On May 27, 2015, the Environmental Protection Agency (EPA) released the Waters of the U.S. Final Rule under the Clean Water Act (CWA). This is an expansion by the Obama Administration of the federal protection of U.S. waterways and drinking water supplies. Many view this new rule as expanding the U.S. Army Corps of Engineers’ (Corps) and the EPA’s jurisdiction over waters that had not previously been considered “Waters of the U.S.,” and therefore subject to federal regulation.

President Obama announced this sweeping new regulation in an effort to restore the federal government’s authority to limit pollution in the nation’s rivers, lakes, streams, and wetlands. This regulation is part of a broader effort by the Obama Administration to use executive authority to build a major environmental legacy, without requiring new legislation from Congress.

Farmers, property developers, and oil and gas producers contend that the new rule will stifle economic growth and intrude on the rights of businesses and property owners. The President of the National Federation of Independent Business opined that the new rule “gives the EPA and the Army Corps of Engineers new power to regulate local projects and local business operations, and it creates for the trial lawyers and the environmental activists a whole new class of potential defendants.”

Various industry groups are already preparing lawsuits to challenge the rule, and the battle may end up before the Supreme Court. Farming groups fear that the rule could impose major new costs and burdens, requiring them to obtain permits and pay fees for environmental assessments. The National Association of Home Builders contends that the rule will increase housing costs and regulatory burdens to landowners. Environmentalists, on the other hand, praise the rule, deeming it an important step that will lead to significantly cleaner natural bodies of water.

The EPA and the Corps jointly proposed the rule last spring. The EPA held more than 400 meetings about it and read more than one million public comments in drafting the final language. Two Supreme Court decisions related to clean water protection, in 2001 and 2006, created legal confusion about whether the federal government had the authority to regulate the smaller streams and other water sources such as wetlands.

EPA officials say the new rule will clarify that authority, allowing the government to once again limit pollution in those smaller bodies of water. The EPA also contends that the new rule will not give it the authority to regulate additional waters that had not been covered originally under the 1972 law. Under the new rule, tributaries and headwaters that show physical features of flowing water—a bed, bank, and high-water mark—as well as waters that are next to rivers and lakes and their tributaries, would be subject to federal regulation.

This final regulation to the CWA is of crucial interest to many of our clients in various industries. The change has a potentially large impact on the construction, real estate development, oil and gas, pipeline, and mining industries.