WOTUS Wars: New Lessons from the Seventh Circuit
Thursday, July 12, 2018

The Clean Water Act (CWA) term “waters of the United States” (WOTUS) has become an evolving term with an often squishy definition leading to considerable litigation – with last month’s Seventh Circuit decision providing new insight on both the definition and the concept of administrative deference in Orchard Hill Building Co. v. United States Army Corps of Engineers.

In the course of directing the Army Corps of Engineers to provide more evidence for its determination that the EPA had jurisdiction to regulate a parcel of wetlands in northeastern Illinois, the court clearly indicated that administrative review proceedings involve more than courts saying “us too” to agency determinations. Here’s some background on the case:

More than a decade ago, Orchard Hill asked the Army Corps for a “jurisdictional determination” as to whether thirteen acres of wetlands were subject to regulation under the CWA. In 2006, the Army Corps of Engineers determined that the EPA had jurisdiction over Orchard Hill’s wetlands. This determination stopped cold Orchard Hill’s plans to develop the land for residential use. But while Orchard Hill appealed, the Supreme Court in Rapanos v. United States held that jurisdictional determinations in wetlands must be made on a case-by-case basis. The Army Corps thus completed another determination in 2010, but again found that the EPA had jurisdiction over the wetlands.

Orchard Hill Building Company filed a challenge to this determination in the Seventh Circuit. The Seventh Circuit reversed the Army Corp’s determination, indicating that courts “extend no deference to agency decisions that lack support or explanation.” The court found that the Army Corps had failed to provide sufficient factual support for its conclusion that there was a significant nexus between the Orchard Hill wetlands and navigable water.

In reaching its conclusion, the Seventh Circuit rejected various rationales the Corps provided for its decision:

  • The Army Corps did no studies to support its theory that an intermittent flow between the wetlands and a navigable water established the “ability” of the wetlands to pass pollutants to the creek. The court held that “such a speculative finding cannot support a significant nexus.”
  • When determining how construction would impact water levels in the watershed, the Army Corps failed to consider the loss of only the Orchard Hill wetlands, instead considering the loss of all wetlands in the watershed. The court reasoned that Orchard Hill accounted for just 2.7 percent of the wetlands in the watershed and noted that “[i]f the Corps thinks that trivial number is significant, it needs to give some explanation as to why.”
  • When determining how construction would impact nitrogen levels in the watershed, the Army Corps again failed to consider only the loss of the Orchard Hill wetlands, and instead considered the loss of all wetlands in the watershed. The court again noted that the Orchard Hill wetlands account for a small percent of the watershed’s wetlands, and that the Army Corp had failed to identify how the loss of the Orchard Hill wetlands would impact specific species of wildlife and or their habitat.
 

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