Background: On May 31, 2016, the Supreme Court ruled unanimously that Jurisdictional Determinations by the Corps can be appealed under the Administrative Procedure Act as a final agency action, in United States Army Corps of Engineers v. Hawkes Co., Inc., et al. Owners and developers often request a jurisdictional determination (JD) for projects in order to identify wetlands and other waters subject to permitting under Section 404 of the Clean Water Act. Under prior court decisions, the landowner or developer had to exhaust administrative remedies by submitting a permit, then challenging the permit itself to obtain relief. The Supreme Court acknowledged that this is an expensive and time consuming process, with average costs exceeding $250,000 and taking an average of 788 days to complete. In Hawkes, the Supreme Court applied the two prong test under Bennett v. Spear, 520 U.S. 154 (1997): First, the action must mark the consummation of the agency’s decision making process… [a]nd second, the action must be one by which rights or obligations have been determined or from which legal consequences will flow.” Because the JD involves extensive fact finding regarding the physical and hydrological characteristics of the property, the first prong is satisfied. As to the second prong, the Supreme Court noted that a JD which does not find “waters of the United States” provides a five year safe harbor from enforcement action. Therefore, there are legal consequences which attach to the JD.
Waters of the United States: Whether wetlands or other water features on property constitute “waters of the United States” has been debated for years in rulemakings and court cases, including the prior Supreme Court case in Rapanos v. United States, 547 U.S. 715 (2006). The Corps with the United States Environmental Protection Agency subsequently adopted a rule modifying the definition and scope of jurisdictional waters in 2015. This rule has been stayed pending challenges by many states, trade associations and others that the rule is arbitrary, capricious, and contrary to law. In the meantime, Jurisdictional determinations and permitting under Section 404 are being conducted under the old rules.
Implication: The Hawkes decision provides another and possibly more expedient avenue to resolve what continues to be a controversial issue of the scope and ability of the Corps and the Environmental Protection Agency’s ability to regulate development projects. However, appeals of jurisdictional determinations would still involve project delays, legal and technical expenses.
Pam Nehring is an experienced environmental attorney whose practice includes environmental permitting, NEPA compliance, brownfields development, remediation claims and litigation. For more information contact Pam Nehring at Daley Mohan Groble, P.C: