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June 11, 2024  |  Written by Ryan J. Mitchell

Colorado Fills Sackett's Wetlands Gap

The phrase “Waters of the United States” (or “WOTUS”) is a contender for the five words that have been subject to the most judicial and executive whiplash since 1972. Under the Clean Water Act (CWA), aquatic environments that fall within the scope of WOTUS are protected from, among other things, certain unpermitted discharges of dredge and fill material. Specifically, the CWA authorizes states to apply to the U.S. Environmental Protection Agency (EPA) “for permission . . . to issue permits for the discharge of dredged or fill material into [certain] bodies of water,” including certain wetlands. Numerous and dueling U.S. Supreme Court decisions and federal rulemakings have been issued regarding the standard for determining whether a specific wetland or stream is navigable, and thus, within the scope of WOTUS.

Most recently, in Sackett v. EPA, the U.S. Supreme Court narrowed the scope of WOTUS, excluding, for example, wetlands that lack a continuous surface connection to traditionally navigable waters, and intermittent and ephemeral streams as they are not relatively permanent, standing, or continuously flowing bodies of water. This change has a particularly broad impact on western states where many wetlands and streams are ephemeral, only filling or flowing during spring runoff and significant rainstorms. The impact in Colorado was accentuated because it relied on the U.S. Army Corps of Engineers’ (ACE) Section 404 Permit Program to regulate such activity in state waters. Thus, as the jurisdiction of ACE’s Section 404 Permit Program receded and Colorado lacked its own program to fill the void, many Colorado wetlands lost protections.

In direct response to the Sackett opinion, Colorado Governor Jared Polis signed House Bill 24 1379 (the Bill) on May 30, 2024. The Bill restores regulatory protections to wetlands and ephemeral streams that are no longer subject to federal jurisdiction. The Bill establishes a state dredge and fill permitting program (State Program) in the Colorado Department of Public Health and Environment. The State Program applies to “state waters” as defined in the Colorado Water Quality Control Act. The Bill also expressly amends the definition of “state waters” to include “wetlands.” The expanded definition of “state waters” likely covers all waters that lost CWA protection after Sackett.

The Bill requires the Colorado Water Quality Control Commission (Commission) to promulgate rules necessary to implement the State Program by December 31, 2025. These rules must focus on avoidance and minimization of adverse impacts and on compensation for unavoidable adverse impacts of dredge and fill activity and be at least as protective as the guidelines developed pursuant to Section 404(b)(1) of the CWA. The Colorado Water Quality Division (WQCD) shall issue, administer, and enforce individual authorizations for activities that will result in the discharge of dredged or fill material into state waters consistent with the Commission’s rules. Similarly, WQCD shall issue general authorizations for the discharge of dredged or fill material into state waters from certain categories of activities that have minimal adverse impacts on state waters and the environment. WQCD shall include compensatory mitigation in all individual authorizations and in general authorizations where unavoidable adverse impacts to wetlands or streams greater than the threshold established by the Commission by rule will occur. WQCD may issue guidance to assist in administering the State Program.

The Bill deems certain activities exempt from the State Program. For example, maintenance work on ditches and canals are specifically exempt. Further, work that disturbs less than one-tenth of an acre of wetland or 3/100ths of an acre of a streambed are also exempt. The Bill also grandfathers active Section 404 Permits and jurisdiction determinations of WOTUS. Similarly, the Bill deems certain waters excluded from regulation under the State Program.

Altogether, the Bill reestablishes the status quo that immediately preceded Sackett regarding the dredging and filling of Colorado’s state waters, albeit with several important nuances. The State Program will take over where ACE’s Section 404 Permit Program lost jurisdiction. However, the scope of the State Program may extend to waters that previously did not fall under CWA. Developers and practitioners should thoroughly examine the Bill to understand its impact on current and future projects.

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