WASHINGTON LEGAL FOUNDATION 2009 Massachusetts Avenue, NW Washington, DC

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1 WASHINGTON LEGAL FOUNDATION 2009 Massachusetts Avenue, NW Washington, DC Submitted Electronically ( Environmental Protection Agency (Attn: Donna Downing) Washington, DC U.S. Army Corps of Engineers (Attn: Stacey Jensen) Washington, DC Re: Proposed Rule to Recodify Pre-Existing Rules Regarding Definition of Waters of the United States Docket ID No. EPA-HQ-OW Fed. Reg (July 27, 2017) Dear Ms. Downing and Ms. Jensen: The Washington Legal Foundation appreciates this opportunity to submit these comments to the Environmental Protection Agency and the Department of the Army ( the Agencies ) regarding their proposal to rescind the definition of Waters of the United States ( WOTUS ) in the Code of Federal Regulations and to re-codify (on an interim basis) the definition of WOTUS as it existed prior to WLF fully supports the proposed rescission and re-codification. The proposal is fully consistent with the requirements of the Administrative Procedure Act (APA). In particular, the Agencies have provided the requisite reasoned explanation for their proposal to revise a past regulatory decision. See Motor Vehicle Mfrs. Ass n v. State Farm Mutual Auto. Ins. Co., 463 U.S. 29 (1983). As the Agencies point out, the existing regulations have been stayed nationwide by an order of the U.S. Court of Appeals for the Sixth Circuit, and have been stayed in 13 States by an order of the U.S. District Court for the District of North Dakota. The result of those stays is to make effective the pre-existing definition of WOTUS (which was in place for 30 years before the new definition was adopted in 2015). Accordingly, by proposing the formal rescission of the 2015 definition and replacing it with the pre-existing definition, the Agencies are doing little more than formalizing the status quo. Moreover, the proposal adds an important degree of stability to the law; that stability is crucial to regulated entities who have a strong interest in knowing in advance the scope of CWA regulations they are likely to face in the near term. As the Agencies point out, the existing court injunctions are subject to change at any moment. For example, a pending U.S. Supreme Court

2 EPA and U.S. Army Corps of Engineers September 27, 2017 Page 2 case will decide in the near future whether the Sixth Circuit possesses subject-matter jurisdiction over challenges to the 2015 WOTUS rule. If the Supreme Court rules that original subjectmatter jurisdiction exists only in the district courts, the Sixth Circuit s injunction will vanish immediately. At that point, regulated entities would face conflicting rules: one definition of WOTUS in the 13 States covered by the North Dakota injunction and another definition in the other States. Moreover, challenges to the 2015 WOTUS rule are pending in other district courts, and those courts might respond to the Supreme Court s jurisdictional ruling by issuing injunctions of their own thereby adding to the confusion. The Agencies can ensure uniformity and predictability in the law by formalizing re-adoption of the pre-existing WOTUS definition at the same time that it studies optimal long-term solutions. There exists another and far more important reason to rescind the 2015 WOTUS regulations. Their adoption was both substantively and procedurally defective. The 2015 WOTUS definition is wholly inconsistent with the definition of WOTUS spelled out by Congress when it adopted the CWA. The new definition encompasses vast amounts of land that lack any direct connection with the navigable waters of the United States. Moreover, regulation of much of that land is entrusted to the States, and efforts by the United States to regulate that land is inconsistent with the Commerce Clause. The substantive deficiencies in the 2015 WOTUS definition are explained at length in comments WLF filed with the Agencies on August 22, A copy of the Comments is attached. The 2015 regulations are also procedurally defective; they were promulgated by the Agencies in violation of the requirements of the APA. In particular, the regulations were promulgated improperly because the Agencies made last-minute changes to the regulations that were not logical outgrowths of the Agencies proposed rule thereby depriving affected parties of an opportunity to comment on those new provisions. The regulations were procedurally defective for other reasons as well, including the Agencies failure to provide reasoned justifications for their expansive definition of tributaries and for their selection of distance criteria. The procedural deficiencies in the 2015 regulation are explained at length in the amicus curiae brief WLF filed in support of the Petitioners in the pending Sixth Circuit challenge to the 2015 WOTUS definition. See Sixth Circuit Case No and related cases. A copy of the WLF brief is attached.

3 EPA and U.S. Army Corps of Engineers September 27, 2017 Page 3 In sum, WLF fully supports the Agencies proposal. Once the 2015 regulation has been rescinded, WLF looks forward to the opportunity to participate in agency proceedings during which the Agencies consider adoption of a new WOTUS definition. Sincerely, /s/ Richard A. Samp Richard A. Samp Cory L. Andrews Washington Legal Foundation ATTACHMENTS: (1) WLF Comments in Docket ID No. EPA-HQ-OW (filed Aug. 22, 2014) (2) WLF Amicus Brief in Sixth Circuit Case No (filed Nov. 8, 2016)

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5 COMMENTS of THE WASHINGTON LEGAL FOUNDATION to the ENVIRONMENTAL PROTECTION AGENCY and the U.S. ARMY CORPS OF ENGINEERS Concerning DEFINITION OF WATERS OF THE UNITED STATES UNDER THE CLEAN WATER ACT (Docket ID No. EPA-HQ-OW ) Cory L. Andrews Markham S. Chenoweth WASHINGTON LEGAL FOUNDATION 2009 Massachusetts Ave., N.W. Washington, D.C (202) August 22, 2014

