A Watershed Year Ahead?

The top water-quality issues in 2006

While the sitting U.S. Congress might be characterized as attempting to expand federal spending abroad and restrict spending at home without regard to the impacts on domestic programs, including water quality-related programs, Hurricane Katrina and a U.S. Environmental Protection Agency (EPA) report on infrastructure maintenance may have been "watershed events" that will result in some re-examination of federal spending priorities in the public sector.

  • While water quality issues arising from Hurricane Katrina are largely limited to Louisiana, the only area with significant and sustained flood-related damage, these impacts have provided significant public health challenges to the region, in addition to challenges to local governments seeking to restore clean water to citizens;
  • The water-related infrastructure damage from Katrina may be a preview of what's to come: EPA's 2005 Drinking Water Infrastructure Needs and Assessment Report projects that $200 billion dollars in investment will be needed to merely maintain existing drinking water infrastructure over the next 20 years. In addition, in 2005:
  • EPA attempted to clarify the nature of National Pollution Discharge Elimination System (NPDES) permitting requirements for water transfers, at least until the U.S. Supreme Court hears the issue again in the next several years; and
  • The 9th Circuit Court of Appeals declined to allow EPA to minimize the effects of consultation requirements under the Endangered Species Act (ESA) when it acted on a request to delegate NPDES authority to the state of Arizona.

Hurricane-related Water Quality Crises in the Southeast
We've become familiar with the images of human devastation associated with Hurricane Katrina and the other hurricanes that hit the Southeast during the 2005 hurricane season. The magnitude of the water quality impacts from this year's hurricanes remain of grave concern. As of November 2005, residents were returning home, the Port of New Orleans was at 45-percent capacity (according to the Los Angeles Times in an Oct. 30, 2005 article), and businesses were rebuilding, but most water treatment and wastewater treatment systems were still incapacitated. On Nov. 2, the Louisiana Department of Environmental Quality (DEQ) issued its Second Amended Declaration of Emergency and Administrative Order, continuing the suspension of many of the state's water quality regulations to assist local governments in their attempts to bring safe-functioning systems back on-line.

The continued suspension by Louisiana DEQ of state water quality regulations is understandable in light of the magnitude of the destruction to infrastructure, but it portends continued contamination of waters from human and industrial wastes. Contamination of water and wastewater systems from raw sewage remains the primary public health concern. EPA and various state and local government agencies are engaged in focused water-quality testing in the region to determine the impacts from spills and discharges of raw effluent. These water-quality testing efforts are also aimed at determining the impacts on the Gulf Coast shellfish beds from raw sewage. Presence of human fecal material may indicate that oysters and other shellfish are not safe to eat. EPA is also leading an effort to sample flood waters and sediments for human fecal material as well as hazardous wastes, including everything from household cleaning supplies to industrial chemicals. The data will help local and state governments make decisions about repopulating flooded areas, as well as worker safety during the destruction/reconstruction efforts that will be ongoing over the next period of years.

Region VI has posted maps on its Web site of treated water and wastewater systems impacted by the storm that are periodically updated. The Region VI Web site also provides other local information regarding things such as restarting use of a domestic well that was impacted by the hurricane ( epa.gov/region6/katrina/index.htm).

NPDES Permits for Transferring Raw Water?
The Clean Water Act makes unlawful the discharge of a pollutant from a "point source." Under the Act, point source includes "any discernible, confined, and discrete conveyance, including but not limited to any pipe, ditch channel, tunnel, conduit?" Until the Supreme Court decided South Florida Water Management District v. Miccosukee Tribe of Indians, 541 U.S. 95 (2004), the act of transferring water from one watershed to another was not widely viewed as an activity requiring a discharge permit. The Court did not rule on whether the Water Management District needed a permit to lawfully make its water transfer, but it did suggest that "meaningfully distinct" water-bodies might require permits. The Court remanded to the federal district court for factual development of the issues.

Although the case is still on remand, on Aug. 5, 2005, EPA issued a memo entitled "Agency Interpretation on Applicability of Section 402 of the Clean Water Act to Water Transfers," in which the agency explained its interpretation of the term "meaningfully distinct." (See,www.epa.gov/ogc/documents.htm.) EPA framed the question as "whether the movement of pollutants from one navigable water to another by a water transfer is the 'addition' of a pollutant potentially subjecting the activity to the permitting requirements under section 402 of the Act." EPA suggested first that Congress intended to allow state and federal water resource management agencies, rather than water-quality regulatory authorities, to make decisions regarding regulation of water transfers. However, if this type of determination must be made by water-quality agencies, EPA defined "meaningfully distinct" through a two-part test: (1) Are the waters distinct?, and (2) is the distinction between them meaningful?

