Tom Shepstone
Shepstone Management Company, Inc.

A Federal court has blocked, for now, another EPA Power grab that would impact not only the oil and gas industry but every American who wants to use their land.

There is no agency more power hungry than the zealots at the EPA, who regularly collude with special interests such as the Natural Resources Defense Council (NRDC) to hamstring any kind of development and frustrate the right of any state to regulate such development as it sees fit.

The latest EPA power grab is an attempt, via regulation rather than law, to extend it’s authority over the waters of the United States or (WOTUS). It all has to do with something called the 404 permit program, which is perhaps the best example ever of how government metastasizes in out of control ways over the years and we end up with what was never intended and has never been voted upon.

It’s a lesson in tyranny and this one affects everything anyone wants to do with their land. A tiny bit of good news came this week, though, as a Federal judge, in response to some states with gumption, halted this latest EPA power grab for 13 states.

Section 404 of the Federal Water Pollution Control Act of 1972 (now 33 U.S. Code §1344) isn’t hard to understand and that’s why it provides such a useful example of government gone wild. The first sentence of the section makes it clear what it’s all supposed to be about:

The Secretary may issue permits, after notice and opportunity for public hearings for the discharge of dredged or fill material into the navigable waters at specified disposal sites.

Read the rest of it and you’ll see it has a straightforward purpose of ensuring no one is allowed to fill in and thereby reduce the navigability of the navigable waters of the United States. Navigable waters, to most of us, of course, means something you can run a boat up and down, and most of us can agree that dumping stuff that might restrict the ability of boats to navigate our rivers and ports in something worthy of regulation.

EPA Power Grab Headquarters

That’s how Section 404 came into being and the Army Corps of Engineers, which has traditionally dealt with such things was logically assigned the authority to issue the permits but, over the years, the EPA has sought to take over and vastly expand this regulatory regime in a long-running saga of power grabs that have been alternately blessed and rejected by US courts. The EPA keeps coming back though, prodded by its allies in the NRDC and the like.

The 404 permit program, in fact, now involves things such as the Constitution Pipeline’s permits for crossing some wetlands in Upstate New York where there are no navigable waters anywhere to be seen. How did we reach this point? Well, by interpretations of course. The term “wetlands” does appear in Section 404 in a sub-section that serves to explain what the authors of the legislation really meant when they passed this act:

The Governor of any State desiring to administer its own individual and general permit program for the discharge of dredged or fill material into the navigable waters (other than those waters which are presently used, or are susceptible to use in their natural condition or by reasonable improvement as a means to transport interstate or foreign commerce shoreward to their ordinary high water mark, including all waters which are subject to the ebb and flow of the tide shoreward to their mean high water mark, or mean higher high water mark on the west coast, including wetlands adjacent thereto) within its jurisdiction may submit to the Administrator a full and complete description of the program it proposes to establish and administer under State law or under an interstate compact.

The intent of Section 404, as the bolded language makes clear, was to regulate waters that could accommodate commerce and “wetlands adjacent thereto” (think New Jersey Meadowlands) not every damned wet spot in a pasture someplace that happens to grow swamp grass. That this seemingly innocuous piece of legislation should be so corrupted by the EPA and its special interest friends as to now require up to 100 feet setbacks from every damp spot in the woods is due to “sue and settle” strategies enabled by the courts.

The ridiculousness of current regulations is illustrated by the experience of one of my consulting clients. They were building a new pharmacy in Honesdale next to my office on an already 100% disturbed former industrial site site along the non-navigable (for commercial commerce) Lackawaxen River. They had to first obtain a very expensive and time-consuming waiver of a 150 feet stream setback in Pennsylvania’s regulations, despite the fact already developed sites weren’t supposed to be covered. This is what we see time and again with Section 404 and related regulation. it’s completely taken on a life of its own beyond all reason.

Some courts have resisted though, including the U.S. Supreme Court, which has, in multiple opinions, including a rather famous one authored by Justice Kennedy, rebuked the Federal government for repeatedly extending its authority on its own without ever going back and getting new legislation from Congress. Kennedy has insisted there must be some nexus, some fig leaf of cover, between the navigable waters involved and what the EPA and Army Corps (who are typically fighting over the authority) seek to regulate.