6 WASHINGTON LEGAL FOUNDATION 2009 Massachusetts Avenue, NW Washington, DC (202) August 22, 2014 EPA Docket Center Attention: Docket ID No. EPA-HQ-OW EPA West Room Constitutional Ave. NW, Washington, D.C Re: Comments Concerning the Proposed Definition of Waters of the United States Under the Clean Water Act (Docket ID No. EPA-HQ- OW ) Dear Sir/Madam: Pursuant to the public notice published at 79 Fed. Reg (June 16, 2014), the Washington Legal Foundation (WLF) appreciates this opportunity to offer comments to the Environmental Protection Agency (EPA) and the U.S. Army Corps of Engineers (the Corps ) on the agencies proposed Rule defining the scope of federal jurisdiction under the Clean Water Act (CWA) in light of recent Supreme Court rulings. WLF is concerned that the proposed Rule s reliance on Justice Kennedy s significant nexus test to promulgate new definitions for tributary, adjacent, and other waters will undoubtedly lead to the sort of resource-intensive and inconsistent case-by-case analysis explicitly rejected by a strong majority of the Supreme Court in Rapanos. In all events, such a rule exceeds the powers granted to the agencies under the CWA. I. Interests of WLF Founded in 1977, the Washington Legal Foundation is a public-interest law firm and policy center based in Washington, D.C. with supporters throughout the United States. WLF devotes a substantial portion of its resources to defending and promoting free enterprise, individual rights, a limited and accountable government, and the rule of law. To that end, WLF engages in original and amicus litigation in a wide variety of environmental matters, including cases involving the proper scope of the federal government s Commerce Clause powers. In particular, WLF has participated as amicus curiae in several cases that raise constitutional issues under the CWA that are similar to

7 EPA Docket Center Environmental Protection Agency August 22, 2014 Page 2 those at issue in the proposed Rule. See, e.g., Rapanos v. United States, 547 U.S. 715 (2006); Solid Waste Agency of Northern Cook County v. United States Army Corps of Engineers, 531 U.S. 159 (2001) ( SWANCC ). In addition, WLF s Legal Studies Division, the publishing arm of WLF, frequently produces and distributes articles on a wide array of legal issues related to EPA regulation under the CWA. See, e.g., George J. Mannina, Jr., EPA Seeks to Overturn Supreme Court Decisions Limiting Water Act Jurisdiction, WLF LEGAL BACKGROUNDER (May 20, 2011); Joshua A. Bloom, New Rule Expands Oversight of Wetlands, WLF COUNSEL S ADVISORY (March 9, 2001); James M. Thunder, Courts and Regulators Shape New Application of Clean Water Act, WLF LEGAL BACKGROUNDER (October 29, 1999). WLF is concerned that the agencies proposed definition of waters of the United States is not consistent with the leading Supreme Court cases interpreting the permissible outer limits of federal jurisdiction under the CWA. The purported goals of EPA s proposal are to provide clarity and predictability to the public, with a rule that is clear, understandable, and consistent with the law. A careful reading of the proposed Rule, however, suggests that its practical effect will likely be to accomplish something Congress chose not to do effectively circumvent the Supreme Court s imposition of meaningful limits on how far the Corps and EPA can go in asserting jurisdiction under the CWA. II. The Proposed Rule At its core, the proposed Rule would presumptively determine that certain waters are subject to regulation under the CWA, based in part upon a controversial draft EPA report that considers studies of the connectivity of streams and wetlands to downstream waters. If finalized, the proposed Rule will have expansive consequences for all developers and users of land across the United States, as the proposal will set the table for determining which wetlands, ponds, and other waters would fall within the jurisdictional reach of the CWA and, in turn would be subject to the permitting and enforcement authorities of EPA and the Corps. Defined Categories of Waters of the United States. In the proposed Rule, the agencies propose to define the following categories to be waters of the United States : Traditional navigable waters. These are tidal waters or waters that are, have been or could be used to transport interstate or foreign commerce.

8 EPA Docket Center Environmental Protection Agency August 22, 2014 Page 3 Interstate waters. These are waters that cross state lines. The territorial seas. These are a belt of waters surrounding the United States shoreline. Tributaries of traditional navigable waters, interstate waters, or the territorial seas. The proposal includes all natural and man-made tributaries adjacent to or near those waters. All waters, including wetlands, that are adjacent to traditional navigable waters, interstate water, the territorial seas, impoundments, or tributaries. Impoundments of traditional navigable waters, interstate waters, including interstate wetlands, the territorial seas, and tributaries, as defined, of such waters. Although these categories largely track the framework used in earlier guidance, the proposal has new and expanded definitions of key terms which could result in expanded federal jurisdiction. Tributaries, for example, are newly defined to include any land with a bed and bank and an ordinary high water mark that contributes flow to any waterway, meaning land that is dry for much of the year could be covered. Likewise adjacent waters are defined as bordering, contiguous or neighboring waters, where a neighboring water includes a nearby floodplain or riparian area an area expansively defined as where surface or groundwater directly influence the ecological processes and plant and animal community structure in that area. The waters that meet these new definitions would be jurisdictional waters of the United States under the proposed Rule no additional analysis of the nexus of such waters to downstream waters would be required. Significant Nexus Test for Addressing Other Waters. For any other waters that do not fall under the listed categories, the agencies propose a process under which those waters could be found to be waters of the United States. The test would be whether the water has a significant nexus to jurisdictional waters under Justice Kennedy s concurrence in Rapanos. Under the proposal, on a case-by-case basis, the agencies could determine whether the aggregate effect of geographically isolated wetlands and other waters significantly affect the physical, biological, and chemical integrity of federally protected downstream waters. WLF fears that this process could greatly expand federal jurisdiction on a case-by-case basis in a way that injects great uncertainty into the process and makes it very hard to predict what other waters are regulated. Categorical Exclusions. The proposal does expressly exclude ditches but only if the ditches are excavated wholly in uplands, drain only uplands, and have less than perennial flow, and the ditches do not contribute flow, either directly or through another water, to a traditional navigable water, interstate water, the territorial seas or an impoundment of a

