit[ted] occasional overflow to the ditch. The ditch emptie[d] into another ditch or drain, which
connect[ed] to Auvase Creek, which emptie[d] into Lake St. Clair.”
After unsuccessful appeals in administrative forums, the Carabells filed suit in District Court but were again
unsuccessful as that court held federal jurisdiction was established since the wetland was “adjacent to neighboring
tributaries of navigable waters and ha[d] a significant nexus to waters of the United States.” Carabell v.
U.S. Army Corps of Engineers, 391 F.3d 704, 708 (6th Cir. 2005). As in the Rapanos’ appeal, the Sixth Circuit
affirmed on the grounds that the Carabells’ wetlands were adjacent to navigable waters. Id.
The Supreme Court granted certiorari and consolidated the cases to determine once and for all, one would hope,
exactly what “navigable waters” and “waters of the United States” are. Before reaching its decision, however,
the Court took considerable time to discuss the existing reservoir of caselaw and regulatory history
surrounding the Act.
One of the earlier cases to consider the phrase “navigable waters of the United States,” The Daniel Ball,
10 Wall. 557 (1871), held that phrase referred to interstate waters that are “navigable in fact” or readily
susceptible of being rendered so. 10 Wall. 557 at 563. This traditional definition was initially adopted by
the Corps. See 39 Fed. Reg. 12119, codified at 33 CFR §209.120(d)(1) (1974).
Current regulations, however, interpret “the waters of the United States” to include all “waters such as intrastate
lakes, rivers, streams (including intermittent streams), mudflats, sandflats, wetlands, sloughs, prairie potholes,
wet meadows, playa lakes, or natural ponds, the use, degradation or destruction of which could affect interstate
or foreign commerce,’ 33 CFR §328.3(a)(3); “[t]ributaries of [such] waters;” and “[w]etlands adjacent to [such]
waters [and tributaries] (other than waters that are themselves wetlands).” 33 CFR §328.3. Further, “adjacent”
wetlands include those “bordering, contiguous [to], or neighboring waters of the United States” as well as
those “separated from other waters of the United States by man-made dikes or barriers, natural river berms,
beach dunes and the like.” Id.
Another significant decision regarding the Act was handed down in United States v. Riverside Bayview Homes, Inc.,
474 U.S. 121 (1985). Considering a wetland “adjacent to a body of navigable water,” due to the fact that
“the area characterized by saturated soil conditions and wetland vegetation extended beyond the boundary of
respondent’s property to… a navigable waterway,” the Riverside Bayview Court upheld the Corps’ interpretation
of “waters of the United States” to include wetlands actually abutting traditional navigable waters. 474 U.S.
at 131. Since “the transition from water to solid ground is not necessarily or even typically an abrupt one,”
[at some point] “the Corps must necessarily choose some point at which water ends and land begins.” 474 U.S. at 132.
In Solid Waste Agency of North Cook Cty. v. Army Corps of Engineers, 531 U.S. 159 (2001) (“SWANCC”), the Court,
considering the Corps’ effort to extend its jurisdiction to an abandoned sand and gravel pit, held that
“the jurisdiction of the Corps does not extend to ponds that are not adjacent to open water” 531 U.S. at 162,
reasoning that Riverside Bayview emphasized “the significant nexus between the wetlands and the ‘navigable waters.’”
531 U.S., at 168. As such, “‘nonnavigable, isolated, intrastate waters… that did not actually abu[t] on a
navigable waterway,” do not qualify as “waters of the United States.” 531 U.S., at 167.
After Riverside Bayview and SWANCC, the “significant nexus” test appeared to be the Court’s definitive
statement regarding the jurisdictional reach of the Corps to wetlands throughout the country. As can be
imagined, some courts got somewhat creative, and one example of how far some courts stretched the bounds
of the “significant nexus” test came in United States v. Rueth Development Co., 189 F. Supp.29 874
(ND Ind. 2002). The court in that case held a significant nexus could be established since “water
molecules currently present in the wetlands will inevitably flow towards and mix with water from
connecting bodies,”’ and “[a] drop of rainwater landing in the site is certain to intermingle with water”
nearby. 189 F. Supp.2d at 877-878.
