05 Mar Supreme Court Rules in Favor of San Francisco in Important Clean Water Act case
Yesterday, in San Francisco v. EPA, in a win for local governments, the Supreme Court held that the EPA is not authorized to impose “end result” provisions in National Pollutant Discharge Elimination System (NPDES) permits and instead it is the EPA’s responsibility to “determin[e] what steps a permittee must take to ensure that water quality standards are met.” This case helps ensure local governments understand their obligations under the Clean Water Act (CWA). It will also allow them take advantage of the permit shield in the CWA by complying with the terms of those now clearer NPDES permits. Penalties for violations of the CWA can result in crushing liability for local governments and the clarity the Supreme Court is requiring the EPA to provide in permits is crucial to avoiding those penalties.
Under the CWA, when an entity, including local governments, seeks to discharge pollutants into waters of the United States, that entity must obtain a permit from the EPA to do so. These permits often contain “effluent limitations” – i.e., limitations that provide specific quantities of pollutants that may be discharged. But as was the case here, they also sometimes contain provisions that make the permittee responsible for the overall water quality where the permittee discharges pollutants. The Court refers to these types of requirements as “end-result” requirements. This question here deals with the legality of these “end-result” permit requirements that do not provide any specific limitations on permittees but instead focus on the resulting quality of the water.
This case arises out of one of San Francisco’s wastewater treatment facilities, which treats combined stormwater and wastewater. Because heavy rainfall can result in overflows and corresponding discharges of pollutants into the Pacific Ocean, San Francisco has a NPDES permit for this facility.
The EPA imposed many conditions on San Francisco’s permit, which the city did not object to, but the EPA also imposed two end-result requirements, which are at issue in this case. The first “prohibits the facility from making any discharge that ‘contribute[s] to a violation of any applicable water quality standard” for receiving waters.’” The second was that the city could not “make any discharge that ‘create[s] pollution, contamination, or nuisance as defined by California Water Code section 13050.’”
After the EPA refused to take out these end-result requirements, San Francisco sued the EPA, making two arguments that the conditions were unlawful. First, the city argued that “all ‘limitations’ imposed under [the statute] must qualify as effluent limitations.” The second narrower argument the city advanced was that “even if §1311(b)(1)(C) is not limited to effluent limitations, it does not authorize EPA to impose NPDES permit requirements that condition permitholders’ compliance on whether receiving waters meet applicable water quality standards.” The Ninth Circuit held the EPA has “broad authority to impose limitations necessary to ensure the discharger’s adherence to ‘any applicable water quality standard’” and upheld the EPA’s end-result requirements here.
In a decision authored by Justice Alito, the Supreme Court reversed the Ninth Circuit and ruled in favor of San Francisco. In doing so, it rejected San Francico’s broad argument that the text of §1311(b)(1)(C) is limited to effluent limitations, but agreed with the city’s narrower argument, holding that the EPA exceeded its statutory authority by imposing the end-result requirements in NPDES permits. The Court relied on the statute’s text, structure, and history of federal water pollution legislation in reaching its conclusion.
Using dictionary definitions for the text of §1311(b)(1)(C), the Court concluded that the “most natural reading” of the statute, “is that it authorizes EPA to set rules that a permittee must follow in order to achieve a desired result, namely, a certain degree of water quality.” The problem with the EPA’s approach, the Court explained is that “[s]imply telling a permittee to ensure that the end result is reached is not a ‘concrete plan’ for achieving the desired result.”
The Court further explained that the history of federal water pollution legislation supported its conclusion. In 1948, Congress passed the Federal Water Pollution Control Act (WPCA), which was premised on having federal authorities review the quality of the water, and if they found it was substandard, they were to work backwards to determine what entity should be held responsible for the pollution. The Court explained that Congress recognized the inadequacy of this “backward-looking model” when it enacted the CWA in 1972 and “omitted any provision authorizing either the United States or any other party to bring suit against an entity whose discharges were contributing to a violation of those standards.”
Finally, the Court noted that the statutory structure supported its reading of the Clean Water Act. On this point, the Court explained that entities can be liable for up to $25,000 per day, per violation, for violations of the CWA and that this liability can reach “enormous sums.” For example, according to the Court, in a suit against San Francisco for another facility, the penalties sought under the CWA are $10 billion. In terms of how the structure supports its holding, the Court explained that the benefit of the “permit shield” provision, which allows protection from liability for permittees that comply with the terms of the permit, “would be eviscerated if the EPA could impose a permit provision making the permittee responsible for any drop in water quality below the accepted standard.” The Court also highlighted another structural problem with the EPA’s interpretation, “the absence of any provision dealing with the problem that arises when more than one permittee discharges into a body of water with substandard water quality.”
The Local Government Legal Center (joined by IMLA, NACo, and NLC as well as Cal Cities) filed an amicus brief in this case, authored by Andre Monette, Shawn Hagerty, and Ana Schwab with Best Best and Krieger. In that brief, we highlighted that local governments expend significant resources to improve water quality and that vague and “generic” (or “end result”) prohibitions undermine their efforts and that these prohibitions violate the CWA.
To read the decision, click here.
To read the amicus brief, click here.