9 EPA Docket Center Environmental Protection Agency August 22, 2014 Page 4 jurisdictional water. Other artificial waters would likewise be excluded, such as irrigated areas that would revert to uplands and artificial lakes or ponds created by excavating and/or diking dry land and used exclusively for certain listed purposes. Water-filled depressions created incidental to construction activity, as well as gullies, rills, and nonwetland swales, would also be excluded. III. The SWANCC Decision Thirteen years after Congress passed the CWA, the Corps determined that the law applied to waters that are or could be used by migratory birds. A 1994 General Accounting Office report concluded that the effect of this Migratory Bird Rule ( MBR ) was that nearly all waters and wetlands in the U.S. were jurisdictional. When 23 Illinois municipalities banded together as the Solid Waste Agency of Northern Cook County ( SWANCC ) to build a municipal landfill in an abandoned, strip-mined gravel pit, the Corps applied the MBR to assert CWA jurisdiction. SWANCC, 531 U.S. at Although the Corps initially concluded that it had no jurisdiction over the site because it contained no wetlands, it later found that when rainwater accumulated in the stripmined trenches they became navigable waters of the U.S. subject to CWA jurisdiction because migratory birds could ostensibly use the water. Id. at 164. The Corps assumed the birds could use the waters because migratory birds had been seen on the site. Id. at 166. The Corps jurisdictional claim meant SWANCC was required to get a 404 CWA permit to fill the trenches at the proposed project site. SWANCC unsuccessfully applied for the 404 permit, expending several million dollars in the process. After the Corps denied the permit request, SWANCC brought suit challenging whether the Corps or EPA had jurisdiction over the site under the CWA. Id. at 165. Ultimately, the Supreme Court ruled that because the Migratory Bird Rule exceeded the authority the CWA granted the Corps and EPA, SWANCC did not require a CWA permit to build its landfill. Acknowledging that significant constitutional questions were implicated by the Corps and EPA s efforts to expand the CWA s jurisdictional reach, the Court concluded that [p]ermitting [the Corps] to claim federal jurisdiction... would result in a significant impingement of the State s traditional and primary power over land and water use. Id. at 174. The Court found that there was simply no persuasive evidence that Congress ever acquiesced to the Corps claim of jurisdiction over non-navigable, isolated, intrastate waters. Id. at 171. Accordingly, the Court decline[d] respondents invitation to... hold[] that isolated ponds, some only seasonal, wholly located within two Illinois counties, fall under 404(2a) s definition of navigable waters because they serve as a habitat for migratory birds. Id. at

10 EPA Docket Center Environmental Protection Agency August 22, 2014 Page 5 SWANCC thus makes clear that isolated ponds are not subject to the CWA and outside of the federal agencies jurisdiction. For the SWANCC majority, any attempt to extend the waters of the United States beyond navigable waters raised significant constitutional questions. Id. at 177. In such a situation the Court read[s] the statute as written to avoid the significant constitutional and federalism questions... and therefore reject[s]... administrative deference. Id. [W]here an otherwise acceptable construction of a statute would raise serious constitutional problems, the Court will construe the statute to avoid such problems unless such construction is plainly contrary to the intent of Congress. Id. (quoting Edward J. DeBartolo Corp. v. Florida Gulf Coast Building & Constr. Trades Council, 485 U.S. 568, 575, 108 S.Ct. 1392, 99 L.Ed.2d 645 (1988)). Consequently, the definition of waters of the United States that the Corps argued falls within Congress power to regulate intrastate activities that substantially affect interstate commerce was unacceptable without an articulation of the precise object or activity that, in the aggregate, substantially affects interstate commerce. Id. The Court found no persuasive evidence that the Corps mistook Congress intent in 1974 by tying jurisdiction to a body of water s capability of use by the public for purposes of transportation or commerce which is the determinative factor. Id. at 168. Indeed, the congressional history revealed no intention [b]eyond Congress desire to regulate wetlands adjacent to navigable waters. Id. at Before striking down the agency s interpretation of the CWA, the Court remarked that [t]wice in the past six years we have reaffirmed the proposition that the grant of authority to Congress under the Commerce Clause, though broad, is not unlimited. Id. at 173 (citing United States v. Morrison, 529 U.S. 598 (2000); United States v. Lopez, 514 U.S. 549 (1995)). SWANCC was the last ruling on CWA jurisdiction in which the Supreme Court provided a clear, majority opinion. IV. The Rapanos Decision Five years after the SWANCC decision, the Supreme Court was called upon once again to decide which waters are subject to CWA jurisdiction. Rapanos v. United States involved four Michigan wetlands located near man-made ditches that eventually emptied into traditional navigable waters. 547 U.S. at The United States brought civil enforcement proceedings against the Rapanos petitioners, who had backfilled three of the areas without a permit. Id. The district court found federal jurisdiction over the wetlands because they were adjacent to waters of the United States and held petitioners liable for CWA violations. Id. Affirming, the Sixth Circuit found federal jurisdiction based on the

