Supreme Court Finds Some Discharge to Groundwater Requires Clean Water Act Permits

Point discharge to groundwater that is the “functional equivalent” of discharging directly into navigable waters will require permits normally reserved for direct discharge to waterways

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The recent U.S. Supreme Court opinion in the County of Maui v. Hawai’i Wildlife Fund (Maui) case expanded the U.S. Environmental Protection Agency’s (EPA) reading of its authority to regulate discharges to groundwater. The court created a new “functional equivalent” test that potentially changes the determination of whether or not stormwater storage ponds, basins and underground storage will require discharge permitting.

In the Maui case, the Court weighed the decision of whether a pollution discharge to groundwater is the functional equivalent of a direct discharge into navigable waters (most discharges to groundwater are regulated under state laws, not the Clean Water Act). In its decision, the Supreme Court rejected the lower court’s “fairly traceable” test and remanded the case back to the Ninth Circuit to apply the new “functional equivalent” test that will determine whether or not a groundwater discharge making its way to waters of the United States requires Clean Water Act National Pollutant Discharge Elimination System (NPDES) permits.

The Court’s opinion on the case observes, “We do not see how Congress could have intended to create such a large and obvious loophole in one of the key regulatory innovations of the Clean Water Act.”

The court says, “. . . an addition (of pollutant) falls within the statutory requirement that it be ‘from any point source’ when a point source directly deposits pollutants into navigable waters, or when the discharge reaches the same result through roughly similar means.”

The functional equivalent test will help decide whether a permit is needed and weighs several factors, but not all factors may be applicable in each circumstance.  According to the Court: “Many factors may be relevant to determining whether a particular discharge is the functional equivalent of one directly into navigable waters. Time and distance will be the most important factors in most cases, but other relevant factors may include, e.g., the nature of the material through which the pollutant travels and the extent to which the pollutant is diluted or chemically changed as it travels.”  The Court expects subsequent case law and U.S. EPA guidance to provide additional clarity on how to apply the test.

Pending the Supreme Court decision, U.S. EPA released an interpretive statement to try to provide clarity and regulatory certainty.  U.S. EPA’s statement concluded that “releases of pollutants to groundwater are categorically excluded from Clean Water Act’s permitting requirements…” because they are addressed by other statutes and programs.  The Court did not defer to U.S. EPA’s interpretive statement – and the majority rejected the agency’s position.  AGC expects U.S. EPA to release updated administrative guidance and additional information on its related Web page for discharges to groundwater.  At this time, there is no formal timeline for these actions to occur.