Supreme Court Rules Some Discharges to Groundwater Require Clean Water Act Permits

On April 23, 2020, a 6-3 majority of the Supreme Court held that discharges through groundwater require a Clean Water Act permit if the discharge is the functional equivalent of a direct discharge from a point source into navigable waters. The dissenting justices argued that the Act only requires a permit when there is a direct discharge from a point source to navigable waters.

In County of Maui, Hawaii v. Hawaii Wildlife Fund, the County of Maui operated a wastewater reclamation facility where treated water is pumped through underground wells and then travels a half mile through groundwater to the ocean. In 2012, environmental groups brought a Clean Water Act citizen suit arguing that the County needed a permit for these discharges. The District Court and the Ninth Circuit agreed. The County petitioned the Supreme Court for certiorari. Because the circuits were split, the Supreme Court granted the petition.

The County and the Solicitor General as amicus argued that no permit is required if a pollutant travels through any amount of groundwater. Writing for the majority, Justice Breyer found this to be too narrow a construction of the Act, one that was inconsistent with the statutory text and with past EPA interpretations and would allow entities to avoid permits by simply designing facilities to discharge into a small amount of groundwater. There was no way, in the Court's view, that Congress intended such a loophole. For these same reasons, the majority gave no deference to EPA's recent interpretive statement that all releases of pollutants to groundwater are excluded from Clean Water Act permitting. Interpretive Statement on Application of the Clean Water Act NPDES Program to Releases of Pollutants From a Point Source to Groundwater, 84 Fed. Reg. 16824 (2019). However, the majority also declined to follow the Ninth Circuit's ruling that a permit is required when the pollutants are fairly traceable from the point source to a navigable water, viewing the statute in context as pointing to a position somewhere between these two.

The majority held that requiring a permit when a discharge is the functional equivalent of a direct discharge to navigable waters was the most consistent with Congress' intent. The opinion points to time and distance as two potentially critical factors and recites a list of other case-by-case considerations, including: (i) "the nature of the material through which the pollutant travels"; (ii) "the extent to which the pollutant is diluted or chemically changed as it travels"; (iii) "the amount of pollutant entering the navigable waters relative to the amount of the pollutant that leaves the point source"; (iv) "the manner by or area in which the pollutant enters the navigable waters"; and (v) "the degree to which the pollution (at that point) has maintained its specific identity." Because there are so many potentially relevant factors, the opinion left determining when a discharge is a functional equivalent to the regulators and subsequent reviewing courts.

Justice Kavanaugh joined the majority's opinion but wrote a concurring opinion. The concurring opinion emphasized that the majority opinion was consistent with Justice Scalia's plurality opinion in the last Supreme Court decision regarding the scope of EPA's authority to regulate under the Clean Water Act because both decisions include indirect discharges within EPA's jurisdiction. Rapanos v. United States, 547 U.S. 715 (2006). In addition, Justice Kavanaugh observed that any vagueness in the scope of EPA's jurisdiction using the "functional equivalency" test is the result of the statutory text rather than the Court's opinion, but the "time and distance" factors will be most important.

A dissent authored by Justice Thomas and joined by Justice Gorsuch argued that the only fair reading of the Clean Water Act is that only direct discharges into navigable waters are regulated. An additional dissent from Justice Alito reaching the same conclusion asserted that the "functional equivalency" test "provides no clear guidance and invites arbitrary and inconsistent application."

This decision will likely be at issue in the judicial challenges to EPA's recently finalized Navigable Waters Protection Rule, which sets out EPA's latest interpretation of its jurisdiction over wetlands. 85 Fed. Reg. 22250 (April 21, 2020). The Navigable Waters Protection Rule explicitly exempts from Clean Water Act jurisdiction groundwater and declines to regulate upstream wetlands that are only connected to a navigable water by groundwater. The Court's decision setting out a new "functional equivalent" test for groundwater discharges may necessitate new EPA regulations or guidance designed to clarify and provide consistency in implementation of the Court's test.

By leaving the ultimate analysis to the regulators and reviewing courts, the Court's holding will raise more questions for dischargers and regulators as to which discharges constitute the functional equivalent of a direct discharge and which do not even outside of the context of groundwater. Depending on how regulators and reviewing courts interpret the opinion, the result may well be future inconsistent application, as well as the absence of fair notice to the regulated community.