11 EPA Docket Center Environmental Protection Agency August 22, 2014 Page 6 sites hydrologic connections to the nearby ditches or drains, or to more remote navigable waters. Id. The Supreme Court granted review. Leaving the SWANCC decision intact (all nine justices agreed with the holding in SWANCC), the Rapanos Court fractured, with four justices led by Justice Scalia voting for a narrow interpretation of CWA jurisdiction; four dissenting justices led by Justice Stevens voting for an expansive view; and Justice Kennedy in the middle casting the deciding vote. Every justice agreed that traditional navigable waters (i.e., waters that are navigable in fact and waters that could be made navigable) are jurisdictional. As to tributaries that cannot be made navigable and intermittent streams, the four dissenting Justices would have deferred to the Corps assertion of jurisdiction. Id. at Justice Scalia s plurality adopted a jurisdictional test under which 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 connected to navigable-in-fact waters are subject to CWA jurisdiction. Id. at 739. Although these bodies of water can be purely intrastate, they do not include channels through which water flows intermittently or ephemerally, or channels that periodically provide drainage for rainfall. Id. Likewise, 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 are covered by the [CWA]. Id. at 742. Such wetlands must be as a practical matter indistinguishable from the relatively permanent body of water, and that body of water must itself be connected to traditional interstate navigable waters. Id. at 742, 755. Justice Kennedy, writing for himself, concluded that regulating such nonnavigable tributaries went too far because it gave CWA jurisdiction over every ditch or drain, however remote and insubstantial, that may eventually flow into traditional navigable waters. Id Justice Kennedy condemned the practice by which the Corps simply deems a water a [regulated] tributary if it feeds into a traditional navigable water (or a tributary thereof) and possesses an ordinary high water mark. Id. at 781. This point echoed the Court s opinion in SWANCC that the Corps view of its CWA jurisdiction had no discernable limits. As to wetlands adjacent to waters that are navigable in fact, Justice Kennedy viewed these wetlands as subject to the CWA based on a reasonable inference of biological interconnection.... Id. at 782. For wetlands adjacent to non-navigable tributaries, Justice Kennedy proposed a test under which the Corps must establish a significant nexus on a case-by-case basis. Id.

12 EPA Docket Center Environmental Protection Agency August 22, 2014 Page 7 V. The Supreme Court Has Never Embraced the Proposed Rule s Significant Nexus Test EPA and the Corps are wrong to read the robust holding in SWANCC as being limited solely to the Migratory Bird Rule. 1 Equally mistaken is their apparent take-away that the case somehow created a significant nexus test. 2 SWANCC clearly established a firm check on the agencies view of federal jurisdiction, which the Court found was a significant impingement of the States traditional and primary power over land and water use. 531 U.S. at 174. There, as here, EPA attempt[ed] to clarify the reach of its jurisdiction through a new definition of waters of the United States. Id. at 164. The Court struck down that clarification, noting that EPA fac[ed] a difficult task in overcoming the plain text and import of 404(a) because [a]bsent overwhelming evidence of [congressional] acquiescence, we are loath to replace the plain text and original understanding of a statute with an amended agency interpretation. Id. at 682, n.5. Rather, the Court expect[s] a clear indication that Congress intended for the administrative interpretation [to] invoke[] the outer limit of Congress power. Id. at 683. Such a concern is heightened where the administrative interpretation alters the federal-state framework by permitting federal encroachment upon a traditional state power. Id. As for the powers granted to regulatory agencies by the CWA, the SWANCC Court noted that [r]ather than expressing a desire to readjust the federal-state balance [by reading out the term navigable ], Congress chose to recognize, preserve and protect the primary responsibilities and rights of States... to plan the development and use... of land and water resources.... Id. at 684 (quoting 33 U.S.C. 1251(b)). Searching the legislative history, the Court found nothing that signifie[d] that Congress intended to exert anything more than its commerce power of navigation and [t]he committee... d[id] not redefine navigable waters. Id. at 683 n.3, n.6. By using the term navigable... Congress had in mind as its authority for enacting the CWA: its traditional jurisdiction over waters that were or had been navigable in fact or which could reasonably be so made. Id. Without explanation, the agencies proposed Rule seeks to adopt Justice Kennedy s significant nexus test from Rapanos. But that approach to interpreting a Supreme Court plurality decision is plainly mistaken. In Marks v. United States, the Court announced a rule for interpreting its split decisions, stating that [w]hen a 1 79 Fed. Reg Id.

13 EPA Docket Center Environmental Protection Agency August 22, 2014 Page 8 fragmented Court decides a case and no single rationale explaining the result enjoys the assent of five Justices, the holding of the Court may be viewed as that position taken by those Members who concurred in the judgment on the narrowest grounds. 430 U.S. 188, 193 (1976) (emphasis added). Narrowest grounds has been interpreted by the D.C. Circuit to mean that opinion which is a logical subset of other, broader opinions. King v. Palmer, 950 F.2d 771, 781 (D.C. Cir. 1991). The ultimate goal is to find a single legal standard... [that] when properly applied, produce[s] results with which a majority of the Justices in the case articulating the standard would agree. Planned Parenthood of Southeastern Pa. v. Casey, 947 F.2d 682, 693 (3d Cir.1991), modified on other grounds, 505 U.S. 833 (1992). Applying the Marks rule to Rapanos, the Scalia plurality concurred with the judgment on the narrowest grounds. As a logical subset of the much broader Kennedy test, the Scalia plurality is the controlling position under Marks. Any body of water that satisfies the Scalia plurality s test would also satisfy Justice Kennedy s significant nexus test. At least eight of the nine Justices would agree that any waters that satisfy Justice Scalia s test are jurisdictional. Conversely, eight of the nine Justices expressly rejected Justice Kennedy s significant nexus test. Scalia s four-member plurality made it clear that Justice Kennedy [simply] devised his new statute all on his own, Rapanos 547 U.S. at 756, and that the Court s previous rulings had explicitly rejected such caseby-case determinations. Id. at 753. Likewise, SWANCC specifically rejected the argument that physically unconnected ponds could be included based on the ecological connection to covered waters. Id. at 754 (emphasis in orginal). Further, the phrase appears nowhere in the Act and can only be inserted by ignoring the text of the statute. Id. at 755. The plurality concluded [i]t would have been an easy matter for Congress to give the Corps jurisdiction over all [waters] that significantly affect the chemical, physical, and biological integrity of waters of the United States. It did not do that, but instead explicitly limited jurisdiction to waters of the United States. Id. at 756. Even the Rapanos dissenters agreed on this point. Justice Stevens, joined by Justices Souter, Ginsburg, and Breyer, did not share [Kennedy s] view that we should replace regulatory standards that have been in place for over 30 years with a judicially crafted rule distilled from the term significant nexus as used in SWANCC. Id. at 808 (Stevens, J., dissenting). Indeed, Stevens noted that SWANCC s only use of the term comes in [one] sentence. Id. Justice Kennedy s approach will have the effect of creating additional work for all concerned with no certain way of knowing whether they need permits and the Corps will have to make case-by-case determinations. Id. at 809. These problems are precisely the ones that Riverside Bayview... avoided. Id.

