The Irony of the Sixth Circuit's Clean Water Rule Stay

Last week, the United States Court of Appeals for the Sixth Circuit issued a nationwide stay of implementation of the new Army Corps/EPA Clean Water Rule.  This sounds like a very big deal, and the state plaintiffs who won the stay will no doubt describe this as a major victory.  Those proclamations will conceal, however, a few layers of complexity and irony.

The legal basis for the ruling is an administrative law principle known as the logical outgrowth rule.  Under this principle, a final rule can be different from a proposed rule, but it still must be a logical outgrowth of that proposed rule; it cannot be something completely new.  That principle flows from the basic Administrative Procedure Act requirement for notice and an opportunity to comment.  Neither is present when an agency’s final rule does something no one reasonably could have expected, and upon which no one would have thought to comment.

According to the plaintiffs—and, now, the Sixth Circuit—EPA and the Army Corps violated that principle when they included distance-based jurisdictional criteria in the final rule.  Under the new regulations, wetlands that are more than 4,000 feet from a categorically jurisdictional water feature are categorically non-jurisdictional.  Under the proposed rule, those wetlands would have been subject to case-by-case jurisdictional determinations.  The final rule also includes specific numeric distance limitations on the definition of “adjacent” waters, which also are categorically jurisdictional.  These distance limitations, the court concluded, were not logical outgrowths of the proposed rule, and it therefore stayed implementation of the rule in its entirety.

The irony here is that, in the long term, the states may have shot themselves in the foot.  Or, at best, they’ve just achieved a little bit of largely inconsequential delay.  The state plaintiffs brought their claims for fundamentally anti-regulatory reasons: they wanted less federal jurisdiction, and they wanted more predictable limits upon that jurisdiction.  And the numeric distance limitations did just what the states wanted (though not as much as they wanted): they established boundaries on federal jurisdiction, and they did so on the basis of distance, which is typically more transparent and predictable than a complex science-based determination about hydrologic and ecological connectivity. 

Indeed, that move from science-based, site specific analysis to more blunt and categorical exclusions is precisely why environmental groups are upset about the distance limitations.  Those groups generally favor the new rule, but they have brought suits specifically focused on the very distance limitations that gave the states their “victory” today.  And if the ultimate result of this victory is that the distance limitations come out of the rule, the states will have succeeded in making the rule—from their anti-regulatory perspective—worse than it is at present.  The environmental groups, meanwhile, may just have achieved a key step toward excising the part of the rule that they particularly dislike.

Of course, all of this may turn out to be a tempest in a teapot.  As I’ve argued previously (and as EPA itself has repeatedly pointed out), the new rules don’t mark much of departure from previous practices.  In the field, this court decision won’t change much.  And the decision itself may not last.  As dissenting Judge Keith pointed out, the Sixth Circuit still has to decide whether it actually has jurisdiction to issue this stay.  If it finds that it lacked jurisdiction, the matter will revert to the district courts.  And if the issue does remain with the Sixth Circuit, this is just a preliminary stay.  I think there is some credible basis for these logical outgrowth arguments, but there also are some very credible responses.  With another round of briefing and argument, and a bit more time to think, the Sixth Circuit could come to a different outcome—which, then, may well be reviewed by the United States Supreme Court.

So stay tuned, and remember that in this dispute, things are not always as they seem.