Opposition Mounts To Ninth Circuit Ruling Requiring NPDES Permit For Stormwater Runoff From Forest Roads

Members of Congress and a national trade association have been outspoken in their criticism of a recent Ninth Circuit decision requiring an NPDES wastewater discharge permit for channeled stormwater runoff from forest roads. Legislation has been introduced in the House and the Senate to overturn Northwest Environmental Defense Center v. Brown,[1] which held that ditches and culverts that drain stormwater from forest roads are “point sources” that should have been regulated under Phase I of EPA’s stormwater permitting program, adopted in 1990. See Ninth Circuit Reissues Opinion Requiring NPDES Permits for Stormwater Discharges from Logging Roads, Marten Law Environmental News (May 20, 2011). The American Forest & Paper Association, the Oregon Forest Industries Council, Tillamook County and four companies that own timberlands have meanwhile petitioned the U.S. Supreme Court to review the Ninth Circuit’s decision.

It is too early to tell whether these efforts will bear fruit. The Ninth Circuit’s finding of ambiguity in the Silvicultural Rule, which for more than 30 years has been understood to exempt stormwater from forest roads from NPDES permitting, also could open the door to further litigation over EPA’s Phase I stormwater rules, which were adopted in 1990. Absent the ambiguity identified by the court, any challenge to those rules would have been foreclosed after 1991. But in the meantime, the Ninth Circuit’s ruling means public and private forest land owners may be required to obtain permits for stormwater discharged from ditches and culverts to waters of the U.S., and could face threats of citizen suits for unpermitted discharges. No general permits have been issued yet that are specifically tailored to stormwater discharges from forest roads. Forest road discharges may, however, fit within existing permits for industrial activities, sand and gravel operations, or other existing general permits, although they bring with them discharge limitations and monitoring requirements that may be a poor fit for forest roads. In any event, so long as the Ninth Circuit’s decision remains in effect, and despite the court’s assurances to the contrary, there is unlikely to be an “expeditious”[2] transition to a new permitting scheme for discharges of forest road runoff.

Development of EPA’s Silvicultural Rule

EPA has excluded rainwater runoff from forest roads from the federal Clean Water Act’s (CWA) National Pollution Discharge Elimination System (NPDES) since that permitting program was first established in the 1970s. The CWA prohibits the discharge of a “pollutant” into waters of the United States from a “point source” without an NPDES permit.[3] The CWA defines a “point source” as “any discernible, confined and discrete conveyance, including but not limited to any pipe, ditch, channel, tunnel, [or] conduit … from which pollutants are or may be discharged.”[4] Not all ditches are point sources, however. The CWA expressly exempts “agricultural stormwater discharges and return flows from irrigated agriculture” from the definition of “point source.” The Act does not define “agricultural stormwater” nor “nonpoint source.”

In 1973, one year after passage of the CWA, EPA issued regulations that categorically exempted several kinds of discharges from the NPDES program, including “[d]ischarges of pollutants from agricultural and silvicultural activities,” but allowed regulation of point source discharges from any agricultural or silvicultural activity identified by EPA or a state as “a significant contributor of pollution.”[5] A district court overturned this exemption as too broad, holding that EPA should have determined which agricultural and silvicultural activities were point and nonpoint sources, and that it could not exempt whole classes of what the statute defined as point sources from the NDPES program.[6]

In 1976, EPA proposed a revised Silvicultural Rule, maintaining that runoff from silvicultural activities produce mainly nonpoint source discharges:

[T]he Agency has carefully examined the relationship between the NPDES permit program (which is designed to control and eliminate discharges of pollutants from discrete point sources) and water pollution from silvicultural activities (which tends to result from precipitation events). It has been determined that most water pollution related to silvicultural activities is nonpoint in nature.[7]

EPA determined that only four activities associated with silvicultural operations, each associated with controlled water use by a person, would be considered point sources: rock crushing, gravel washing, log sorting, and log storage facilities.[8] Any other silvicultural discharge, even if made through a “discernible, confined and discrete conveyance” such as a ditch or culvert, was considered a nonpoint source of pollutants. In explaining its decision, EPA said: “It is evident … that ditches, pipes and drains that serve only to channel, direct, and convey non-point runoff from precipitation are not meant to be subject to the § 402 permit program.”[9]

The current language of the Silvicultural Rule, changed slightly since 1976, limits “silvicultural point sources” to “rock crushing, gravel washing, log sorting, or log storage facilities which are operated in connection with silvicultural activities and from which pollutants are discharged into waters of the United States.”[10] Falling outside the definition are “non-point source silvicultural activities such as nursery operations, site preparation, reforestation and subsequent cultural treatment, thinning, prescribed burning, pest and fire control, harvesting operations, surface drainage, or road construction and maintenance from which there is natural runoff.”[11]

