High Court to Clarify Murkiness of Clean Water Act Liability for Pollution Via Groundwater

Recently, the United States Supreme Court agreed to consider whether liability under the Clean Water Act (“CWA”) extends to pollution traveling through groundwater prior to reaching federally regulated water. The Court’s decision may drastically redefine the scope of the CWA, impacting permitting across the country. The potential implications for regulated parties are significant. According to the Solicitor General’s Office, “[g]iven the potential breadth of those provisions, and the ways in which groundwater may be connected to navigable waters, the question presented here has the potential to affect federal, state, and tribal regulatory efforts in innumerable circumstances nationwide.”

The High Court’s forthcoming interpretation may have sweeping consequences for regulated entities under the National Pollutant Discharge Elimination System (“NPDES”), the CWA’s permitting regime. The CWA prohibits the discharge of “any pollutant to navigable waters from any point source” without a permit. “Navigable waters” has been broadly defined as “waters of the United States”. Traditionally, courts have not extended federal jurisdiction over point source discharges to groundwater, leaving regulatory oversight of groundwater to state or tribal entities. Thus, NPDES permits under the CWA are generally issued to “point source” dischargers of pollutants to waters of the U.S. with a “discernible, confined, and discrete conveyance.”

However, the recent Ninth Circuit decision of Hawai’i Wildlife Fund v. County of Maui, 886 F.3d 737 (9th Cir. 2018), held that dischargers must obtain a permit if groundwater acts as an indirect conduit for the migration of pollutants to navigable waters. Consequently, the Ninth Circuit concluded that Maui County violated the CWA by allowing pollutants from four wastewater injection wells to reach the Pacific Ocean via groundwater. The appeals court reasoned that the County discharged pollutants from a point source (the injection wells) that was “fairly traceable” to a navigable waters (the Pacific). Thus, the County was subject to the CWA’s permitting requirements even though they did not directly discharge the pollutants into the ocean. Maui County asked the Supreme Court to review the Ninth Circuit’s finding that the CWA grants permitting authority to the federal government or its delegates where the pollutants are “fairly traceable” from the point source to a navigable water.

In Kinder Morgan Energy Partners LP v. Upstate Forever, 887 F.3d 637 (4th Cir. 2018), the Fourth Circuit reached a similar, though narrower, conclusion in litigation concerning a ruptured underground gasoline pipeline that contaminated nearby rivers, creeks, and wetlands after moving through groundwater. The Fourth Circuit espoused a “direct hydrological connection” approach, stating that “direct hydrological connection between groundwater and navigable waters” brought the discharges within the jurisdiction of the CWA. The appeals court clarified that “[w]e do not hold that the CWA covers discharges to groundwater itself. Instead, we hold only that an alleged discharge of pollutants, reaching navigable waters located 1,000 feet or less from the point source by means of groundwater with a direct hydrological connection to such navigable waters, falls within the scope of the CWA.” Kinder Morgan has sought review from the Supreme Court, but the Justices have not yet ruled on that request.

The Sixth Circuit, however, sanctioned the opposing view by holding that CWA regulation did not extend to coal residuals discharged through leaks in unlined waste ponds. See Kentucky Waterways All. v. Kentucky Utilities Co., 905 F.3d 925, 927 (6th Cir. 2018) and Tennessee Clean Water Network v. Tennessee Valley Auth., 905 F.3d 436 (6th Cir. 2018). Creating a circuit split, the Sixth Circuit declined to characterize the groundwater leaks as point sources subject to CWA enforcement. Although the Sixth Circuit recently denied plaintiffs’ petition for en banc review, there has not yet been a petition for writ of certiorari filed at the Supreme Court. A district court in the Seventh Circuit, however, has recently followed suit in dismissing a lawsuit alleging discharges from coal ash ponds to an adjacent river were subject to CWA liability. The district court held that omission of groundwater from the CWA was not an oversight but rather the deliberate decision of Congress. Therefore, the CWA would not regulate such discharges “even if there is an alleged hydrological connection between the groundwater and surface waters qualifying as ‘navigable waters’ of the United States.” Prairie Rivers Network v. Dynegy Midwest Generation, LLC, 350 F. Supp. 3d 697 (C.D. Ill. 2018) (citing Village of Oconomowoc Lake v. Dayton Hudson Corp., 24 F.3d 962, 963 (7th Cir 1994).

The question of the CWA’s application to groundwater has significant implications for a variety of industries, including waste disposal, oil, and energy production. The decision could impact coal ash ponds, pipeline spills, holding ponds, and even agricultural runoff. Although EPA has previously implied support for a broader view of CWA interpretation in line with the Fourth Circuit’s direct hydrological connection approach (even filing a brief in the Maui County action against the County’s position), EPA recently announced plans to revisit the issue. EPA has requested public comment on the matter but has yet to take any further action.  It remains unclear if EPA plans to ultimately issue a guidance document, memorandum, or formal rule. But it appears the Trump Administration is content (for now) with referring the issue to the Supreme Court.

In its amicus brief petitioning for Supreme Court review of the Maui County case, the Trump Administration stated that “[t]he courts of appeals are divided on the question whether a CWA ‘discharge of a pollutant’ occurs when pollutants are released from a point source to groundwater and migrate through, or are conveyed by, groundwater to navigable waters.” Past Supreme Court decisions considering jurisdictional issues under the CWA, however, have not necessarily provided the bright line rules desired by regulators and permittees. Given this history, it remains unlikely that the Supreme Court will wholly resolve the issue, but it may add some clarity to the current murky role of groundwater in the CWA permitting process. We will continue to monitor the situation as it develops.