14 EPA Docket Center Environmental Protection Agency August 22, 2014 Page 9 Justice Stevens concluded that he see[s] no reason to adopt the significant nexus test. Id. Nevertheless, the Rule proposed by the agencies inexplicably relies on Justice Kennedy s significant nexus test to justify their new definitions: Because Justice Kennedy identified significant nexus as the touchstone for CWA jurisdiction, the agencies determined that it is reasonable and appropriate to apply the significant nexus standard for CWA jurisdiction that Justice Kennedy s opinion applied to adjacent wetlands to other categories of water bodies as well (such as to tributaries of traditional navigable waters or interstate waters, and to other waters ) to determine whether they are subject to CWA jurisdiction, either by rule or on a case-specific basis. 3 Not only does this approach rely on the broadest concurring opinion in Rapanos, which the Marks rule dictates is not the Court s holding, but it also would impose a rule that eight of the nine Rapanos Justices expressly rejected. Notably, the agencies never explain why they chose to single out Kennedy s significant nexus test as the basis for their new definitions. Regardless, the significant nexus test has no proper place in the Agencies interpretation of waters of the United States under the CWA. It can find no support in either the statute or Supreme Court precedent. The Agencies reliance on Kennedy s idiosyncratic interpretation to completely rewrite the jurisdictional reach of the CWA will not withstand judicial scrutiny. VI. Conclusion The CWA does not grant the agencies the authority to regulate every drop of water in the nation. Rather, the statute applies only to discharges into navigable waters. 33 U.S.C. 1344(a). While the Supreme Court has recognized a narrow exception to the plain meaning of navigable waters namely, that wetlands sharing a bank with navigable waters are themselves considered navigable the scope of the proposed Rule s definition under which wetlands miles away from navigable-in-fact waters could be considered navigable runs contrary to the plain text of the statute and the intent of Congress. If the agencies were to embrace the construction of the CWA as advanced by the proposed Rule, the statute as so construed would exceed Congress s power under the Commerce Clause. The Washington Legal Foundation respectfully requests that the Corps and EPA withdraw the proposed Rule clarifying the definition of 3 79 Fed Reg

15 EPA Docket Center Environmental Protection Agency August 22, 2014 Page 10 waters of the United States in order to comply with Supreme Court precedent that is directly on point. Respectfully submitted, /s/ Cory L. Andrews Cory L. Andrews Senior Litigation Counsel /s/ Markham S. Chenoweth Markham S. Chenoweth General Counsel *WLF counsel wish to thank John Eisler, a 2014 K.K. Leggett Fellow, for his assistance in preparing these comments.

16 No (and related cases: , , , , , , , , , , , , , , , , , , , ) UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT IN RE: ENVIRONMENTAL PROTECTION AGENCY AND DEPARTMENT OF DEFENSE, FINAL RULE: CLEAN WATER RULE: DEFINITION OF WATERS OF THE UNITED STATES 80 Fed. Reg. 37,054, Published on June 29, 2015 On Petitions for Review of a Final Rule of the U.S. Environmental Protection Agency and the United States Army Corps of Engineers BRIEF OF WASHINGTON LEGAL FOUNDATION AS AMICUS CURIAE IN SUPPORT OF THE BUSINESS AND MUNICIPAL PETITIONERS AND THE STATE PETITIONERS, URGING THAT THE RULE BE VACATED Richard A. Samp Mark S. Chenoweth Washington Legal Foundation 2009 Massachusetts Avenue, NW Washington, DC rsamp@wlf.org November 8, 2016 Counsel for Amicus Curiae

17 CORPORATE DISCLOSURE STATEMENT Pursuant to Federal Rule of Appellate Procedure 26.1, Washington Legal Foundation states that it is a corporation organized under 501(c)(3) of the Internal Revenue Code. It has no parent corporation and no stock owned by a publicly owned company.

