The United States Supreme Court has issued a significant ruling in the case of San Francisco v. EPA, directing the Environmental Protection Agency (EPA) to retool its wastewater permitting process under the Clean Water Act. The City of San Francisco argued that the EPA exceeded its authority under the Clean Water Act by including “end-result” requirements or “receiving water limitations” in its National Pollutant Discharge Elimination System permits, making the permit holder potentially responsible for the quality of a body of water, despite the fact the quality of the receiving water could be influenced by factors outside the permittee’s control.
The Supreme Court's 5-4 decision requires the EPA to be more specific in its wastewater permits, eliminating references to the receiving water body’s overall water quality, and detailing specific numerical pollutant discharge limits for water quality protection. As a result of this ruling, the EPA (and, by extension, state permitting agencies acting under federally delegated authority) can no longer enforce permit provisions issued under Section 1311(b)(1)(C) of the Clean Water Act that “make a permittee responsible for the quality of the water in the body of water into which the permittee discharges pollutants” unless the provisions consist of clear numerical limitations.
While some industry groups have praised the ruling for limiting EPA’s authority, providing regulated entities with clearer compliance guidance and reducing compliance risks based on the Clean Water Act’s “permit shield,” other stakeholders have expressed concern the decision may result in increased delays or denials of NPDES permits and a concomitant increase in permit application costs, including for new and modified industrial and municipal wastewater treatment projects requiring the compilation and analysis of additional data sets to develop legally defensible numerical limits for each permitted outfall.
This ruling could result in various implications for stakeholders. Businesses and municipalities holding NPDES and federally delegated state agency permits will need to closely review and potentially renegotiate their permits to ensure compliance. Attorneys and environmental consultants should prepare for an uptick in permit-related inquiries and potential litigation as the EPA and state agencies adjust to the new permitting standards. The ruling necessitates a significant investment in EPA staff and agency resources to develop and enforce more detailed permits, which may be challenging given the recent cuts to EPA staff, thereby compounding the risks of permit issuance delays from this decision.
Overall, the Supreme Court's ruling in San Francisco v. EPA represents a significant shift in the enforcement of the Clean Water Act. As a result, permit holders will gain greater clarity on enforceable pollutant-discharge permit limitations, and regulators will no longer be able to penalize the regulated community based solely on causing or contributing to water quality conditions of receiving waters. The regulated community may be further impacted based on EPA Administrator Lee Zeldin’s recent announcement that the EPA will begin working on revising the 2023 definition of “waters of the United States.”