The Ninth Circuit’s Decision

NEDC v. Brown involves two logging roads in Oregon’s Tillamook State Forest. The Oregon Department of Forestry and the Oregon Board of Forestry own the roads. Various timber companies use the roads to access logging sites and to haul timber under contracts with Oregon. Timber sales contracts require the companies to maintain the roads and their associated stormwater collection systems, which are ditches, culverts, and channels that collect and convey stormwater runoff from the roads to tributary streams and adjacent rivers. An environmental group, Northwest Environmental Defense Center (NEDC), brought a citizen suit under the Clean Water Act, alleging that sediment discharges in stormwater from these roads negatively impacts aquatic life, such as salmon and trout, and require permits under the NPDES program.

The District Court of Oregon dismissed NEDC’s suit for failure to state a claim, holding that the Silvicultural Rule exempted the discharges from the NPDES program. According to the district court: “the fact that pollutants deposited on top of the roads during timber hauling end up being washed into the water bodies does not turn the road system with its associated ditches and culverts into a point source. The road/ditch/culvert system and timber hauling on it is a traditional dispersed activity from which pollution flowing into the water cannot be traced to single discrete sources.”[12]

On appeal to the Ninth Circuit, NEDC argued that the unpermitted stormwater discharges violate the Clean Water Act, despite the Silvicultural Rule. The Ninth Circuit also addressed a second issue that the district court elected not to: whether and how 1987 amendments to the Act governing stormwater discharges, and EPA’s regulations implementing those amendments, apply to stormwater runoff from logging roads.

The Ninth Circuit agreed with NEDC, holding that discharges from the logging roads require compliance with an NPDES permit. It further held that the Silvicultural Rule does not and cannot, consistent with the Clean Water Act, exempt runoff that is collected from logging roads and discharged from a ditch or culvert to jurisdictional waters.

The Ninth Circuit’s decision reviewed the statutory definition of “point source,” case law interpreting the distinction between point and nonpoint sources, and the genesis and history of the Silvicultural Rule. It also defined nonpoint source pollution, based on Ninth Circuit precedent, as “the type of pollution that arises from many dispersed activities over large areas, and is not traceable to any single discrete source.”[13] Because “runoff is not inherently a nonpoint or a point source of pollution,” according to the court, the distinction between point and nonpoint source discharges turns not on the runoff itself, but on whether stormwater “is allowed to run off naturally (and is thus a nonpoint source) or is collected, channeled, and discharged through a system of ditches, culverts, channels, and similar conveyances (and is thus a point source discharge).”[14]

In the court’s view, EPA’s intent in the Silvicultural Rule was to focus on the “source of the pollutant” and not the mechanism of discharge, where “any natural runoff containing pollutants” from silvicultural activities is exempt “from the definition of point source, irrespective of whether, and the manner in which, the runoff is collected, channeled, and discharged into” jurisdictional water.[15] This approach, the court opined, directly conflicts with the statutory definition of “point source” under the CWA, and is therefore invalid.

Instead of striking down the Silvicultural Rule, the court determined that the Rule is subject to a second interpretation that is consistent with the CWA, even though it neither “reflect[s] the intent of EPA” nor exempts the discharges at issue in the case. Under the latter interpretation, the Rule “exempts natural runoff from silvicultural activities …, but only as long as the ‘natural runoff’ remains natural. That is, the exemption ceases to exist as soon as the natural runoff is channeled and controlled in some systematic way through a ‘discernible, confined and discrete conveyance’ and discharged into” jurisdictional waters.[16]

After holding that the discharges require NPDES permits, the court then addressed the impact of the CWA’s 1987 amendments and EPA’s regulations implementing those amendments. The 1987 amendments ushered in a tiered approach to addressing stormwater discharges, in what is now CWA § 402(p). Congress required EPA first to promulgate so-called “Phase I regulations” for five classes of significant sources of stormwater pollution, including “industrial activity.” Second, Congress required EPA to study stormwater discharges that were not covered by the Phase I regulations, and to issue “Phase II” regulations accordingly.[17]

The court acknowledged that it is “within the discretion of EPA to promulgate Phase II regulations requiring, or not requiring, permits for” discharges from relatively de minimis sources, but stated that EPA lacks discretion with respect to the entities that fall within the Phase I regulations.[18] Because Congress expressly required EPA to promulgate Phase I regulations to address “discharges associated with industrial activity,” the court held that, “if silvicultural activity is ‘industrial in nature,[‘] § 402(p) requires that discharges from such activity obtain NPDES permits.”[19]

