AMSA Legal Alert (Leg 04-4)

On March 23, 2004, the U.S. Supreme Court (Court) issued its opinion in South Florida Water Management District (SFWMD) v. Miccouskee Tribe of Indians (Miccosukee), No. 02-626, a case reviewing whether National Pollutant Discharge Elimination System (NPDES) permits should be issued to operators of dams, levees, and similar flood control and water transfer structures to require control of their water quality impacts. AMSA filed an amicus brief in the case with member agency the New York City Department of Environmental Protection (NYCDEP) and other municipal groups, emphasizing the administrative complexity of adding thousands of sources to the backlogged NPDES permit program, the need to preserve local government autonomy over water management decisions, and that other Clean Water Act (CWA) tools – such as the total maximum daily load and storm water programs – are better suited to address the water quality impacts of water transfer and management activities.

In vacating the Eleventh Circuit decision appealed and remanding the case, the Court does not rule on whether an NPDES permit should be issued to the flood control structure at issue in Miccosukee. However, the High Court’s analysis provides the following important guidance that should be of interest to AMSA members across the nation:

• the CWA “point source” definition covers structures conveying or transferring water, and the “discharge of a pollutant” definition covers incidental movement of pollutants already in water;
• pumping or moving water within a single water body generally does not require a permit, while pumping or moving water between separate water bodies may require a permit;
• whether water bodies are one or two is a factual and site-specific determination; and
• general permits could be used to manage the burden of permitting new sources.

This Alert summarizes the Court’s opinion, and discusses the implications for AMSA members. A copy of the decision is available in the Litigation Tracking section of AMSA’s Member Pipeline. As always, please feel free to contact AMSA’s General Counsel Alexandra Dunn at 202/533-1803 or adunn@amsa-cleanwater.org with any questions.

I. Case Background
In 1948 Congress established the Central and South Florida Flood Control Project (Project) to alleviate drainage and flooding problems in the growing South Florida area. The Project dramatically altered water movement in South Florida and the Everglades ecosystem. Today, the SFWMD is the local sponsor and day-to-day operator of the Project.

One of the Project’s many structures is the S-9, a pump that moves water collected in a canal (the C-11) eastward approximately sixty feet to a water conservation area and reservoir (the WCA-3). The C-11 collects ground and rain water from urban, agricultural, and largely settled areas, while the WCA-3 essentially is part of the original Florida Everglades. Due to agricultural runoff, the C-11 water contains higher levels of phosphorus than the WCA-3 water. When pumped into the WCA-3, the C-11 water alters the naturally low-phosphorus ecosystem of the Everglades, causing problematic algae and foreign plant growth. The phosphorus-related impacts of this and other Project operations have been the subject of federal and state regulatory attention for 20 years, and several initiatives are underway to restore the Everglades ecosystem.

The Court notes that “impatient with the pace of this progress,” the Miccosukee brought this CWA citizens suit against the SFWMD, arguing that the S-9 requires an NPDES permit because it moves phosphorus-containing water from the C-11 to the WCA-3. Opinion at 4. The SFWMD responded that the S-9 is not “discharging” or “adding” pollutants when it pumps water without treatment for flood control purposes. The lower federal district court held in the Tribe’s favor, and the Eleventh Circuit court agreed. Both courts assumed that the C-11 and the WCA-3 are two distinct water bodies. The Supreme Court questions the accuracy of this assumption, and after making several key findings, remands the case for further factual analysis.

II. Highlights of the Supreme Court’s Decision

A. Discharge or Addition of a Pollutant
The Supreme Court flatly rejects the SFWMD’s position that the S-9 does not require an NPDES permit because it does not discharge or add pollutants to navigable waters under CWA § 502(12), but rather moves pollutants already in the water added by other sources. The High Court holds that taken to its logical conclusion, this position would mean that NPDES permits would not be required for many other sources, such as publicly owned treatment works, that treat and discharge pollutants added to water by others. Opinion at 7-8. The Court holds that the CWA’s “discharge of a pollutant” definition clearly includes “point sources that do not themselves generate pollutants.” Opinion at 8. The Court also confirms that the S-9 is a “point source” even though it solely moves water, given that the CWA’s point source definition refers to “discernible, confined, and discrete conveyance[s].” CWA § 502(14).

