Supreme Court Declines to Review 11th Circuit Decision Upholding EPA Water Transfer Rule by Joe Middleton
On November 29, the Supreme Court denied certiorari in an appeal of an Eleventh Circuit decision upholding the United States Environmental Protection Agency’s (“EPA”) 2008 Water Transfer Rule. Friends of the Everglades v. South Florida Water Mgmt. Dist., No. 10-196, 2010 WL 3164795 (Nov. 29, 2010). The Water Transfer Rule allows transfers from one jurisdictional water of the United States to another without the need for a National Pollution Discharge Elimination System (“NPDES”) permit, even where the transfer introduces pollutants to the receiving water body. The Rule has significant implications for water users in Colorado, who may be affected by the introduction of pollutants which may occur in numerous Colorado water transfers, including large trans-basin diversions like the Colorado-Big Thompson Project.
Background
The Eleventh Circuit’s decision resulted from an appeal of a judgment in the United States District Court for the Southern District of Florida. Friends of the Everglades, Inc. v. South Florida Water Mgmt. Dist., No. 02-80309 Civ., 2006 WL 3635465 (S.D. Fl. Dec. 11, 2006). That decision considered whether water transfers by several large pumping stations operated by the South Florida Water Management District required an NPDES permit. Id. at *1. The pumps convey water from a system of canals south of Lake Okeechobee and into the Lake in order to prevent flooding in the large agricultural district to the south. Both the Lake and the canals are jurisdictional waters of the United States, though water quality is significantly different in the two bodies. The pumping process results in the introduction of pollutants into the Lake which would not otherwise be present, and which detrimentally affect its water quality.
Several citizens’ groups brought suit under the citizens suit provision of the Clean Water Act, 33 U.S.C. § 1365(a), alleging that the introduction of pollutants into the Lake during pumping operations violated the Act’s NPDES permitting regime which generally prohibits “the discharge of any pollutant by any person” except in compliance with the NPDES program. See 42 U.S.C. § 1311(a); id. at *1. The water management district defended the suit by arguing that its pumping simply moved already polluted water from one jurisdictional water to another, and thus did not actually add pollutants to waters of the United States. Id. at *34-35. The district court rejected this argument, finding that the lake and canals were “meaningfully distinct,” based on chemical and biological differences between them, their different classifications under state laws implementing the Clean Water Act, and the fact that the back-pumped waters would not reach the lake without pumping. Id. at 43-44. The court reasoned that the statute’s language prohibiting the “addition” of pollutants was intended to apply to any addition from anywhere outside the receiving water body, including another body of water. Id. After supplemental briefing on the issue of remedies, the court entered an injunction requiring the district to obtain an NPDES permit, and the district appealed to the Eleventh Circuit.
EPA’s Water Transfer Rule
After the briefing stage in the Eleventh Circuit appeal, but before the appeal could be decided, EPA finalized its Water Transfer Rule. 73 F.R. 33697 (June 13, 2008). The rule defines water transfers as any activity which “conveys or connects waters of the United States without subjecting the transferred water to intervening industrial, municipal or commercial use,” and exempts those transfers from the NPDES permitting requirement. Adopting earlier reasoning by the D.C. Circuit—reasoning which has since been rejected by the Supreme Court—the agency took the view that an addition of pollutants occurs only if the point source itself introduces a pollutant into a water “from the outside world.” Id. at 3377 (quoting National Wildlife Fed’n v. Gorsuch, 693 F.2d 156, 175 (D.C. Cir. 1982)). The agency argued that Congress simply did not intend to regulate the inevitable introduction of pollutants which occurs when two jurisdictional waters are combined. This line of reasoning has also been referred to as the “unitary waters” theory, which has been rejected by both the Second and Ninth Circuits, and called into doubt by the Supreme Court. See, e.g., South Florida Water Mgmt. Dist. v. Miccosukee Tribe of Indians of Florida, 541 U.S. 95, 107 (2005); Catskills Mountains Chapter of Trout Unlimited, Inc. v. City of New York, 451 F.3d 77, 83 (2nd Cir. 2006); Northern Plains Res. Council v. Fidelity Exploration and Dev., 325 F.3d 1155, 1163 (9th Cir. 2003). The agency described the Clean Water Act’s “addition” language as ambiguous, and declared that, in light of the potential for the NPDES program to add significant administrative burdens to a large number of water transfers, its interpretation of the statute was reasonable since Congress did not intend that the Clean Water Act interfere with the States’ ability to allocated water resources.
