On Thursday, the United States Supreme Court, in a 6-3 opinion, expanded the applicability of the Clean Water Act’s (Act) permitting requirements to require a National Pollutant Discharge Elimination System permit if the discharge of pollutants into groundwater from a point source is the “functional equivalent” of a direct discharge.

In 2012, several environmental groups filed a citizen suit in district court alleging the County of Maui (Maui) violated the Act by discharging pollutants into navigable waters, namely the Pacific Ocean, without a permit.  At the time the suit was filed, Maui was injecting millions of gallons per day of treated sewage water into deep wastewater wells, which combined with groundwater and later discharged into the Pacific Ocean.  The environmental groups cited a study showing the pollutants contained in the discharge interfered with coral reefs and triggered invasive algae blooms near popular beaches.  In response, Maui and the federal government argued that pursuant to the Environmental Protection Agency’s Interpretive Statement (84 FR 16810), the Act’s permitting requirements did not apply to groundwater and a permit was only required if a point source delivered pollutants directly into navigable waters.

The District Court disagreed with Maui and found the discharge from the wastewater wells into the groundwater was “functionally one into navigable water” and ruled in favor of the environmental groups.  The Ninth Circuit affirmed the District Court’s ruling, but applied a broader standard and held that a permit is required when pollutants are “fairly traceable from a point source to a navigable water such that the discharge is the functional equivalent of a discharge into the navigable water.”  Maui then sought review by the Supreme Court.

The Supreme Court held that the Act’s permitting requirements may be used to regulate pollution traveling through groundwater and that the Ninth Circuit’s “fairly traceable” standard was overly broad because it could allow EPA to assert permitting authority over the release of pollutants that reach navigable waters many years after their release.  The Court instead created a new test requiring a permit when either “there is a direct discharge from a point source into navigable waters or when there is the functional equivalent of a direct discharge.”  The Court’s majority explained that the Ninth Circuit’s “fairly traceable” standard deviated from Congress’ intent in passing the Act, and even though regulation of groundwater is typically the responsibility of the states, the Act does not cede all rights to regulate groundwater from the federal government.

Justice Breyer writing for the majority emphasized that time and distance are critically important and in scenarios “[w]here a pipe ends a few feet from navigable waters and the pipe emits pollutants that travel those few feet through groundwater (or over the beach), the permitting requirement clearly applies.”  Alternatively, the Court explicated that a permit is not required where a “pipe ends 50 miles from navigable waters and the pipe emits pollutants that travel with groundwater, mix with much other material, and end up in navigable waters only many years later.”  The Court explained that in middle instances, courts should remember Congress’ intent in passing the Act, and focus on the time and distance of the discharge in determining if a permit is required.  The Supreme Court remanded the case for further proceedings consistent with its articulation of the “functionally equivalent” rule in the opinion.

With this ruling, the question of whether the Act requires permits for discharges of pollutants to groundwater that ultimately reach navigable waters will be answered on a case by case basis.  However, regulated entities looking for clarity will likely be disappointed because the standard articulated by the Court, like the Kennedy test in Rapanos, will leave many guessing about the Act’s applicability.  In the words of Justice Alito’s dissenting opinion, regulators will have broad discretion “to make of this standard what they will” and can expect future challenges from all fronts.

The case is County of Maui v. Hawaii Wildlife Fund et al., case number 18-260.

For further information on this topic, please contact Kyler C. Rayden at krayden@somachlaw.com.

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