March 08, 2019

The proposed WOTUS rule: How do states regulate nonfederal wetlands?

Phillip Bower and Megan McLean

The Trump administration announced its proposed replacement rule defining “waters of the United States” in December 2018. The U.S. Environmental Protection Agency (EPA) and the U.S. Department of the Army (Army) (collectively, the “agencies”) note that, in accordance with section 101(b) of the Clean Water Act (CWA), the proposed rule would “recognize and respect the primary responsibilities and rights of States and Tribes to regulate and manage their land and water resources.” (For additional discussion of the agencies’ treatment of CWA section 101(b) in the context of this rule, see Mark A. Ryan’s article “The WOTUS Rule Repeal” in the Fall 2018 issue of Natural Resources & Environment.) In fact sheets accompanying the proposal, the agencies note that “states and tribes have existing regulations and programs that apply to waters within their borders, whether or not they are considered ‘waters of the United States.’” 

Setting aside any questions about the legality of the agencies’ proposal for the time being, the number of wetlands that fall outside of federal jurisdiction is expected to increase under the proposed rule. This begs the question: What are states doing to regulate nonfederal waters, especially nonfederal isolated wetlands?

State programs

In Appendix B of the proposed rule’s Resource and Programmatic Assessment, the agencies indicate less than half the states have formal isolated, nonfederal wetlands permitting programs designed to protect isolated wetlands from dredge and fill impacts. Even when these programs exist, they vary widely in scope from state to state. Some states, like Wisconsin and Minnesota, have robust wetlands regulatory programs. Others have none. Here are a few examples.

Wisconsin’s program

Wisconsin may have one of the most robust nonfederal wetlands regulatory programs in the nation. Of the approximately five million acres of wetlands in Wisconsin, an estimated 10 to 30 percent are nonfederal wetlands under current rules. In 2001, under the authority of the public trust doctrine and its broad general police powers, Wisconsin adopted legislation to regulate discharges into nonfederal wetlands after the U.S. Supreme Court’s decision in Solid Waste Agency of Northern Cook County v. U.S. Army Corps of Engineers (SWANCC) decision removed these waters from federal jurisdiction. Wisconsin law requires that a person obtain authorization under a general or individual permit for the discharge of dredged material or fill material into a wetland unless the discharge is exempt.

Primarily over the last decade, changes were made to the law to make Wisconsin’s nonfederal wetland program less restrictive. New laws have mandated that the state’s Department of Natural Resources issue general permits for several types of discharges, including discharges for many purposes that do not affect more than 10,000 square feet of wetlands. New exemptions from permitting that were created in 2018 include exemptions for nonfederal “artificial wetlands” which did not exist prior to August 1, 1991, for discharges that impact less than one acre of a nonfederal “urban wetland,” and for discharges that impact less than three acres of a nonfederal “nonurban wetland.” The law now prohibits local governments from enacting ordinances with respect to these exemptions or the mitigation requirements. The legislature even created a blanket exemption from wetland permitting for discharges into wetlands in an “electronics and information technology manufacturing zone” (aka the proposed Foxconn campus in southeastern Wisconsin) if the impacts are compensated at a ratio of 2:1. The state also waived water quality certification under CWA section 401. Generally, high quality wetlands are still protected, and mitigation is often required even if the dredge and fill activity is exempt, but the recent trend has been to make it easier to fill a nonfederal wetland in Wisconsin.

Minnesota’s program

What are Wisconsin’s neighbors doing? Minnesota has two major wetland regulatory programs: the Minnesota Wetland Conservation Act of 1991 (WCA) and the Department of Natural Resources (DNR) Public Waters Work Permit Program. Between the two programs, nearly all activities occurring in wetlands in Minnesota are covered by a state or local regulatory authority. The primary requirement of the WCA, primarily implemented by local governmental authorities, is that “[w]etlands must not be drained or filled, wholly or partially, unless replaced by restoring or creating wetland areas of at least equal public value under [an approved] replacement plan.” The Public Waters Work Permit Program regulates activities occurring below the ordinary high-water level in designated public waters. Public waters generally include larger (10 acres or larger in non-municipal areas and 2.5 acres or larger in municipal areas), seasonally flooded to permanently flooded freshwater marsh-type wetlands as well as all lakes and streams. Minnesota DNR regulates these waters through public waters work permits.

Many states have limited programs

Despite Minnesota’s relatively far-reaching regulatory requirements, most states have taken a more laissez-faire approach to wetlands regulation. The majority of states rely primarily on CWA section 401 to provide input into the dredge and fill permitting process, but this only applies to waters of the United States and not to nonfederal waters. For example, Illinois does not have a state wetland program, and most state regulation of wetlands on private land occurs only through the state’s CWA section 401 authority, although the state does regulate state-funded projects and activities that impact state wetlands. Nebraska has a voluntary program for nonfederal waters. Dredge and fill activities in waters of the state, including wetlands, are subject to an anti-degradation clause. So, while the state cannot issue a permit for dredge and fill, it will send a “letter of opinion” to the applicant stating that an activity might violate state water quality standards, and the state will consult with the applicant to avoid violation of these standards.

What’s next?

Given that many states do not robustly regulate nonfederal wetlands, and states with programs seem to be interested in regulating less, any narrowing of the definition of “waters of the United States” could leave more wetlands susceptible to unregulated dredge and fill activities. In a state like Wisconsin, the current regulatory scheme will automatically continue to regulate the newly nonfederal wetlands as state wetlands. However, if the proposed rule becomes final, will more states implement programs to fill the gap?

Phillip Bower and Megan McLean

Phillip Bower is a partner in the Madison, Wisconsin, office of Husch Blackwell LLP, advising clients on environmental issues, including wetland permitting. He serves on Council for the Section of Environment, Energy, and Resources. Megan McLean is an associate at Husch Blackwell LLP in St. Louis who focuses on environmental law. She is currently serving as marketing and communications vice chair for the Section’s Water Resources Committee.