After reviewing EPA’s Phase I regulations, the court concluded that stormwater discharges from logging roads fall within the scope of Phase I as “storm water discharge[s] associated with industrial activity,” and therefore require compliance with the NPDES program. The court based this ruling on a provision of EPA’s regulations that specifies broad Standard Industrial Code (SIC) categories of industries considered “industrial activities,” one of which includes “logging,” defined as “establishments primarily engaged in cutting timber and in producing … primary forest or wood raw materials … in the field.”[20] The court also noted that EPA had defined “stormwater discharge associated with industrial activity” as including “immediate access roads … used or traveled by carriers of raw materials, manufactured products, waste material, or by-products used or created by the facility.”[21] The court gave no significance to the first sentence of the regulatory definition upon which its analysis rested: “Storm water discharge associated with industrial activity means the discharge from any conveyance that is used for collecting and conveying storm water and that is directly related to manufacturing, processing, or raw materials storage areas at an industrial plant.”[22]

According to the court, and relying on EPA’s preamble to the Phase I rule, logging roads qualify as “immediate access roads,” because they are “roads which are exclusively or primarily dedicated for use by the industrial facility.”[23] Second, logging roads are “primarily dedicated” to use by the logging companies, because, although logging roads are “often used for recreation, … that is not their primary use. Logging companies not only build and maintain the roads and their drainage systems pursuant to contracts with the State. Logging is also the roads’ sine qua non: If there were no logging, there would be no logging roads.”[24] Finally, the court concluded that the Phase I rule defines “industrial activity” broadly enough to encompass other non-traditional sites that are directly related to an industrial process, including “immediate access roads.”[25] Despite EPA’s pending obligation from a prior case to determine whether the discharges should be included in EPA’s Phase II stormwater regulations, the court reiterated that logging road runoff is subject to the Phase I regulations. The court opined that EPA should be able to “effectively and relatively expeditiously” adapt the “closely analogous NPDES permitting process for stormwater runoff from other kinds of roads” to a general permit for stormwater discharges from logging roads.[26]

Congressional Reaction

In July, 2011, a bipartisan group of Senators from Idaho, Oregon and Alaska introduced a bill in the Senate that would codify the Silvicultural Rule as an amendment to the Clean Water Act, with the clarification that no NPDES permit is required for “road use, construction and maintenance.”[27] While opposition from environmental groups makes passage of this bill in the Senate unlikely, prospects are much better in the House. In late July, votes were held on the House floor on the appropriations bill to fund the Department of the Interior and other agencies, including the EPA, for fiscal year 2012. A host of environmental riders were attached to the bill, including one that would amend the Clean Water Act to prohibit EPA or the states from requiring an NPDES permit for discharges of stormwater runoff from roads associated with silvicultural activities.[28] The House failed to take final action on the bill before its August recess, however. It was put aside so that the House could consider the legislation raising the national debt ceiling.

The 2011 fiscal year has now ended without passage of the individual appropriations bills needed to fund the government for fiscal year 2012. After a series of short-term continuing resolutions that will fund the government for a few weeks at a time, Congress is expected to develop a bill that will combine the outstanding appropriations bills and fund the government for the balance of 2012. When it does, one of the issues will be the fate of environmental riders, like the fix for the Silvicultural Rule. There appears to be sufficient support in the House to force a showdown with the Senate and the White House on this and other environmental riders this fall.

Appeal to the Supreme Court

In September, 2011, parties that intervened in the Ninth Circuit case – the American Forest & Paper Association, Oregon Forest Industries Council, Tillamook County, Georgia-Pacific West, Inc., Hampton Tree Farms, Inc., Stimson Lumber Co., and Swanson Group, Inc. – filed a petition for a writ of certiorari with the Supreme Court.[29] The appellants’ petition focuses on three issues: (1) that the Ninth Circuit did not give required deference to EPA’s interpretation of its own regulations; (2) that the Ninth Circuit’s decision conflicts with rulings from other circuit courts, which have affirmed EPA’s treatment of channeled forest road runoff as a nonpoint source that is not subject to NPDES permitting, and (3) the suit should have been viewed as a direct challenge to the silvicultural rule itself, the time for which is long passed under the Clean Water Act’s 120 day statute of limitations.[30]

