Earlier this week, the US Supreme Court unanimously concluded that wetland determinations by the US Army Corps of Engineers (“Corps”) under the Clean Water Act constitute final agency action, meaning that landowners can immediately seek judicial review of such determinations. All eight justices agreed in Army Corps of Engineers v. Hawkes Company Inc. that the Corps’ “jurisdictional determination” regarding the presence of wetlands on three Minnesota peat mining companies’ properties was an appealable “final agency action.” Adding insult to injury for the U.S. government, the court’s unanimous opinion was accompanied by a sharp concurring opinion by Justice Kennedy assailing the broad and unpredictable reach of the Clean Water Act.
Background
Under Section 404 of the Clean Water Act, property owners are required to obtain a permit from the Corps prior to discharging dredged or fill material into “waters of the United States” covered by the Act. Prior to commencing dredge or fill activities, landowners are required to obtain a “jurisdictional determination” from the Corps – specifically a determination that a wetland or other waterbody is or is not a “water of the United States” (“WOTUS”) subject to the provisions of the Clean Water Act. If a waterbody is determined to be WOTUS, then a Clean Water Act permit from the Corps is required to fill or disturb the waterbody, and there are severe criminal and other penalties for not obtaining a permit.
The U.S. government argued that the Corps’ jurisdictional determinations relating to the presence of wetlands on private property could not be challenged in court because such determinations were not “final agency actions” that were appealable under the Administrative Procedures Act. Rather, the government asserted the Corps’ determinations were more like informal agency guidance that had no legal effect.
This argument put landowners in a very difficult situation. Unable to challenge the Corps’ WOTUS decision, landowners had to choose between going through the full permitting process – an expensive process that can take years to resolve – or risk criminal and financial penalties.
SCOTUS Unanimous
The justices wholly rejected the government’s rationale. In its decision, written by Chief Justice John Roberts, the Court concluded that the peat mining companies had a right to immediately challenge in court the Corps’ jurisdictional determination that their lands included WOTUS and were, therefore, subject to the Clean Water Act. In the concurring opinion, Justice Anthony Kennedy renewed concerns regarding the Clean Water Act, calling the law’s reach “notoriously unclear” and stating that the law “continues to raise troubling questions regarding the government’s power to cast doubt on the full use and enjoyment of private property throughout the nation.”
The Supreme Court’s decision now gives landowners and others who wish to fill or disturb waterbodies that they believe are not WOTUS under the Clean Water Act a quicker, less expensive, and much less risky avenue to challenge the Corps’ jurisdictional determinations. That’s a big win from our perspective.
If you have any questions about the content of this alert, please contact a key contributor.