Perhaps in response to this liberal interpretation, the plurality in Rapanos derived a two-part test for
determining the Corps’ jurisdiction. In analyzing the Corps’ position, the Rapanos Court stated “[t]he Corps’
expansive approach might be arguable if the CSA defined ‘navigable waters’ as ‘water of the United States.’
But ‘the waters of the United States’ is something else. The use of the definite article (“the”) and the
plural number (“waters”) show plainly that §1362(7) does not refer to water in general. In this form,
‘the waters’ refers more narrowly to water ‘[a]s found in streams and bodies forming geographical features
such as oceans, rivers, [and] lakes,’ or ‘the flowing or moving of such masses, as of waves or floods,
making up such streams or bodies.’” As such, “[o]n this definition, ‘the waters of the United States’
include only relatively permanent, standing or flowing bodies of water… [i.e.,] water as found in
‘streams,’ ‘oceans,’ ‘rivers,’ ‘lakes,’ and ‘bodies’ of water ‘forming geographical features.’” The end
result being that “waters of the United States” are only “continuously present, fixed bodies of water, as
opposed to ordinarily dry channels through which water occasionally or intermittently flows.”
Moreover, the Court suggested the definitions within the Act itself distinguish “navigable waters” from
intermittent flows. Under the Act, a “point source” is “any discernible, confined and discrete conveyance,
including but not limited to any pipe, ditch, channel, tunnel, conduit, well, discrete fissure, container,
rolling stock, concentrated animal feeding operation, or vessel or other floating craft, from which
pollutants are or may be discharged.” 33 U.S.C. §162(14). When considering that the “discharge of a
pollutant” is “any addition of any pollutant to navigable waters from any point source,” 33
U.S.C. §1362(12)(A), it would appear that “point source” and “navigable waters” are mutually exclusive.
Based on these rationales, the plurality held that, “…on its only plausible interpretation, the phrase
‘the waters of the United States’ includes only those relatively permanent, standing or continuously
flowing bodies of water ‘forming geographic features’ that are described in ordinary parlance as
‘streams[,]… oceans, rivers [and] lakes.’”
For the plurality, however, permanence of a water alone was not enough to establish the Corps’ jurisdiction.
Looking back to the holdings of Riverside Bayview and SWANCC, the Court noted that those decisions relied
on the “significant nexus between the wetlands and ‘navigable waters’” at issue, and stood for the proposition
that defining the highwater mark of the Corps’ reach “rested upon the inherent ambiguity in defining where
water ends and abutting (“adjacent”) wetlands begin. In other words, “isolated ponds [a]re not ‘waters of
the United States’ in their own right [as they] presen[t] no boundary-drawing problem.”
Reading Riverside Bayview and SWANCC together, the plurality reasoned “only those wetlands with a continuous
surface connection to bodies that are ‘waters of the United States’ in their own right, so that there is
no clear demarcation between ‘waters’ and wetlands, are ‘adjacent to’ such waters and covered by the Act.
Wetlands with only an intermittent, physically remote hydrologic connection to ‘waters of the United States’
do not implicate the boundary-drawing problem of Riverside Bayview, and thus lack the necessary connection
to covered waters that we described as a ‘significant nexus’ in SWANCC.”
In its decision to remand, the plurality stated: “[t]he lower courts should determine, in the first instance,
whether the ditches or drains near each wetland are ‘waters’ in the ordinary sense of containing a relatively
permanent flow; and (if they are) whether the wetlands in question are ‘adjacent’ to these ‘waters’ in the
sense of possessing a continuous surface connection that creates the boundary-drawing problem we addressed
in Riverside Bayview.”