18 TABLE OF CONTENTS Page CORPORATE DISCLOSURE STATEMENT... TABLE OF AUTHORITIES... i iv INTERESTS OF AMICUS CURIAE...1 STATEMENT OF THE CASE...2 SUMMARY OF ARGUMENT...6 ARGUMENT...10 I. THE AGENCIES FAILED TO COMPLY WITH THE APA S NOTICE REQUIREMENT...10 A. The Final Rule Included Distance Criteria that Were Not Included in the Proposed Rule...11 B. The Distance Criteria Were Not Logical Outgrowths of the Proposed Rule...14 C. Petitioners Were Prejudiced by the Notice Violation and Are Entitled to Relief...19 D. A Study Undertaken by Congress Concurs that Notice Was Inadequate...21 II. THE FINAL RULE IS ARBITRARY AND CAPRICIOUS...23 A. The Agencies Failed to Provide Reasoned Justifications for Their Distance Criteria...23 ii

19 Page(s) B. The Agencies Failed to Provide Reasoned Justifications for Their Expansive Definition of Tributaries The Agencies Arbitrarily Relied on Randomly Distributed Physical Indicators and Unrepresentative, Water-Rich Systems to Assert Jurisdiction over the Arid Southwest The Agencies Failed to Respond to Comments on the Arid Southwest...28 CONCLUSION...30 iii

20 Cases: TABLE OF AUTHORITIES Page(s) Allina Health Servs. v. Sebelius, 746 F.3d 1102 (D.C. Cir. 2014)...20, 21 Assoc. of Battery Recyclers, Inc. v. EPA, 208 F.3d 1047 (D.C. Cir. 2000)...14, 15 Christopher v. SmithKline Beecham Corp., 132 S. Ct (2012)...1 Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402 (1971)...10 City of Portland v. EPA, 507 F.3d 706 (D.C. Cir. 2007)...15 Council Tree Communications, Inc. v. FCC, 619 F.3d 235 (3d Cir. 2010)...11, 16, 19 CSX Transp., Inc. v. Surface Transp. Bd., 584 F.3d 1076 (D.C. Cir. 2009)...15 Dismas Charities, Inc. v. U.S. Dep t of Justice, 401 F.3d 666 (6th Cir. 2005)...11 Encino Motorcars, LLC v. Navarro, 136 S. Ct (2016)...9, 24 Environmental Integrity Project v. EPA, 425 F.3d 992 (D.C. Cir. 2005)...17, 19 Heartland Reg l Med. Ctr. v. Sebelius, 566 F.3d 193 (D.C. Cir. 2009)...21 In re: EPA, 803 F.3d 804 (6th Cir. 2015)...18 Int l Union, UMW v. Mine Safety and Health Admin., 407 F.3d 1250 (D.C. Cir. 2005)...6, 7, 11 Long Island Care at Home, Ltd. v. Coke, 551 U.S. 158 (2007)...7, 14 Miami-Dade County v. EPA, 529 F.3d 1049 (11th Cir. 2008)...11, 14 Motor Vehicle Mfrs. Ass n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29 (1983)...23, 29 North Dakota v. EPA, 127 F. Supp. 3d 1047 (D.N.D. 2015)...18 iv

21 Page(s) Owner-Operator Ind. Drivers Ass n v. Fed. Motor Carrier Safety Admin., 494 F.3d 188 (D.C. Cir. 2007)...15 Perez v. Mortgage Bankers Ass n, 135 S. Ct (2015))...1, 10, 29 Tennessee v. FCC, 832 F.3d 597 (6th Cir. 2016)...1 Statutes and Constitutional Provisions: U.S. Const., Art. I, 8, cl. 3 ( Commerce Clause )...2 Administrative Procedure Act (APA)... passim 5 U.S.C , 20 5 U.S.C. 553(b)...2, 6, 10 5 U.S.C. 553(c)...2, 10, 17 5 U.S.C U.S.C. 706(2)(A)...9, 23, 24 5 U.S.C. 706(2)(F)...19 Clean Water Act (CWA)... passim 33 U.S.C. 1311(a) U.S.C. 1362(7)...3 Regulations: 33 C.F.R (a)(8) C.F.R (c)(2) Fed. Reg. 22,187-22,274 (April 21, 2014) ( Proposed Rule )... passim 79 Fed. Reg. 22, Fed. Reg. 22, Fed. Reg. 22, Fed. Reg. 22, Fed. Reg. 22, Fed. Reg. 22, , 13 v

22 Page(s) 80 Fed. Reg. 37,054-37,127 (June 29, 2015) ( Final Rule )... passim 80 Fed. Reg. 37, , Fed. Reg. 37, Fed. Reg. 37, Fed. Reg. 37, Miscellaneous: Committee on Oversight and Government Reform, U.S. House of Representatives, Politicization of the Waters of the United States Rulemaking (Oct. 27, 2016), available at oversight.house.gov/wp-content/uploads/2016/10/wotus-ogr-reportfinal-for-release-1814-logo-1.pdf (last visited November 7, 2016)...22 Lawrence S. Ebner, DC Circuit Shuts Down Another Federal Regulatory Switcheroo, WLF Legal Opinion Letter (May 23, 2014)...1 R.W. Lichvar, et al, U.S. Army Corps of Eng rs, Distribution of Ordinary High Water Mark (OHWM) Indicators and Their Reliability in Identifying the Limits of Waters of the United States in Arid Southwestern Channels (2006)...26 M.K. Mersel & R.W. Lichvar, U.S. Army Corps of Eng rs, A Guide to Ordinary High Water Mark Delineation for Non-perennial Streams in the Western Mountains, Valleys, and Coast Region of the United States (2014)...27 Patrick Parenteau, A Bright Line Mistake: How EPA Bungled the Clean Water Rule, 46 Envtl. L. 379 (2016)...18 U.S. Army Corps of Eng rs, Survey of OHWM Indicator Distribution Patterns Across Arid West Landscapes, (2013)...26 Clean Water Rule Technical Support Document vi

23 Clean Water Rule Response to Comments - Topic Clean Water Rule Response to Comments - Topic Comments of Arizona Farm Bureau Federation (Nov. 14, 2014)...28 Comments of Arizona Mining Ass n (Nov. 13, 2014)...26, 28 Comments of Arizona Rock Products Ass n (Nov. 10, 2014)...28 Comments of ASARCO LLC (Nov. 13, 2014)...28 Comments of Freeport-McMoRan Inc. (Nov. 12, 2014)...27, 28 Comments of New Mexico Mining Assoc. (Nov. 13, 2014)...28 vii