The Eleventh Circuit’s Decision
On appeal, the Eleventh Circuit noted that the unitary waters theory had been rejected by every court that had directly considered it, and recognized that almost all existing precedent was “against the unitary waters theory,” including an earlier Eleventh Circuit decision. Friends of the Everglades v. South Florida Water Mgmt. Dist., 570 F.3d 1210, 1218 (11th Cir. 2010). Nevertheless, the court reasoned that because EPA had, in its newly published regulation, interpreted the statute in accordance with the unitary waters theory, that interpretation was entitled to deference under Chevron USA, Inc. v. Nat. Res. Defense Council, Inc., 467 U.S. 837 (1984). Id. at 1227. The court focused on the “addition . . . to navigable waters” language of the statute, finding this language ambiguous because it could be interpreted to apply to navigable waters as a whole, or to individual navigable water bodies. Id. The court recognized that under the unitary waters theory and EPA’s water transfer rule, no NPDES permit would be required to “pump the most loathsome navigable water in the country into the most pristine one,” but nevertheless found that EPA’s construction of the statute should stand under Chevron because it was one of two permissible interpretations. Id. at 1226-28. Based on this reasoning, the appellate court reversed the district court. Id. at 1228.
The Friends of the Everglades, Florida Wildlife Federation and Fishermen Against Destruction of the Environment filed a petition for certiorari, framing the question presented as “whether all waters of the United States may be treated as a ‘unitary’ whole for purposes of the Act’s provisions requiring permits for point source discharges so that transferring pollutants from one distinct water body to another . . . does not constitute an ‘addition’ of the pollutants to navigable waters and therefore does not require a permit.” The petitioners argued that the Eleventh Circuit’s decision would result in a broad exemption to the NPDES permit requirement that is contrary to both the plain language of the Clean Water Act and the Act’s overall scheme. The petitioners objected to the appellate court’s focus on the absence of the word “any” before the words “navigable waters” in its consideration of the meaning of the general prohibition against adding pollutants, and argued that the Eleventh Circuit had created an ambiguity where only one interpretation is compatible with the rest of the statute.
The petitioners claimed that the Clean Water Act’s prohibition against adding pollutants to jurisdictional waters does not turn on the source of the pollution, or whether that pollution originates in a jurisdictional water or anywhere else. They also argued that EPA’s interpretation did not deserve deference because it was inconsistent with the NPDES program’s scheme for establishing and maintaining different water quality standards in specific, individual water bodies. A number of parties filed amicus briefs urging the Court to grant certiorari, including the Sierra Club; the City of New York, a consortium of States including Colorado, Alaska, California, Florida, Idaho, Nebraska, Nevada, New Mexico, North Dakota, South Dakota, Texas, Utah and Wyoming; and parties in Colorado, including the City and County of Denver; the Northern Colorado Water Conservancy District and the Town of Grand Lake, the Greater Grand Lake Shoreline Association and the Three Lakes Watershed Association.
The Supreme Court’s refusal to grant certiorari leaves EPA’s Water Transfer Rule in effect for the time being. In addition, several direct challenges to the rule which were consolidated, transferred to the Eleventh Circuit, and stayed pending resolution of the Friends of the Everglades appeal, are now likely be dismissed, since the Eleventh Circuit has determined that EPA’s interpretation of Clean Water Act is permissible. As a result, the South Florida Water Management District may continue its pumping operations, and similar water transfers will continue without the need to comply with the NPDES regime. However, other challenges are likely in the future—particularly in light of decisions in the Second and Ninth Circuits which rejected the unitary waters theory prior to EPA’s promulgation of the Water Transfer Rule. Future challenges are likely to focus on the reasonableness of EPA’s interpretation of the prohibition against pollutants in light of what most federal courts have found to be a relatively straightforward statutory scheme intended to prevent the addition of any pollutants to navigable waters except in compliance with the NPDES program.