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Under Section 401 of the Clean Water Act (“CWA”), projects requiring federal permits or licenses that have the potential to result in point source discharge into waters of the United States must obtain a Section 401 water quality certification evidencing compliance with applicable state water quality standards. Until this state certification is received, a project can’t obtain its federal permit or license.
In response to claims that the states are unreasonably delaying Section 401 certifications and/or imposing requirements that go beyond the mandates of the CWA, U.S. EPA has issued a final rule clarifying the time period for states these certification reviews and limiting the conditions that can be imposed on a project as part of this certification process. In a press release accompanying the final rule, U.S. EPA Administrator Andrew Wheeler stated that “EPA is returning the Clean Water Act certification process under Section 401 from its original purpose, which is to review potential impacts from discharges from federally permitted projects may have on water resources, not to indefinitely delay or block critically important infrastructure.”
Section 401 of the CWA requires certifying authorities to act on Section 401 certification requests within a “reasonable period of time” that shall not exceed one year. 33 U.S.C. 1341(a)(1). Federal licensing and permitting agencies are tasked in the final rule with establishing what constitutes a “reasonable period of time either categorically or on a case-by-case basis” but in no circumstances can the period exceed one year. 40 CFR § 121.6. The final rule provides that the “reasonable period of time” starts to run once the certifying agency receives a “certification request” as opposed to running once the certifying authority deems the application or request “complete” as had been the historical practice.
The final rule also clarifies that the state review is limited to ensuring compliance with water quality standards as opposed to addressing non-water quality related considerations For example, U.S. EPA noted that certifying authorities have “on occasion required in a certification condition the construction of biking and hiking trails … and the creation of public access for fishing along waters of the United States.” Certifying authorities have also attempted to address air emission and transportation effects as part of the certification process. U.S. EPA's final rule specifically states that the Section 401 certification “is limited to assuring that a discharge from a Federally licensed or permitted activity will comply with water quality requirements.” 40 CFR § 121.3.
Within this “reasonable time period” set by the permitting agency, certifying authorities can grant, grant with conditions or deny certification requests. 40 CFR § 121.7. Certifying authorities may also waive the certification requirement, either expressly or by failing to act. 40 CFR § 121.9. Section 401 certifications must include supporting information for each condition, including a statement explaining why the condition is necessary to assure that the discharge will comply with state water quality requirements. Denials must state the reasons for denial, including the specific water quality requirements with which the discharge will not comply, and if the denial is for insufficient information, the denial must describe the specific information that would be required. In the event that a certifying authority fails to comply with the procedural requirements governing the certification process, the final rule allows the permitting agency to deem that the certifying agency has waived its certification rights. 40 CFR § 121.9(a)(2).
U.S. EPA's final rule has been praised by industry groups with the American Petroleum Institute issuing a statement that " the addition of a well-defined timeline and review process will provide certainty to operators as they develop infrastructure projects that meet state water quality standards." The Natural Resources Defense Council, on the other hand, issued a statement claiming that the new rule "makes a mockery of this EPA's claimed respect for cooperative federalism."
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