24 INTERESTS OF AMICUS CURIAE Washington Legal Foundation ( WLF ) is a public-interest law firm and policy center headquartered in Washington, DC, with supporters in all 50 States. 1 WLF devotes a substantial portion of its resources to defending free enterprise, individual rights, a limited and accountable government, and the rule of law. To that end, WLF has frequently appeared in this and other federal courts to ensure that administrative agencies adhere to the rule of law. See, e.g., Tennessee v. FCC, 832 F.3d 597 (6th Cir. 2016). In particular, WLF on a number of occasions has sought invalidation of federal rules because the promulgating agency failed to comply with the notice-and-comment requirements of the Administrative Procedure Act (APA). See, e.g., Perez v. Mortgage Bankers Ass n, 135 S. Ct (2015); Christopher v. SmithKline Beecham Corp., 132 S. Ct (2012). In addition, WLF s Legal Studies Division, the publishing arm of WLF, regularly publishes articles concerning the procedural requirements with which federal agencies must comply when adopting regulations. See, e.g., Lawrence S. Ebner, DC Circuit Shuts Down Another Federal Regulatory Switcheroo, WLF Legal Opinion Letter (May 23, 2014). The APA requires federal agencies, before adopting substantive regulations, 1 Pursuant to Fed.R.App.P. 29(c)(5), WLF states that no counsel for a party authored this brief in whole or in part; and that no person or entity, other than WLF and its counsel, contributed monetarily to the preparation and submission of this brief. WLF believes that all parties have consented to the filing of this brief.

25 to provide notice sufficient to alert interested parties regarding the regulations to be adopted and permit them a meaningful opportunity to participate in the rulemaking. 5 U.S.C. 553(b) & (c). WLF is concerned that numerous interested stakeholders did not receive adequate advance notice regarding how the Environmental Protection Agency (EPA) and the U.S. Army Corps of Engineers (collectively, the Agencies ) would ultimately define the term waters of the United States. As a result, WLF believes, these stakeholders were denied a meaningful opportunity to participate in the rulemaking process that culminated in the Agencies adoption of the Final Rule in June WLF is also concerned that the Agencies failed to adequately explain their rationales for several critical provisions included in the Final Rule. In WLF s view, that failure constitutes arbitrary and capricious rulemaking, in violation of the APA. WLF fully concurs with other arguments raised by the Business and Municipal Petitioners and the State Petitioners, including that the Rule is inconsistent with the language of the Clean Water Act (CWA) and that it violates the Constitution s Commerce Clause and principles of federalism. WLF does not, however, address those issues separately in this brief. STATEMENT OF THE CASE The facts of these consolidated petitions are set out in detail in the briefs of 2

26 the Business and Municipal Petitioners and the State Petitioners. WLF wishes to highlight several facts of particular relevance to the issues on which this brief focuses. The CWA prohibits the discharge of any pollutant into navigable waters from a point source, except as authorized under the Act. 33 U.S.C. 1311(a). It defines navigable waters as the waters of the United States, including the territorial seas. 33 U.S.C. 1362(7). As the federal agencies charged with administering the CWA, EPA and the U.S. Army Corps of Engineers have struggled for decades to arrive at an acceptable definition of waters of the United States. 2 These petitions are challenges to the Agencies latest effort to do so. On April 21, 2014, the Agencies published in the Federal Register their Proposed Rule to define waters of the United States ( WOTUS ). 79 Fed. Reg. 22,187-22,274 (Apr. 21, 2014). The Agencies stated that their goal was not to expand the scope of their regulatory authority; rather, they sought to promulgate a rule that is clear and understandable and protects the nation s waters, supported by 2 A principal point of contention throughout these struggles has been the proper balance between federal and state regulation. The CWA is not, of course, the sole font of government regulation of water resources. Throughout our Nation s history, state governments have played a preeminent role in managing and conserving those resources. The Final Rule and similar efforts to expand the scope of federal regulation of water resources by definition serve, if upheld by the courts, to revise the federal-state balance by reducing the States role. 3

27 science and consistent with the law. Id. at 22,198. The Agencies explained that the Proposed Rule divided waters into eight defined categories to assist in determining when waters qualified as WOTUS. The Agencies declared that the first six categories were jurisdictional waters; that is, waters that the Agencies would deem always to fall within the definition of WOTUS. 3 Whether a seventh category ( other waters, including wetlands determined to have a significant nexus to any one of the first three categories) would fall within the definition was to be determined on a case-specific basis. Id. at 22,193. An eighth category included specified waters and features (such as waste-treatment systems) that were always to be excluded from the definition, even if they would otherwise satisfy the regulatory requirements for any of the first six categories. Ibid. The Proposed Rule repeatedly stressed that whether waters qualified as adjacent waters (for purposes of the sixth category), and whether waters would 3 Those six categories were: (1) all waters which are currently used, were used in the past, or may be susceptible to use in interstate commerce, including all waters which are subject to the ebb and flow of the tide; (2) all interstate waters, including interstate wetlands; (3) the territorial seas; (4) all impoundments of a traditional navigable water, interstate water, the territorial seas, or a tributary; (5) all tributaries of a traditional navigable water, the territorial seas, or impoundment; and (6) all waters, including wetlands, adjacent to a traditional navigable water, interstate water, the territorial seas, impoundment, or tributary. Id. at 22,193. Among those six categories, the fifth and sixth ( tributaries and adjacent waters) are the principal focus of Petitioners challenges. 4