EPA would apply a number of factors to answer the first question: How long have the two bodies of water in question been co-mingled, and can they be distinguished hydrologically? EPA's analysis would impose a pragmatic approach to the second question: Does the transfer have water quality consequences on the receiving water and are regulatory authorities taking steps to mitigate that impact? EPA's Memo describes in some detail its application of these factors; however, EPA's interpretation will not be the last word on the question of NPDES permits for water transfers. Interested water-quality professionals should stay apprised of the progress of the Miccosukee case as it makes its way back to the U.S. Supreme Court, as well as decisions in related litigation that may arise involving EPA's Memo.

Ninth Circuit Announces that EPA Must Consider Endangered Species Act
Consultation Requirements Before Transferring NPDES Programs to States In an unusual intersection between the federal consultation requirements under the Endangered Species Act and the Clean Water Act provisions for delegating NDPES programs to states, the 9th Circuit Court of Appeals vacated EPA's approval of Arizona's application to assume NPDES permitting authority.

Defenders of Wildlife v. United States Environmental Protection Agency, 420 F.3d 946 (2005). EPA had relied on a United States Fish and Wildlife Service (USFWS) Biological Opinion (BO) that identified the loss of mandatory ESA consultation as an indirect effect of delegation. Although previous ESA consultation in the context of EPA-issued NPDES permits had resulted in mitigation measures that avoided jeopardy to endangered species, the BO concluded that the loss of consultation benefits was a manifestation of congressional intent. EPA reasoned that it was not required to consider these "indirect effects" in authorizing a transfer of permitting authority. The Court rejected EPA's interpretation of its duties, citing various ESA requirements imposed on federal agencies. The Court ordered EPA to transfer the permitting authority back to EPA and consider the impacts acknowledged in the BO from delegation. The Court acknowledged the difficulty and expense associated with what might ultimately be an unnecessary withdrawal of state authority, but the Court found the lack of certainty regarding endangered species protection warranted the move. This decision sets up a split in the federal courts of appeal that will likely be the subject of a petition for certiorari to the U.S. Supreme Court.

In the short term, the decision may be of greatest concern for water-quality professionals in the inter-mountain West (and within the 9th Circuit), the region with the largest concentration of states without delegated NPDES authority. In addition to Arizona, both New Mexico and Wyoming rely on EPA for NPDES programs, and in recent years, the survival of Colorado's previously model program has been jeopardized by state funding cutbacks. States that are facing funding crises similar to Colorado's, and that consider devolving NPDES authority back to EPA to save budget dollars over the short term, might ultimately find it difficult to retake authority when the budget clouds clear.

The Expense of Maintaining and Expanding Drinking Water Infrastructure
In June of 2005, EPA released its Drinking Water Infrastructure Needs and Assessment Report (Needs Assessment or Report). The Report is the third prepared for Congress since 1995 and covers a 20-year period from Jan. 1, 2003, through Dec. 31, 2022, and projects total investment needs of $276.8 billion over the next 20 years in order to provide clean and safe drinking water to consumers. The Needs Assessment considered infrastructure needs for large, medium, small, and American Indian and Alaska Native Village water systems. EPA also considered the cost of installation of new infrastructure to replace deteriorated or undersized infrastructure, as well as infrastructure presently adequate but in need of significant rehabilitation or replacement in the next 20 years.

The nation's 1,041 largest community water systems account for $122.9 billion, or 44 percent, of the report total. Medium and small community water systems estimated expenses of $103 billion and $34.2 billion respectively. American Indian water system needs accounted for $1.3 billion while Alaska native village systems account for $1.2 billion in expenses over the next 20 years. The Assessment also attributes $0.9 billion in expenses to the recently promulgated arsenic rule, $3.4 billion for not-for-profit Non-community Water Systems and $9.9 billion in costs associated with proposed and recently promulgated regulations.

What is perhaps most surprising about the Report's expenditure projections for the next 20 years is that the projections do not take into account growth-related needs -- in other words, projects undertaken solely to accommodate future population growth. For many areas of the country, including the inter-mountain West where census indicators show a burgeoning population over the next two decades, these projections present significant challenges to water-quality decision-makers in keeping pace with adequate infrastructure needs for all communities.

The Need Assessment is available at www.epa.gov/safewater/needssurvey/pdfs/2003/report_needssurvey_2003.pdf.

This article originally appeared in the 01/01/2006 issue of Environmental Protection.

About the Authors

Jason V. Turner, Esq. is an associate with the law firm of White & Jankowski, LLP in Denver where he practices in the areas of water rights, water quality, and natural resources.

Sarah Klahn, Esq. is a partner with the law firm of White & Jankowski, LLP in Denver where she assists clients in the areas of water rights, water quality, and administrative law.

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