EPA Explains Its Position on Whether Groundwater Is Covered by the Clean Water Act

Earlier this year the United States Supreme Court issued its order in County of Maui v. Hawaii Wildlife Fund, 140 S. Ct. 1462 (2020) (“Maui”). The case resolved disagreement among several federal courts on whether a permit issued under the Clean Water Act (“CWA”) Section 402 National Pollutant Discharge Elimination System (NPDES) program is required for migration of pollutants through groundwater. More specifically, whether a “discharge of a pollutant” regulated under the CWA occurs when a pollutant is released from a point source and subsequently moves through groundwater before reaching a “Water of the United States.” The Maui decision outlines seven non-exclusive factors for the regulated community and permitting authorities to consider when evaluating whether a discharge of a pollutant from a point source that travels through groundwater to a Water of the United States is the “functional equivalent” of a direct discharge from a point source to a Water of the United States.

The factors commented on by the Court are: (1) transit time; (2) distance traveled; (3) the nature of the material through which the pollutant travels; (4) the extent to which the pollutant is diluted or chemically changed as it travels; (5) the amount of pollutant entering the navigable waters relative to the amount of the pollutant that leaves the point source; (6) the manner by or area in which the pollutant enters the navigable waters; and (7) the degree to which the pollution (at that point) has maintained its specific identity. Id. at 1476-77. The Court explained, however, that the “functional equivalent” analysis is expected to be further refined through court decisions in individual cases—the traditional common-law method—and through EPA administrative actions or guidance. Id. at 1477.  

The EPA has issued a draft guidance document concerning Maui. A guidance document does not have the force and effect of a formally promulgated rule that interprets statutory language (e.g., WOTUS rulemaking), but it provides clarity to the public regarding the interpretation that the Agency will take in permitting or enforcement cases. Courts in such cases will give some (sometimes substantial) deference to Agencies’ published interpretations of statutes and rules that they are authorized to implement.

In the draft guidance document, the EPA identifies an additional factor that the agency considers to be relevant and thus should be considered when performing a “functional equivalent” analysis: the design and performance of the system or facility from which the pollutant is released  EPA does not define what is actually meant by the phrase “design and performance.” They do reference the fact that a facility owner or operator may apply for an NDPES permit and that permitting authorities would review and take into consideration the design of a facility, including how the facility plans for the transfer, storage, treatment, or discharge of wastewater. The draft guidance notes that design and performance can provide important information about the function and effectiveness of the engineered wastewater handling system, which may be able to supply data from which one can make reasonable assumptions about the water quality of the actual discharge.

The CWA, EPA’s regulations, and relevant court decisions provide two threshold conditions that must be satisfied before the legal obligation to have an NPDES permit is triggered. First, there must be (or will be) an actual discharge of a pollutant to a Water of the United States. Second, such a discharge must be from a point source. The Maui decision did not modify these two threshold conditions for triggering NPDES permit applicability. Instead, Maui clarified that an NPDES permit is required for only a subset of discharges of pollutants that reach a Water of the United States through groundwater—discharges that are the “functional equivalent” of direct discharges to jurisdictional waters. Maui, 140 S. Ct. at 1468, 1477.

The draft guidance document notes that the Supreme Court’s decision in Maui did not instruct NPDES permitting authorities to assume that discharges to groundwater that occur in the vicinity of jurisdictional water are the “functional equivalent” of direct discharges to that water. According to the Court, neither the “functional equivalent” analysis set out by the Supreme Court nor the CWA itself requires a facility owner or operator or a permitting agency to prove the absence of a discharge. (Draft Guidance page 4) However, where there are indications that there may be a discharge of pollutants through groundwater to Waters of the United States, the Agency recommends considering whether conducting a technical analysis would be prudent. 

The EPA draft guidance asserts that if the pollutant composition or concentration that ultimately reaches the Water of the United States is different from the composition or concentration of the pollutant as initially discharged, whether through chemical or biological interaction with soils, microbes, plants and their root zone, groundwater, or other pollutants, or simply through physical attenuation or dilution, it might not be the “functional equivalent” of a direct discharge to a Water of the United States. By contrast, a discharge via groundwater that reaches a Water of the United States in the same or nearly the same chemical composition and concentration may be deemed by the EPA to be more like a direct discharge to the jurisdictional water.

We would emphasize three key points from this publication: First, this is a draft, out for public comment, and it may be withdrawn by the Biden administration. Guidance from a Biden EPA is likely to place the burden on potentially regulated dischargers, i.e., to require that affected persons present proof of no discharge to a Water of the United States at the commencement of the regulatory process. Second, the Maui decision will give potentially very strong leverage to any party who seeks to challenge the development of a facility with arguably adjacent Water of the United States or where a decision has been made that no NPDES permit is needed. A party opposing such facility now has a well-defined legal tool to block or delay permitting where it can raise factual concerns regarding the groundwater’s impact on a Water of the United States. This tool might block the facility’s development or make the development so expensive and delayed as to make the facility economically not viable. Third, and perhaps more importantly, the affirmation by EPA that sub-surface transport has the potential for discharge permitting may validate or encourage State and local authorities to do so.  Regulated facilities must now monitor the standards that state permitting authorities apply to projects under their authority. Their determinations as to State law requirements will not necessarily be limited by this EPA guidance and may be subject to local politics.