Judge Ralph R. Erickson

This brings us to the latest EPA power grab and the decision of Federal Judge Ralph R. Erickson of North Dakota rejecting it. The decision speaks for itself in explaining the power grab and articulating why the EPA has, yet again, gone too far. Here are some of the most relevant excerpts:

The States are likely to succeed on the merits of their claim that the EPA has violated its grant of authority in its promulgation of the Rule…

In order to establish the requisite significant nexus, the Agencies must determine whether the waters in question do in fact affect the chemical, physical, and biological integrity of those waters. Jurisdictional waters have the requisite nexus, if they “significantly affect the chemical, physical, and biological integrity of other covered waters more readily understood as ‘navigable.’” Waters fall outside the zone of “navigable waters” when the effect “on water quality [is] speculative or insubstantial.” In determining its jurisdiction over waters, an agency “may choose to identify categories of tributaries that, due to their volume of flow . . . , their proximity to navigable waters, or other relevant considerations, are significant enough that wetlands adjacent to them are likely in the majority of cases, to perform important functions for an aquatic system incorporating navigable waters.” The Rule here likely fails to meet this standard…

The Rule allows EPA regulation of waters that do not bear any effect on the “chemical, physical, and biological integrity” of any navigable-in-fact water…

While the Agencies assert that the definitions exclusion of drains and ditches remedies the defect, the definition of a tributary here includes vast numbers of waters that are unlikely to have a nexus to navigable waters within any reasonable understanding of the term…

The Agencies assert that any water that fits in the definition of a “tributary” will as of necessity “significantly affect the chemical, physical, and biological integrity of traditional navigable waters…

The Rule asserts jurisdiction over waters that are remote and intermittent waters. No evidence actually points to how these intermittent and remote wetlands have any nexus to a navigable-in-fact water. The standard of arbitrary and capricious is met because the Agencies have failed to establish a “rational connection between the facts found” and the Rule as it will be promulgated…

The Rule also arbitrarily establishes the distances from a navigable water that are subject to regulation…

While a “bright line” test is not in itself arbitrary, the Rule must be supported by some evidence why a 4,000 foot standard is scientifically supportable. On the record before the court, it appears that the standard is the right standard because the Agencies say it is. Under these circumstances the Rule setting the 4,000 feet standard is likely arbitrary and capricious…

The final rule greatly expanded the definition of “neighboring” such that an interested person would not recognize the promulgated Rule as a logical outgrowth of the proposed rule. The proposed rule defined waters of the United States as “includ[ing] waters located within the riparian area or floodplain of a water identified in paragraphs (a)(1) through (5) of this section, or waters with a shallow subsurface hydrological connection or confined surface hydrological connection to such a jurisdictional water.” When the Agencies published the final rule, they materially altered the Rule by substituting the ecological and hydrological concepts with geographical distances that are different in degree and kind and wholly removed from the original concepts announced in the proposed rule…

The States here have demonstrated that they will face irreparable harm in the absence of a preliminary injunction. It is within the purview of the traditional powers of the States to maintain their “traditional and primary power over land and water use.” Once the Rule takes effect, the States will lose their sovereignty over intrastate waters that will then be subject to the scope of the Clean Water Act…

In addition to the loss of sovereignty, the States assert an irreparable harm in the form of unrecoverable monetary harm. It is undeniable that if the States incur monetary losses as a result of an unlawful exercise of regulatory authority, no avenue exists to recoup those losses as the United States has not waived sovereign immunity from suits seeking these sorts of damages…

The States assert numerous losses that would be attributable to the Rule. For example, the Rule will make North Dakota subject to, among other things, undertaking jurisdictional studies for every proposed natural gas, oil, or water pipeline project. This will incur both direct losses, including vast expenditures to map and survey large portions of the state, and indirect losses such as lost tax revenue while projects are stalled pending mapping…

Judge Erickson also noted the way the EPA was going about extending its authority in this instance to intrastate waters the states were supposed regulate would set an extremely bad precedent:

If the exceptionally expansive view advocated by the government is adopted, it would encompass virtually all EPA actions under the Clean Water Act. It is difficult to imagine any action the EPA might take in the promulgation of a rule that is not either definitional or regulatory.

Dry reading? Yes, but this is how the sausage we’re all forced to eat is made and we’d better pay attention. This EPA power grab has been stopped for now, but, unfortunately, only in the 13 states that appealed. The Judge’s opinion lays out the case quite well. His decision was in response to an appeal by these 13 states: Alaska, Arizona, Arkansas, Colorado, Idaho, Missouri, Montana, Nebraska, New Mexico, Nevada, North Dakota, South Dakota and Wyoming.

It’s ironic, isn’t it, given that 13 other states created the Federal government that now seeks to dominate them in every way, beyond all imagination of the Founders or even the authors of that 1972 legislation on which this EPA power grab is based. The real question is why those original 13 no longer seem to care. Freedom has largely vanished from many the old colonies, but it lives in North Dakota and a dozen others. The EPA rule takes effect everywhere else (for now). Thank your tyranny loving state if you’re not part of the new 13.