An approved jurisdictional determination (“JD”) by the U.S. Army Corps of Engineers (“Corps”) can be appealed to Federal District Court according to a unanimous United States Supreme Court decision issued May 31, 2016, U.S. Army Corps of Engineers v. Hawkes Co. Inc. The decision is particularly significant given the Corps and EPA’s expansive interpretation of the definition of waters of the United States in existing agency guidance and in the now-stayed Waters of the United States rule. It raises the question as to how parties may approach jurisdictional issues in the future. For example, will the Corps receive additional requests for approved JD’s because of the ability to have a judicial appeal? How will the Corps’ approach making approved jurisdictional determinations in the future?

The Corps issues both preliminary JD’s and approved JD’s. A preliminary JD simply indicates that there may be waters of the United States on a parcel of property, but an approved JD definitely conveys the Corps’ position on the presence or absence of such waters. Approved JDs can be administratively appealed, but the Corps has always taken the position that there is no right of judicial appeal of such a determination. Under the Administrative Procedures Act final agency action by the Corps can be appealed to the District Court if it is one from which legal consequences flow and there are no other alternatives than such an appeal.

The Hawkes Company wanted to mine peat on its property. Chief Justice Roberts notes that peat “is widely used for soil improvement and burned as fuel. It can also be used to provide structural support and moisture for smooth, stable greens that leave golfers with no one to blame but themselves for errant putts.” While the case is not about removing excuses for bad putting, it does reflect that the mining of peat had value. The Hawkes Company requested a jurisdictional determination in conjunction with a Clean Water Act 404 permit application. The majority opinion states that the Corps issued an approved jurisdictional determination that concluded the subject property contained a “water of the United States” because its wetlands had a “significant nexus” to the Red River of the North, located some 120 miles away. The reference to this fact in a fairly brief opinion could indicate the majority’s concern over the expansive federal intrusion into private property rights.

In what could be considered the understatement of the decade Chief Justice Roberts, in his majority opinion, wrote, “It is often difficult to determine whether a particular piece of property contains waters of the United States, but there are important consequences if it does.” The Court applied Bennett v. Spear, 520 U.S. 154 (1997) to determine whether the agency action gave rise to judicial review.Bennett v. Spear sets out two conditions that must be satisfied. First, the action must mark the “consummation of the agency’s decision making process,” and second the action must be one by which “rights or obligations have been determined or from which legal consequences flow.”

The Corps did not dispute that the JD was a final agency action. In fact an approved JD is good for five years. However, the Court considered the impact of a negative JD where the Corps concludes the property would not constitute waters of the U.S. An approved JD creates a safe harbor. That action has direct and appreciable legal consequences because it is binding on the Corps and EPA through a memorandum of agreement. Likewise an affirmative JD represents the denial of the safe harbor.

The Court found that alternatives to APA judicial review urged by the Corps were not adequate at all. The Corps contended that Hawkes had two alternatives: discharge fill material without a permit risking EPA enforcement during which they could argue no such permit was required, or apply for a permit and seek judicial relief if dissatisfied.

The case may signal that the Court is getting more and more concerned about Agency overreach in matters involving waters of the United States. Certainly the Court in Sackett v. EPA provided a judicial appeal of EPA administrative orders related to filling waters of the United States, and now this case. The HawkesCourt was aware of the 6th Circuit stay of the waters of the United States rules and footnoted the rules. Notwithstanding any foreshadowing, the Court’s opinion and the concurring opinions of the other justices, make it clear that this case was not even a close call.