Summary of a Recent
Judicial Development in
Clean Water Act

EPA's Approval of State Water Quality Antidegradation Rules Receives
Deference in Part, Exemptions Held Not in Accordance with the Law

Eric H. Foy
National AgLaw Center Research Associate

Summary of Decision

In Kentucky Waterways Alliance v. Johnson, 540 F.3d 466 (6th Cir. 2008), the United States District Court of Appeals for the Sixth Circuit affirmed in part and reversed in part the district court's decision. Several environmental organizations alleged that by approving Kentucky's water quality antidegradation rules, the Environmental Protection Agency (EPA) acted arbitrarily and capriciously. The district court partially granted the organizations' request for summary judgment, and the organizations appealed. On appeal, the Sixth Circuit held that the EPA's approval of Kentucky's water body-by-water body approach and Kentucky's exclusion of impaired waters from Tier II protection was not arbitrary and capricious, but it held that the EPA's approval of Kentucky's Tier II exemption for coal-mining discharges under the Federal Water Pollution Control Act (FWPCA) was not in accordance with the law.

Background

Pursuant to a 1987 amendment to the Clean Water Act (CWA), state-established water quality standards must include an antidegradation policy to prevent further degradation. Id. at 471. A state can only revise water quality standards if the revision is consistent with the state's antidegradation policy. Id. The EPA regulations require state antidegradation standards to, at a minimum, be consistent with federal water quality standards provided for in the regulations, namely Tier I, Tier II, and Tier III. Id. Once a state selects its water quality standards, including the antidegradation policy, the CWA requires the state to submit them to the EPA for approval. Id.

To comply with federal water quality requirements, the Kentucky Environmental and Public Protection Cabinet (Cabinet) twice adopted water quality standards and an antidegradation policy, and sent them to the EPA for approval, and the EPA rejected both. Id. at 472. On May 19, 2001, the plaintiffs brought suit against the EPA director, pursuant to the citizen suit provision of the CWA, 33 U.S.C. § 1365, for failing to promulgate antidegradation requirements for Kentucky, a mandatory duty under 33 U.S.C. § 1313(c)(4). Id. In November 2002, the EPA proposed an antidegradation scheme for Kentucky to adopt, but the plaintiffs asserted that the proposal would not bring Kentucky into compliance with the CWA's requirements. Id.

On February 17, 2004, the plaintiffs once again demanded that EPA finalize the antidegradation rules for Kentucky. Id. However, the Cabinet adopted its own rules and submitted them to the EPA for approval. Id. Two days prior to the Cabinet's submission, the plaintiffs commenced an underlying action in district court alleging that: (1) the "EPA had failed to comply with its mandatory duty under the CWA to finalize federal water quality Tier II antidegradation standards for Kentucky; and (2) [the] failure to comply with a mandatory CWA duty was arbitrary, capricious, and contrary to law, in violation of the APA." Id. at 472-73. On January 29, 2005, the plaintiffs filed a motion for summary judgment requesting that the judge order the EPA to promulgate antidegradation requirements for Kentucky, but prior to the judge's ruling on the motion, the EPA approved antidegradation measures submitted by the Cabinet. Id. at 473. The plaintiffs responded by amending their complaint to allege that the EPA's approval of the Cabinet's antidegradation standards was arbitrary and capricious, and the plaintiffs dismissed their other claims against the EPA. Id. On September 6, 2005, the plaintiffs motioned for summary judgment and the defendants cross-motioned for summary judgment. Id. On March 31, 2006, the district court issued an order denying the plaintiffs' motion and granting the defendants' motion. Id. This appeal followed. Id.

Arguments

The plaintiffs raised two challenges to the EPA's approval of the Cabinet's antidegradation measures. Id. at 475. The court summarized these challenges:

First, [p]laintiffs contend that the EPA's approval of Kentucky's classification of certain waters as eligible for Tier I protection rather than Tier II protection was arbitrary, capricious, and contrary to law. Second, [p]laintiffs argue that the EPA's approval of Kentucky's categorical exemption of six types of pollution discharges from the Tier II review procedure was arbitrary, capricious, and contrary to law.
Id.

Analysis and Holdings

On the issue of whether a pollutant-by-pollutant approach is required by the EPA's regulations, the court held neither the Cabinet's approach to setting antidegradation standards, water body-by-water body, nor the plaintiffs' approach, pollutant-by-pollutant, were compelled by the regulation's language. Id. at 477. Because the regulation was ambiguous on this issue, the court deferred to the EPA's interpretation, which held that either approach was acceptable. Id. Therefore, the EPA's approval of Kentucky's use of water body-by-water body antidegradation standards was not arbitrary and capricious. Id.

Next, the court addressed the plaintiffs' argument that the exclusion of impaired waters from Tier II protection was arbitrary and capricious. Id. at 480. According to the court, 40 C.F.R. § 131.12(a)(2) linked a water body's relevant quality level to its designated uses. Id. In other words, the quality level of water bodies must exceed the minimum level necessary to support aquatic-life based uses, wildlife uses, and recreational uses. Id. Impaired waters do not have any designated uses; therefore, the court held the exclusion of impaired waters from Tier II protection was not arbitrary and capricious. Id.

Although the court sided with the EPA on the first two issues, the court disagreed with the EPA on the final issue. The court held that the EPA would have to reconsider five of the six exemptions to the antidegradation standards for lack of measurement data. Id. at 492. The court remanded the exemptions to address the deficiencies. Id. at 493. Additionally, in a concurring opinion adopted by the majority, the court held that because the EPA relied on an informal Cabinet commitment to approve Kentucky's Tier II exemption for coal-mining discharges, the agency's approval was not in accordance with law. Id. at 494. To address this issue, the court added it to the list of deficiencies to be addressed on remand. Id.

The case was decided on September 3, 2008.