B. The Unitary Waters Theory
The Court then reviews the unitary waters theory advanced in the case by the U.S. Government (on behalf of all federal agencies, including the U.S. Environmental Protection Agency (EPA), the Army Corps of Engineers, and the Department of Interior). Under this theory, which relies on a detailed analysis of the “navigable waters” and “discharge of a pollutant” definitions, the Government argues that Congress intended for the pollution resulting from the transfer of navigable water to another navigable water to be addressed through nonpoint source provisions. See CWA §§ 304(f)(2)(F), 502(7), 502(12). The Government concludes that under a unitary waters approach, the S-9 does not discharge a pollutant to navigable waters and does not need a permit. The Government also suggests that the Supreme Court defer to the theory, because it supports EPA’s historic practice of not issuing NPDES permits to structures that transport, impound, or release navigable water.

The Court’s serious skepticism of the unitary waters theory is evident. The Justices cite to CWA provisions that apply to the movement of pollutants between different water bodies, note that the theory allows polluted navigable water to be transferred without a permit to pristine navigable water, and state that they “are not aware of any reported case that examines the unitary waters argument in precisely the form that the Government now presents it.” Opinion at 8-11. As a result, the Court does not issue a final judgment on the unitary waters theory, and indicates that the parties can use it on remand.

C. Two Water Bodies or One?
The Justices believe that the determination of whether a permit should be issued to the S-9 turns on the relationship between the C-11 and the WCA-3 waters, because pumping or moving water within a single water body cannot cause the addition of pollutants. The SFWMD argues the C-11 and WCA-3 are hydrologically indistinguishable parts of a single water body, while the Miccosukee argue they are two separate water bodies due to their different biological and ecosystem characteristics. The Supreme Court notes that the lower courts took a completely different approach, holding that the S-9 required a permit because the water transfer “would not occur naturally.” Opinion at 13.

In short, the Supreme Court finds that the lower courts acted prematurely given the differing views of the C-11 and WCA-3 relationship, and remands the case for further study. Although the Court does not make a formal factual finding, the Justices appear to believe that the C-11 and the WCA-3 are parts of one water body, noting their common aquifer, that surface and ground waters move freely through the porous soils, that water leaks from the WCA-3 to the C-11, and that without the S-9 the area would flood and form a single large water body over the C-11 and WCA-3 area.

D. AMSA’s Amicus Brief
AMSA’s amicus brief clearly impacted the Court. Citing arguments from our brief, the Justice’s note that amici warn that issuing NPDES permits to water transfer structures “would have significant practical consequences,” and that permits might be issued to thousands of “engineered transfers among various natural water bodies” requiring “expensive treatment to meet water quality criteria,” which could “raise the costs of water distribution prohibitively.” Opinion at 10-11. The Court states, however, that NPDES permits ultimately may be needed to protect water quality in some cases, and that general permits could contain costs.

III. Effect of the Court’s Decision
The Court’s decision does not immediately impact any sources. It is likely that the factual issues surrounding the C-11 and the WCA-3 will be resolved before a Florida federal court later this year.

The Miccosukee decision reactivates a Second Circuit case raising similar issues involving AMSA member NYCDEP. Catskill Mountains Chapter of Trout Unlimited, Inc. v. New York, 273 F.3d 481 (2d Cir. 2001) (New York). To supply New York City drinking water, NYCDEP moves water from the Schoharie reservoir through the 18-mile Shandanken Tunnel to the Esopus Creek, the main tributary to the Ashokan reservoir. The tunnel water becomes turbid during transfer, causing the Esopus Creek water near the tunnel to become cloudy and muddy in violation of state water quality standards. The Second Circuit held that NYCDEP needs an NPDES permit to control the water quality impacts of the tunnel, and a district court on remand assessed NYCDEP over $5.7 million CWA penalties. After Miccosukee, the tunnel may require an NPDES permit because it connects two distinct water bodies, while under the unitary waters theory the tunnel merely moves one navigable water to another and would not require a permit.

The further developments in Miccosukee on remand and the continuation of the New York case will be of critical interest to AMSA member agencies, local governments, and permitting authorities across the nation. In coming months, activist groups also are likely to seek a western water transfer “test case” to further refine the Miccosukee analysis. AMSA will keep its members apprised of these and related developments going forward.

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