28 be determined under the seventh category to have the requisite significant nexus, would be determined on the basis of the best scientific evidence. At no point did the Proposed Rule state that those determinations would hinge on distance-based criteria (e.g., that a feature would be deemed adjacent to one of the first five categories of jurisdictional waters if it were located within a specified number of feet of such waters). Nor, apparently, did those commenting on the Proposed Rule understand it as stating that the Agencies were contemplating adoption of distance criteria: of the more than one million comments filed, virtually none addressed whether the Final Rule should include distance criteria. On June 29, 2015, the Agencies published their Final Rule in the Federal Register. 80 Fed. Reg. 37,054-37,127. Unlike the Proposed Rule, the Final Rule included a substantial number of specific distance criteria (described in more detail infra) that are to be used by the Agencies in making adjacent waters and significant nexus determinations. The Agencies stated that it adopted these distance criteria in defining adjacent waters because based on the agencies expertise and experience implementing the CWA and in light of the science, the distance criteria established a reasonable and practical boundary within which to conclude the waters significantly affected the integrity of other jurisdictional waters. Id. at 37,085. The Agencies provided a nearly identical explanation for 5

29 establishing distance criteria in defining what constitutes a significant nexus with jurisdictional waters. Id. at 37, Numerous commenters objected to the Proposed Rule s very broad definition of tributary and to the Agencies proposal that such tributaries should be categorized as WOTUS under all circumstances. In particular, many commentators asserted that the definition inappropriately included significant amounts of totally dry land in the arid Southwest. The Final Rule retained the broad definition of tributary yet did not respond to the scientific evidence submitted by commenters who objected to the broad definition. SUMMARY OF ARGUMENT The APA requires that a federal agency, before adopting substantive regulations of the sort at issue here, provide notice sufficient to alert interested parties regarding the regulations to be adopted. 5 U.S.C. 553(b). A principal purpose of the notice requirement is to give affected parties an opportunity to develop evidence in the record to support their objections to the rule and thereby enhance the quality of judicial review. Int l Union, UMW v. Mine Safety and Health Admin., 407 F.3d 1250, 1259 (D.C. Cir. 2005). The Agencies failed to provide the requisite notice in this instance. They added to the Final Rule numerous distance criteria to be used in determining whether land is subject to 6

30 federal regulation under the CWA that were neither included nor even hinted at in the Proposed Rule. The result was that affected parties were denied an opportunity to comment on those distance criteria and to introduce evidence that those criteria lacked both scientific and statutory support. Accordingly, the Final Rule should be vacated and the Agencies should be directed on remand to provide interested parties an opportunity to comment on the distance criteria set forth in the Final Rule. Agencies are entitled, of course, to make some changes to proposed rules without re-opening the comment period. Indeed, if changes were not permitted, there would be no point in authorizing affected parties to file comments suggesting changes. But the APA notice requirement limits changes by mandating that any final rule adopted by an agency must be a logical outgrowth of the rule proposed. Long Island Care at Home, Ltd. v. Coke, 551 U.S. 158, 174 (2007). The Final Rule issued by the Agencies does not satisfy the logical outgrowth standard. In general, a changed final rule qualifies as a logical outgrowth of the proposed rule if and only if interested parties should have anticipated that the changes were a realistic possibility and thus should have filed their comments on the [new provisions] during the notice-and-comment period. Int l Union, 407 F.3d at Nothing in the Proposed Rule would have tipped 7

31 off a reasonable observer that the Agencies might ultimately adopt a Final Rule that substituted arbitrary distance criteria (when determining whether features constitute adjacent waters or have a significant nexus to jurisdictional waters) for the science-based criteria promised in the Proposed Rule. That none or virtually none of the million-plus comments discussed the pros or cons of distance criteria is a strong indication that commenters were not adequately alerted to the possibility of the change and thus that a Final Rule containing distance criteria cannot qualify as a logical outgrowth of the Proposed Rule. Petitioners have demonstrated that they were prejudiced by inclusion in the Final Rule of significant provisions not included in the Proposed Rule. They were thereby deprived of an opportunity to persuade the Agencies of the inappropriateness of relying on the distance criteria. They were also deprived of the opportunity to include evidence in the administrative record demonstrating inappropriateness; if they had been granted that opportunity and the Agencies nonetheless adopted a final rule that incorporated the distance criteria, the expanded record could then have been used to bolster a judicial challenge. Reviewing courts routinely conclude that affected parties are prejudiced (and thus are entitled to relief) when a federal agency violates the APA by failing to provide adequate advance notice of a final rule. 8

32 The Final Rule also fails to satisfy basic precepts of reasoned decisionmaking under the APA, 5 U.S.C The Agencies adopted distance criteria despite an absence of any scientific evidence supporting that approach. Indeed, EPA s Scientific Advisory Board (SAB) advised against that approach, cautioning EPA that adjacent waters and wetlands should not be defined solely on the basis of geographical proximity to jurisdictional waters. 80 Fed. Reg. at 37,064. One basic procedural requirement of administrative rulemaking is that an agency must give adequate reasons for its decisions. Encino Motorcars, LLC v. Navarro, 136 S. Ct. 2117, 2125 (2016). When, as here, an agency has failed to provide even a minimal level of analysis in support of its decision, its action is arbitrary and capricious, in violation of the APA. Ibid (citing 5 U.S.C. 706(2)(A)). The Agencies vague assurances that unspecified agency experience justifies adoption of the distance criteria do not constitute reasoned decision-making. The Agencies also acted arbitrarily and capriciously in adhering to their broad definition of tributary without providing any sort of response to commenters substantial evidence that the definition lacked scientific support. In particular, a number of commenters submitted substantial scientific evidence that the Agencies definition of tributaries would inappropriately include significant amounts of totally dry land in the arid Southwest. The Final Rule either totally 9