Clean Water Act Update

Clean Water Act Update

Federal Agencies Are Proposing to Impose Additional Requirements to Protect Endangered Species in State and Federal Water Quality Programs

On January 15, 1999, the U.S. Environmental Protection Agency ("EPA"), the U.S. Fish and Wildlife Service and the U.S. National Marine Fisheries Service (collectively, the "Services") proposed a draft Memorandum of Agreement ("MOA") to assure that endangered species are addressed in Clean Water Act ("CWA") (33 U.S.C. § 1251 et seq.) programs. 64 Fed. Reg. 2,742 (Jan. 15, 1999). Comments on the draft MOA must be received by April 15, 1999.

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The MOA sets forth requirements for assuring adequate endangered species protection under the Endangered Species Act ("ESA") (16 U.S.C. § 1531 et seq.) in CWA-authorized activities, and the MOA will markedly increase the Services' involvement in CWA programs, including National Pollutant Discharge Elimination System ("NPDES") permits and water quality criteria and standards. The primary mechanism for the Services elevated participation in CWA activities will be ESA "Section 7" consultation for federal activities. Under ESA Section 7, federal agencies - in this case EPA - are required to consult with the Services on impacts to endangered species if an agency action will have a potential effect on species or critical habitat. Section 7 consultation can result in delays and compelled modifications to a project, or even, at worst, complete stoppage of a project.

The following three Clean Water Act programs are specifically targeted for endangered species compliance in the MOA: water quality standards, state-issued NPDES permits, and EPA-issued NPDES permits.

Water Quality Standards. Under the CWA, states establish water quality standards, which designate the beneficial uses for each water and specify water quality criteria to protect those designated uses. These water quality standards are reviewed and, if appropriate, revised by the states every three years. Water quality standards and triennial revisions to them are subject to EPA approval. CWA § 303(c).

The MOA will have several impacts on the water quality standards process. Initially, EPA, at the Services' request, will develop new national water quality criteria, particularly for aquatic life, to protect endangered species. EPA and the Services have indicated that many existing aquatic life criteria standards, including EPA's national "guidance" criteria, are not sufficiently protective of listed species. In addition, EPA will modify its water quality standards regulations to formally require protection of species. Finally, EPA and the Services will conduct Section 7 consultation on all water quality standards and triennial reviews, and EPA will veto water quality standards if deemed insufficiently protective of species.

State-Issued Permits. EPA has delegated to many states and tribal nations the authority to issue NPDES permits, with oversight from EPA. However, pursuant to the MOA, the Services would review every proposed NPDES permit for potential impacts to listed species. Based on the Services' review, EPA could exercise its veto authority and disapprove state NPDES permits.

EPA-Issued Permits. For states and territories in which EPA issues NPDES permits, the Services would be included in all NPDES permit actions. First, EPA would be required to determine the potential impacts to listed or proposed-listed species and to provide a copy of all permits to the Services. Second, if the permitted activity were found to potentially affect endangered species, EPA and the Services would enter into Section 7 consultations and, potentially, disapprove permit applications or require new permit restrictions.

Legal Concerns. In addition to many programmatic and policy concerns associated with the Services' involvement in CWA programs, the MOA raises several specific legal questions, including:

Does the CWA provide adequate legal authority for EPA to issue regulations requiring protection of endangered species in the development of water quality standards? Also, does the MOA's directive for EPA to promulgate such regulations violate the procedural rulemaking requirements of the Administrative Procedures Act? Does the MOA exceed the scope of ESA Section 7 by requiring Services' consultation in each and every water quality standards and permit proceeding, including actions for which there is no evidence of potential impacts to endangered species? Does the MOA violate ESA Section 7 by requiring Services consultation on all state permit actions, not just federal permit actions? In American Forest and Paper Ass'n v. EPA, 137 F.3d 291 (5th Cir. 1998), the Fifth Circuit held that EPA violated the CWA by requiring Louisiana's NPDES program to incorporate endangered species review (by the Services) on all permit actions. Because the MOA's provides for the Services' involvement in all state permit proceedings and for potential veto of permits, the MOA, in effect, requires states to include ESA review in their permit programs. Does the MOA exceed the legal authority of the CWA by requiring endangered species review as a component of state NPDES programs? Does ESA Section 7 authorize full-scale ESA consultations for impacts to proposed endangered species in EPA actions on NPDES permits?

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