In rejecting the two-part test devised by the plurality, Justice Kennedy’s concurring opinion stated the
plurality “rea[d] nonexisting requirements into the Act” by requiring a “water” to consist of a permanent
body of water or one continuously flowing, since such a requirement was not aligned with the purpose of
the statute. If the Act was intended, at least in part, to preserve water quality, then “[t]he merest
trickle, if continuous, would count as a “water” subject to federal regulation, while torrents thundering
at irregular intervals through otherwise dry channels would not.”
Further, “a full reading of the dictionary definition precluded the plurality’s emphasis on permanence:
‘The term waters may mean flood or inundation,’ events that are impermanent by definition.” While a
flood or inundation may not necessarily be navigable in the traditional sense, the use of the term “waters”
of the United States, as opposed to “water” of the United States, “does not necessarily carry the connotation
of [permanence].”
Moreover, the plurality’s use of the definition of “point source” troubled Justice Kennedy since “[p]olluted water
could flow night and day from a pipe, channel, or conduit and yet still qualify as a point source,” meaning point
sources are not, by definition, strictly intermittent. Id. Indeed, “any contrary conclusion would likely exclude,
among other things, effluent streams from sewage treatment plants, … [and] even were the statute read to require
continuity of flow for navigable waters, certain water-bodies could conceivably constitute both a point source
and a water.”
Shifting the focus away from permanence, Justice Kennedy reasoned, is what the Riverside Bayview Court intended
after all, since, in that decision, where the regulated wetland received its moisture was irrelevant, so long as
the Corps could reasonably conclude that such wetland had “‘significant effects on water quality and the aquatic
ecosystem.’”
Justice Kennedy did, however, deem the “significant nexus” test to be the key element from the Riverside
Bayview and SWANCC decisions: “‘It was the significant nexus between wetlands and navigable waters,’ the Court held,
‘that informed our reading of the [Act] in Riverside Bayview Homes.’”
As such, to conform with existing precedent, Justice Kennedy’s approach to Rapanos relied on the holdings from
Riverside Bayview and SWANCC. Specifically, his view of the question was, “[d]o the Corps’ regulations, as applied
to the wetlands in Carabell and the three wetlands parcels in Rapanos, constitute a reasonable interpretation of
‘navigable waters’ as in Riverside Bayview or an invalid construction as in SWANCC? Taken together these cases
establish that, in some instances, as exemplified by Riverside Bayview, the connection between a nonnavigable water
or wetland and a navigable water may be so close, or potentially so close, that the Corps may deem the water or
wetland a ‘navigable water’ under the Act. In other instances, as exemplified by SWANCC, there may be little or
no connection. Absent a significant nexus, jurisdiction under the Act is lacking.”
So, what does all of this mean for property owners and developers? Unfortunately, it would appear that treading
water in the hopes of getting more guidance is the safest plan. However, in uncertain times, the real estate
development field does not sit quietly and wait for direction from the federal government before getting back to
work.
The plurality’s test is easy enough to summarize: when looking at an area of wetlands, determine first whether
the nearby water source is relatively permanent, and, if so, is there a continuous surface connection with such
relatively permanent water source such that it is difficult to tell whether the water stops and the wetland begins?
But, with only four Justices supporting this theory, what really is the law? Justice Kennedy’s concurring
opinion emphasized finding a significant nexus, which could arguably be taken as ranging from (1) the plurality’s
requirement of a permanent surface connection between wetlands and their water source, such that defining the
boundary between the two is impossible or nearly so; to (2) deferring somewhat to the Corps’ expertise to determine
whether the connection between a nonnavigable water or wetland and a navigable water is so close, or potentially
so close, as to create this significant nexus; to (3) the other extreme that the connection between wetland and
water source of a single water molecule is sufficient.
Without a clear direction from Congress or the Supreme Court, the lower courts and any individual or entity
considering wetland development may just have to assume some risk that their decision to fill or not to fill,
or to apply or not to apply, will be overruled at some point. However, considering that “[t]he average applicant
for an individual permit spends 788 days and $271,596 in completing the process, and the average applicant for a
nationwide permit spends 313 days and $28,915--not counting costs of mitigation or design changes,” and “for
backfilling his own wet fields, Mr. Rapanos faced 63 months in prison and hundreds of thousands of dollars in
criminal and civil fines,” one could hardly consider assuming such risk to be a fair cost of doing business.