Their first argument is based upon the Supreme Court’s ruling in Chevron v. NRDC,[31] which firmly established the courts’ obligation to defer to agency interpretation when the agency is charged with implementing an ambiguous statute. The appellants argue that the Ninth Circuit failed to defer to EPA’s interpretation of the scope of the Clean Water Act provision excluding agricultural runoff from NPDES requirements.[32] They point to EPA’s statements in 1976, when it was developing the Silvicultural Rule, that “ditches, pipes and drains that serve only to channel, direct and convey non-point runoff from precipitation are not meant to be the subject of the [NPDES] permit program.”[33]

Their second argument is that the Ninth Circuit’s ruling directly conflicts with an Eighth Circuit decision from 1998, which rejected a claim that logging road drainage systems require an NPDES permit.[34] The Eighth Circuit held that the logging and road building activities at issue were not included in the narrow list of silvicultural point sources identified in EPA’s regulation, and so did not require an NPDES permit.[35] The appellants argue that the Ninth Circuit’s decision also conflicts with a Vermont district court decision, and with an Eleventh Circuit decision that did not deal with forest roads, but did address the scope of the Clean Water Act’s agricultural runoff exemption.[36]

Finally, the appellants argue that NEDC v. Brown really was a direct challenge to the Silvicultural Rule, and not to how it has been interpreted by EPA, and as such should have been barred by the 120-day statute of limitations for challenging Clean Water Act regulations.[37] The Ninth Circuit held that applicability of the Silvicultural Rule to channeled runoff from forest roads is ambiguous, and that the U.S. resolved that ambiguity for the first time in an amicus brief it filed in this suit.[38] That, according to the Ninth Circuit, brought the case within an exception to the Clean Water Act’s statute of limitations, which allows a later suit if “based solely on grounds which arose after such 120th day.”[39] Appellants argue that, contrary to the Ninth Circuit’s holding, EPA’s position has been clear for decades that runoff from forest roads is a nonpoint source, even if channeled prior to discharge. Appellants’ argument on this issue, while supported by EPA statements during development of the Silvicultural Rule[40] and the agency’s practice over thirty years, is undercut by a brief the U.S. filed in the Ninth Circuit, ceding the Ninth Circuit’s jurisdiction on grounds that EPA had not formally taken the position that channeled runoff from forest roads is “natural runoff” before its first amicus brief filed in the NEDC case.[41]

Implications

The Supreme Court’s decision whether to review the Ninth Circuit’s ruling is still months away – defenders of the decision have until November 18, 2011 to respond to the cert petition. The Congressional proposals to codify the treatment of forest road runoff as a nonpoint source face an uncertain future, as they must overcome likely opposition in the Senate (passage in the House is more certain). But regardless of whether these two current avenues of attack falter, others may follow.

The Ninth Circuit’s decision may itself have opened the door to a new legal challenge to one of its central holdings. The court held not only that channeled runoff from forest roads should be treated as a point source, but also that the roads are “associated with an industrial activity” within the meaning of EPA’s Phase I stormwater rules adopted in 1990.[42] In doing so, the court acknowledged that EPA intended to exempt discharges that fell within the Silvicultural Rule from Phase I.[43] If the Ninth Circuit’s holding that ambiguity as to the scope of the Silvicultural Rule allowed the NEDC plaintiffs to evade the Clean Water Act’s 120-day statute of limitations on rule challenges survives the requested review by the Supreme Court, that same holding could open the door to a new challenge to EPA’s 1990 Phase I regulations.

But while legal and Congressional challenges to the Ninth Circuit’s decision play out, the owners and users of forest roads in the western states (those within the Ninth Circuit’s jurisdiction) still must cope with the court’s holding that their discharges of channeled runoff fall under EPA’s Phase I stormwater regulations. The Ninth Circuit closed its opinion by saying “we are confident, given the closely analogous NPDES permitting process for stormwater runoff from other kinds of roads, that EPA will be able to” establish permitting for forest road discharges “effectively and relatively expeditiously.”[44] That confidence does not appear to be well placed.

To date, no general permits have been developed that are specifically tailored to channeled discharges from forest roads. Individual permits also are a theoretical possibility, but are unlikely to be developed given the resource commitments they would require for forest road owners and regulatory agencies. Absent a simpler solution, the discharges may have to fit within an existing general permit, although the effluent limits and discharge monitoring required by those permits are unlikely to be well suited to forest roads, and must be carefully evaluated. A closer examination of road networks with an eye toward whether runoff, even though channeled at some point, actually discharges to U.S. Waters from a point source may reduce somewhat the regulatory burden of the court’s decision. These and other regulatory strategies will likely be deployed if the court’s decision withstands the current challenges.

For more information on the regulation of stormwater from forest roads, please contact Svend Brandt-Erichsen or any other member of Marten Law’s Water Quality practice group.