Supreme Court's Muddled Clean Water Act Ruling Threatens Property Rights and the Trump Administration's Deregulation Efforts

Federal clean water regulations are a confusing mess for property owners. The Supreme Court just made things worse.

The U.S. Supreme Court has set the stage for continued conflict between environmentalists, polluters, and property owners with a muddled decision that attempts to establish the outer boundaries of the federal government's power under the Clean Water Act.

In a 6-3 ruling handed down on Thursday in Maui v Hawaii Wildlife Fund—which dealt with whether a county waste treatment facility needed an Environmental Protection Agency (EPA) permit to legally emit treated sewage water into underground wells—the Court ruled that anyone discharging pollution into the ground is covered by the Clean Water Act if doing so was "functionally equivalent" to emitting pollutants into a lake, river, or other regulated body of water.

The decision, which could have major implications for the Trump administration's deregulation efforts, was cheered on by environmentalists.

"This decision is a huge victory for clean water," said David Henkin, an attorney with Earthjustice. "The Supreme Court has rejected the Trump administration's effort to blow a big hole in the Clean Water Act's protections for rivers, lakes, and oceans."

Property rights advocates, meanwhile, are warning that the Court's ruling is a confused jumble that gives landowners no clear guidance on when they might need to seek federal permission to make use of their land.

"It's really a mess," says Glenn Roper, a lawyer with the Pacific Legal Foundation. "It's a recipe for lots and lots of follow-on litigation."

The 1972 Clean Water Act requires that entities discharging pollutants—which include toxic chemicals, as well as less odious substances like sand or gravel—into "navigable waters" must first get a permit from the EPA, or else risk fines and even jail time.

What exactly counts as a discharge into navigable water is complicated by the fact that pretty much any substance one puts into the ground will eventually filter into a larger body of water. At the same time, it's obvious that Congress didn't intend for the Clean Water Act to regulate literally every discharge of a pollutant. This has set the stage for decades of litigation and rule-making over the extent of the law.

In Maui, environmental groups, led by the Hawaiian Wildlife Fund, sued the Maui county government in 2012, arguing that because the water emitted by the plant eventually made its way through groundwater to the Pacific Ocean, it was in effect discharging pollutants into a navigable water, and therefore needed an EPA permit.

The county government, alongside the Trump administration, argued that because pollutants were entering the Pacific Ocean from groundwater, it was not the direct source of those pollutants, and therefore did not need to get a permit.

Johnathan Adler, writing at Volokh Conspiracy, notes that if the Clean Water Act does cover pollution conveyed to navigable waters through groundwater, it would impose permitting requirements on "6,000 underground injection wells and over 20,000 septic systems" in Hawaii alone.

A District Court sided with the environmental groups when determining that the discharge from the Maui plant into groundwater was "functionally one into navigable water." The Court of Appeals for the Ninth Circuit went even further in a subsequent ruling, saying that a permit was required when pollutants are "fairly traceable" from a source to a navigable water.

In his opinion in Maui, Justice Steven Breyer rejected the ruling of the Ninth Circuit, which he said gave the EPA overly broad authority, and could end up requiring permits for "pollutants carried to navigable waters on a bird's feathers, or… the 100-year migration of pollutants through 250 miles of groundwater to a river."

Instead, Breyer drew on the District Court's ruling to say that the Clean Water Act requires a permit "when there is a direct discharge from a point source into navigable waters or when there is the functional equivalent of a direct discharge."

To determine what exactly the "functional equivalent of a direct discharge" is, Breyer's opinion lays out at least seven factors courts should consider, including the time and distance it takes for pollutants to travel into a navigable water, the nature of the material they travel through, and how much the pollutant is diluted.

Breyer acknowledges that these are vague standards and says it should be up to lower courts to apply them to the facts of individual cases. Breyer's ruling sends the Maui case back to lower courts to hash out whether the county's wastewater treatment plant does, in fact, need an EPA permit under his new multi-pronged test.

In doing so, says Roper, the Court has failed to give landowners any clear guidance as to when they might run afoul of federal regulations.

"As with any sort of balancing test, it's a mess of factors. There's no way of knowing how they're going to apply in any given situation, how to weight them, or what sort of tipping point you need to get to before it constitutes a functional equivalent," he says. "It's giving judges a blank check for how it's going to apply and how people will be punished."

This means individual landowners, companies, and other regulated entities can expect to be the target of Clean Water Act litigation for years to come, he says.

It could also have serious implications for the Trump administration's rewrite of clean water regulations, which is intended to narrow the definition of navigable waters that are regulated by the federal government.

On Tuesday, the administration published the final version of its Navigable Waters Protection Rule, which replaces the more expansive and legally controversial Waters of the United States rule the Obama administration had issued in 2015.

Among its many changes, the Trump administration's new rule declares that groundwater does not count as a navigable water under the Clean Water Act, and it's up to states and tribes, not the federal government, to regulate them.

Breyer's opinion that discharges into groundwater are in fact regulated by the law when they meet his functional equivalent test seems to conflict with this new rule. The majority opinion in Maui could thus provide more ammunition to environmental groups that have already promised to sue the Trump administration over its Navigable Waters Protection rule.