What can be derived from the “plurality plus one” decision is that, while permanence of a supplying
water source may or may not be an absolute requirement, establishing some kind of significant connection
between a wetland and its water source is absolutely required. The problem there is, however, whether such
a significant connection has to be a continuous surface channel, or if it can be a single raindrop.
In a situation with such little guidance and such extreme disparity between interpretations, the safest route
would seem to be to take the most restrictive interpretation. That is, if Developer A wants to fill a
wetland directly connected to a branch of the Mississippi River, he can rest assured that he’ll need to
apply for a fill permit, forgo his plans, or hire a good lawyer. On the other hand, if Developer B wants
to fill a wetland similar to an isolated pond but that, during the rainier months of the year, is connected
to an ephemeral stream, he will have to make the decision to either spend thousands of what may be otherwise
budgeted dollars for permit he doesn’t actually need, or take risk of becoming the subject of the litigation
that eventually affirms or overrules Rapanos.
Considering the issues giving rise to the Act, namely pollution control and wetlands preservation, among others,
it is hard to imagine that Congress intended a statute as comprehensive as the Clean Water Act to have some of
its more significant provisions be reduced to interpreting the difference between a creek that flows 12 months
of the year versus one that flows six months of the year. In fact, by using the term “waters of the United States,”
it is arguable that Congress was specifically trying to avoid such nitpicking.
Forty years ago, the Supreme Court decided United Mine Workers v. Gibbs, 383 U.S. 715 (1966). Dealing with an
entirely different type of jurisdiction, that Court first derived the test for establishing the ability of a
federal court deciding matters within its federal-question jurisdiction under 28 U.S.C. §1331 to decide state
law claims not otherwise within their subject-matter jurisdiction – i.e., if the federal and state law claims
“derive from a common nucleus of operative fact” and comprise “but one constitutional ‘case.’” 383 U.S. at 726.
Several decades later, that Court held a federal district court could not consider within its jurisdiction a
claim involving a party not already a party to a claim independently within that court’s subject matter
jurisdiction. See Finley v. United States, 490 U.S. 545 (1989). One of the unique aspects of the Finley case,
however, and the sole reason it is mentioned in this article, is that decision was tempered by statements from the
Court clarifying that Congress is the body vested with the power to establish the jurisdiction of the federal courts,
see 490 U.S. at 550, and “[w]hatever [this Court] say[s] regarding the scope of jurisdiction conferred by a
particular statute can of course be changed by Congress.” 490 U.S. at 556. Indeed, with such blatant encouragement,
Congress enacted the supplemental jurisdiction statute, 28 U.S.C. §1367, the next year.
While the Rapanos decision is not so suggestive of a need for statutory revision as Finley, it is not entirely
devoid of subtle insinuation. In discussing the claimed potential adverse effects of the plurality’s test for
wetlands jurisdiction, Justice Scalia, writing for the plurality, states, “[i]t is not clear that the state and
local conservation efforts that the CWA explicitly calls for, see 33 U. S. C. §1251(b), are in any way inadequate
for the goal of preservation. In any event, a Comprehensive National Wetlands Protection Act is not before us,
and the ‘wis[dom]’ of such a statute, post, at 19 (opinion of Stevens, J.), is beyond our ken. What is clear,
however, is that Congress did not enact one when it granted the Corps jurisdiction over only "the waters of
the United States.”
As Chief Justice Roberts stated in his concurring opinion: “It is unfortunate that no opinion commands a majority
of the Court on precisely how to read Congress’ limits on the reach of the Clean Water Act. Lower courts and
regulated entities will now have to feel their way on a case-by-case basis.”
Perhaps its time for Congress to boil down the “waters of the United States” a little.
i
J. Craig Kiser is a commercial real estate attorney with Schell Bray Aycock Abel & Livingston PLLC,
located in Greensboro and Chapel Hill. Craig's email address is ckiser@sbaal.com.
|
